the collieries in the same coal field have a common organization for the study of the market situation. When alterations in the scale of prices are found by those in the industry to be necessary or opportune, they are thus put into force simultaneously in the same locality, and sharp fluctuations are avoided.

The central committee of the coal industry does not intervene in the question of selling prices, which remain exclusively under the control of the mining companies. There is an agreement between the French collieries in the Nord and Pas-de-Calais and the Belgian collieries regarding the selling price of household coal in France. Recently the Nord and Pas-de-Calais coal owners and a number of importers of British coal have established an organization called Selling Agency for Screened and Compressed Coal for the joint distribution of household coal, briquettes, and boulets throughout 17 French departments of the center and west.

AMALGAMATIONS

The French law is on the whole unfavorable to combinations. Agreements between producers are forbidden, and although the law is not now interpreted literally, it tends to limit the scope of associations.

The reorganization of the coal mines in the devasted area was accompanied by the formation of large companies, and the number of undertakings in the Nord and Pas-de-Calais coal fields in 1927 was only 32.

In the reconstructed coal fields of the Pas-de-Calais the units of production are of the same order of magnitude as in Westphalia. In 1925 an output of 20,000,000 tons was produced there by only 16 undertakings.

A certain amount of combination has taken place between the coalmining industry and metallurgical concerns, but no details as to specific agreements are available.

Three collieries in Lorraine, covering 10 per cent of the French output in 1925, recently formed themselves into a sales syndicate.

MECHANIZATION

The French mines in the Pas-de-Calais and in the Nord have been completely reorganized. In the latter district, 70 per cent of the coal was hewn in 1927 with the aid of mechanical power, and in the Pas-de-Calais 65 per cent.

OUTPUT OF WORKERS

It is stated that much remains to be done to raise the output of workers. As compared with 1913, the individual output was 14 per cent lower in 1927. This decrease is said to be the result of the rapid increase in the number of workers employed, and, still more, of the legal reduction of hours which progress in technical equipment has not yet been able to counterbalance. It has been suggested that the coal industry must therefore face this prospect and study the possibility of reducing its cost of production by improving the output of its workers, and must endeavor to achieve a maximum of elasticity in production.

REGULATION OF WAGES

The regulation of wages, which are keenly fixed under a collective agreement for each coal field as a whole, is left entirely to the coal field organization which negotiates with the workers' representatives. No coal field applies in any form the system of a sliding scale involving the automatic adjustment of wages according to fluctuations in a simple or comple index number. In brief, economic factors are considered as well as changes in the prices of foodstuffs and services likely to affect the workers' standard of life.

Although there is no direct relation between the prices charged for coal and the agreed wages of miners, it has been found that over long periods there is a fairly close parallelism between changes in wages and prices.

IMPORT DUTY

In France there is a general duty on the importation of coal amounting to 0.20 paper francs (approximately 1⁄2d.) per 100 kilograms.

RAILWAY RATES

Rates judiciously adapted, as the result of long experience, to the economic and geographical conditions of the country, were abandoned ruthlessly during the war and replaced by a single scale of charges obviously lacking in elasticity. The few corrections introduced later under the pressure of manifest necessities are of trifling importance. The opinion has been expressed that a methodical readjustment of an excessively simplified scale of charges might have an appreciable effect in restoring the markets for French coal.

GERMANY

The importance of Germany as a coal-producing country may be gaged from the fact that about one-quarter of the entire world output of coal is raised within its boundaries.

PRODUCTION

The production of coal (in metric tons) since 1909-1913 has been as under:

Table B, attached to this statement, shows the comparative progress of European production.

Although under the peace treaty Germany lost approximately 26 per cent of her coal resources, yet in 1928 from the reduced capacity the output was 90 per cent of the pre-war amount, whereas the output of the United Kingdom in 1928 was only 82 per cent of the pre-war quantity.

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PRICES

The weighted average value per ton of coal sold from the mines in the Ruhr (including the estimated value of the coal used in the mines and that supplied to householder imployees) is shown hereunder

A comparison with other countries is shown in Table A attached hereto.

ORGANIZATION

The coal industry law passed by the German Reichstag in 1919 compelled collieries to join 1 of 11 syndicates which cover the entire country, and to sign a legally enforceable contract. These syndicates united into the Reich Coal Association, which is governed by the Reich Coal Council (Reichskohlenrat) or "parliament," consisting of 60 members representing the Government, owners, miners, large consumers, and coal merchants. Each producing district has its own organization and all of these are members of the Reichskohlenrat. This council directs the general commercial policy and manages the whole coal-mining industry of Germany under the supervision of the Reich, the powers conferred on which are exercised by the Minister for Economic Affairs.

Syndicates independently fix quota and sell at prices approved by both the Reich Coal Association and the Reich Coal Council. The Rhenish-Westphalian Syndicate sells a large percentage directly to large consumers and the balance through merchants. This method is followed approximately by other syndicates, with the exception of the Upper Silesia Coal Syndicate and that of central Germany, which sell exclusively through wholesale companies.

In a League of Nations publication ("Memorandum on Coal, Vol. I), it is stated that the coal industry is more highly organized in Germany than in any other country, but even there no general combination exists, partly because the coal areas are widely separated and have divergent interests. The offiical organization of the industry owes something to pressure from the State, which in certain cases has insisted on a degree of syndication.

But the central official organization, the Reichskohlenrat, the original function of which was price fixing, was concerned in 1927 mainly with watching imports and exports. Its functions are for the most part advisory.

THE RUHR SYNDICATE

The objects of the Rhur Syndicate, which provides the supreme example of concentration, are stated to be rationalization of the industry and the fixing of prices for each category of coal under three heads: (1) A stable minimum price; (2) the account price at which the syndicate buys from its members; and (3) a selling price which may be above or below account price.

Profits are distributed in proportion to the participation of constituent undertakings. Each mine has a consumption quota including

items (coal used at the colliery, local sales, miners' coal, etc.), which are excluded in estimating the sales quota. Production is then regulated on the basis of the consumption quota, to which is added a variable percentage of the sales quota. The selling organization varies for markets with or without foreign competition; in the former, the syndicate reserves to itself large clients and hands over the surplus to merchants and selling organizations; in the latter, the syndicate sells directly to large consumers and through intermediary syndicates to other buyers.

REGULATION OF OUTPUT

In Germany the most effective agency in eliminating the seasonal flucuations that would exist despite the pressure of output on reserves has been the coal syndicates. Although the syndicates were formed primarily for the control of prices, they have aided in the stabilizing of output in at least two ways. One method of controlling prices has been the restriction, both of the total output and of the output of the individual company. Since, in the domestic market, an operator can dispose of only a fixed amount of coal and at a price fixed in April for the following 12 months, his only means of increasing profits is by decreasing his mining costs or by increasing out put and exporting the surplus above his allotment for the domestic market. One method of decreasing costs is to work the mines at the highest efficiency and capacity all the year round, rather than seasonally in response to demand. Pressure is exerted on the coal merchants to force them to distribute their purchases evenly throughout the year in order that the coal producer will not have the problem of storing the surplus coal during the slack season.

One paragraph of the Rhenish-Westphalian Coal Syndicate's contract of sale with merchants provides: "If merchants do not take up full quantities from March to August, the syndicate is entitled to reduce by the same amount deliveries in other months." This provision has made it necessary for the merchants either to provide for the storage of coal or to induce the large consumers to make their purchases during the season of minimum demand. It is a policy that has encouraged the storage of coal, not by the mines, but by the middlemen or by the consumer. Further, the syndicate has tended to eliminate seasonal production by fostering the export of German coal, thus providing an outlet for the surplus output of the mines. Under the syndicate agreement there are no limitations, either on the price charged for export coal or on the quantity exported. In many cases the fixed price for the domestic market has been high enough to permit the producer to make substantial reductions in the price of coal for export, and thus undersell British coal in foreign markets. It has been a frequent charge by German manufacturing concerns that the price of German coal is higher in Germany than in some of the near-by countries.

No data are available for a comparison of regularity of output before and after the formation of the Rhenish-Westphalian Syndicate, undoubtedly the most important and the most highly organized and closely-knit association in the German coal industry, butc ontemporary comments on the industry indicate that one of the reasons for the formation of the syndicate in 1893 was to bring about a stabilization of output. It is true that in the period since 1893 German mines

have worked with greater regularity-probably with greater regularity than can be found in any other large coal-mining country. Since 1901 the average working year of the Prussian mines has been 307 days and no year in that period has fallen below 286 days.

Now that coal supplies exceed the demand on the home and foreign markets, and prices are falling, the economic organizations of the German coal industry, the Reichskohleaverband and the Reichskohlearat, under the supervision of the Reich Ministry for Public Economy, exercise mainly advisory functions. The fixing of selling pricesformerly their principal task-is no longer practicable. The action taken by these organizations in relation to prices did not always meet with the approval of the industry. As in the case of all administrative fixing of prices, these organizations could only proceed on the basis of so-called objective standards, in this case the costs of production. It is thought that this criterion is not alone sufficient in any long view of the necessities of production; but that a rational business calculation requires higher prices in a period of brisk demand in order to provide against losses at times when sales are insufficient to cover costs of production. However, these organizations and also the workers' representatives on them did their best to meet, the requirements of the industry as far as this was possible within the limits stated above.

CLOSURE OF MINES

In pursuance of its program of rationalization, the Ruhr industry closed down large numbers of unremunerative mines; in 1924-25 77 undertakings normally employing 60,000 workers went out of operation. Moreover, in order to reduce the costs of production to a competitive level, a large number of less productive seams were closed. Most of these mines and seams will never be worked again.

GAS SCHEME

The extension of its system of long-distance gas supply, to embrace a number of the biggest industrial cities in Germany, is reported by the Ruhr Gas Corporation (the company formed in 1926 by the leading coal, iron, and steel interests in the Ruhr) to be part of their program of rationalization.

The Ruhr Gas Corporation has now in operation a network of 450 kilometers of pipe lines conveying the gas, which was formerly a waste product of the Ruhr coke ovens, to cities as far distant as Hanover, while plans in hand provide for the extension of the service to Berlin and the North Sea coast at Hamburg. The sum of £1,500,000 has been spent on its system by the Ruhr Gas Corporation, which is financed by the New York banking firm of Dillon, Read & Co., and which has obtained a contract for the supply of gas to Cologne. In their first full year the activities of the Ruhr Gas Corporation increased German consumption of gas by 25 per cent.

OUTPUT PER WORKER

On January 1, 1924, the 8-hour day was introduced in Germany, and the output per worker has increased steadily from that date until in almost all coal-mines in 1927 it exceeded pre-war figures.