War against Nickel

Canada's International Nickel Co. Ltd., and its subsidiaries own 90% of the world's nickel ore; they supply 90% of U.S. nickel needs. Come good times or bad, the price of nickel, 35-c- a pound, has not changed in 18 years. In the same period even monopolistic Alcoa dropped the price of aluminum from 24-c- to 14-c-. Last week the U.S.' Government, despite pressure from the Canadian Government, finally took note of this.

In New York, the Anti-Trust Division of the Department of Justice filed a complaint against Inco, its wholly owned U.S. subsidiary, International Nickel Co. Inc., and three U.S. officers of both companies, President Robert C. Stanley, Executive Vice President John F. Thompson, Vice President Paul D. Merica. The charges: 1) conspiracy to prevent competition in the nickel industry, 2) fixing prices, 3) making cartel agreements with I. G. Farbenindustrie, A. G. and two French companies to prevent competition and peg prices in the world market. Said Justice: Inco had so increased its nickel shipments to Farben in 1937 that Germany had built up a stockpile of Canadian-mined nickel for the German war machine. (Nickel is used to make armor plate.)

Actually, Justice charged, the industry ceased to be competitive in 1902, when Steelman Charles Schwab arranged a merger between Canadian companies with plenty of nickel ore and U.S. companies with the chemical process for separating nickel from copper. Holdings of the combine ($135,000,000 worth of mines, smelting and refining) were consolidated under Inco, Ltd. in 1928. Inco's sales last year: $148,000,000.

In answer, Inco denied that it was a monopoly. It said that nickel prices were so low that the U.S. Government had to subsidize Cuban mines during the war to enable them to compete with Inco. This seemed to sharpen Justice's point that Inco owns all economically workable nickel deposits in the Western Hemisphere. Submarginal mines such as Cuba's can compete only with subsidies.

If Justice wins its suit, Inco will have to divest itself of its U.S. subsidiary, eliminate fill interlocking ownership of the two companies.

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