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Rh 1921, that the world's merchant shipping since 1914 had been actually increased by more than 10,000,000 tons. Unfortunately for the shipping industry, the world's trade had not developed in proportion. Owing to the complete breakdown of credit in some countries trade was practically at a standstill.

An unprecedented step was taken by the Register in April 1921, when issuing its shipbuilding returns for the first quarter of the year. It issued with these returns a statement to the effect that, as the times were not normal, the figures of tonnage reported to be under construction did not provide a true index of the relative position of the shipbuilding industry as compared with, say, 12 months previously.

The total tonnage under construction in the United Kingdom at the end of March 1921 was given as 3,798,500 tons represented by 884 vessels. In ordinary times such an amount of work in hand would have indicated great activity and prosperity in the shipbuilding industry. It compared, for example, with 1,890,800 tons under construction at the end of March 1914, showing an increase of 1,907,700 tons, and with 1,722,100 tons under construction at the end of June 1914, the last quarter completed before the outbreak of the war. But the amount of tonnage stated to be in course of construction at the end of March 1921 included a considerable amount on which work had been suspended, owing to the heavy fall in shipping values consequent on the severe decline in freights and the corresponding decline in the demand for tonnage. The tonnage on which work had been suspended in this way amounted to 497,000 tons. There were also included in the total figures some 350,000 tons, the completion of which had been delayed owing to the cessation of work by ship joiners. To arrive at comparative figures, it was therefore necessary to deduct these two figures, amounting together to 847,000 tons, from the amount of tonnage described as being under construction. The total figures of tonnage on which work was actually proceeding at the end of March 1921 was thereby reduced to 2,951,500 tons, showing an increase of 847,000 tons over March 1914.

There would have been grounds for satisfaction in such an increase if the world's commerce had been active. Unfortunately, enormous numbers of the world's inhabitants were taking no part in international commerce, and, further, there were immense numbers who were not producing goods or working at the same rate as before the war. Consequently the construction of so much tonnage, although the work was proceeding at a slow pace, could not be regarded with unmixed satisfaction. Cancellations of shipbuilding contracts by owners were common, and large sums were paid in order that owners might be relieved of their commitments. The surplus of ordinary cargo steamships was especially large. The losses of mail and passenger liners during the war had not been made good, but the high cost of building tended to prevent replacements.

As compared with the figures for the quarter ended Dec. 1920, there was a reduction in the shipping launched during the first quarter of 1921 of 146,000 tons. The tonnage started during the quarter declined by 113,000 tons, while in the tonnage in preparation, but not actually commenced, there was a fall of 75%, as compared with the figures of the first quarter of 1920. Attention was called by Lloyd's Register both at the end of 1920 and in the beginning of 1921 to the lower rate of construction as compared with pre-war times. In 1913 the average amount of tonnage completed during each quarter was over 23% of the total work in hand at the beginning of the quarter, whereas the figures for 1920 fell below 13%. During the first quarter of 1921 the output fell as low as 8% of that under construction at the beginning of the year.

The total amount of tonnage being built abroad was 3,288,100 tons—not quite so large an amount as the tonnage described as being under construction in the United Kingdom, but actually larger than that on which work was actively proceeding there. The Register pointed out that the returns for foreign countries, unlike those for the United Kingdom, were not subject to any material reduction on account of suspended or delayed work, of which there appeared to be comparatively little in other countries. The shipping being built abroad was less by 183,000 tons than that under construction at the end of 1920. The decline was due to the continued decrease in the United States of America, where the tonnage under construction was less by 27% than that building at the beginning of 1919. Apart from the United States, the countries in which the largest amount of shipbuilding was taking place were France, with 427,100 tons, an increase for the quarter of about 30,000 tons; Holland with 417,600 tons; Italy with 351,600 tons; and Japan with 294,300 tons, an increase of 46,000 tons.

The returns showed that there were then 187 steamers and motorships, each of over 1,000 tons, with a total of 1,320,100 tons, under construction for the carriage of oil in bulk. Of the total number, 84, of 557,000 tons, were under construction in the United Kingdom, and 82, of 632,000 tons, in the United States. In the former the oil-tank tonnage represented 57 % of the total amount of construction. The tonnage of vessels under construction to be fitted with internal combustion engines amounted to 503,800 tons.

A highly unsatisfactory feature was the diversion of a large amount of British shipping from British to foreign shipyards for reconditioning. This was due to a refusal on the part of the ship joiners to accept the lower wages proposed by the employers and the consequent cessation of work by the ship joiners in the United Kingdom for many months. Large liners were diverted to Dutch and French ship repairing works. The work of reconditioning was essential, and the stoppage by the ship joiners meant the loss of a large amount of work to the United Kingdom, which, it was to be feared, might have a far-reaching effect on the British industry.

Condition and Prospects.—What might be described as a bird's-eye view of the state of the shipping industry during 1910-21 is afforded by the course of prices of a “new, ready, 7,500-ton cargo steamer” as recorded in the chart published by the weekly shipping journal Fairplay and described as “Fairplay's Curve.” This type of vessel may be considered representative of ordinary cargo steamers. In 1910 the price of such a vessel was £37,000. Prices then rose sharply and by the end of 1911 a price of £47,000 was reached. A further rise took place in 1912 to £58,000. That year, as has been shown, was a prosperous one for shipping, and from the high point reached, values fell to £48,000 at the end of 1913. A further drop occurred in 1914 to £43,000. The great rise then began. By the end of 1914 the price had advanced to £60,000. In 1915 prices more than doubled and £125,000 was reached. In 1916 there was a further advance to £188,000. The effect of the Excess Profits duty was seen in 1917 and values fell to £165,000. In 1918 there was a recovery to £181,000 and then a fall to £169,000. An extraordinary rise took place in 1919, the high price of £232,000 being reached. Early in 1920 there was a further upward movement. Then a great and steady fall began and by the end of the year the value of £105,000 had been reached. In the first six months of 1920, values again receded. On May 24 two new, ready steamers of 9,250 tons dead-weight built by the Furness Shipbuilding Co. to Lloyd's highest class were sold for £85,000 each, representing rather more than £9 a ton. These ships were of the shelter-deck type, with the tonnage openings closed. Vessels of similar size with tonnage openings would carry only 8,300 tons dead-weight, and on that basis the prices bid for the two ships appear somewhat better. Another ship which was of 5,500 tons dead-weight and was built by Charles Hill & Sons, Ltd., of Bristol, was sold for £40,000, representing only rather more than £7 a ton. This particular ship had not been launched, and was not expected to be ready for sea for at least two months.

The Chamber of Shipping estimated that at the beginning of 1921 there were laid up in the United Kingdom, the United States and Scandinavian ports, 5,000,000 tons dead-weight of shipping, or, approximately 3,000,000 gross. This amount of tonnage was made up of 2,250,000 tons in the United Kingdom, represented by 600 vessels, of 2,000,000 tons in the United States represented by 250 vessels, and of 750,000 tons represented by 428 vessels in Scandinavian ports. In addition, many vessels were laid up in Spain, Italy, Japan and other countries, and in the early months of 1921, the amount of tonnage laid up throughout the world steadily increased.

In 1920 there took place the greatest fall in freights that has ever been recorded. The extent of the drop is shown by the movement of the time charter rate, i.e. the monthly rate of hire for ordinary cargo steamers. When vessels are chartered in this way the owners provide and pay the crews and pay for the stores. The charterers pay for the coal, since the amount consumed and the cost depend upon the trade into which the vessel is put. At the beginning of 1920 the usual time charter rate for cargo steamers was 30s. a ton dead-weight. By midsummer the rate had dropped to 20s. a ton or rather less. By the end of the year the rate had fallen to 10s. a ton, and with very little inquiry it fell further. By the end of the first quarter of 1921 steamers were chartered at a rate of 6s. a ton. There were also heavy falls in the voyage rates.

As compared with maximum rates during the war for free British steamers bringing grain from Argentina of about 183s. a ton, the freight early in 1921 had fallen to about 35s. Then, when the coal stoppage occurred at the end of April, rates advanced, owing to the necessity of steamers proceeding from this country in ballast, and to the difficulty of securing bunkers. By the end of May, rates of about 57s. 6d. a ton were being quoted for vessels that were available for immediate loading. It was generally accepted in shipping circles that a freight of about 50s. was necessary to cover the cost of sending a vessel to S. America in ballast and bringing her home with a cargo of grain. The fact that, before the war, cargoes of coal had always been available from the United Kingdom meant competition for the homeward voyage and enabled freights to be restricted. The new conditions were distinctly serious for the shipping industry.

Coal also represented a serious problem for the liner companies. Sir Owen Philipps, chairman of the Royal Mail Steam Packet Co., gave some figures respecting comparative costs at the annual meeting of the company in June 1921. He stated that in 1902 the average cost of all coal consumed by the company's steamers in all ports served, including rail carriage and freight, was exactly 22s. a ton. In 1903, the average price had increased to 22s. 3d., while 10 years later, in 1913, the average cost, including railage and freight, had increased to 22s. 11d., which was then considered a very high average price. In 1920, the average cost per ton of all coal consumed by the company's steamers, including railage and freight, was 120s. 1d. Early in 1921 the price fell very considerably, largely owing to the supply of coal by Germany to France and Belgium, with a consequent falling off in the demand for British coal. Then when the stoppage at the British collieries had been proceeding for some little time, and stocks were being exhausted, British shipping had to look to the Continent for supplies.