Business: Steel: Rise in Price

For a month steelmen anxiously waited for U.S. Steel, the industry's pace setter, to raise its prices to match the automatic July 1 wage increase (cost: 26¢ an hour). But Big Steel, which led the industry in eleven of the twelve boosts since World War II, this time plainly intended to let someone else lead the way—and take the political walloping that was sure to follow. Moreover, Big Steel probably needed a raise least, because of increased efficiency in its operations (see below). Last week Armco Steel's President R. L. Gray finally took the step, raised the price on flat rolled products (35% of all steel production) $4.50 a ton. The rest of the industry, including Big Steel, joyfully followed, spreading the raises to virtually all steel production. Democratic Senator Estes Kefauver promptly called his Senate Antitrust and Monopoly subcommittee into session to investigate the rise.

Will the price rise be passed on to consumers? Retail competition is so tough that most steel users thought not—for the time being. They apparently intended to see how fast business picked up before they took a chance on raising prices. Said General Electric Chairman Ralph Cordiner guardedly: "In the face of rising costs bargain prices cannot be expected to continue very much longer."