The Last to Go

There is still need for new controls against inflation, President Truman bravely said a fortnight ago, because the price of metals, such as lead, is still going up. The President could hardly have been more unfortunate in his choice of illustration. Last week, the price of lead dropped 2-c- a pound (from 21 1/2-c- to 19 1/2-c-)#151;the first major break in non-ferrous metal prices since their phenomenal rise on the death of OPA. When even the cut failed to bring any increase in demand, this week American Smelting & Refining Co. cut the price another 1 1/2-c-.

Metals were the only commodities which had held firm as food and retail prices eased. Now there were plenty of unmistakable signs that demand was dropping and that the price of all metals was over the peak and ready to start down also.

Copper Cut. Brassmakers, in the doldrums for months, had cut their orders for copper scrap. Copper fabricators' orders were dropping, too. Competition had returned to the wire business; some manufacturers cut prices 5 to 12%. And last week, Phelps Dodge Chairman Louis S. Gates foresaw an eventual copper surplus. Said he: the import tax, now suspended, will again be "essential to the welfare of the . . . industry." In zinc, too, demand for some grades had tapered off.

Even steel was slowly marching toward a buyers' market, though production last week soared to new records. Said U.S. Steel Corp.'s Ben Fairless: "The supply is rising and the demand is slackening . . . The supply of most steel products should be in excess of demand some time during the last half of the current year." Steelmen agreed that there is certainly no need for the Government to build plants.* But steel was still short enough to keep many industries, notably automaking, from operating at capacity.

Coal Strategy. The coal industry, which has been cutting down on production because of a surplus, had its first big break in prices. Pittsburgh Consolidation Coal Co., the nation's biggest commercial coal producer, cut the contract price 15-c- to 40-c- a ton. With a vast amount of coal above ground, and with demand failing, the price had to be cut to meet the spot prices, already below the long-term contract prices.

Consolidation's President George H. Love also knew that a, price cut would take some of the steam out of any new wage demands John L. Lewis intended to make, come bargaining time. Two days later, Lewis hit back with a two-week "holiday" for miners (see NATIONAL AFFAIRS). Except for layoffs by coal-hauling railroads, the stoppage would have little effect on industry, which had the greatest stockpiles of coal in years.

* Said Socialist Norman Thomas of President Truman's proposal for Government entry into the steel business (TIME, Jan. 17): It was "neither good socialism nor good capitalism nor good common sense."

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