a large quantity of creosote oil, like or similar to that produced in the United States, was and is produced in the principal competing country and exported to the United States, where it is sold in competition with the like or similar domestic product. Differences in qualities, grades, and uses are fully considered in the report transmitted herewith.

PRINCIPAL COMPETING COUNTRY

The resolution is similar to the provision of section 336 in that costs are required for the principal competing country, rather than the average foreign costs of production in general as prescribed in some resolutions. In this respect, therefore, the commission followed the general rules in connection with investigations under section 336, and it was found that the United Kingdom was the principal competing country during each of the three years for which cost data were requested in the resolution.

PRINCIPAL MARKET OR MARKETS

The resolution follows the general principles of section 336 with regard to the principal market or markets of the United States, and in this respect, therefore, the commission followed the rules set forth with reference to the principal market or markets.

In general, therefore, while creosote oil is on the free list as specified in paragraph 1651 of the tariff act of 1930, and not subject to investigation under section 336, and while Senate Resolution 470 specified that the investigation be conducted under section 332 of the tariff act of 1930, which provides for the making of surveys, this investigation was carried forward under the rules of practice and procedure prescribed for investigations under section 336, so as to show differences in costs of production between the United States and the principal competing country of the like or similar article when delivered in the principal market or markets of the United States, during a representative period of time.

NATURE OF CREOSOTE OIL

Creosote oil is a product of the distillation of coal tar. Coal tar in turn is a product principally of the destructive distillation of bituminous coal. In the United States about 7 per cent and in the United Kingdom from 50 to 65 per cent of the coal tar is produced by gas works as a by-product, along with coke and various other commodities, of the manufacture of coal gas from coal. The remainder is produced in the coke industry by the use of so-called by-product coke ovens, where, along with various other commodities, it is a by-product of the major product, coke. A species of tar is also derived from the manufacture of water gas, but except in negligible amounts this is not a raw material for creosote oil.

The fact that coal tar is a by-product is important with respect to the problem of determining the costs of creosote oil, domestic and foreign. Its significance is discussed in the section dealing with

costs.

According to the census of 1927 the total value of products of the manufactured gas industry was $485,100,000 (not including certain net items directly connected with the production of gas), of which

the value of gas itself produced for sale was $446,245,000; the value of coke produced for sale, $25,514,000; the value of coal-gas tar produced for sale, $4,449,000; and the value of all other by-products produced for sale, $8,892,000. Coal-gas tar is thus a very minor product of the industry even for those plants which produce tar used for distillation to creosote oil.

According to the same census, the total value of coke-oven products (including products made in beehive ovens as well as by-product ovens) was $368,851,000, of which coke itself represented $247,188,000; gas sold, $53,725,000; tar sold, $14,570,000 (a further substantial amount being consumed as fuel); and other by-products sold (chiefly ammonia products), $53,368,000. Here again tar is a relatively minor product.

As shown more fully below, only part of the coal tar produced in the United States is subjected to those processes of which creosote oil is one of the joint products. A considerable fraction of the output of tar is burned as fuel, and another considerable fraction is made into refined tars, which are chiefly used as a binder in road making, in the manufacture of roofing material, or for impregnating paper and felt. In other words, tar has alternative uses, a fact which affects the calculation of its value as material for creosote oil production.

Finally, creosote oil is a joint product of the distillation of coal tar. The nature and the quantities of the other products obtained from distillation of coal tar depend on whether the coal tar used is gas-house tar or coke-oven tar. The reason for this difference is that in the by-product coke oven certain products, notably benzol and toluol, are separated from the tar in the coking process itself, whereas in the gas works these products remain in the tar and are separated by the subsequent distillation process. As shown more fully below the domestic tar-distilling plants, since they use chiefly coke-oven tar, have a distribution of products considerably different from that of the tar-distilling plants of the United Kingdom, which use chiefly coal-gas tar. The major products, other than creosote oil, resulting from the distillation of coke-oven tar are pitch, tar acids, naphthalene, and high-boiling neutral oils, but there are a number of others. From gas-house tar, there are obtained, in addition to the products mentioned, benzol, toluol, and other minor products. For the tar-distilling plants in the United States covered by the present investigation, creosote oil, on the average for the three years 1928-1930, represented about two-thirds of the total value of the products derived in distillation for the purpose of obtaining creosote oil, not counting operations in which the major product sought is refined tar; whereas in the United Kingdom creosote oil represented about one-third of the total value of the products of such distillation.

USES OF CREOSOTE OIL

By far the principal use of creosote oil is for impregnating wood to preserve it against decay. Approximately 95 per cent of the consumption in the United States is in this use, the remainder being consumed chiefly in the manufacture of lampblack and disinfectants. The practice of impregnating wood is particularly important for treating railway ties. Approximately 60 per cent of the total con

sumption of creosote oil by wood-preserving plants in this country is for treating railway ties, 20 per cent for treating telegraph and telephone poles, and the remainder for construction timbers.

Because of the great mileage of the railways in the United States and of the prevalence of the use of wood ties the domestic consumption of creosote oil is very large, probably greater than that of all the other countries of the world combined. In many of the European countries there is much greater employment of stone, concrete, and steel for railway ties than in the United States.

USES OF JOINT AND ALTERNATIVE PRODUCTS

As already stated, the alternative uses of tar are for the production of creosote oil and its joint products and for the production of refined tar. Refined tar is used chiefly, both in the United States and in foreign countries, for road making, roofing material, and impregnating building materials. Both in the United States and in the United Kingdom large quantities of coal tar are thus converted into refined tar; the proportion so converted is considerably larger in the United Kingdom than in the United States.

Next to creosote oil, pitch is, in both countries, much the largest joint product of tar distillation, and in the United Kingdom exceeds in quantity, although not in value, the production of creosote oil. Abroad the most important use of pitch is as a binder in making briquets from pulverized coal. On the Continent, especially in Germany, there is a very large production of so-called brown coal or lignite, which is relatively unsatisfactory fuel in its original state, but which when converted into briquets is of much greater utility. A large part of the British production of pitch is exported to Germany for this use and considerable quantities are also similarly used in the United Kingdom itself. In the United States there is relatively little manufacturing of briquets. Other uses of pitch. are in core binders, roofing, battery seals, targets, electrode binders, paint bases, and waterproofing compounds. The demand for pitch in the United States, however, is so limited that a large part of the production is burned as fuel.

Other products of coal-tar distillation are tar acids and naphthalene, used chiefly in the manufacture of coal-tar dyes, medicinals, and in the synthetic resin industry.

II. GENERAL DATA

SUMMARY OF DOMESTIC PRODUCTION AND IMPORTS

The production of creosote oil on a large scale is a relatively new industry in the United States. The use of this product as a preservative for wood was unimportant prior to about 1903, but it developed rapidly from that time on. The production of creosote oil was of somewhat earlier development in Europe, largely because of the demand for the joint product pitch, for making briquets, and at the outset practically the entire domestic requirement was supplied by imports. The first available statistics with regard to the origin of the creosote used by wood-treating plants in the United States are for the year 1909. In that year the total consumption for this purpose was reported as 51,426,000 gallons, of which 13.862,000 gallons,

or 27 per cent, was domestic and 37,564,000 gallons, or 73 per cent, was imported. By 1913 the consumption of the domestic product had risen to 41,700,000 gallons and that of the imported to 66,673,000 gallons, the domestic proportion being 38 per cent. During the later years of the war and the immediate postwar years there was a great decline in imports, partly because of the shutting off of supplies from Germany. In the meantime domestic production increased only moderately. Beginning about 1921 there was a rapid increase both in imports and domestic production. Imports reached their peak in 1927 and declined during each year covered by the investigation, also in 1931, and domestic production reached its peak in 1929.

Table 1 shows the quantity and value of domestic production and of imports for each year from 1917 to 1931, inclusive. The figures are not exactly comparable with those in Table 20 in the appendix. This table relates to the consumption of domestic and imported creosote by treating plants, and in which the domestic product includes not only creosote oil proper but creosote coal-tar solution, refined watergas tar solution, and paving oil when these products are used by wood-treating plants.

TABLE 1.-Creosote oil: Domestic production and imports

Source: Production, Census of Dyes and Other Synthetic Organic Chemicals, U. S. Tariff Commission; imports, Foreign Commerce and Navigation of the United States, Department of Commerce. 1 Fiscal year.

Preliminary figure obtained by deducting imports from approximate consumption.

DOMESTIC PRODUCTION BY REGIONS

Tar-distilling plants are located chiefly in the vicinity of large cities where a supply of gas-house tar is available, or in the vicinity of by-product coke plants. Whereas beehive coke is ordinarily produced at the coal mines, by-product coke is chiefly manufactured close to steel works where not only the coke can be utilized, but also the gas produced in the process. As the result of these geographic conditions, the centers of the production of creosote oil may be grouped into seven districts: (1) Eastern United States, including the vicinity of New York harbor, Philadelphia, and Norfolk; (2) the steel region of western Pennsylvania, eastern Ohio, and northern West Virginia; (3) the Toledo-Detroit region; (4) the steel region in the vicinity of Chicago, including one plant near Mil