Trade Combinations.
—National and even international control of the lead market has at times been attained through marketing organizations or trade combinations of reduction works, ore-buying and metal-selling agencies with interlocking directorates, joint ownership, and long-term contracts for ores, concentrates, and metals.
In 1909 the so-called Lead Convention, or officially the International Sales Association, was formed in Paris. It was composed of German, Spanish, and Belgian producers and metal-selling agencies controlling directly about one-half of the European production. Some companies not nominally in the association acted in concert with it. This convention was renewed in 1910 and again in 1913 for three years. The association was dominated by the same interests as the German Zinc Syndicate,—the Merton group, comprising the Metallgesellschaft, the Metallbank and Metallurgische Gesellschaft of Frankfort and the Merton companies of London; Beer, Sondheimer & Co., controlling a dozen German metal and chemical concerns, and Aron Hirsch & Sohn at Halberstadt. The Merton group of London and Frankfort were the selling agents of the association, and the dominant “Trio,” through the Australian Metal Co., controlled the lead exported as metal or concentrates from Australia.
In the United States and Mexico all lead exported was controlled by the American Metal Co., affiliated with the association, or the American Smelting & Refining Co., acting in concert with it. The German “Trio” maintained and was rapidly extending and strengthening its ascendancy throughout the world through banks, holding companies, affiliations with syndicates and cartels, interlocking directorates, joint share holdings and purchase in whole or in part of mines and smelters. Some of the English lead refineries were closely associated with the Convention, and all lead exported from the Port Pirie smelter was sold by Merton & Co. The association was able to fix the price of lead in Europe and thus affect the output and, it has been claimed, so manipulated the market that lead outside the Convention was controlled just as effectively as that inside. The membership was international, brought together by mercenary motives. That the strongest and most aggressive interests were German citizens was purely incidental.
As a result of the war, however, the production of Australian lead concentrates and bullion is permanently diverted from German control. The activities of the Alien Property Custodian tended to eliminate all German interests in the United States. Most of the Australian lead bullion production is now marketed by the Broken Hill Associated Smelters, Prop., Ltd., of whose capital stock the Broken Hill Proprietary owns one-third and the Broken Hill South, Broken Hill North, and Zinc Corporation each own two-ninths. The plant of this company is now the largest smelter in the world.
The nationalist movement in France resulted in the formation of trade associations known as “consortiums,” comprising the principal factor in each industry. These “consortiums,” were recognized by the government, and each was made virtually arbiter of its particular field. The consortium of the mineral industry has been perfected into the Société Minerals et Metaux, 154 Boulevard Hausmann, Paris. The official announcement states that this society is organized under the auspices of the French government in order to group the French metal producers operating both at home and abroad into a co-operative association for the purchase and sale of metallurgical products.
The participants comprise the principal companies in France producing or refining metals and also the mining and smelting companies controlled by French capital in Spain, Algeria, Tunis, and other foreign countries. A highly centralized organization of that part of the mineral and metal industry under French control is thus achieved for mutual protection and advantage in competition with other nationalities. Members of this organization will produce most of the ore from Algiers and Tunis and probably 75 per cent. of the Spanish lead bullion. The present annual output of the participating companies is about 200,000 metric tons of lead, 50,000 metric tons of zinc, and 40,000 tons of copper, besides iron, antimony, platinum, etc. The association comprises the following companies: Société Minière et Metallurgique de Penarroya; Société d’Affinage de Metaux; Compagnie des Mines d’Ain-Barbar; Association Minière; Société des Mines de Zinc d’Ain-Arko; Compagnie du Boleo; Compagnie Française des Mines de Bor; Corocoro United Copper Mines, Ltd.; Société des Mines de Fedj-el-Adoum; Société des Mines de Zinc de Guergour; Compagnie des Mines de Huaron; Société Minière du Kanguet; Compagnie des Minerais de Fer Magnetique de Mokta-et-Hadid; Comptoir Lyon Allemand; Société Anonyme des Mines de Malfidano; Compagnie des Mines d’Ouasta et de Desloula; Société des Mines de Parzan; Compagnie Industrielle du Platine; Société Anonyme des Mines et Fonderies de Pontgibaud; Société des Mines d’Antimoine de Rochetrejoux; Société des Anciens Etablissements Sopwith; Société Française d’Etudes et d’Enterprises; Société des Mines du Djebel-Ressas; Société Anonyme Française du Djebel-Hallouf; Société Anonyme des Mines et Usines de Peyrebrune; and Compagnie La Cruz.
One of the results of the war was the stimulation of co-operative enterprises between British companies, the movement being encouraged by the government, which in some cases participated financially. The British Australian Lead Manufacturers Proprietary, Ltd., was formed as a consolidation of the Australian interests of British firms, with the object of establishing a white-lead industry in that country. Those participating comprise: Alexander Ferguson & Co.; Cookson & Co.; Foster, Blockett & Wilson; Locke, Blockett & Co.; Locke-Lancaster; W. W. & R. Johnson & Sons, Ltd.; Mersey White Lead Co., Ltd.; and Walkers Parker & Co.
The Chloride Syndicate comprising the Zinc Corporation, Ltd., Burma Mines Corporation, and the Swansea Vale Smelter, Ltd., is conducting experimental work on the Ganlin process with the object of perfecting it.
Richard Tilden Smith, having acquired controlling interests in J. H. Enthoven & Sons, Locke-Lancaster, Walkers Parker & Co. and a one-third interest in the Burma Mines Corporation, became a strong link between these important companies and thus secured an arrangement with the Imperial Government for financial assistance with the new plant of the National Smelting Co., Ltd., at Avonmouth to the extent of £500,000 out of the total estimated cost of £750,000, the government being particularly interested in the production of by-product acid. The National Smelting Co. agreed to take 25,000 tons yearly of Broken Hill concentrate and smelt no foreign ore without government permission. Enthoven & Sons control through ownership the output of one of the Spanish smelters and through desilverizing and marketing contracts the output of the French Laurium company of Greece. An attempt to bring about a closer combination of all the above-mentioned English and Australian companies failed.