Letter to Representative Pittenger of Minnesota Concerning Coal Supplies in the Midwest.

My dear Mr. Pittenger:

Being just as deeply interested as you are in seeing that supplies of coal in the Midwest and the upper Great Lakes area will be adequate to prevent hardship during the coming winter, I have given careful consideration to your letter of September 24, in which you request that one million tons of coal produced in Districts 7 and 8 be diverted to the upper Great Lakes docks away from other sections of the nation during the remainder of the navigation season. You suggest that this can be done because it was done in 1943, and that the diverted tonnage could be restored to other areas after the close of lake navigation.

This administration is fully cognizant of the needs of the area served by the upper Great Lakes docks, as well as the needs of other sections of the country. In the application of distribution controls, every effort is made to assure that each area receives not only its equitable share of the more desirable grades and sizes of coal normally used in the area, but also enough other usable coal to fulfill its total requirements. Widespread recognition of the need for such controls this year led to extension of the life of the Solid Fuels Administration for War. Dock operators and others in your area, who were aware of the shortage of coals produced in Districts 7 and 8 and who expressed their belief that only under SFAW Regulations could they obtain their fair share of the available supply, repeatedly requested continuance of the agency.

In the early years of the war, the coal stocks above ground were the largest in the nation's history, reaching a peak of 91,000,000 tons in the latter part of 1942. Although inroads were made in those reserve tonnages, there were still substantial stocks throughout the country in 1943 when the tonnages to which you refer were directed by SFAW to the Lakes. By April 1946, when the recent strikes commenced, these stocks were at a much lower level, and they were further reduced during the strike. This difference in the coal stockpile situation in 1943 and 1946 alone indicates that the feasibility of diverting a million tons of premium coal at this time must be viewed against a background quite different from that which prevailed in 1943.

It is quite clear that this year's supply of District 7 and 8 coals, for which there is a popular demand in your area and elsewhere, is relatively short. During the strikes in April and May, those districts together lost approximately 27,000,000 tons of production, or about 16 per cent of their combined total annual production. In the period from April 1, 1946 to September 21, 1946, each of those districts has produced only about 85 per cent of the amount it produced in the comparable period last year. To effect an equitable distribution of this short supply, SFAW, after making allowance for a possible increase in the rate of production, found it necessary to limit shipments of prepared sizes of these coals for domestic use to 90 per cent, and of industrial sizes to 100 per cent of the tonnage of such sizes shipped during the last coal year.

In order that the Lake dock territory will receive its fair share of the available supply and that the great bulk of the coal will be delivered during the navigation season, the following provisions have been made:

1. Shippers in all producing districts are required to assure delivery of their lake commitments before making shipments to others, and to afford a preference in shipment to the upper Lake docks over the lower Lake ports.

2. Retail dealers in other areas obtaining their coal via rail from Districts 7 and 8 may not receive more than 57 per cent of their 90 per cent quota prior to the close of lake navigation.

3. Public utilities and other industries receiving coal via rail from Districts 7 and 8 are restricted to stockpiles of 20 and 15 days' supply, respectively. For coals produced in other districts, less drastic stockpiling provisions are in effect.

In addition, the Office of Defense Transportation has conferred with Lake forwarders, vessel operators and others with a view toward the issuance by it, if found practicable, of a direction to vessel operators similar to the SFAW direction to shippers, whereby vessel operators on the Great Lakes would serve the upper Lake docks in preference to the lower Lake ports. Also, the SFAW is seeking to effect arrangements whereby insurance coverage will be available beyond the normal close of the season and thus permit deliveries as long as it is physically possible to make them.

The total U.S. requirements of District 7 and 8 coals are approximately 170,000,000 tons. Of this, the Great Lakes (over all) require about 32,250,000 tons, leaving about 137,750,000 tons to be distributed via rail and other methods of transportation. It must be remembered that the Great Lakes territory has access to coals in surplus supply produced outside of Districts 7 and 8, as well as mine-run and some other sizes of Districts 7 and 8 coals. Other areas having such access are finding it necessary to piece out with such alternate coals. Some other sections of the country are not so fortunate, however, and they must get along with just their equitable share of Districts 7 and 8 coals. Prudence would seem to dictate that in view of the short supply of the so-called higher grade coals of Districts 7 and 8, territories having access to other coals should supplement their supplies of those premium coals with others which are suitable although not so desirable. SFAW has for months been urging that this be done.

I am advised that some dock operators in the upper Lakes region have taken as much mine-run coal for screening on the docks as their facilities will permit, and by screening, they obtain prepared sizes and screenings comparable to those secured at the mine. In view of the shortage, however, that probably will not be enough. I believe that they, as well as other dock operators who have not taken any substantial amounts of surplus coals, should supplement their stocks with mine-run--not for screening on the docks, but for resale as mine-run.

Under the circumstances which I have outlined, I do not believe that direction of additional tonnages of prepared sizes of coal produced in Districts 7 and 8 to the upper Great Lakes territory would be justified unless a step-up in rate of production should make it possible to increase the quotas for all sections which receive those coals. The SFAW is constantly surveying the production picture and whenever it is found that additional tonnage will be available, the established quotas will be increased promptly.

While the situation, as I see it, does not warrant my complying with your request, I assure you that every effort will be made, as it has been and is being made by SFAW, to provide adequate supplies to any dock operator who demonstrates that he will not have enough tonnage to supply his domestic consumer customers with a tonnage equal to 90 per cent of the prepared sizes he supplied to them last year, and to furnish his industrial consumers with 100 per cent of the prepared sizes he furnished last year.

I appreciate your concern in this matter, and I ask that you lend your aid in advising the people in your area of the wisdom of supplementing their supply of premium coals with enough of the surplus coals to keep themselves warm this year.

Very sincerely yours,

HARRY S. TRUMAN

[Honorable William A. Pittenger, House of Representatives, Washington, D.C.]