stainless steel and cannot legitimately be included in total stockpile availability. The Administration has recently proposed further liquilurgical chromite stockpile, retaining less than 6 months' supply in the national inventory.22

U.S. STOCKS OF METALLURGICAL GD. CHROMITE ORE*

Government

(Thousand Short Tons)

1968a 1969 1970a 1971a 19721 1973 19741

stockpile 4,128 3,868 3,708 3,440 3,440 3,490 2,504 Industry

stockpile 381 296 387 667 601 339 311 TOTALS: 4,509 4,164 4,095 4,107 4,041 3,829 2,815

* Includes National Stockpile, Defense Production Act Stockpile, and Supplemental Stockpile.

a. Source: Bureau of Mines Minerals Yearbook.

b. Includes 1,668,000 tons non-stockpile grade.

c. Includes 1,482,000 short dry tons non-stockpile grade.

d. Includes 1,594,000 tons non-stockpile grade.

e. Amount of non-stockpile grade included in these figures is not specified by the Bureau of Mines Minerals Yearbook.

f. Source: GSA.

g. Includes 1,483,175 tons non-stockpile grade. h. Includes 1,451,708 tons non-stockpile grade. i. Includes 551,758 tons non-stockpile.

Industry Stocks: Industrial stocks of metallurgical grade chromite are currently sufficient for about 4 months' operations.22a Unfortunately, for the third consecutive year, consumption has

22 The Administration has proposed the stockpile of high quality metallurgical grade ore be reduced to 444,710 tons. In 1974, the metallurgical industry consumed 894,708 tons of chromite. United States Department of the Interior, Bureau of Mines, Mineral Industry Surveys, December, 1974 [hereinafter cited as Mineral Industry Surveys].

22a As of December 31, 1974, industry stocks of chromite totaled 310,954 tons, as compared with a years' consumption rate of 894,708 tons.

exceeded imports, requiring heavy drawdowns on available inventory.

U.S. Imports of Chromite

American imports of metallurgical grade chromite have declined since 1970, the year before the Rhodesian sanctions were lifted. This trend is illustrated by the following chart:

The reason for declining ore imports is relatively simple: countries with chromite supplies are reluctant to sell ore if they can sell ferrochrome.

Many countries-including Rhodesia-which have reserves of chromite ore are anxious to develop primary refining facilities of their own; exporting semi-finished (ferrochrome) rather than raw materials. This follows the pattern of most developing countries which wish to control the exploitation of their own resources.

To this end, countries with large ore deposits have built gigantic ferrochrome facilities over the past five years. Rhodesia, which produced almost no ferrochrome in 1967, now has an industry almost double the size of the U.S. ferrochrome capacity. All countries lacking supplies of ore are in a similar position. Japan, France, West Germany and Sweden-as well as the United States are finding chrome ore an increasingly scare commodity.

The trend is likely to accelerate in the future. Rhodesian, South African, Turkish and even Russian ferrochrome production is certain to increase. Their chromite ore exports are likely to continue to decline.

Ferrochrome is increasingly replacing raw ore as the strategic material. The decline of U.S. stocks of chromite parallels the constricted world availability of metallurgical grade ore.

The availability of high quality metallurgical grade chromite is further complicated by our historical dependence upon the Soviet Union as a source of supply. During the sanctions period and immediately thereafter, over half of U.S. imports of metallurgical grade chromite ore came from the Soviet Union. Russian chrome dealers exploited this virtual monopoloy in two ways:

1. The physical quality of the Russian lump ore exported to U.S. consumers steadily deteriorated when Rhodesian chromite was unavailable to the U.S. Market. The increase in Russian shipments since 1964 has been largely run-ofmine ore, some of which contains excessive "fines," dras

tically limiting its utility for the production of high-carbon ferrochrome.23

2. Russian prices dramatically accelerated during the sanctions period as the following chart indicates:

AVERAGE PRICE/SHORT TON SOVIET
METALLURGICAL GRADE CHROMITE ORE

(Price/Chrome Contained)

1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 SOURCE: Bureau of Mines Mineral Industry Surveys.

AVERAGE PRICE/TON SOVIET METALLURGICAL GRADE CHROMITE ORE (Price/Chrome Contained) (Short Tons)

1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 $35.78 $36.46 $41.12 $39.87 $45.30 $56.88 $68.49 $68.45 $51.73 $61.33 [Source: Bureau of Mines Mineral Industry Surveys]

23 Id. NMAB Report.