THE COAL AND IRON SITUATION OF WESTERN EUROPE UNDER THE TERMS OF THE PEACE TREATY
A mineral problem of special international importance at the present time relates to the disposition of the coal and iron resources of Germany. Germany's coal and iron have been the basis for its commanding position in industry and commerce. In fact, its development of these resources has been probably the most vital element in the European economic situation. The terms of the Peace Treaty in regard to these commodities have far-reaching consequences, not only for Germany but for all Europe, and indirectly, for the world.
Germany (Westphalia) outclasses all other European sources in grades of metallurgical coal, in quantities produced, and in cheapness of production. Both France and Belgium must continue to be dependent on this source for important parts of the coking coal for metallurgical purposes, notwithstanding France's acquisition of the Saar Basin, which produces mainly non-coking coal, and the development of new reserves in Belgium. Germany's command of coal is wrecked in several ways. The French take over full and absolute possession of the coal of the Saar Basin, though Germany has the right to repurchase it at the end of fifteen years, in case this territory then elects for union with Germany. The coal of Upper Silesia, with a production of about 23 per cent of the total of all German hard coal, is to be ceded to Poland, subject, however, to plebiscite. Germany undertakes to deliver to France each year, for not to exceed ten years, an amount of coal equal to the difference between the annual pre-war production of the French coal mines destroyed as a result of the war, and the production of the mines of the same area during the years in question,—such delivery not to exceed 20,000,000 tons in any one year of the first five, nor 8,000,000 in any one year of the succeeding five years. In addition, Germany agrees to deliver coal, or its equivalent in coke, as follows: to France 7,000,000 tons annually for ten years; to Belgium 8,000,000 tons annually for ten years; to Italy an annual quantity rising by annual increments from 4,500,000 tons in 1919-20 to 8,500,000 tons in each of the six years 1923-24 to 1928-29; and to Luxemburg, if required, a quantity of coal equal to the pre-war annual consumption of German coal in Luxemburg.
The total pre-war coal production of Germany in 1913 was 191,500,000 tons. The diminution of production due to loss of territory in Alsace-Lorraine, in the Saar Basin, and in Upper Silesia amounts to about 61,000,000 tons. The further required annual distribution of coal to France, Italy, Belgium, and Luxemburg amounts to about 40,000,000 tons. This leaves about 90,000,000 tons for Germany's domestic use, as compared with a pre-war domestic use of 139,000,000 tons. Even then, these calculations make no allowance for coal to be used in export trade to neutrals or other countries, some part of which seems vital to Germany's trade. They make no allowance for the deterioration of plant and machinery in the mines, which will delay resumption of coal production. They make no allowance for the diminution in working hours and the lack of transportation. In short, unless there is a miraculous recovery and development of Germany's coal industry, impossible conditions have been imposed. Some recognition of this fact appears in the great powers to adjust terms which have been vested in the Reparations Committee. Successive revisions of requirements by the Reparations Committee have already reduced the direct contributions of coal from Germany nearly fifty per cent. The entire European coal situation is in a state of chaos. It was found necessary in 1918 to appoint a Coal Commission under international control, to attempt to allocate and distribute supplies. It seems inevitable that the physical facts of the situation will prevail, and that the control of the Allies will resolve itself into efforts to distribute and coördinate supplies so as to keep the European machinery going, more or less regardless of the terms of the Peace Treaty.
One of the important outcomes of this situation has been the recent rapid development of German lignite production, based on newly worked-out methods of treatment and utilization.
By taking over Alsace-Lorraine, France acquires about 70 per cent of the iron ore reserves and annual production of Germany. This production was in minor part smelted locally,—the larger part moving down the Rhine to the vicinity of the Ruhr coal fields, and Ruhr coal coming back for the smelting in Lorraine. This great channel of balanced exchange of commodities has been determined by nature, and is not likely to be permanently affected by political changes. For the time being, however, the drawing of a political boundary across this trade route hinders the full resumption of the trade. Self-interest will require both Germany and France to keep these routes open. France requires German coal to supply the local smelters near the iron fields, and German markets for the excess production of iron ore. On the other hand, Germany's great smelting district in the Ruhr Basin is largely dependent on the Lorraine iron ore, and the movement of this iron ore requires coal from down the Rhine as a balance.
The intelligent handling of this great coal and iron problem is of far-reaching consequence to the mineral industries of the world.