Prices: The Great Aluminum Rattle

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Backroom Battle. All week behind the scenes, the Administration tried to persuade the balking aluminum companies to buy the surplus tonnage it wanted to unload, dropping the politic mask of silence only when the firms rejected each of five alternate Government proposals. Determined as the Government may be, the extent to which it can affect aluminum prices remains in doubt. Now running close to 100% of its 2.7 million-ton-a-year capacity, the industry nevertheless cannot meet domestic demand. Furthermore, by law the Government must sell its surplus metal at market prices. It can, however, choose instead to provide it as Government equipment for defense contractors, thus cutting its own expenses. The 200,000 tons that the U.S. intends to dispose of next year—a good deal less than the nation will import—just about equals the expected rise in defense consumption of the metal.

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