The domestic consumption of all fats and oils (excluding farm butter and lard, which are estimated yearly) in the second quarter of the current year amounted to 2,550 million pounds, the heaviest quarterly consumption on record, and 171 million pounds over the previous peak figure in the first quarter of

this year.

The six months consumption of 4,930 million pounds was 17 percent over their absorption into distributive channels in the 1940 half year.

It is doubtful that this rate of consumption will prevail in the latter half of 1941, when there will probably be some inventory adjustment of finished products formerly purchased on a rapidly rising market beyond current requirements. However, it is likely that the consumption of fats and oils in the United States in 1941 will substantially exceed the record 1940 figure of 9,812 million pounds.

The present high rate of industrial activities, increased factory pay rolls, and National Defense requirements are expected to result in a fats and oils consumption this year of well over 10 billion pounds.

Stocks are Lower

Stocks of all fats and oils at the end of June (including the oil equivalent of oilseeds) amounted to 2,600 million pounds, a 7-percent decrease from the June 30, 1940 inventory, and about the same as the amount consumed in the country in the second quarter of this year. They decreased 15 percent from the carry-over on March 31, 1941.

In addition to this domestic product, there are foreign holdings of about 200 million pounds of whale oil in bonded warehouses in the United States. This product was formerly imported (mainly from Norway) at the rate of about 50 million pounds a year before the 1934 excise tax of three cents per pound inhibited its competition with domestic inedible tallow in soap manufacture.

In the first six months of 1941, imports (including the the oil equivalent of imported oilseeds) aggregated 838 million pounds, a decrease of 93 million pounds or ten percent from the first six months of 1940.

Prices Are Higher

Prices are currently moving within narrow

limits, pending new developments regarding the possible placement of a cottonseed oil price ceiling. This action was suggested in a statement on July 27 by the Office of Price Administration and Civilian Supply, because of speculative influences in the upward spiraling of prices which reached their peak in the latter half of June. The fats and oils market reacted with immediate sharp declines to the action of the Office of Price Administration and Civilian Supply, and then firmed somewhat and adjusted itself gradually to the changed. outlook, with the July price level lower than that prevailing at the end of June, but higher than that month's average.

The July weighted average index of wholesale prices of 28 leading fats and oils (using 1935-1939 as the base period) was 134.3, compared with 128.0 in the preceding month and 78.1 in July 1940. Cottonseed oil was 139.4, 133.6 and 69.8 in those respective months.

Demand for Cooking Fats Rising

The domestic consumption of lard continues at a much slower rate than is the case with competitive shortenings, the movement into distributive channels in the first six months of 1941 being one percent and 37 percent respectively over the same period in 1940. Lard consumption of 631 million pounds was 18 percent less than the 774 million pound shortening distribution in the 1941 half year, with lard supplying 45 percent of the total, compared with 53 percent a year ago.

While there has been a larger actual consumption of shortening in the current year, there has also been evidenced a considerable overstocking of this product by large consumers and distributors during the recently rapidly rising vegetable oil market which may have a tendency to reduce the need for replenishing shelf stocks in the near future.

Soybean Production; Peanut Oil

The Department of Agriculture estimates the prospective soybean production in the United States from the 1941 crop at about 109 million bushels, compared with 80 million

bushels in 1940 and with 91 million bushels from the previous record 1939 output. This would be an increase in the crude oil equivalent of about 250 million pounds compared with a year ago.

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The consumption of crude soybean oil in first six months reached 301 million pounds, a 27 percent increase over a year ago. Substantial supplies of peanut oil in the current year have placed this product in an extremely fortunate position to benefit from the increased demand for edible oils, and the consumption of peanut oil in the first six months more than quadrupled from the comparable period in 1940.

Supply conditions are not as favorable from the 1941 crop, which is now being harvested in some sections. The August 1 crop estimate indicated a 14 percent decrease in this year's picked and threshed peanut production, compared with the record 1940 output. It is, however, expected to be about 40 percent over the ten-year (1930-39) average.

Flaxseed, Linseed, Tung Oils

Flaxseed crushings and linseed oil production and consumption increased a third over the first six months of last year, and reached the highest levels for any similar period since 1929.

Flaxseed production from the 1941 crop, estimated at 30,711,000 bushels on August 1, is less than two percent below the 1940 production, and nearly three times the average annual production in the ten years 1930-39. Import requirements are estimated at about 15 million bushels.

The increased usage of linseed oil (our principal drying oil) is reflected in record sales of paint for the first half year, which were also one-third over the corresponding period in 1940.

Tung oil consumption of 35 million pounds increased eight percent over the 1940 half year. However, much of this consumption was from stocks previously acquired, as imports were only a fourth of a year ago.

Short supplies of tung oil have been augmented by a greatly increased usage of de

Back in 1870 when women still were knitting socks and stockings, the commercialized hosiery industry produced only 4,269,512 dozen pairs. This included both men's and women's. At that time 30.4 percent of the production was of cotton and 69.6 percent was classified as wool, but including cotton and wool and rayon and wool mixtures.

Cotton constantly gained to 34.2 percent in 1880; 74.3 percent in 1890; 88.2 percent in 1899, and reached its high point in 1909 at 91.2 percent. It then began to feel the competition of silk and rayon and dropped to 71.6 percent in 1919; 29.7 percent in 1929, and increased to 36.9 percent in 1939, due in considerable part to the popularization of sport hosiery, primarily of cotton, such as anklets and slack and crew socks.

PICTURE AT A GLANCE

Wool, starting at 69.6 percent in 1870, went down to only two percent in 1939.

Silk and silk mixtures as hosiery material showed for the first time in the Census figures of 1899 when 12,572 dozen pairs of silk hosiery were made. At that time they constituted only 0.04 percent of the total.

By 1909 silk hosiery was 0.7 percent and by 1919 silk hosiery constituted 20.3 percent of production; by 1929, 32.6 percent; and, by 1939, 37.1 percent, which, at that time, represented 56,550,107 dozen pairs with a factory value of $289,712,194 and a per dozen factory value of $5.12.

Rayon (including rayon and cotton mixtures) was first classified in the Census of 1919. At that time it had achieved 1.9 percent of the industry; by 1929, 29.7 percent; and fell in 1939 to 21.6 percent.

Women Are Chief Users

The big increase in the use of silk took place in women's hosiery. Even in 1939, 41.3 of men's hose were made of cotton, or a higher percentage than the 36.7 shown in 1929. The year in which cotton constituted the greatest proportion of men's hosiery was 1909 when the percentage was 88.9.

In 1890, 24.5 percent of men's hosiery was of wool, but the percentage made of wool in 1939 was only 5.1.

Silk made its best showing in men's hosiery in the war prosperity days of 1919 when 13.4 percent was silk, compared with 9.4 percent in 1929 and 5.3 percent in 1939.

Rayon in men's hosiery started at 2.5 percent in 1919, jumped to 39.8 percent in 1929 and to 45.3 percent in 1939.

Women started to turn thumbs down on cotton hosiery in 1919 when cotton constituted 57.6 percent of women's hosiery. By 1929 it had gone down to 14.2 percent and in 1939 to 9.1 percent. In 1939 wool constituted only 0.1 percent of material used for feminine hosiery.

In 1919, 39.2 percent of women's hosiery was of silk and silk mixtures; in 1929, 65.3 percent, and, in 1939, 84.0 percent. Rayon as a basis for women's hosiery started at 2.3 percent in 1919; jumped to 18.3 percent in 1929, and went down to 6.3 percent in 1939.

A strong seasonal expansion in railroad freight traffic normally begins about the middle of August, reaches a peak about the middle of October, and is followed by a rapid and almost unbroken decline to the year-end. This year, the railroads face this expansion with low car reserves and almost no further opportunity to increase their equipment supply.

Consequently, the need for more effective utilization of freight cars during the coming higher traffic levels is evident, and constitutes the reason for the recently intensified efforts by the carrier, shipper, and Defense organizations to utilize every possible source of economy in car use.

Seasonal Pattern Expected to be Somewhat Unusual

In general, the fluctuations in carloadings so far this year have followed approximately the customary seasonal movement, except for the sharp drop during April (caused by the coal strike) and the basic upward trend, which started in May 1940 but gained momentum during 1941. This may be seen by the similarity between the curves representing 1941 and 1935-39 weekly carloadings in the accompanying chart.

The five-year average may be taken as a rough approximation of a recent normal traffic level, and of the normal seasonal variations in carloadings volume throughout the year.

If a normal seasonal rise were to follow the current level of carloadings, the seasonal peak this year would be in the neighborhood of 1,050,000 carloadings per week, even without allowing for the upward trend mentioned above. But a normal rise can scarcely take place, in view of the shortages of materials that have been hampering industrial production and the impossibility of seasonal expansion in industries that already are operating at capacity levels.

However, seasonal influences undoubtedly will bring increased freight shipments from other industries. Furthermore, the full effect of the diversion of traffic from ocean shipping to the railroads probably has not yet become evident, and increased military shipments also should increase the traffic peak somewhat.

While the extent of the dampening to be expected in the seasonal rise cannot be calculated with precision, the peak demand probably will be in the neighborhood of 1,000,000 carloadings weekly in October.

Current Carloadings at High Level

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Total carloadings during the last six weeks have averaged slightly below 900,000 weekly the highest sustained level since 1930. As shown by the last two columns in the accompanying table, about half of the increase above the corresponding 1935-39 average was caused by increased loadings of miscellaneous commodities which consist primarily of manufactured products. Coal and ore shipments accounted for the major part of the balance, while livestock movements were actually lower than the 1935-39 average.

Although the relative increases in coke and ore shipments above the five-year baseperiod were far more spectacular than in the other commodity groups, the total volume of each of those two types of products was relatively small. (Note the first four columns

of the table).

Equipment Supply Below Railroad Program

Since the middle of 1939, the supply of serviceable cars has been gradually increasing. During the early stage of this program, the major increases were derived from intensive rehabilitation of unserviceable cars. However,