811.20 Defense (M)/3085a: Telegram
The Secretary of State to the Ambassador in Japan (Grew)
546. The following account of developments in the American silk industry since the application to Japan of the freezing order is given for your information.
The Office of Production Management on July 26 ordered the freezing of all stocks of raw silk in warehouses, the limitation of processing, and the imposition of a ceiling on raw silk prices, and requested the suspension of trading in silk futures in the New York Commodity Exchange. On August 1 OPM issued a further order prohibiting all processing of raw silk after midnight August 2 unless specifically authorized by the priorities’ director, explaining that the Army and Navy needed the total reserves of silk in the country.
On July 29 representatives of importers, dealers, brokers, processors and manufacturers met at the Office of Price Administration and Civilian Supply to take stock of the situation. At this meeting it was determined that the supply of processed silk and finished silk products is sufficient for normal requirements over five months. During the first two weeks in August conferences took place between representatives of the Government and representatives of the silk hosiery, silk throwing and rayon manufacturing industries as well as representatives of workers and employers in silk-using industries other than the hosiery industry. At these conferences the use of substitutes for silk was discussed and reports heard on the available and future supply of such substitutes. The consensus of the hosiery industry, which normally consumes 93 percent of raw silk imports, as brought out at the conferences, is that certain rayons, of which large amounts of the right denier are produced, are suitable for hosiery manufacture, and that while there will be initial shortages, brief shut-downs due to experimentation, and temporary deterioration in quality while shifting to rayon, the adjustment will present no serious difficulty to the industry or undue hardship to consumers. It was also brought out that production of nylon, now furnishing 16 percent of the material for the hosiery industry, will be doubled by middle 1942 and further materially increased in 1943. The weaving industry also indicated at the conferences that it can shift to rayon, although, with the hosiery industry requiring so much more of the output of types of rayon yarn used by the weaving industry, it expects that it will experience difficulty in getting even its normal requirements of rayon let alone additional amounts to take the place of silk. To solve this difficulty, recommendations were made that available types of rayon yarn not [Page 866] suitable for hosiery be substituted for silk. The problem of substitute raw material was shown to be most acute in the case of the minor industries, but proposals to relieve these industries too were put forward.
A plaintive note over the interruption of silk imports was heard only once during the conferences, when Mr. Levy, saying he represented 175,000 workers depending on silk for their livelihood, in the course of the July 29 meeting stated that the average plant employing such workers would cease to operate in 10 weeks unless more silk were imported. With this single exception further supplies of raw silk were not even mentioned and the proceedings were devoted entirely to adjusting affected American economy to a silkless state. In fact the opinion was current that in 2 years silk will hardly be missed in this country primarily because of the increased production of nylon.35
In this connection it may be mentioned that there was a run on silk hosiery for a few days after the freezing of raw silk stocks, but that it has subsided to a considerable degree. Available information indicates that the prospect of early exhaustion of silk stockings and fabrics has been viewed very calmly if not indifferently by American women.
Sent to Tokyo via Shanghai. Repeated to Peiping and Chungking.
- William R. Langdon, of the Division of Far Eastern Affairs, made this comment in a memorandum dated August 22: “The future of the great Japanese raw silk industry, with this country making every preparation to get along without silk, and also of our trade with Japan, with perhaps this important commodity absent from it after normal relations are resumed, is interesting to speculate upon.”↩