THE RUBBER INDUSTRY IN THE SINO-SOVIET BLOC (RR PR-155)

Created: 3/15/1957

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N? 81

PROVISIONAL INTELLIGENCE REPORT

THE RUBBER INDUSTRY IN THE SINO-SOVIET BLOC

CIA/RR57

CENTRAL INTELLIGENCE AGENCY

OFFICE OF RESEARCH AND REPORTS

FOREWORD

The purpose of this report Is to present the latest Information available on the rubber industry of the Slno-Soviet Bloc. Previous reports have presented Information on the rubber position of the USSB and of the European Satellites. This information has been brought up to date In this report. Because of Its increasingin the econony of the Sino-Soviet Bloc, the rubber Industry of Co^sunlst China it discussed.

No data arc available on capital Investments, Manufacturing costs, wholesale prices, or labor Inputs for either synthetic rubber or finished rubber products in the Slno-Soviet Bloc. Hence this report la confined to the production and consumption phases of the industry.

- ill -

CONTESTS

Pare

Summary

I. Introduction

II-

A.

1.

Rubber

c- Synthetic Rubber

d. Reclalned

e- Transportation Goodo

Black

Goods

J. Sixth Five Year Plan

2-

3.

Rubber

g- Tire

Goods

4.

ft.

Rubber

Rubber

Goods

1. Nontransportation

5- East

Rubber

Rubber

Rubber

Goods

p. Tire

h.

1. Nontransportation Goods

- vi -

Egg

Rubber

1. Hontranaportotlon

Rubber

. Transportation

1. Kontransportatlon

r.

Rubber

Transportation

Goods

natural

Synthetic Rubber

Rubber

U.

- vii -

III. Consumption Patterns

.

Ocrmany

China ,

73

Ik 7"

8 79

8l

Material Balances of Rubber in the SiBO-SOviet Bloc

Satellites

China

V. Inputs

VI. Capabilities, Vulnerabilities, aad Intentions

5 85

89

89

50

93

3 9*

A.. Appendixaps iu Intelligence Appendix C. Source References .

99

101

- viil -

S C

Tub Its

Page

1. Estimated Production of Synthetic Rubber in the USSR,

by Plant,

?. Estimated Requirements for Reclaimed Rubber in the USSR.

Production or Motor Vehicle Tires In the USSR,

by

for the Production of Carbon Black in the USSR,

5- Estimated Production of Rubber Footwear ln the USSP,

6. Estimated Production of Motor Vehicle Tires in Bulgaria,

7- Estimated Production of Synthetic Rubber in Czechoslovakia,

8. Estimated Production of Motor Vehicle Tires

9- Estimated Production of Synthetic Rubber ln East Germany.

0

Production of Motor Vehicle Tires in the Euro-

pean Satellites, by Country and by

Production of Carbon Black in East Germany, by

Production of Footwear in East Germany,

- lx -

13- Estimated Production of Reclaimed Rubber in Hungary,

Estimated Production of Motor Vehicle Tires in Hungary,

U 46

15- Estimated Production of Rubber Footvear in Hungary,

Production of Reclaimed Rubber in Poland,

Production of Motor Vehicle Tires in Poland,

48

4

Estimated Production of Footvear in

Estimated Production of Motor Vehicle Tires In Rumania,

Production of Motor Vehicle Tires in Communist

Production of Motor Vehicle Tires in China,

by

Production of Footvear in Communist China,

Imports of Natural Rubber by the Sino-Soviet Bloc,

by

Shipments of Synthetic Rubber and Motor Vehicle

Tires Within the Soviet Bloc,

Consumption of Rubber in the

ond

Consumption of Rubber in

Page

27- Estimated Consumption of Rubber in .

Consumption of Rubber in Czechoslovakia,

Estimated Rubber Consumption In East

Estimated Consumption of Rubber in

Estimated Consumption of Rubber in

Estimated Consumption of Rubber in -

Estimated Material Balances of Rubber In the Sino-Soviet

t

1

- xi

cta/rr vR-iy)

(ORR';0)

THE RUBBER INDUSTRY IK UHB SINO-SOVIET BLOC*

During the period following World War II the rubber industry in the Sino-Soviet Bloc has expandedate somewhat greater than that Of most other Bloc industries. Although the productive capacity of the rubber industry in the Bloc now meets the essential requirements of the Bloc-wide economy, it is not great enough to provide quantities and varieties of consumer goods comparable to those available to the people of Western Europe. The per capita consumption of rubber to the Bloc5 vasraction of that in most countries of the West.

The rubber industries of the various countries of the Sino-Soviet Bloc, like those of other countries, are dependent on supplies of natural, synthetic, and reclaimed rubber. The total Bloc supply of these kinds of rubber5 wasetric tons.** Of this total, natural rubberall of which was imported frail non-Bloc countriesccounted forons, synthetic rubber foroos, and reclaimed rubber forOO tons.

Of total Bloc production of synthetic rubberhe USSR produced the greater part,ons. East Germanyforons, Polandons,producedons, and the other European Satellites and Communistroduced negligible amounts, if any. The USSR wag also the major producer of reclaimed rubberccounting for0 tons ofotl total- The other Bloc countries, except Albania and Communist China, produced amounts rangingons in Bulgaria0 tons la Czechoslovakia.

The estimates and conclusions contained in this report represent the best Judgment of ORR as

** Tonnages throughout this report are given in metric tons unless otherwise indicated.

Perhaps the best measure of the development of the rubber Industry tn any Industrialized nation ls the production of motor vehicle tires. Including tires for aircraft and "military vehicles. 0roduction of tires ln the Slno-Soviet Bloc6 percent. 5 production of motor vehicle tires Id the Bloc vaa aboutillion units. The USSR produced6 million; Czechoslovakia,illion; East Germany,illion; Coroainiet China,; Poland,; Rumania and Hungary,ach; and Bulgaria, USof motor vehicle tires5 "asillion unite. Any comparative evaluation of production of tires ln countries of the Bloc, based on US production. Is qualified by differences ln the patterns of production. In the US, tlree for pasGongcr cars accountuch greater portion of total production of tires than In any of the Bloc countries.

Except for Imports of natural rubber from non-Bloc countries, Sino-Soviet Bloc trade In rubber and rubber products ls confined largely to intra-Bloc shipments. ommunist China Imported the largest amount of natural rubber,0 long tons ofon total, mainly from Indochina and Burma. The USSR0 long toon;0 long tons;0 long tons; and the other European Satellites imported the remainder.

Perhaps the most significant aspects of the Intra-Bloc trade ln rubber and rubber products are probable reahlpaents of natural rubber from Communist China to the USSR and shipments of synthetic rubber from East Germany to other countries of the Bloc. oat German exports of synthetic rubbercontrolled by the USSR through the mechanism of the Council of Mutual Economic Assistancemounted toercent of total East German production.

It is probable that strategic reserves of rubber are maintained only in the USSR - At the end2 the Soviet reserve amounted toons of natural rubber. Fromohe USSR purchased no natural rubber In the world markets, and lt la probable that to uvold deterioration of the stored rubber, reserves were consumed by the Industry. On the baBis of that assumption. It Is estimated that at the end5 Soviet reserves of natural rubber -ere0ons.

The diversity of application of ruhbor and rubber products in an industrial economy makes impossible Uie determinationetailed pattern of consumption of rubber ln the Blno-Sovlet Bloc. eneral pattern can be established for the USSR, however, on the basis of consumption of rubber in transportation goods and in nor.transportnticei goods. Of the total Soviet supply of rubberoo tons,ercent was consumed in the manufacture of transportation goodsires, tubes, repair materials, and the like. The manufacture of nontransportation goods rubber footwear, hose, belting, sanitary goods, and the likeconsumedercent of the total. Xt is probable that the pattern of consumption of rubber In the USSR is generally applicable to the Blochole, except, of course, to Communist China, tn which the major rubber product is footwear. The5 US pattern of rubber consumption was aboutercent of the total supply consumed by transportation goods andercent consumed by nontransportation goods.

The rubber industry of the Sino-Soviet Bloc currently has the capability of meeting the essential peacetime requirements of the economy of the Bloc. artime economy the5 productive capacity would sustain Bloc military activity forears. At the end of that period the loss of Imports of natural rubberoncnensurate Increase ln production of synthetic rubbor would seriously hamper Bloc military effort. Sino-Soviet Bloc plans indicate the clear Intent of avoiding this eventuality. The Soviet Sixth Five Yearalls for moreercent increase in the production of syntheticonscrccnt Increase in the production of motor vehicle tires,illion units East German plans call for the production ofons of synthetic rubberncrease5 production, and the productionillion motor vehicle tiresercent Increase5 production. Both Hungary and Communist China plan to construct new facilities for the rubber industry, and the USSR undoubtedly will be an active buyer of natural rubber in world irej-kctH duringeriod.

The rubber industry of the Slno-Sovlet Bloc does not appear to be significantly vulnerable, cither tn its supply of raw materials

For serially numbered source references, see Appendix C.

I. Introduction.

Rubber is an essential componentreat many industrial and consumer products, and roost modern media of transportation aredependent on adequate supplies of rubber. Transportation difficulties of the German armies during Worldlearlythe strategic importance of rubber. Following the war,only Germany and the USSR made serious efforts toynthetic substitute for rubber. 2j 9 these two countries alone hud well-established synthetic rubber industries. With the dislocation of production and transportation of natural rubberWorld War II, supplies of rubber become of vital importance to all It was during this period that synthetic ruboer was first producedarge scale in the US. kj Synthetic rubberajor factor ln the ultimate victory of the Western Powers.

5 the world demand for rubber has increased muchthan available supplies of natural rubber, and theindustry has continued to thrive. Technologicalproduced rubber which is made to specifications, and thethe industry is likely to continue. The economic importancerubber will increase as new applications are developedof living rise in all countries. At the same time,methods of growing natural rubber and new uses forwill intensify competition with synthetic rubber, andindustry probably willhifting pattern for

In the USSR the growth of the synthetic rubber industry has followed pre-World War II planning. The primary concern of the USSR is to be independent of Western sources for its essential strategic raw materials. Because naturul rubber grows outside the present Communist-heId areas, production of synthetic rubber has expanded rapidly. Planned production5ercent of prewar production. 5/ As transportation facilities and living standards increase, future expansion probably willimilar pattern.

Except for8 period, when the rubber industry of the USSReparate ministry, the industry has alwaysart of the Ministry of the Chemical Industry. 6/ Within the Ministry the following three main administrations are responsible for production of rubber and rubber products jj: the Mainof the Rubber Industryhe Mainof the Tire Industrynd the Mainof Industrial Rubber Products and Footwearhe sale and distribution of these products are handled by the Main Administration for the Sale of Rubber Products, whichart of tho Main Administration Tor the Sale of Chemical Products (Glav-khlnebyt).

Although Soviet scientists are extremely capable and devote much time to research on synthetic rubber, there seems to have been little technical advancement In manufacture In the USSR the basic raw material, butadiene, has been made from alcohol produced by fermenting such foodstuffs as grain and8/ By contrast, the Germans have made synthetic rubber from butadiene derived from calcium carbide and froa styrune made fromyproduct of coal tax. 'f the Communiststhe equipment of the Germun plant at Schkopau and moved lt to the USSR. This equipment was put Into production with the help of German technical personnel. It Is probable that much of the expansion of the industry called for by the Sixth Five Yearill be based on the expansion of production ofalcohol .from petroleum and on the expansion of production of carbide. Thus the growth of tho industry will follow6 dictum of Stalin to the effect that nonfood sources should heas raw materials.

Expansion of production ofoviet ollproof rubber, has been curtailed because the USoR has been able to Import other types of oil-resistant rubber fron East Germany, lw With the planned expansion in production of carbide, it would be possible to expand production of Sovprene bhould it become urgent for the USSR to increase present supplies.

II. Supply.

A. Production. 1. USSR.

Production of synthetic rubber in the USSR vas begun in thes and9 had become well established. Although no reliable information is available on production during World War II. the Fourth Five Yearhowed the postwar importance of the industry in the minds of the Soviet planners. Production of synthetic rubber0 vas to be twice that, whereas the industryhole was expected to expand onlyercent. of motor vehicle tires was to be trebled, production of rubber footwear was to increase one-third, and the announced goal for reclaimed rubber0 tons. The gains accomplished werebut it is probable that the announced plans were nothe Fifth Five Yearontinued to emphasize the impor- tance of the industry; production of synthetic rubber was scheduled to increaseercenthile the planned increase for all industry wasercent. No plans were announced for increases Inof tires and footwear. The annual announcements concerning plan fulfilltaents which have appeared1 indicate that the actual Increase in production Of synthetic rubber05 was aboutercent. Increases in production of tires during theears of the Plan were to totalercent. 4increases in production of rubber footwear amounted5 percent, but the increase50 is estimated to have been somewhat less.

Although industrial productionhole exceeded the planned goals, it would appear that production of synthetic rubber vas one of the areas in which plans were not

Rubber.

In support of Soviet efforts to become Independent of foreign sources of strategic raw naterials, the USSR experimented with domestic cultivation of rubber bearing plants ins. Plans for growing such plants ss kok-sagliyz, tau-saghyz, and guayule on

i-

a large scale vere interrupted by World War The Fourth Five Year Plan calledectaree (moreo be planted to these crops This acreage would have producedons of No announcements vere made concerning the realisation of this goal, and it is believed that results were disappointing. In any event, the Fifth Five Year Plan made no mention of domestic production of natural rubber.

Several factors indicate that,oviet planners abandoned the plan to cultivate natural rubber. First, the land requirements to meet the minimum needs of the USSR for natural rubber would amount to several million hectares; at the same time there wus urgent need for urable land to implement the new agrarian policy of the USSR. Second, manpower needed for cultivation and processing was disproportionate to the amount of rubber produced. It has been estimated that the cost to produce the raw materialson of rubber solids amounted to the equivalent This amount did not Include the cost of extracting the rubber. By contrast2 average price of natural rubber ln Singapore waserubles at the official rate of Third,ther crops were mentionedn the Soviet press as being expanded on lands freed by the abandonment of the rubber program. Fourth, no mention of production of natural rubber has appeared In the Soviet press

C. Synthetic

A famous Russian chemist, Lebcdov, was the inventor of synthetic His discoveries led to the establishment of the industry In the USSRime when the Soviet planners were eager to become independent of foreign sources of strategic raw materia The Second Five Yearalled for the building of plants which could produce "several tens of thousands of tons of rubber" per year. Production9 has been estimated0ll oade from alcohol obtained by the ferrricntntlon of foodstuffs. The end

* One hectarecres.

All trade values are given ln Wtos of US The official rate of exchange

- 8

producteneral-purpose material which could be substituted for natural rubber in most products. Meanwhile, the manufacture or an oil-resistant synthetic rubber Had been developed in the US-Soviet attempts to duplicate this material were unsuccessful until the technology of the US manufacturer was made available to the USSR through Lend-Leaae during World War IT. The USSRlant at Yerevan to makesimilar to US neoprene) and has continued to make this epecial-purpose rubber in quantitiesto meet its needs.

The Fourth Five Year Plan culled for the development of nonfood sources for making synthetic rubber,lant to use petroleum gases was built In the Baku oil region. The Germans had based their process on calcium carbide obtained from coke and limestone, but most of the US industry used petroleum gaoesaw material-After World War II, much of the equipment at the large East German plant located ln Schkopau was confiscated ond moved to sites in the USSR- German scientists and technicians were used to get these new plants into operation. Details on the individual plants and on rubber technology are givenrevious

The estimated production of synthetic rubber in the USSR, by plant,s shown in Table Sites other than those listed inave been reported, but their present status is uncertain, and they have not been Included as producers- arge plant has been under construction for several years nearart of the industrial complex being built in lhat area to utilize local coal. Current Information indicates that this plant is not yet in

d. Reclaimed Rubber.

Reclaimed rubber is made by the destructive processing, either chemically or mechanically, of old or discarded rubber products. It is used both to increase the supply of natural rubber and ln formulutions to impart desired characteristics to finished products. An accurate estimate of production is impossible to obtain, because production is largely dependent on the political and economic situations in the rubber-growing areas and on the quantity of old rubber products available for processing. Furthermore, most of the production of reclaimed rubber is from facilities located in plants

* ollows on

Table 1

Estimated Production of Syntactic Rubber ln the USSR, by Plant

Metric Tons

Economic

Plant Location

Kirov

y

d

Estimatesre taken fromiscussion of individual plant capacities, aee Appendix A, Methodology.

production3 "as announcedercent of that

production4 vas announcedercent of that

production5 "as announcedercent of that

-

that use it for (taking consumer goods. Reclaimed rubber ia consideredaw material, and for this reason no reports are published on it6 production.

It has been estimated that tbe rubber-reclaiming capacity of tbe USSR50 Io addition to the data available oo the individualeliable indication of the desiand for reclaimed rubber in the USSR can bc drawn from theof new rubber. Io the US lhe consumption of reclaimed rubber ranges fromoercent of the new rubber coosuned, dependingumber of economic factors such as the availability aad price of reclaimed, natural, and synthetic rubber aod on the types and potential uses of the rubber products. The USSR is thoroughly familiar with the literature on US practice in the use of reclaimed rubber, and It is probable that the Soviet demand for reclaimed rubber will be within the same general parameter as the US demand.

The estimated requirements for reclaimed rubber in the USSRre shown in Table P.

Table 2

Estimated Requirements for Reclaimed Rubber in the USSR

Metric Tons

V' v Requirementsa/

23

30

37

45

50

55

a

Estimatesre taken fromT Estimatesrc based on the assumption that expansion of requirements for reclaimed rubber would have been proportional to expansion of requirements for new rubber.

-

o

e- Transportation Goods.

.* lea"nUSSR Producing2as been concluded that three plants lifted in an earlierhose atpasnya, and Ul yanovekrobably do not produce tires. No information has been received on these plants1 nor have any tires traceable lo them been reported. It appears probable that these plants make camelback (the trade name for retreading material) and are engaged in retreading or repairing tires. One plant has been added to the earlierlant identified at FosforitnuyuH -El

tirCS'action W

During the past decade the USSR not only hasof motor vehicle tires by installing additionalolder plants but also has built at least tvo new have been mentioned lo the Soviet press, but therefrom either reports or markings data that theseJ**Zreports indicate that future expan-

sion of the tire Industry vlll include production capacity in both central and eastern Siberia.

stimated production of motor vehicle tires in the

USSR, by plant,s shovn in

Carbon Black.

rub-

Carbon blackpecial fortr. of essentially pure carbon which, when added to rubber, greatly increases resistance to abrasion and flexing. Carbon black is an essential component of most rubber products, particularly transportation goods. In general, natural rubber requires the admixture of aboutercent by welaht of carbon black to obtain products of high quality, and synthetic ber needs fromtoercent to achieve comparable quality.

.blacky burning an organic substanceontrolled supply of air and collecting the resultantr earb The original process burned natural gas and collected the carbon

* ollows on

-

Table 3

Estimated Production of Motor Vehicle Tires in tbe USSR, by Plant

Thousand Units

Plant Location

>L5

900

Estimatesre token fromA Estimates for later years are based on more recent information and announced annual increases, as follows: there was no announced increase10 (it was assumed toercent orroduction2ercent of thatroduction3ercent of thatroduction4ercent of thatad production5ercent of that

deposited on ironhe product being known as "channel black." An improved method burns petroleum fractionsurnace to make what are known as "furnace blacks." This process gives higher yields per pound of raw material and is subject to the close control which makes possible the production of grades designed for specific applications. The latest development in the manufacture of carbon black la the production of "high-abrasion" furnace blacks specially suited for tire treads. As far as la known, the USSB has not been able to produce carbon black of this type. The USSR has ample supplies of both natural gas and petroleum, but the Sovietuses old processes which US industry has improved greatly during recent years. The quality of Soviet tires indlcutes that similar improvements have not been attained by tbe USSR.

Before World War II the USSR was self-sufficient in the production of carbon black, having built several channel plants ln the Baku oil region. 3U/ In the postwar period the production of these plants was insufficient to meet the requirements of the expanded rubber industry. The resulting deficiency was met by imports from the US, which producesercent of the world's 0 the US placed an embargo on exports of carbon black to the Slno-Sovlctove which caused the USSR to expand production rapidly, primarily in the gas and petroleum producing As athe USSR today has adequate supplies of carbon black to meet the needs of Its rubber industry.

facilities for the production of carbon black in the USSR5 are shown in Table 'l.*

g. Tire Cord.

During World War II the USSR receivedart of Lend-leaseomplete, modern, US-built motor vehicle tire plant. Thus Soviet technicians were fully informed on the importance of high-tensile tire cord as an essential component of heavy-duty tires. For this reason, the Fourth Five Year Plan calledpecial main administrationthe Soviet textile industry, known as Glavcord, to control theof all tire cord. Much technical information was published on the theory of tire construction and the causes of tire

* ollows on

-

Table h

Facilities for the Production of Carbon Black in the USSR aj

Metric Tons per Year

Type of Carbon Black

Location

ty

Materials

I

(Krutaya)

gas

and furnace

gas

III

gas

and furnace

IV

gas

gas

gas

gos

V f

gas

gas and petroleum

and furnace

gas

gas and petroleum Channel and furnace

a.This table is derived from detailed' plant studies vhlch are fully documented end are available in CIA files.

-

Table k

Facilities for the Production of Carbon Black In the USSR

Continued)

Metric Tons per Year

Type of Carbona tion Capacity Raw Materials

VI

Kuybyehev Saratov

atural gas Channel and Natural Channel and furoace

VII

Ivanovo Yaroslavl1

0

Petroleum Petroleum

Furnace Furnace

IX

Keg lor. XI Irk'atsk

The industry apparently has followed developments in the US; articles have appeared in Soviet publications regarding the use of nylon and similar polyomid fibers which the USSR makes under the names of "perlon" and

There are nine known Soviet tire cord plants which operate under the supervision of In addition, three plants are known to make perlon fiber which is used in tire cord. Production data are lacking on individual plants, but it has been estimated thatof perlon fiber12 wasons perills amount would constitutemall percentage of lhe total Soviet requirements for tire cord. It is probable that perlon cord would be used primarily by the USSR in tires for jet aircraft and for motorsubject to extreme road conditions. In the US, nylon cord is

-

standard for all aircraft tires aad is being adopted for premium heavy-duty tires of all types. ecent survey shoved that5 the use of nylon cord in the US increased ICO percent above thatl/

On the basis of the motor vehicle park in the USSR and the high usage of trucks compared with passenger cars, It is estimated that truck tires constitute aboutercent of total Soviet production of motor vehicle On the basis of average weights, it is estimated thatilograms (kg) of tire cord would be required to make an average tire. The estimated production of tires in the USSR would levy tire cord requirementss follows:

Tons)

h. Beadwire.

Modern motor vehicle tiresbead" at either edge which serves to hold the Inflated tire on the rim. These beads must have flexibility and great strengthlni-fium ofr extensibility. Tire beads are made from high-carbon steel, the wire being drawn and either woven or twisted at the steel mill. The beadwire is shipped to the^tire plants on spools, and the individual beads are cut and then fabricated by welding. Because of the extreme precautionsto guard against corrosion, it is not considered feasible toor store beadwire or the fabricated beads for extended periods. The average weight of steel in the finished beads variesercent of the weight of the finished tire, t'ae higher percentage being needed for heavy-duty

Construction of motor vehicle tires in the Sino-Soviet Bloc follows standard practice in Western countries. Soviet-made tires have been carefully analyzed und have been found to contain beadwire similar to that used in the US, the chief difference being that the USSR uses tin or zinc plating instead of copper or It is probable that the USSR will be forced to adopt US practice for the construction of tubeless tires because neither tin nor zinc plating produces the adhesion needed in the newer type of tires.

-

Estimated requirements for hlgh-tenslle wire In the USSR are equalercent of the eetlaated total weight of all tires produced. ercent figuresed because of the high percentage' of heavy-duty and truck tires made in the USSR. It is probable that in the European Satellites there is morealance between the number of truck tires and the number of passcnger-cex tires produced. For this reason. Satellite requirements ore eetlaated to5 percent of the estimated total weight of all tires produced. In the USSR the requirements of the tire industry for steel wire will represent lessercent of the estimated national production of steel wire, and production of vehicle tires cannot be considered toajor consumer of steel. Estimated consumption of beadwire ln the USSRs as follows;

Tons)

Goods.

are thousands of finished products mode from rubber, and lt is Impossible to estimate production in even such broad cate* gcries as hose, belting, and mechanical goods. Although production data on rubber products are not given in Soviet publications, one rubber product in the nontransportation field Is usually mentioned ln the Five Year Plans and ln the annual fulfillment announcementsubber footwear. This category includes rubber-soled sandals as well as such usual items sa boots, athletic shoes, and overshoes. For thishe statement appearingoviet chemical magazine ino the effect that the industry must produceillion pairs of boots and galoshes4 in order to meet Its establishedoes not Include other items which appear in Soviet statistics as rubber footwear."

Annual increases ln production of rubber footwear have been announced every yearith the exception3. From these announcements and published prewar figures. It has been possible to develop estimates of production of rubber footwear. The Fourth Five Year Plan calledevenfold increase0 above

-

ut this goal was slightly underfulfilled. The failure vas admitted in the official announcement covering the accomplishments during the Plan period. The estimated production of rubber footwear in the USSRs Shown in Table 5-

Table 5

Estimated Production of Rubber Footwear in the USSR

Announced Production in Terms Estimated

of PreviousPairs)

45

lie

lie

105

.

J. Sixth Five Year Plan

The Sixth Five Yearf the USSR makes several references to the expansion which is to take place in the rubber industr Duringear period it Is planned to increase the production of synthetic alcohol approximatelyimes and that of syntheticimes. The production capacity for motor vehicle tires is to be doubled during the same period.

-

The Sixth Five Year Plan of the USSR specifically provides that new production facilities will be built ln various econoaic regions to sect local needs for rubber products. If these plans are fulfilled, much of the planned expansion, particularly In the tire plants, will lake place in south-central and eastern Siberia, where such facilities are now lacking.

Because Albania ls not primarily an Industrial country, its production of rubber products is limited to nontransportation goods such as footwear, gloves, and other consumer goods. The local demandor vehicle lireB is met by Imports from other countries of the Slno-Soviet Bloc. Tbe only rubber plant in Albania is located at DurreaN -E) and la variously reported to have from In addition to making corsuner goods, the plant at Durre* Is said to recap worn motor vehicle tires. 5V tatistics are puMti.tied on the quantities of various products made, but occasional notices appear in the Albanian press indicating that the plant has fulfilled its production plan.

Components.

Becnuse the rubber industry of Albania is limited to producing nontransportstion goods, the oaly nonrubber component ofis carbon black, which is used ln footwear and some other consuoer goods. All of the raweeded by the rubber industry, except the small amount of fabric used ln footwear, must be Imported.

a. General.

The manufacture of rubber products ls considered to be one of the principal Industries of Bulgaria and was scheduled topercent expansion2j/ For administrative

* iscussion of the estlzoted volume of these imports, see C,elow.

-

purposes, rubber plants are under the Ministry of Light and Food Industries and are controlled by the Director of the Leather and Rubber Industries.

t>. Natural Rubber.

As earlyulgaria was reported to be experimenting vith the production of natural rubber from Since the USSR obtained control of the country, these experiments have been extended to include tho cultivation of xok-saghyz. As late as, lt vas announced that further plantings of rubber bearing plants vould continue during the No announcements have been made about the success or failure of the project, vhlch probably has been dropped. As noted in" Bulgaria continues to import its requirements for natural rubber from the West and from other countries of the Slno-Soviet Bloc.

Synthetic Rubber.

r Bulgaria docs not moke synthetic rubber. It is dependent on imports from the USSR and possibly from East Germany to meet its needs.

d. Reclaimed Rubber.

As previously reported, production of reclaimed rubber In Bulgaria was startedrincipally in the only stotor vehicle tire plant (see e, below) in tKe country. This production is used In the plant, ond no statistics are published on production. It vas reported thatons of reclaimed rubber vere consumed in the tire plant The estimate of production of reclaimed rubber in Bulgaria, as shovn in the following tabulation. Is based on the grovth of the tire industry:

Tons)

P.elow.

-

The manufacture of motor vehicLc tires io Bulgaria ll eotlrelyi state controlled. The only plant la Bulgaria Is the Georgl Dlmltrov State Rubber Factory ln Sofia, which employshe plant was privately ownedhen lt was seized from the owner. It had made footwear and consumer goodsddition to tires.owever, production was limited principally to truck tires., new buildings werend new machines from the USSB and Easl Germany were to behus Increasing the capacity of the plant Tho rate of production4 "as reported to be0 tires pernd it was claimed that this rate Increased byer month The estimated production of motor vehicle tires In Bulgaria ioshown in Table 6.

Table 6

Estimated Production of Motor Vehicle Tires ln Bulgaria

Thousand Units

Year

!

All figures are rounded to the nearest hundred.

f. Carbon Black.

Bulgaria does not produce any carbon black and so must meet its requirements through imports from other countries of the Sino-Soviet Bloc. The volume of this business is discussed below.*

* See C,elow, and III,elow.

-

g. Tire Cord.

The textile Industry of Bulgaria le primarily concerned vith the manufacture of cotton fabrics. As late4 there vere no artificial fibers produced or used inhere have been no reports of synthetic fiber cord being imported by Bulgaria. Based on these negative data, it is assumed lhat all tire cord made or used in Bulgaria is cotton. Using the standardg of cord per tire, estimated requirements for tire cord In Bulgariare as follows:

Requirements Year (Metric Tons)

329

375

435

h. Beady!re.

Bulgaria has no wire-producing facilities and is dependent on imports for its requirements. The estimated consumption of bead-wiren Bulgaria Is as follows":

Counumptioo Year (Metric Tons)

1- Kontrer.sportetion Goods.

Approximately eight rubber plants ln Bulgaria, the majority of which are located in Sofia,ide variety of consumer goods, including footwear, rainwear, sanitary goods, belting, hose, and similar No statistics have been publishedhe total annual production of Individual products. It is reported, however, that the principal footvear plant, located at Sveto VrachecoN -E) produced rubber footwearateillion pairs per year

Based on the same ratio used for the USSR.

** Details on these plants are meager. It is probable, however, that fewerorkers are employed In all of them.

4. Czechoslovakia.

The rubber industry of Czechoslovakia ia controlled and administered by the Ministry of Chemical Production. The industry ia highly developed and not only la capable of reetlng domestic requirements but also exports its products to other Buropeon Satellites. It vaa reported that production In the industry* percent during the First Five Yearnd the Minister of the Chemical Industry claimed that production> percentompared vithercent Increase for all the chemical Industries. The planned expansion in the first year of the Second Five Yearalls for an Increase ofercent In the rubberhich is only slightly higher than the planned expansion ofercent for the chemical Industry. Very little data have been received on Individual plantso estimates can be derived only from previous reportsev claims of expanded operation*.

Rubber.

9 the Soviot Minister of Agriculture ordered tlie cultivation of kok-saghyz ln Czechoslovakia nd effortB vere mode to expend this crop during the succeeding years. roductionons vas/ ublicity has been given to the programnd in viev of the small yield, compared vith an estimated annual consumption^ of0 tons of natural rubber, itrobable that the program has been abandoned.

Rubber.

It vas reportedlunt producing an oil-resistant rubber known aa "svltpren" (neoprene) was put Into operation In Czechoslovakia during World War II. This plant reportedly producedoos in loltp. The plant was, however, destroyed during the war and has not beenut production of synthetic rubber apparently has continued ln Czechoslovakia on an experimental basis. Scientific publicationsthat small amounts of svltpren are made st Gottvaldov (formerly Zlln) to meet domestic requirements for ol1-realstant Recent press notices indicatedeneral-purposo synthetic rubber for use in tlreo and related productsot being made. 5

-

Table ?

Estimated Production of Synthetic Rubber in

Metric Tons

/

0

ft .

I

N.A.

5

Production Year Production

/

Rubber.

of reclulraed rubber is well-established in Czechoslovakia. Three plants are reported to be In production, but no figures are available on their Individual capacities. 6l/ operational plans for the *th quarter9 Indicatedons of reclaimed rubberequirement1 tons. Consumption of new rubber in the same year waa estimated to0 tons, which would beons of new rubberon of reclaimed (in the US the ratio Isn tlie transportation sector of the Industryn the nootransportallon) It ls believed that the reclaimed rubber industry in Czechoslovakia will continue tc expandate sufficient to maintain production in approximately thla ratio. The estimated production of reclaimed rubber ins shown in the following tabulation:

Year

(Metric Tons)

(Metric Tons)

0

5

0

Transportation Goods.

As shown in* Czechoslovakia is the major producer of motor vehicle tires among the European Satellites, its production accounting for aore than one-half of the aotor vehicle tires Bade ln the Sino-Soviet Bloc outside the USSR. Before World War II the French

Mlchelln firmranch plant in Prague, and the Bata interestsarge plant ln Cottvaldov. The plant ln Gottwaldov continues to be

by far the largest tire plant in the country. All rubber plants ln

Czechoslovakia have been nationalized..

The First Five Year Plan of Czechoslovakia calledpercent Increase In production of motor vehicle tires3 coo-pared with thatn average increase ofercent per year. The Czechoslovak State Statistical Office reported an Increase during the periodercent for the rubber Industryhole but did not specify whether this increase vas reported ln monetary value or ln units of production. Tires were not mentioned in the the name period, total industrial production "more thano plans for production of tires were mentioned in the annual plana0 goals have been announced for the current Five Year Plan. Production of truck tires4 was announced as "greater thannd production of footwear,ercent of thatRo press announcements have appeared thnt would Indicate the majorof any of the tire plants. It therefore seems reasonable to assume that production of tires3 has not been expandedate greater thanercent per year. The estimated production of motor vehicle tires in Czechoslovakias shown in*

s booed on data previouslynda conservative estimate basedestudy of several hundredpertaining to the Individual tire plants in Czechoslovakia. ecent report by the Council of Mutual Economic Assistance (CEMA) on the

elow-** ollows on

-

one

Table 8

Estimated Production of Motor Vehicle Tires ln Czechoslovakia

Thousand Units

0

Production

Estimates on the production byplants is shovn inelow.

planned production of tires70uch smaller production of tires In Czechoslovakia. According toroduction of "automobile tires" during this period will be ns foi1 nun -

Production Year (Thousands)

The report specifies "automobileut normal statistical methods report "motor vehiclehich Include equipment for all types of motor-driven vehicles. The estimates of production in the other European Satellites ore consistent with CIA estimates. The figures given for Czechoslovakia, however, are considerably below those given In many other documents. The weight of the evidence now available substantiates the figures ln Table 8.

4uantity rather than quality seems to have been stressed in the motor vehicle tire industry of Czechoslovakia.est Germany reported, that the tires made in Czechoslovakia with which imported "Skoda" motor vehicles were fitted were "entirely worn out"ilometers (km) More

-

Barura" tires (made at Oottwaldov) were Imported by Bolivia. The Bolivian government bought them from the importer and supplied them to the participantsational automobile race. The results were disastrous because the tires failed before the race was half completed. The Bolivians haveefund of the dollar price of the Czechoslovak, authorities apparently haveerlouo view of this complaint and haveission to La Pa* to Investigate. It has nlso been reported that Czechoslovakiaires to Communist China5 and lhat China protested that the tires developed longitudinal cracks ln the treads before they were put Into/

Early5 the formationooperative between the Czechoslovak and Polish rubber manufacturers was announced. Itswas lo improve both the quality of the products and the methods of manufacture. All tiro producers ln Czechoslovakia and Poland wereln this

Black.

Czechoslovakia has only one plant vhlch produces carbon black. This plant io located at Moravcka OstravaN -B) and Is known as Urxovy Zuvody. The plant rakes carbon black by burningyproduct of coal lor. It was reported toorkers0 and was operatingateons per year* Because Czechoslovakia requires0 tons of carbon black per year, lt obviously is heavily dependent on Importa to meet its needs.

Cord.

Czechoslovakia manufactures tire cord of cotton, rayon, and perlon. Rayon cord is exported to other countries of the Slno-Soviet Bloc in addition to being used for heavy-duty tires mode ln Cotton cord is produced at the Svit National Enterprise at/ Rayon cord is produced in the recently built rayon plant at Senlca, No Information has been published on production at either of these plants, although Svit was reported to have producedons of cotton cord

5 The First Five Year Plan of Czechoslovakia calledroduction schedule for carbon block in tbe leather and rubber industryonsons7 tonsonsons Therevidence that these goals wt-re met.

-

oute making some tire cord

ESS r

Tons)

idvire.

Czechoslovakiaarge steel industry aod

SoS itsi"-bJ^V?

Gc^nv W but also "Parted large quantities toC.re^ ferw-,ntSCzeehosJovakia in

Tons)

Hontransportation Goods.

has longanufacturer or all tvnes

tl/T belting, hose, and Industrial

and sanitary items. No data have been published on the volumeor value

-

illion toillion pairs per year. There is no method ofthe volume or value of other rubber products made.

5- East Ocnaany.

a. General.

One of the most serious shortages experienced by the Germane in Worldaa that of rubber. Consequently, Germanyioneer in the developmentatisfactory synthetic substitute. Before World War II, production of synthetic rubber had Increased more0 tons per year, and this amount was expanded rapidly during the war. The principal producer vaa. parben plant atocated in what Is now East Germany. Besvy air raids* reduced productioninimum, but lt vas Increased as soon as the fighting/ The Soviet dismantling of industrial facilities8 again reduced plant capacity. When the USSR gained political control of the country, rehabilitation of the chemical and rubber plants received high priority, and production at Schkopau haa progressively Increasedshown in The Second Five Yearf East Germany calls for the expansion of production0 tons per year/

5 the German rubber plants vere located principally ln the area which is now West Gc runny. With tbe partition of the country the USSR was faced with the task of building up capacity to make no tor vehicle tires, beating, hose, footvear, and other rubber/ For most rubber products, capacity appears to be adequate to meet tbe minimum domestic requirements. In the field of motor vehicle tires,erious shortage still exists.**

Because the plant at Schkopuu vas one of the moat Important chemical plants In East Germany, lt was among the first to be organizedtnte-ovned company (Sowjotlschc AktiengesellschaftAG)after the USSR gained control of the country. * it vas returned to East German control to be organizedeoples-owned enterprise (Volkseigener Betriob/ Operation of the plant ls officially controlled by the Ministry for Heavy Industry, which also supervises the production of aotor vehicle/ Therubber produced is distributed by two agencies: the DIA Cheoie (Deutseher Innen- und Aussenhandcl ChcmleGerman Domestic and Foreign

* elow. ** Sec III,elow.

-

Trade forhich handles priority export shipments, and the DHZ (State Administration for Materialhich allocates synthetic rubber to domestic consumers. Planning the distribution between domestic demand and export is done at the ministerial level and Is the result of negotiations among the Ministry for Heavy Industry, domestic consumers, and the Soviet authorities.

b. flatural Rubber.

East Germany is the only European Satellite which has shown no interest in the domestic production of natural rubber. As far as is knowD, no attempts have been made to grow any of the rubber-bearing shrubs or vines. esult, the country is wholly dependent on imports to meet its requirements.

c. Synthetic Rubber.

As previously mentioned, Kaot Germany is the chief producer of synthetic rubber In the Sino-Soviet Bloc. The only producing plant, located at Schkopau,rocess developed by the Germans, based on the conversion of acetylene lOj/ (obtained from calcium carbide) to Tlie latter is mixed with styrenc derivedoal-tar product, and the mixture Is polymerized. Thus tlie basic raw materials of the process are calcium carbide and coal tar. In addition to these, other organic chemicals may be used to make an oil-resistant synthetic rubber. It is significant that manufacture of the German products is based on the use of heavy chemicals as raw materials, in contrast to the Soviet process which is primarily dependent on alcohol derived from foodstuffs, such as grain and^potatoes. The estimated production of synthetic rubber in East Germany0 is shown in Table 9-

Table 9

Estimated Production Of SyntheticEastandTons

Year Production

0

1 b/

7 cV

5 t]

0 e/

IT. 7

b. /

c- /

-

d. Reclaimed Rubber.

Ho statistical information has been published2 on either production or plans for production of reclaimed rubber in Bast Germany. Because of the severe shortage of motor vehicle tires in East Germany,t is believed that production of reclaimed rubber has not kept pace with other sectors of the rubber industryold tires are the principal raw material for making reclaimed rubber, and even old tires are scarce in East Germany. The manufacture of reclaimed rubber is carried outart of the production operations inplants, so reclaimed rubbercaptive" product. Consequently, lt does not appear ln East German statistics as an end product. Estimates of production are therefore based on previously published Information, the growth of the rubber industryhole, and the probable availability of raw materials. The estimated production of reclaimed rubber ln East Germanys shown in the following tabulation*:

Tons)

Tons)

Transportation Goods.

Therelants making motor vehicle tires in East Germany,f which were ln production/ Because more thanercent of the rubber fabricating capacity before World War II was located in what is now West Germany, production of tires was seriously inadequate in East Germany, not only to meet consumer demand but also to supply tires for the Soviet occupying forces. In an effort to relieve this shortage, new equipment vee added to existing tire plants as well as to other

* For further information, see Appendix A, Methodology. Estimatesre taken from Estimates4 arc basedominal increase above those te4 the authorities in East Berlin putcrap rubber drive to get more old tires for/ It Is assumed that this effort would result in an increase in available raw materialesulting increase in production

-

rubber fabricating plants. In Bpite of the rapid expansion which haa taken place, the supply situation is still serious. In official market analyses, mention Is made of vehicles being "Idle due to shortage of/ It was estimated In Wov4 that lo spite of increased productionhere wouldhortageillion tires at the end of that/ The Second Five YearO) of ICast Germany callsapital expenditureillion East German murks (DMB) for the expansion of the tire/roduction goalillionillion tiresKO/

stimated production of motor vehicle tires in the European Satellites, by country and by plant,5 is Bhown ln"

f. Carbon Black.

East Germany produces little or no natural gas and so has developed other materials as sources of carbon black for its rubber Industry. The principal basic material is acetylene gas generated from calcium carbide, which, when burnedontrolled supply of air,orm of carbon called acetylene black, which can be used to reinforce rubber. Although acetylene black docs not produce rubber compounds with the high resistance to abrasion which Is achieved with gas blacks such as are made in the USSR and Rumania, it nevertheless can be used for most rubber products. Acetylene black also can be used toubber compound which is electricallyroduct which has several^strategic uses. For this reason, East Germany exports to other countries of the Sino-Soviet Bloc some acetylene black In exchangeonventional type of black needed for tire treads. In addition to acetylene black, East Germanymall amount of carbon black by burningyproduct of coal tar which has Halted Industrial use. The resultant product lo similar to channel black made from natural gns. Production fran this source is small.

After the USSR and Rumania, East Germany Is the largest producer of carbon black In the Sino-Soviet Bloc. Production isIn three plants. The estimated production of carbon black ln East Germany, by plant,s shown in

Tableollows on p.

Tableollows on (Text continued on)

-

ami

I!ds!

| m

(lift*

fill I

Iff! V

i!

6 ct ii lit if

6i! I!

hif fl

if I

If ss If!

IS

!

E as ?

lb lb o

w 5

b b

I f

I,

e. bl I

Its N

is, I

BK. IS

Tire Cord.

East Germany produces large quantities of both rayon and perlon but haa no domestic production of cotton. Consequently, all tires produced in East Germany are made with synthetic fiber cord. Analysis of yearly plans showe that simple supplies of rayon and caprolactum, the raw Material for perlon, are available. Actualof rayon tire cord*ons, and planned production of perlon cord for the same year/ Planned production5ons of perlon cordons of rayon/

Analyses indicate that tires for passenger cars comprise aboutercent of the total production of motor vehicle tlree ln East Germany. In estimating consumption of tire cord in East Germany, It therefore can be assumed that the average tire willeg of cord, based on an averageg of cordassenger-car tiregruck, tire. The estimated consumption of tire cord in East Germanya shown in the following tabulation:

Tons)

Beadwlre.

East Germany producea aboutercent of its requirement* for beadwlre and is dependent on Import* for the remaining/ Available Information indicates that there ls an over-all shortage of steel wire In East/ Based on the cumber of tires produced, an estimate of the steel requirements of tbe rubber industry in East Germanys shown in the following tabulation:

Tuns)

-

i. Wontransportation Goods.

East Germanyide variety of nontransportation consumer goods, such as footwear, conveyor belts, rubberized fabrics, and rainwear. Except for footwear, few statistics are available on the volume of these products. Production of conveyor belts was reported toillion square metersillion square meters Most of these conveyor belts are exported to other countries of the Sino-Soviet Bloc.

Production of footwear has increased graduallyut production Is apparently considerably below demand. Statistics are not entirely satisfactory since "footwear, boots, overshoes, and overboots" appear with disconcerting duplication. The estimatedof footwear in East Germanys shown ln

Table 12

Estimated Production of Footwear in East Germany

Thousand Pairs

a>

planned) b/

/

gT

h.

(planned)

(planned)

(planned)

pJ

hi

demand for rubber boc-ts and shoes in East Germany has been estimated toillion pairs per/ It seems probable that production is limited somewhat byhortage of equipmentack of rubber.

-

6. Hungary

i. Gone rai.

Before World War II, production of rubber products ln Hungary represented onlyercent of its Since the USSB gained control of Hungary, the rubber Industry haa been expanded at about the sane rate as other Industries. Tbe plants were in private hands before the war, but they wereln9 and placed under the control of the Mainfor the Rubber Industry. The First Five Year Plan ofalled for expansion of the industryercent9 Actual production* was announced by the Minister of the Chemical Industryercent of that/ ress statement mentions an increase/

Rubber.

Hungary is dependent on Imports for its supplies of natural rubber. Importa were valuednd7 the value/ In an effort to reduce this burden of foreign exchange, Hungarian planners proposed to grow kok-saghyz, using seed supplies under the Soviet-Hungarian trade agreement Much publicity was given to the programith promlBes of large financial returns to bo realized from gj-owlng kok-saghyz. The First Five Year Plan calledcres to be under cultivation Nothing has been published or. the renultB obtained from this grandiose scheme, and it is doubtful If there ia any significanttoday.

During World War II tlie Oerrana started the constructionynthetic rubber plant in Hungary, which was to be the largest of Its kind outside of Germany. The plant never got into production, and the Hungarians have since converted the plant to other uses.art of the developmentetrochemical industry, the USSR planned to produce synthetic rubber which used natural gesaw material. oint Hungarian-Rumanian company backed by the USSR was formed for this purpose, and construction was reported to hove startedlant located atlose to the Hungarian-Rumanian border. Planned production6 was said

- 39

to0/ It is believed that construction of thia plant is lagging because parts of it are only now reported to be under construction. ater report states that production will start during the Second Five Year Plan of Hungary/

d- Reclaimed Rubber.

Only one plant reclaims rubber in Hungary, and because lt consumes this material in Its own operations, no production statistics are available. Because of the severe shortage of tires that exiBts ln/ and the consequent use of tires until they areworn Out, lt is doubtful if the necessary raw material is available for an extensive rubber-reclaiming industry. The estimated production of reclaimed rubber in Hungarys shown in

Table 13

Estimated Production of Reclaimed Rubber lu Hungary a/

Metric Tons

Year

0

.

3

5

N.A.

Estimatesre taken from Those45 are based on an expansion of total rubberin Hungary.

-

e. Transportation Gooda

There IB only one manufacturer of motor vehicle tires ln Hungary, the Elaoe Magyar Ruggyantaariigyar Rubber Plant located in Budapest/ It was established before World War IIungarian subsidiary of the Dunlop Rubber Ccrapany of England and vas considered to be one of the finest tire plants In Europe. The plant vaa seized by the USSR and ls operatedtate-owned enterprise. The Importance vhlch la attached to this vaa indicated by the report that9 the rubber industry of Hungnry vould0 tone of coal as fuel, of vhlchercent would be assigned to this/ STie plant alsoide variety of other consumer goods and was reported toGOO eaployees In/ The estimated production of motor vehicle tires ln Hungaryhown In

Table 1*

Estimated Production of Motor Vehicle TlrcS in Hungary

Year Production t

0

3

5

Production

160

180

b.

f. Carbon Black.

Since the end of World Warngary has producedamount of carbon black in conjunction vith its natural gas:.r. Inl-jutriea./

-

Llapesrcntadorjanhich was reported tocuapacity and to be very/ odern plant wae scheduled to be built2 near the city of Nagykanizea!hlch was planned to satisfy the domestic demand for carbon black and provide some black for/ Ho published reports have been received which would Indicate the completion of this plant or any exports of carbon black by Hungary. For these reasons, it seems probable that Hungary is still dependent on Imports for its major requirements for carbon black. Production at the Llspeszeotadorjan plant, from descriptions of the facilities, is estimated toons per year, compared with an estimated demandons per year.

g. Tire Cord.

Although both rayon and cotton cord are consumed in Hungry, the domestic production of rayon is of such poor quality as to preclude Us use ln/ For this reason, rayon cord is Imported. In the third quarterungary purchasedons of rayon cord from one firm ln/ It was reported that early* Hungary was purchasingons of rayon cord per month from the Enka Company of the/ Ho shipments or perlon or nylon cord into Hungary have been reported, nor Is there any known domestic production of these materials. Hungary's requirements for tire cord, based on its estimated production of tires, is shown lo the following

tabulation: .

Year (Metric Tons)

675

900

975

h.

Hungaryomestic production of steel wire adequate to meet the requirements of its rubber Industry. VJO/ Unlike the USSR, Hungaryopper-coated wire for making tire beads. Consumption of beadwire in Hungarya onown In the following tabulation:

- U2 -

Consumption Year (Metric Tone)

200

205

220

1. Hontransportation Goods.

Motor vehicle tires are estimated to account forone-half of the rubber consumption in Hungary, other products being footvear and rubber soles, iudustrial goods, and sanitary articles. Only fragmentary information is available on the production of individual items. Estimating production of rubber footwear Is difficult because Hungarian statistics include leather sandals with rubber soles in the category of "rubber footwearOne report0 stated that production of rubber shoes9airs, comparedairs/ Statements by government officials indicate that the total production of all types of rubber footwear9 was6 million pairs. The First Five Year Plan called for an increase ofercentbove the levelajor expansion, of the footwear industry was undertaken2 This expansion resultedharp Increase in the production of all types of footwear- Government statistics during the First Five Year Plan have not differentiated between rubber and leather footwear; hence the figures in* showing the estimated production of rubber footwear in Hungary, have been developed from the announced production of all types of footwear, assuming the same proportion of rubber shoes thut prevailedroduction of rubber footwear5 was reported toercent above that/

The First Five Year Plan also called for an increaseons of industrial rubber goods4 above that/

7 Poland.

a. General.

Before World War II, Polandelatively large rubber Industry with aboutlants employing0 workers who

5 Tableollows on

-

Table 15

Estimated Production of Rubber Footwear in

Million Pairs

Year

ide variety of S these plants were operating at only aboutercent ortpaclty because of tne shortage of raw material-,. The postwar Three Yearf Poland called for the restoration of the industryercent of the prewar levelnd great exponsioZwas planned ror lhe

tires was to" cwaw

otion of footwear was to reachillion pairs No specific announcements have been publishedhe aecompluiunent of these objectives. As of6 the current Five Yearad notublished In detail, buV it is known to include further expansion of the rubber fabricating industry . tionynthetic rubber plant 'ontinues to operate with Sported rawnd is able to meet domestic requirements for rubber props'

b. Natural Rubber.

Poland has made some postwar attempts to growbut no publicity has been given to the project sincerocessing plant was included in the Six Tear Plan, but it is doubtful if this plant was built; no mention has been made of It in the Polish press. It seems probable that the plan to grow kok-saghyz has been abandoned.

- I* -

c. Synthetic Rubber.

Just before World War II the IG Farbon Companylant at DebicaN -E) to produce synthetic rubber. This plant vas not in operation at the end of the war, and thevas shipped to the USSR. Plans for the reestabllshment of the plant were presented in the Six Year/rojected productionoos3oal0 tons/ Although several announcements have appeared concerning the success of the rubber products industry of Poland, no publicity has been given to the production of synthetic rubber. It Is therefore believed that accomplishments to dote have been far below the announced goals.

1 the Polish government announced the projected building of another synthetic rubber plant, at OswiecimH artarge chemical combine which included extensive facilities for making calciumaw material neceBBary for the German process of manufacturing/ According toreports, machinery for the plant was Imported from East Germany early/ although the Polish press staled that two-thirds of the equipment was imported from the USSR and that the remaining one-third was to be made in/ The plant is planned to be in operation/

Auother small plant, located atas built Just before World War II to make "thiokol"pecial type of rubber vAich is oil-resiatant but of slight value for general-purpose use. This plant reportedly hud an initial capacityons per/ It was taken over by the government6 and has operated intermittently since that time. Production apparently is limited by the difficulty of obtaining the special raw materials needed for the operation of the plant. Tlie plant was not ln production in

revious report lOh/ included estimates ofsubsequent evidence seems to indicate that production of synthetic rubber in Poland le 6tlll limited to experimental or pilot-plant quantities, with total production being lessons per year. The most recent document received Indicates that there will be no commercial productionhen it Is expectedons will be/ 'Ihis figure Is expected to rise0 This information was giveneeting held in, attended by the Soviet members of CEMA, and is believed to be based on reality rather than on propaganda.

-

-SBC R

A. Reclaimed Rubber.

The Three Year Plan of Poland Included tne erectionlant for reclaiming rubber, which wouldapacityons per year. It la doubtful If thla capacity was realised.

Since World Warecond plant for reclaiming rubber has been built at KoloNut It was reportedly completely destroyed by fire* and had not beenear/ In addition tolants, atf theplants located at KrakowH -K) ond LodzN -E) reclaim old rubber, using tho reclaimed rubber In their finished/ The estimated production ofrubber In Polands shown in

Table 16

Estimated Production of Reclaimed Rubber in Poland

Metric Tons

Tear

j

1

he range of error ia plus or mlnuoercent.

Transportation Goods.

Two oflants producing motor vehicle tires ln Poland we established with the aid of US capital. The Stomll plant, located attarted making tlreieized by the Germans in World War II and haa been expanded several

-

tines plant was scheduled to

tons of, products of all types, and2 lt reported the production0 tona of/ The plant was reported toires Inhich would be equivalent toires perhe Stomll Tire Plant No.ocated at Debica, alao built with US assistance, began production It was designed tolreB per day but never reached It waa completely demolished during World War II, vaa rebuilt with machinery from Germanynd began production againurlthe expansion to be carried out under the Six Year Plan, the plant Is being greatly enlarged with machinery from East/ Upon completionhe Stomll Tire Plants planned to be "the largest rubber plant in EuropeIg5_/

The third motor vehicle tire plant, located at PlockNas been under construction for several years and was to be completed/ No Information has been published to indicate that production had started or what volume was being produced. The estimated production of motor vehicle tires in Polandshown in*

f. Carbon Black.

Two Polish plants produce carbon black from natural gas. These plants vere built under the supervision of the USSB afler World War II and wire reported0 to beotal ofona per/ Another carbon black plant, located at Gleivittwaa built by the Ccrmana before World War II. This plant produced carbon black by burningnthracene and naphthaleneandated capacityons per month. It was dismantled after the war, and the equipment was removed to the/ Later lhe plant waa partially restored and was reported to have started production Ineported capacity laons per/ Because Poland's requirements are considerably below the Indicated annual productionone, lt la able to export carbon block to other European Satellites.

Tobleollows on

-

Table 17

Estimated Production of Motor Vehicle Tires in Poland

Thousand Units

Year

b/

no official announcements haveconcerning the accomplishment ofYear Plan goal for production ofare necessarily based onand probable rates ofrange of error ls.plu3 or minus 10 Estimatesrc

6- Tire Cord.

Poland has facilities for producing cotton, rayon, and perlon (called "steelon" io Poland) tire cord. 7 it vas reported that cotton cord vas being used In conjunction with rayon breakerractice followed ln the US when rayon was priced too high to permit its exclusive use in motor vehicle tires. 1 it was reported that rayon cord was being used extensively for/ The Debica tire plant was reported to be planning lhe production of lubcless tires7 and8 to be making tires with steelon/ Based on Poland's estimated production of tires, coosuinptlon of tire cords shown in the following tabulation:

-

. 'z.

Consumption Year (Metric Tons)

h. Beadwire.

Poland's requirements for beadwire represent lessercent of Its production of steel wire. 0 it was reported that0 tons of wire lessillimeters io diameter were produced at tbe Koscluszko Iron and Steel Works in/ The estimated consumption of steel in production of beadwire in Polandfi shown ln the following tabulation:

Consumption Year (Metric Tons)

l. Nontransportation Goods.

Before Wonld War II the rubber Industry of Poland, which employed0 workers, was characterized by an emphasis oo production of footwear, which was eald to account forercent of the production of the industry, in contrast to only l6 percent for cotor vehicle tires. In the worldwide industry, footwear amounts toercent and2 percent. Industrial, sanitary, aod other consumer goods constituted less thanercent of production ln Poland. In the postwar period, as Poland has become more highly industrialized, the rubber Industry has had to realign its production to meet the shift ln demand. Byires had risen2 percent of the Industry's production, and footwear had decreased to/ The current Five Year Plan calls for further Increases In production of tires and technical goods and lessof footwear.

In effecting this change the PoliBh planners have had to make the most efficient use of the small supply of experienced personnel and to establish training schools for additional workers. They have also received technical assistance from Soviet experts in an effort to improve production methods and the quality They plan to Increase greatly the use of synthetic rubber, which5 accounted for onlyercent of the new rubber used In/

For nontransportatloQ gOodB the only specific figures available are those for rubber footwear. The Six Year Plan called for Uie productionh million pairs of rubber shoeshis goal was said toercent above production 5 it was reported that the goal for production of footwear would be exceeded8/ An early report stated that production9ercent above that in heproduction of footwear In Polands shown in.

Table 16

Estimated Production of Footwear in

Million Pairs

jeer

8. Rumania.

a. General.

Before World War II the rubber Industry of Rumania was very small. Except for carbon bluck, the necessary raw materials were It was estimated thatubber constituted one-third

-

of the value of all Imports into/ Production was confined largely to footwear, raincoats, and other consumer goods. The first plant for mailing motor vehicle tires vae established6 vith the helpS/ During the war, Germany organized another company to make tires, thereby Increasing its war supplies. Since the USSR assumed economic control of Rumania, efforts have been made to expand the rubber industry to meet domestic requirements, vhlch vere the basis for the planned expansion during the First Five Year Plan of The Plan calledillion lei, the equivalentillion at the time the Plan vas formulated, to be invested in'the induitry/

The production of synthetic rubber la the responsibility of the Ministry of the Chemical Industry. The nanufacture of rubber products lo controlled by the Rubber Center of the General Directorate of Leather andart of the Ministry of Light/ Worn rubber products, such as old tires, are collected by the Directorate of Collection and Acquisition for conversion Into reclaimed/ Tlie Ministry of Industry and Commerce controls the distribution and sale of tires, which are strictly/ Tlie purchase of Uie necessary rav materials, which are Imported, ie handled by Chinlmport, and the import of finished rubber products la bandied by TVchnoliaport.

b. Rubber.

In an* effort to reduce import requirements for natural rubber, Rumania has undertaken the production of rubber from kok-saghyz. Under the terms of the Soviet-Rumanian Trade Agreement ofhe USSR was to supply Rumania withg of kok-eaghyz/ fromons of rubber were reported produced This production teens highly Improbable, because the amount of seed specified would be sufficient to plant only aboutectares, which ln turn would produceons of/ There have been no later reports of production, and although the industry may still be ln operation on an experimental baa la, lt Is doubtful if lt laignificant contribution to Rumania's rubber supply. Ft le probable that the program or kok-oaghyz cultivation has been abandoned because of ito slight potentialities.

-

c. Synthetic Rubber.

Rumania haH been Interested in producing, synthetic rubberart of its plana for the developmentetrochemical industry. Although numerous references Lave appeared concerning production of synthetic rubber, lt teems lifcely that such produciion is only on an experimental scale. The cost reliable reportlant inhichons of synthetic rubber In? and plwned to produceons in/ Another plant is reported to be located In Ploesti, but no details of its capacity are/ On the otherress report of5 stated that "more attention must be given to the scientific problems connected with the production of synthetictatement which would indicate that the industry is cot In commercial production. No mention of synthetic rubber was made ln the First Five Year Plan, but the Second Five Year Plan ofalla for the establishmentynthetic rubber industry to increase productionoleone per year, with production0 tone/ On the basin of the available information, lt is believed that production of synthetic rubber ln Rumania is atllln experimental basis and probably is lessons per year.

d. Reclaimed Rubber.

Rumania has been interested for boec time ln the production of reclaimed rubber. As previously mentioned, the collection of worn rubber products Is the responsibilityovernment agency, and tbe motor vehicle tire plant atE) has been reclaiming rubberart of its operations. The First Five Year Planillion lei (equivalent to aboutillionor the erectionubber combine at JllnvaN -south of Bucharest, which would reclaim rubber and produce footwear, belting, hose, and other technical articles. The reclaiming equipment (reportedly outdated machinery) was to come from the USSR, end the plant was to be completed/ The reported capacity0 tons per month is obviously an error, because Rumania's requirements for reclaimed rubber would be lessercent of this amount and because lt would not have raw materlala available to produce such an amount. adio report of5 reported that this plant

On the basis of the consumption of

new rubber ID Rumania, lt is estimated that the production ofrubber would notons per month, even when the new

-

e. Transportation Cools.

Rumania has two plants producing motor vehicle tires. The first plant, built6 with the aid of US capital, Is located in/ It was called the Banloc Rubber Factoryhen the*liame was changed to the Victory Chemical/

reported capacityires per day, but becausehortage of raw naterials, production Is probably much less than this figure. The other plant Is the Rubber Products Factory located at Orasu/Stalin

hich vas built by the Germans4 to produce tires for military vehicles. 0 the capacity of this plant was reported toires per/ but actual production probably is Bomewhat leas than this figure.

The estimated production of motor vehicle llres in Rumanias shown ln

Table 19

Estimated Production of Motor Vehicle Tires in Rumania

Thousand Units

0

IT eduction

Estimatesre taken from. /

f. Carbon Black.

Rumania has longroducer of carbon black, Its production being closely associated with the petroleum and natural gas Industries. Production8 was lessons, and carbon black vas used largely as pigment for paints. Inks, and the/ Rumania

-

mall channel-type plants locatede natural bus region, but bcctise production decreased sharply In? of these plants are believed to have been damaged during World War II. It ls believed, however, that these plants vere rebuilt. our plants were rcpc-icd to be In operation. These plantsotal annual capacity of/ 32 the USSR instigated the construction of seven modernlants to use the large reserves of natural gas. Equipment for these plants, located atasted to have been sent toby the/ Each plant li estimated to have an annual capacityons. Another facility fa? making carbon black. Which vent into productioneei reported at Satu-Mare/ and Is believedproduceons per year.* There have beeneferences to Increased capi-ity in tba carbon black Industry of--sola during theatrs; hence It Is believed thatas been stabilized at0 tona per year. Because cbrbot black plants normally operate at maximum capacity andontir.cus basis, anyIncrease In production can be acco-ipil ir.ed only by theof additional facilities.

g. Tire Cord.

Rumania produces its docwostlc or cotton tire cord nnd inas reported toing vith tho productionyon/ These attempts apparently were not entirely successful. In"n offieiaL of Poranoe/^ort was attempting to purchase as muchons ofrc :crd per/ There have been no recent reports of production o* rayon cord In Rumania. Runar-la's requirements for tire cord, baaed on Itstire production, are shovn Inoliovltsg tabulation:

Requirements Year (Metric 'ions)

"

Pririuctlonas reported to have6j

-

h. Brady ire.

Rumaniaajor producer of steel wire. Its two steel producing plantsombined annual production of moreone, and both plants have facilities for drawing high-carbon steel/ As can be seen from the following estimates,of ate*el wire by the rubber Industry Tor beadwlreractionercent of domeotic production. The conaumptlon of ateel wire for beadwlre in Rumanias ahoVD lQollowing tabulation:

Consumption Year (Metric Tons)

1. KQr.transportatlon Goods.

In addLtion toire plants mentioned, Rumanialants which produce industrial goodslant which produces sanitary and surgical/ Also the largest shoe factory In Rumanie was to be supplied un3e7 the First Five Year Planillion lei3 million) for equipment to make rubber soles.There is little information available on actual production of loot-wear. The Rumanian Chemical Works Rubber Factory in Bucharest waa scheduled toairs of rubber shoes/ and the First Five Year Plan called for national productionillion palra This figure waa raisedillion on/ There have been no announcements as to tbe success of the Industry In meeting either of theae goals.

9. Cccsunlst China.

a. Gere rai.

Before the Japanese Invasion of China in thes, the Chinese rubber industry was primnrlly engaged in the production of footwear aad of tires for bicycles, jinrickshas, and carts. Raw materials, except cotton fabric, were Imported. Numerous smalleachew employees using primitive methods, were responsible for most of the production. ew larger plants, moot of which were located in the Shanghai area, used more modern methods.

-

The demand for sanitary gocds, motor vehicle tires, and hose was small, and investment ln the machinery needed to make these items was not warranted. For this reason, such rubber products were

With the Japanese invasion the pattern of the rubber industry of China changed. The invadersarge modern plant and equipped other plants with Japanese machinery to supply their military needs. These plants were organized ss branches or Japanese rubber companies. Some of the small handcraft plants were allowed to continue operationsestricted basis. No detailed information on the industry during the Japanese occupation is available, but it is known that small supplies of rubber and of Other raw materials confined production to an austerity basis.

Motor vehicle tires (thousand units) Motor vehicle tubes (thousand units)

M I I

Afler World War II, production of rubber was one of threeight industry which enjoyed relative prosperity. (The Other two were textiles and flour milling.) The small plants vere retained by their owners, whereas the large plants formerly operated by the Japanese were taken over by the Chinese Nationalists Limited availability of foreign exchange hampered the import of raw materials and curtailed production. Nevertheless, by 1QU8 it was est'.Tualed that the rubber industry of Coruramist China had the following annual capacity 2'i3/:

tubea

3 evr !' a"On

Ihcef

When the Chinese Communists came into power9 the rubber industry practically ceased operations becauseemporaryof raw materials, ZkU/ the result Of the confusion irTpelping and the more pressing problems of the new rulers. 0 some order oegan to appear, and restoration of the industry was'begun. The plants were placed under the Ministry of Light Industry. Direct supervision is maintained through regional bureaus which control all of the industrial facilities ir. their respective adminlstra-

inICJta?ufaclure ofProducis appears to have been one of the activities selected by the Chinese Communists to be

-

nationalized. Because the Chinese Coemunlsts controlled imports of raw materials, they were able gradually to eliminate the smaller and less efficient manufacturers. Larger plants were seized for taxes or reorganized into joint state-private enterprises. By the endrivate enterprise had almost ceased to exist in the principal centers of rubber

The rubber industry of Communist China is plagued with serious problems which it is attempting to correct. One of these problems concerns the quality of product. Many reports are received indicating an average service life for motor vehicle tires/ and footwear laot6 lessonths. At an annualcommittee meeting held in Peiping duringesolution was passed to increase the life of tires00 km, to extend the life of rubber shoes by/ and to reduce the price of rubber shoes byercent- , shoes were priceder dozen pairs, wholesale. At the same time, truck tires were advertised at the equivalent oficycle tire and Inner tube cost. By contrast, workerb in the principal rubber plant ln Tientsin were paid00 per month, the latter beingubsistence level/

b. Natural Rubber.

For years the Chinese have attempted to raise rubber trees on Hainan Island.tmall amount of rubber was beinp. produced before World War II. The plantations, however, suffered considerable damage during the Japanese occupation. Reports vary in detail as to tlie situationhen the Chinese Communists gut tied control of the area. There probably werelantations, each of whichsa average ofon of rubber per/ The Chinese Communists announced an ambitious program for plantingillion additional trees, which would ultimately yield0 tone of/ Some of these trees were to be planted on the Lutchow Peninsula- Technicians were sent to the area, and workers werefree, the cities to clear the land andhe seedlings imported from Burma and India. 2Jn/ Workers were reported to receive the equivalent of $l4er month,eductedeals per/ ears of effort, apparently it was realized that the project was doomed to failure. The soil on the mainland was poor, and the drafted labor used proved inadequate for the Job. Returnees45 reported that most of the trees had died and that the

-

workers vere diverted to other/ Tlie most recentby the Chinese Communists have listed several projects for the development of Hainan Island, but no mention has been made of growing rubber. undamental reason for the failure of the program probably is the fact lhat the area is too far north; the practical growing area for rubber is considered to be withinegrees of the equator.

It is estimated that production on Hainan Island is still lessons per year, with little prospect that this figure will increase materially

c. Synthetic Rubber.

The only attempt to produce synthetic rubber in China vas made by the Japanese-owned Manchurian Synthetic Rubber Companyut production never exceeded experimentalJ Thefrom the plant, located in Kirin, was shipped north by the Chinese Communists, and the facilities have not been/ The Chinese CocEfiunists have shown an interest inlant and may, with the help of Soviet technicians, realize this ambition, but.lt is doubtful if the plant could be built and in operation At present, requirements for synthetic rubber must be met by imports-

d- Reclaimed Rubber.

For many years, China has imported large numbers of old tires for processing Into reclaimed rubber. The processing was carried outew large pAnts making consular goods, and statistics onhave never been published. I the Chinese Communists have built two plants specifically designed to reclaim/ One plant built in Shanghui was scheduled to go into production in5apacity ofld tires per year (equivalent toons of reclaimed/ Another plant built in Mukdea (Shen-yang) was reported to hoveercent of its machinery Installed In* and was scheduled to start operating No Information was given On its/ In view of the fragmentary information available, it is Impossible toeasonable estimate of the total production Df reclaimed rubber in Communist China.

-

e' Tran sports t! on Cools .

As previously mentioned, the Japanese established theof motor vehicle tires in China. Almost the entirewas ofnch size to fit military vehicles. When the Chinese Nationalists took over the government, they started the production of other sizes, and later the Chinese Communists began production of aircraft and large bus tires, and today many sizes are in production.

When the Chinese Cttranunisls gained control of Northeast China the major tire producer was the former Japanese Bridgestonc Rubber Factory* in Tsingtao, and this plant continues to be the largest producer. Other tire plants were located ln Shanghai, Tientsin, and Mukden. The announced goals of the First Five Year Plan of Communistncluded the constructionire plants and an increase in productionires2ires/ It is probable that two of these new/ are located at Peiping end Mu-tan-chlang. In addition, it was announced4ire plants had been undergoingn Northeast Chinan East China, and it was expected that production would be doubled in these/ Tliese expansions are believed to have taken place in Tientsin nnd Mukden. Equipment for this added capacity is reported to be corning from Czechoslovakia, East Germany, and the/

Annual announcements of production/ are sufficient toairly accurate estimate of the total production of tires in Communist China. The estimated production of motor vehicle tires in Communist Chinas shown in

The estimated production of motor vehicle tires lnCnina, by plant,s shown in*

f. Carbon Black.

Communist China's domestic production of lamp black, which is made by burning tung oil and similar materials, ia not suitable for making tires, but it can be used in some nontransportation goods.

See. 6l, below Tableollows onableollows on p. 6l.

-

Table 20

Estimated Production of Motor Vehicle Tires in Communist China

Units

25

62

ion

225

/

/

/

/

Supplies of carbon black, therefore, are essential for tiro plants ln China. Because the US produces more thanercent of tho Western supply, China imported carbon blackuality needed for tires from the UShen restrictions were placed on this trade by lhe US. hrlvlng business in/ through lloug Kong and Macao then developed because the Internal price of US-made carbon black rose to0 per ton, moreer pound, comparedS price ofl6 per pound. Snuggled supplies were Inadequate to meet requirements; hence the principal source was the countries of the Soviet Bloc. Soviet carbon black has been reported lo be valued at3 Per/ 0 thealsorogram to produce carbon black from domestic sources.

Large amounts of gas escape into the air from the coal mines ataotung Province. lant was constructed at Fuehun to collect the gas and burn lt to produce carbon black. The plant laby the Fushun Mining Administration und is reportedly producingons or carbon black per/ Another source which was exploited was the gas field at Lung-Ch'ang, Stechwan Province, which vas controlled by the Petroleum Administration General Bureau.

-

mm*

i hi

f ii

A channel block plant was constructed3 to make carbon blackroducing gae wells, and production was estimated to beons/ Construction of buildings and drilling of new wells have been reported to be continuing, with an ultimate production goal ofons of carbon blackhe carbon black plant was said to havemployees45 and was expected tohen/ Soviet technicians supervised the drilling and construction of the plant.

g. Tire Cord.

Requirements for tire cord in Ccoarunlst China seem to be net entirely by the cotton textile industry. Thia assumption isby the analysisJC tire which was captured during the Korean War. Tills tire was madehinese Communist factoryoviet tire mold and was made entirely of natural rubber with cotton/ Because Jet aircraft tires must withstand extreme service conditions, the use of cotton cord would Indicate that no better material was available.

5 trade agreement. Communist China Is to0 bales of Egyptian cotton from/ It is probable that come of this long-staple cotton will be used to make tire cord and textiles Tor the rubber industry.

The Tslngtao tire plant reportedly produces Its own tire cord Trom thrcad/obtained from the Tslngtao textile/ Also, the new rubber plant in Tientsin built by the Chinese Ccnuriu-nistaas reported to get Its fabric requirements from textile mills located ln There la no furtherindicating which textile mills are producing tire cord. It has been reported that Communlnt China Intends toayon and textile mill In Mu-tan-ch!ang,which would be able to produce the textiles needed byhber Industry; Mu-tan-chlang Is also the location of one of the new tire plants discussed above. The estimated requirements for tire cord ln Communist China, based on tire production, are shown in tlie following tabulation:

Tons)

5

62

h. Nontransportation Goods.

Footwear is the principal nontransportation item produced by the rubber industry of Communist China. Because the processhasandcraft operation, no exact figures can be given for production before the Communist regime. ootvear capacity vas estimated toillion pairs per month in the Shanghai area alone, aod this capacity was supposed to represent aboutercent of the total for the/ Because of the small supply of raw materials, actual production of footwear is believed to have been considerably below capacity. The Chinese Communists have made the following moves to organize Uie industry to Increase itsl) the gradual elimination of Uic small, handcrafthe concentration of equipment in largerhe adoption of standard methods of manufacture to eliminate waste of raw materials;) attempts to improve the quality of product by adopting quality stendards and interchanging technical Information ut conferences of tlie principal leaders of tile Industry.

0 the rubber industry of Communist China was reported tolants employing approximately/ ajority of these plants were making/ It is impossible to estimate accurately Uic number of plants or workers in the industry today because of the changes being made by the Chinese Communists. Nor is lt possible to make an accurate estimate of the production of footwear in the individual plants known to be still operating. Fromannual reports made by the Chinese Communist State Planning Commission, however, reasonably accurate figures can be given for the annual production of footwear Theproduction of footwear in Communist Chinas shown in*

B. Stockpiles.

Very little information is published on the stockpiling of rubber in the Slno-Soviet Bloc. When considering the Soviet stockpileossible source of supply, lt ls necessary to make certain basic assumptions because the final estimates can be reuched only by indirection. It is reasonable to assume the following:

nly natural rubber Is stockpiled. It is the Judgment of US experts that synthetic rubber should not be stored for moreears, whereas natural rubber can be kept for periods ofears

* Tableollows on p.

- 63

Table 22

Estimated Production of Footwear ln Communist

Thousand Pairs

Production Year

3

002 d/

e/

planned) g,

or more, depending on Uie original quality of the rubber andOf storage, such as temperature and humidity. Standard practice in tAe US is to store only the highest grades available and to rotate the stockpile by withdrawals within reasonable periods to assureigh-qualityeserve at all times.

2. Stockpiling, in Uie sense oftrategic reserve, is done only in Uie USSR. Because the control of natural rubber imports and its Intra-Bloc movementunction of/ it seems reasonable to assume that any strategic or military reserves are held within Uie geogranhic limits of the USSR.

3- Available information indicates that rubber compounding and application in the Sino-Soviet Bloc are similar to standard US practice. Tbe Soviet consumption pattern of natural rubber compared with that of synthetic rubber probably is similar to lhat in the US.

-

A leading authority on rubber has estimated that of the total rubber requirements in the US,ercent can best be met with natural rubber, regardless of its price. Aboutercent of the requirements need synthetic, rubber for best performance, and the remaining Ji2 percent can be met with either natural or synthetic rubber, depending on price and availability. These proportions do not represent actual consumption statistics in the US; natural rubber actually accounts for approximately *i0 percent of theof new rubber. It is probable, however, that the estimates given would be approximately correct for the Sino-Soviet Bloc.

It is reported, for Instance, that East German plants mok'.ng truck tires for the USSR are required to use all natural rubber for the tires andercent natural rubber endercent Buna rubber for the inner/ (US practice is to use fromercent natural rubber for the tiresercent butyl rubber for the Inner tubes.) It seems reasonable to assume lhat thisis followed in Soviet tire plants- There remains, however, the question of how much natural rubber the USSR actually consumes and how much it is able to set asidetrategic reserve, or stockpile.

According to an earlier/ imports of natural rubber by the USSR through1 would have permittedons of natural rubber. Later data show that2 the apparent available supply of natural and synthetic rubber0 tons mocc thon estimated in the earlier study. This increase would mean that lnsteud of the estimatedons available for stockpilinghe actual amount0 tons, which would increase the estimated stockpile as of2 to moreons.

. Soviet imports of natural rubber decreased sharply,0 tons, lower than in any year * the USSR imported almost no natural rubber through normal trade/5 it was announced that the USSR was again in the market torubber. Imports, however, did not start until about July, and the amount obtained was0 tons during the remainder of the year, less than one-half of the estimated Soviet minimum requirement. In contrast, the European Satellites continued to ii-port natural rubber in amounts approximating their estimated normal needs. It seems unlikely thathe USSR obtained significant amounts of natural rubber from the Satellites. On the other hand,

* Seeelow.

-

Communist Chinandoubtedly imported more natural rubber than was needed or could be processed. It was reported that under the Soviet-Chinese Payments and Credits Agreement concluded earlyhina was obligated to reeell to the USSRercent of the rubber obtained from Ceylon (under the rubber-rice barter agreement) andercent of that which was obtained/ If thiB report is correct, China would supply the USSR with natural rubber duringears as follows;0 tons0 tonsnd0 tonB If these amounts are added to Soviet purchases through normal trade channels, the Imports of natural rubber by the USSRould have been approximately as

Imports Year (Metric Tons)

On the basispercent requirement for natural rubber, the USSRons of natural0 tons more than was available from outside sources.

Because earlier estimates indicate that (stockpiling ln the USSR startedt seems likely that the deficit which existedos mot by removal of rubber from the stockpile. iming point of viewhat is, the necessity lo rotate some ofhis assumption seems reasonable. In addition, it would appear logical from the change which has taken place in the politicalin Communist China9 Geographically, the Chinese Communists are not farotential annual supplyCOO0 tons of rubber from southern Indochina. Thus the urgency to-ear supply In the stockpile 1bless than it was Also, under the Soviet-Chinese agreement, the USSR will receive an average of0 tons of nutural rubber per/ argeof natural rubber represents large amounts of hard currency, there is an additional economic reason for the USSR to keepinimum. Exactly what figure the Soviet planners have agreed on is not known, but the factors discussed above suggestons would be considered adequate for any emergency. S Air Porce/ lt was estimated that In the eventar the

-

Sino-Soviet Bloc wouldeficit0 tons of rubber during the first year of fighting.tockpileons would be more than adequateears.

In conclusion, it Is probable thathe USSB has been reducing Its strategic reserve of natural rubber0 tons per year. Soviet purchases since/ have been of the highest quality rubber, whichurther indication thatare being used to replace material being withdrawn from the stockpile.

In any event, itignificant that the Soviet policy ofnatural rubber through world trade channels and in amounts at least adequate to meet current requirements was changed early3 as shown in* The importance of this shift ln policy cannot bo assessed without more information. Purchases by the Sino-Soviet Bloc during the next few years may indicate whether the reasons vere economic or political. Also, information on similar shifts in the stockpiling of other materials may make possible seme firm conclusions OP. the subject.

C. Trade.

1 Natural liubber.

Because domestic production of natural rubber is almost nonexin-ent, the Aino-Sovlet Bloc must depend on Imports from the West to meet Its requirements- Estimated Imports of natural rubber by the Sino-Soviet Bloc, by country.rc shown in* The figures In Tablere based on the published statistics of the iTiternatlonal Rubber Study Croup (IRSG; in London, whichtatistical service covering the world movements of rubber. on the Bloc has been estimated on the basis of reportedfrom the principal rubbers the most accurate available. Ho statistics are published by the BSC on estimated shipments to East Germany.

Statistics on natural rubber imported by Coraraunlet Chinaroblem- Exports of rubber to China by members of the UN

arc proscribed because rubber Is conflidered totrategic material.

When" this prohibition was enactedeylon wasember of the UN; consequently, China began importing its requirements from

ollows on

-

t

'

Ceyloo. Total importsn shovn inere froa Ceylon. Late ln the sane yearountriesear trade agreement whereby China0 tons of rubber per year ln exchangeons of rice. JOT/ Consequently, the published statistics for theears represent shipments from Ceyloo to China. Actually, additional quantities have beenfrom Indonesia and Burma. The quantities shown in Tableeflect all known imports, China continues attempts to circumvent the control of rubber shipments by offering premium prices, particularly to Indonesia and/ where political advantage might be gained from such deals, even though China's requirements are less than its la-ports from/

Because imports of natural rubber must be purchased with hard currency, they represent en important drain on supplies of sterling In the Slno-Soviot Bloc. 2 the market value of rub-ber Imports by the USSR represented an estimatedercent of all Imports from the Vest. Later years. In which Imports were smaller,ecreasing value of these acqulsltione. The present trend appears to be for the European Satellites lo obtain rubber In exchange for manufactured products through trade agreements, thus reducing requirements for foreign exchange.

2. Synthetic Rubber.

The Sino-Soviet Bloc does not import synthetic rubber; on themall amount, supposedly from Rest Germany, was exported through Switzerland to the US in ons of synthetic rubber were Imported at New Yorkeclared value3 cents per pound. This is abouteiito per pound less than Ihc prevailing price ln the US.

3- Rubber Products.

Small amounts of motor vehicle tires are exported annually from Italy to the European Satellites, Statistics on the volume of this trade, however, are insufficient toeliable indicator of its/ These Imports are not believed lo constitute an Important source of supply for the Satellites.

k. Plans.

There is no mention ln the Soviet Sixth Five Yearf projected trade in rubber or rub'-er products. Information

- 69

is available, however, on the planned movements of these materials to and from East Germany5 lanned exports of synthetic rubber from East Germany0 tons, valued at aboutillion/ Thie amount represented aboutercent of the planned production6/ ast Germany la expected to0lightly more than one-half of planned production. Imports of motor vehicle tires were expected to0 tiresalued/ compured0 tires to bo imported/ Planned, imports of natural rubber and rubber products5 were valued atillion rubles,ercent of planned imports of chemicals. xports of synthetic rubber and fabricated rubber products were listed asalue ofillionercent of all experts of/

eeting of CEMA, held io East Berlin from l8 to/ detailed plans were made for the exchange of many chemicals and" rubber products within the Soviet Bloc. Shipments of synthetic rubber and motor vehicle tires between the various participating countries were forecast. Planned shipments of synthetic rubber and motor vehicle tires within the Soviet Blocre shown in* The approximate values of these exchanges have been derived froa thegiven above for East German trade

A study of the figures In Tablehows that East Germany ls to be the primary source of synthetic rubber for theecause exportB from the USSB are almostby Imports. The USSR and Czechoslovakia, however, are expected to supply motor vehicle tires to the rest of the Bloc. From the Incomplete data available on the trade in these products during the Fifth Five Year Plan period, it vould appear that these projected noveaenta conform to the general trade pattern which has prevailed in recent years.

* Tableollows on

-E-C

- Ii. -

. M

ftwawo0.1

<U

rs

=i

5mo3v (saivm lurouy cawrwiL) jvmtfflv (aoiqNI puoffnculj iimoay /JV-moonpojj

P- SPc, M

brfl-.v.

Ill. Consumption Patterns.

As explained In previousonsumption of rubber falls Into tvo major categoriesthat used in transportation goods and that used ln nontransportation goods. The uses of rubber lngoods arc many, so the potential demand ln this field Is almost unlimited. The demand for rubber ln most industrialized countries, hovever, can be Judged by the amount consumed ln transportation goods because this category usually accounts foroercent of the total consumption.

In addition to the number of motor vehiclesountry, there are many factors which influence the demand for motor vehicle tires, such as the condition of the roads, the averagetraveled per vehicle, and the quality of the tires, furthermore, thereargeBloc trade In tires on which information is Production of tires ln Individual countries, moreover, is not necessarily proportional to the doaiestic motor park. For thesehe estimated production of tires in the Sino-Soviet Blocuch firmer basis for estimating rubber demand than the number of motor vehicle produced or in use. In Albania, where no motor vehicle tires area small amount of rubber is used for bicycle tires and tirematerials, Milch are classified as transportation/ This amount Is assumed to be aboutoercent of the consumption of rubber in Albania. Because Albania Is not economically developed, the amounts involved are small.

4

A. USSR.

The consumption of rubber ir. the USSB can be estimated from the production of motor vehicle tires.* Briefly, lt consists ofthe amount of rubber required to make the estimated number of tires und inner tubes produced, with un addition ofercent for bicycle tires and tire repair materials. On the basis of thisit Is believed that transportation goods represent about tvo-thlrdB of the total demand for/ This proportion closely approximates the average prevailing ln the Vest, but it will tend to decrease as the use of rubber ln consumer goods expands. As long as

Details of the methodology used are presented in/

-

the Soviet economy is state controlled and emphasis remains on heavy industry, the amount of rubber used in nontransportation goods probably will remain about one-half of that used in transportation goodB.

The estimated consumption of rubber in the USSR50 is shown in Table

The consumption of rubber in the European Satellites has been thoroughly analyzedrevious/ In Albania there is one rubber plant, located In Durres, which makes bicycle tires, tire repair materials, footwear, and consumer goods. The estimatedof rubber in Albania5 is shown in

The Second Five Year) of Bulgariaoal of Increasing the production of rubber/uring the period. Production of motor vehicle tires increased rapidly during the postwar years, transpertatIon goods consuming an increasing proportion of the rubber supply. 3 it was announced that the Georgi Dlmitrov Tire Plant was making busndarge tires for heavy trucks ueyo in7 Theof the larger sizes would increase the amount of rubber used In tires. The estimated consumption of rubber in Bulgarias shown in"

Czechoslovakia is the major producer of motor vehicle tires in the European Satellites. In addition, Czechoslovakia produces large quantities of industrial and consumer goods made from rubber. On the basis or reported national estimates of total volume of goods and trade and related data, it is estimated that transportation goods currently

* Tableollows onableollows OR Tableollows on

-

Table 25

Estimated Consumption of Rubber in the USSR0

Estimated Consumption of Rubberftrig

b- Approximate.

Production of Tires Transportation Units) Total

(Plan)

y

b/

0 b/

b/

/

-

Table

Estimated Consumption of Rubber In Albania

Metric Tons

iVar

T. i

oken from Estimates*5 are based on tne published goal of the First Five Year Plan, that5 production toercent of that

consume only about/ of the national rubberhe estimated consumption of rubber in Czechoslovakia5 Is shown in

E. East Germany.

Many reports on the rubber Industry of East Germany are available; so it is possible toairly accurate picture of rubber consumption ln that country. Although the production of motor vehicle tires has increased sharply during recent years, there Isevere tireondition which probably will continue until manufacturing capacity ls considerably/ More than one-half of the tires made arc large sizes for trucks and buses. InEast Germany Is an Important producer of industrial rubber goods such as conveyor belts, transmission belting, and rubber hose, some

For further details, see

Tableollows on

-

Table 2?

Estimated Consumption of Rubber in

Vehicle Tires

Transportation Nontransportation

Year Inner Tubes g/ Materials

*5

78

625

681

5 k/

a- /

on anoundsand

on anoundsand

or. anoundsand

on the basisaverage annual increase9 percent, thefor the Second Five onthsnnounced.

-

Toole 23

Estimated Consumption of Rubber in Czechoslovakia

Metric Tons

0

re taken fromstimates45 were calculated from the estimated production of tires.

of which are exported to other European Satellites. Consequently, transportation goods require less thanercent of the consumption of new rubber in East Germany. The estimated consumption of rubber in East Germanys shown in*

P. Hungary.

Although the rubber Industry of Hungary has been expanded since World War II, it still represents onlyercent of the total rubber industry in the European Satellites. The Second Five Yearf Hungary provides for further expansion Df the industry with the objective of Hungary becoming self-sufficient in rubber

* Tableollows on

-

set' 'it 1.

/ Transportation goods consume approximately one-half of the total demand for rubber in Hungary. The estimated consumption of rubber in Hungarys shown in*

Table

Estimated Rubber Consumption in East Germany

Metric Tons

ansportati on

2

sJ

b/

d/

<7

c/

cj

t]

table was compiled from data px*esented inand from information based on actualand^plans3

on the basis of actual production

between total rubber consumptionused to make transportation goods.

total rubber consumption

total rubber consumption

total rubber consumption

G- Poland.

Before World War II, Polandarge rubber Industry. Although lt suffered severely during the war thc Industry had regained its position Since that time it has continued to expand vith the industrial development of the country. ide variety of rubber

* Tableollows on

-

Toole 30

Estimated Consumption of Rubber in Hungary a/

Metric Tons

Estimatesre taken fromEstimates*5 are based on later.

products ore muoe, not only for domestic consumption but also for export. Domestic demand for motor vehicle tires isires per ycari production is estimated to have beenires/ Montr an sport atoods are the major consumers of rubber, requiring aboutercent of total consumption. Theconsumption of rubber In Polands shown in*

H. Rumania.

The demand for rubber in Rumania Is not large, as Rumanian industrial expansion began after World War II. The Second Five Yearf Rumania calls for extensive additions to various industries, which will be reflected in an increased demand for rubber products. Rubber products have been imported cither from other European

Tableollows on p. 8l-

-

Table 31

Estimated Consumption of Rubber ln Poland

Metric Tona

Transportation Total

a- mj

Satellites or from the USSR, but Ftum^nla should be scir-sufflcient in domestic production* The estimated consumption of rubber in Rumaniao shown in

I. Cowiunlat China.

As lt is ln otber countries, the rubber Industry of Communist China is geared to the needs of the country. Its products, ln order of Importance from the point of view of rubber consumption, are as follows: footwear; motor vehicle tires; small tires for bicycles. Jinrickshas, and carts; and Industrial and consumer goods.

Production of footwear5 was'estimated to beillion Rubber requirements for this number of shoes will naturally depend on the type of footwear being made. Moat of the Chinese

* Furtherre given in source Tableollows on See II, A,,bove.

-

Table 32

Estimated Consumption of Rubber in Rumania a/

Metric Tons

Transportation

c/

ai Unless otherwise indicated, estimatesre taken fromi/.

on the estimated annual production of tires

on theal increase in valueproducts

Corrcnunists are accustomed to wearing sar.dalsoftOe, so the rubber shoes produced arc predominantly of the "sneaker" type. In addition, many miners* boots are manufactured. Sneakers require us little as one-eighth of new rubberhereas the boots may require several kilograms. On the basis of experience of theUS manufacturer of rubber footwear, it is estimated that the average amount of rubber needed for all footwear would be2 pound) per pair. To makeillion pairs would0 tons of nev rubber, more thanercent of the total demand.

Most of the production of nocor vehicle tires in Communist/ Is of the sizesnchesnchesrnchesly, both of which require6 kg5 pounds) of rubberireube. Other sizeslarge tires for buses and small tires for passenger cars.

-

Because these sizes are relatively few in number, it is believed lhat the weight given aboveonservative average. On the basis orimated productioniresonsumption of rubber In motor vehicle tires in China would be slightly moreons.

Coranuoist China annually uses many tireside variety of vehicles such as bicycles, tricycles. Jinrickshas,and wagons. Most of these tires have Inner tubes which would require new rubber in their construction. The casings made In at least one plant wereercent new rubber andercent reclaimed/ Considering the various sizes of tiresonservative estimate of Uie average requirement would be atg of new rubber for each new tire and Inner tube. The annualof small tires is difficult to estimate, but It was reported8 that manufacturing capacity5 million tires5 million inner/ Because the Chinese Communists areproduction of motor vehicle tires, it is doubtful, considering the small supply of raw materials, that moreillion small tires and inner tubes were madehich wouldons of rubber.

The following tabulation is a

Other items manufactured in Ccconunist China are hose, belting, printing rolls, and industrial goods- ew consumer goods, such as hot-water bottles, gloves, and rubberized fabric for rainwear, are produced. The amount of rubber used in these products will be basedvailability Of raw materials. On the baslB of plannedof t'-res ana footwear and on individual plant studies. It is believed that the total rubber consumption in Communist China5 *as0 tons, breakdown of this figure;

illion pairs) Motor vehiclemall tiresillion) Industrial and consumer goods

Total

Consuir.pt

(Metric

A recent estimate of the consumption of rubber in Cccimunist China50/

-

IV. Material Balances of Rubber ln tlx-c.

nc rn 1.

Estimated material balances of rubber in the Slno-Soviet ULoc5 are shown in* Arbitrary conclusions cannot be dorlwd fron these data, but certain obvious trends are indlcuted.

The USSR was obviously short of rubberears after World War II. 8 the USSR had started to build up supplies and for several yearsolicy of stockpiling rubber. The reversal of this policy, which took placeas been discussed."*

Satellites.

Rubber supplies in the European Satellites approximateln those countries. Any surpluses which appear probably go into stute reserves, which may be drawn on to meet temporary shortages. As they probably neveronth requirement, they vould not constitute stockpilestrategic point of view.

China.

Communist China's operations ii; the rubber market ore not clear Purchases01 were obviously nueh in excess of domeuti needs. Although the reasons for making these purchases aro not known, the following reasons nay apply:

To anticipate the control on the shipment of rubber toChina which vas imposed late1 by the UM,

To convert foreign credits into useful raw materials before the COCOM Lraobillxed these accounts, or

3- To provide acceptable exports to the USSR in exchange for the military aid received for use in Korea.

Communist China's agreement with Ceylon assured China of more than adequate supplies of rubber during the life of the contract. Nevertheless, Communist China apparently continues efforts to obtain

Tableollows on Gee II, B,bove.

-

Table 33

Estimated Material Balance! of Rubber ino-Sovtet Bloc a/ v

Europeane^

Year

Supply

rf'-rencc

25

T

5-5

i

5-3

0.6

For methodology.

Appendix A. The

of error

plus or

10

rubber from the underdeveloped countries of Southeast Asia. undoubtedly are politically motivated; in at least oneit is suspected that tho ruooer purchased and paid forChina went directly to the European/ is discussed more fully

i

* Sec VI, C,elow.

-

V. Inputs.

A. General.

The manufacturing phases of the rubber industry may be divided into tvo broad categories: (l) chemical, which includes the production of synthetic rubber, rubber chemicals, and reclaimed rubber;echanical, which involves the fabrication of rubber products.

In the chemical phase the processes are varied, and some are extremely complicated. As an illustration, the following list shows the basic chemicals required to make "Buna S" type of rubber

acid Alcohol, ethyl Alum

Alumina, activated

Aluminum chloride, anhydrous

Anmoula, anhydrous

Antioxident, BLE

Bardol

Benzene

Casein

Caustic soda

"Chlorex"

Chromium acetate

Commercial acetone

Ethylene

Furfural

Hydrogen chloride Hydroquinone Lauryl mercaptan

Manganese acetate Hitrie acid, fuming Oxalic acidaphthylumineaphthylamine Potassium persulfate Potassium tantalum fluoride Sal t

Silica gel

'it

Sodium carbonate, anhydrous

- . ulfonated pine Oil Sulfur

SuJ.furic acid,ercent Sulfuric acid,ercent Titanium dioxide Triethanolumlne Zinc sulfate

lt is considered thats only one of many types of synthetic rubber, lt ie evidentetailed list of material inputs, if it vere obtainable, would be of little practical value and beyond the scope of this report. Alcohol requirements for making synthetic rubber by the Soviet process have been discussedrevious report./ ecent statementoviet book, which Calledto the/ advantages of petroleumource ofstated that for the manufactureassenger-car tire,iters of alcohol normally are used. Fifty liters of alcoholg0 pounds) of grain,gounds) of

potatoes. In making Sovprene, the Soviet equivalent for oll-reaifltant neoprene, the principal Ingredients are acetylene from calcium carbide and hydrogen chloride. According to the US originators ofg of calcium carbide andkg of hydrogen chloride are required per tor. of product.

According to captured documenta, during World War II, Germany required the following InputB toon of Buna rubber:

ubic meters

ons

ilowatt-hours (kwh)

to 16 cubic meters

ubic neters

ubic meters

Ko information Is available on capital investment, manufacturing costs, or labor requirements in making synthetic rubber ln the USSH.

Io the mechanicalide variety of ante rials ln addition to rubber Is required to make finished end products. For example, Uie dtundard formulalrc-tread mix will contain fromongredients la addition to rubber. Even the quality and percenl-uge of rubber used will vary with the nature of the product to be made. For this reason, ltot possible to estimate the Inputs for the rubber Industry ln terms of specific quantities of different materials. Only one reference to utilities requirements has been found which ls applicable to the Slno-Soviet Bloc. ecent Soviet/ Btutedotor vehicle tire plunt00 kwh ofenergyjres produced. On that basis, the tireof the USSR would consumeillion kwh of electricity per year.

B, Capital Investment.

No statistlcfl have been noted on capital investment In the rubber Industry of the Slno-Soviet Bloc since World War II. In the earlier days of the USSR, periodic announcements were made concerning inveBtments, which permit comparison between the rubber and chemical industries during that period. In thes, before theof synthetic rubber, the rubber Industry.received aboutercent

-

of the capital which went into the Soviet chenical industry. For Instance,igure for chemicals1 million/ comparedillion rubles for/ In the0 the USSRajor program for the construction of four plantB to make synthetic rubber. Consequently, the proportion of capitalin rubber compared with that Invested in chemicals roseeak of lU percent owever, this proportion had dropped to1 million rubles for/ comparedillion rubles for

oper able statistics have been found covering the period sinceso lt is not possible to give an accurate estimate of the amount invested In the Industry to date, nor of its present value. On the other hand, lt is believed possible toeneral estimate of investments during the Sixth Five Year Plan, based on the planned physical expansionat period. The following factors nay be significant:

Production of synthetic rubber la scheduled for the greatest expansion of any product ln the rubber andercent of production5 comparedercent for mineral fertilizers aod lessercent for other chemical products mentioned io the Sixth Five yeBr Plan.

Production of tires Is to be doubled during the same period; it is specified that seven major enterprises will be built and put into operation for making tires and technical articles.

Ro percentage figure Is given for the over-all expansion of the chemical industry. Industrial production, however. Is scheduled lo Increase onlyercent. It Is evident, therefore, that the planners are emphasizing expansion in the rubber industry.

In view of the above factors and of the available prewar information, it is probable that expansion in the rubber industry will receive capital Investments ln tho range ofoercent of those devoted to the chemical industry. ecent/ tlie InveuOnentB ln the chemical Industry were eBtlmated to beillion toillion rubles during the Sixth Five Year Plan period. It therefore seems probable that the expansion scheduled to take place lu the rubber Industry will require '> billionillion rubles.

l

VT. Capabilities, Vulnerabilities, and Intentions.

A. Capabilities.

The Sino-Soviet Bloc Is capable of meeting its strategic requirements for rubber products. In certain fields, however, Soviet technology appears to be considerably behind that of the US. For instance, in every country of the Bloc, vith the exception of Cowminist China, there have been press announcements to the effect that tubcless tires were in production or being planned. Because the Bloc has no supplies of butyl rubber, uhich is essential for the production of tubeless tires, It is probable that thiswill fail from an economic point of view. There have been several recent reports of failures of Soviet truck tires afterew thousand miles of service. The corresponding tires made In the US would normally0 miles of service. imilarIn Czechoslovak-mode tires has been reported, which would indicate probable inferiority in manufacturing methods.

It was recently announced that the Voronezh Synthetic Rubber Plant had begun production of oil-extended rubber. This development, if it is in process, couldonsiderable effect on theof synthetic rubber in the Sino-Soviet Bloc. Experience In the US lndlcules that production can be increased at leastercent, with no decrease in quality, by the use of Oil extension. Soviet scientists have been aware of this important Improvement, but until recently the.fe has been no indication that they had succeeded in applying it to their manufacturing processes.

On the other hand, it is Improbable that the Sino-Soviet Bloc will attempt ln the foreseeable future to manufacture butyl rubberonroerclal scale. Manufacture of this material, which was developed in the US, requires temperatures of lUo degrees below zero, and the process Is extremely difficult. Large amounts of special solvents obtained from petroleum are required, and theobtained to dote indicates that the Bloc does not have either the equipment or the materials available to produce butyl rubber.

B. Vulnerabilities.

eographic point of view, the manufacture of synthetic rubber by the Sino-Soviet Bloc is well dispersed. The largest plant is that at Schkopau in Bast Germany andapacity of more0 tons, aboutercent of the total Bloc capacity. Second in

-

size is the plant at Voronezh, which is estimated toapacity of slightly more0 tons, aboutercent of the total Bloc capacity. Haw materialsther than oynthetlcequired by the Bloc rubber industry appeor to be in adequate supply, although the USSR does Import quantities of Egyptian long-staple cotton for caking tire cord. In an emergency, domestic supplies of cotton could be substitutederious Impairment of quality. As has been shown, strategic reserves of natural rubber probably are more than would be needed to meet an emergency. It Is probable, however, that the USSR Is heavily dependent on East Germany for supplies of certain special types of rubber and for rubber chemicals. If these supplies were denied theerious dislocation ln the Industry night result.

C. Intentions.

Because tlie rubber Industry in the Slno-Soviet Bloc Is operating at approximately rated capacity, lt le unlikelyhift ln the strategic Intentions of the USSR would be indicatedronounced change ln the operations of the Industry. udden activity In the eumufacture of specific war items, such as gas masks, might well foreshadow aggressive Intentions, buthift would be difficult to detect.

The principal bulk Item used by the military forces Is, of course, tires. Because Soviet truck sizes are standardized for either militarynmil Itaryudden shift to wartimewould not Involve radical changes ln the operations of tire plants. ecent/ estimated that the Slno-Soviet Bloc demand for tires during the first year of hostilities would be as follows:

Units

lioomllltary

Total 0

Tills number of tires would requireons of rubbe which Is within the capacity and resources of the tire Industry In the Sino-Soviet Bloc. For these reasons, it is unlikely that Soviet intentions can be Judged by the operations of the rubber Industry.

-

APPENDIX A

ME'fllODOlCGY

The methodology used In this report follows in general that used in previous reports published on the rubber industry in the Sino-Soviet Bloc. In preparing the tables showing the production of individual planta, it vas necessary to assume that where information to thewas lacking, the expanded total production of the product ln question had taken place at about the same rate in each plant. It Is assumed that nethods found to increase efficiency or production ln one plant would quickly be adopted by plantslrallar type. Rubber plants ln the USSR are controlled by one central authority and tend to be standardisedreater extent than those In tbe US, where design and operations arc privately controlled. Fabricating plants usually operate one shift per day; hence their production can be Increased by working longer hours. On the other hand, plants making synthetic rubber and carbon black operateours per day. Thus, although nlnor Increases in production can bc effected by Improvements Lnsubstantial increases can be attained only by the addition of more equipment.

a

Another limiting factor in productionay be thoof raw materialsfor example, ln the case of the synthetic

produced from calcium carbide. ecent study has determined that the amount of calcium carbide available for the production of Sovprene would limit productionCOO tons per year. Because it is known that the USSR has recently been trying to buy neoprenc, which is the US equivalent of Sovprene, it seems probable that production at Yerevan has not been expanded.

The figures for the production of reclaimed rubber in most countries of the Sino-Soviet Bloc arc usually estimates because this material is normally made in plants turning out finished products in whichrubber is usedomponent. Thus production is consumed in the plant, and no quantitative figures are available. East Germany has several plants devoted to making reclaimed rubber, which Is shipped to rubber fabricating plants. Information on these plants was the basis for the figures given onbove.

-

New material about the rubber industry of Communist China Is based on plant studies. Economic reports on the industrynd press reports published since the Communists came to power. Little specific Information is available on the status of individual plants in Chinaence the finished data are the product of many bits of information. The Chinese Communist authorities areolicy of Increasing efficiencyolicy which has resulted in closing some less efficient plants and moving their Information on these moves ia fragmentary, and the exact number of plants now in existence is uncertain. In the case of nonrubber tire components, statistics were developed from unpublished reports on these subjects.

The methodology used to determine demuxi* Is based on theof motor vehicle tires, because Western statistics divide rubber consumption into lhat used ln transportation goods and that used in nontransportation goods. There usuallyeneral relationship between the two categories. The great variety of nontransportation goods produced and the fact that the number made in each country is generally dependent on the social and economic development of that particular area make it impossible to estimate consumption patterns with any degree of accuracy. For transportation goods, attempts were made to correlate the motor vehicle park and estimates of consumption of motor fuel with production of tires In each of the Sino-Soviet Bloc countries in an effort to refine the estimate of demand for rubber in transportation goods. The Imponderables of road conditions, theton-kilometers' of travel, snd the quality of tires defeated any attempt to correlate data from the countries being studied vithfrom Western countries.

In preparing the data for materialt was realized that there Is extensive intra-Bloc trade in natural and synthetic rubber as well as in rubber products. Because statistics on this trade arc incomplete, it was believedore accurate picture of the rubber situation in tbe Sino-Soviet Bloc would be presented by the method used. Exceptmall quantity of synthetic rubber which appearedhe Hew York market5 and was suspected of coming from East Germany, there have been no reports of the Bloc exporting rubber. ew tires hove been shipped by Czechoslovakia to the Middle East, and, conversely, Italy has shipped some tires to Bulgaria. Because these

* See III,bove. ** See TV,bove.

-

shipments hove been relatively Bmall and vere believed toeach other, they have been ignored as being less than the probable accuracy of the final estimates.

lhe figures for supply* vere aade up of knovn imports of natural rubber plus domestic production of natural, synthetic, and reclaimed rubber. Estimates of demand vere developed from figures forof tires and other available data, following the methodsin previous reports. To check the accuracy of the results, the data on imports of natural rubbereriod of several years have been examined and compared with the estimated over-all figures for demand. These calculations appear to confirm tho figures shown in

In preparing the figures forrevious estimates had to be revised because more accurateud become available on production of tires in the USSR2 and Tbe net result was that0 tons less rubber probably were consumed inears than had previously been estimated. This amount was assumed to be available for stockpiling in addition to the amounts 'previously estimated, making the total maximum stockpileons at the end As vas staled, there isolicy of reducing this reserve is now ln effect.

* .bove. ** bove. see II, B,bove.

-

APPENDIX B

GAPS IN INTELLIGENCE

Very little specific information is available on theat llie synthetic rubber plants in the USSR. Nevhave been erected or are in production atN -E> andut,press notices, no data have been received on either plant. reportedly vas under construction ut-E)

in southern Siberia No information bos been received on this plant sincevhen it vas still under construction.

Estimates of production of tire plants in the USSR are based or. the assumption that expansion has taken place in all of the plants, except lhat att about the sane rate. "

Information on the production of both synthetic rubber and tires ln the European Satellites, except for East Germany, is for from complete. It would be helpful to Know what progresseing made on thecomplex (scheduled to make synthetic rubber) being built by Hungary and Rumania because, when in operation, this complex willftjOr industrial^ development for these countries.

A major gap in intelligence exists in knowledge of the cost of constructing various facilities in the rubber industry. Although figures may be obtained based On US experience, conditions in the Sino-Soviet Bloc may alter the costs considerably. For instance, the extreme weather conditions at Usol'ye might increase construction costs by as much asercent. Concomitant with this question is that of manufacturing costs. Although there are some figures on the retail selling price of some sizes of tires, these figures are forew sizes and may or may not reflect plant costs.

Information on the rubber industry or China Is fairly goodO. Since the Communists came to power, however, the reports have been few in number and often contradictory. Although official Imports of natural rubber are reported, many shipments are consigned to other

- 99

ports but ore suspected of ending up in Communist China. Also thereonsiderable amount of rubber smuggled out of Indonesia, part of which probably finds its way into China. All U8 sources seem alert to report such Bicuggling, but the devices used by tho Chinese Comnunlets to circumvent tbe rubber embargo make detection extremely difficult. As to the industry withinampaign has been undertaken to eliminate waste, not only of materials but also of manpower and Small plants have been closed, and usable equipment has been Dcvcd to larger and more modern plants. Very few data, except such information us that derived from press notices of quotas nx-t, have been published on these modern plants. Current information on China ls the weakest of any obtained from the Slno-Soviet Bloc.

4

AlTKKDIX C

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CIA. CIA/RR

CIA. PBIS, Daily Report (USSR and Eastern1

p. II 3. SE. Eval. RR CIA. ar 5P, Info Eval. RR 3.

CIA.* S. Eval. RR 6.

CIA. 9 R. Eval. RR 3.

CIA. SO,nfo beforect JI. s,

.

ibid.

CIA." nfo Marnd earlier. C. Eval. RR 3.

CIA. CS,ofo RR 3-

Cbemle-Ir.gerx?ur-Tgchnlh-Weinhelir. (Chemical Engineering Tech-

pe3t,. U. Eval. RR 3.

FBIS, Dally Report (USSR ond Eastern1

p. II 3- OFF USE. Eval. RR- CIA. , - S ONLY.

CIA. C. Evsl. DOC.

gsjjg uchwsla pi on sgcstoletnl (Parliament Decrees the Six

Year U. Evsl. CIA. SO, la RR 3.

Air. Treasure U. Evsl. Doc. (tr of

Prxcaysl chcalczny, no CUT. info-

ISO. Air. 6nfo C. .

State/Gt Brit, Warsaw. Polish Press Summary,sec B, p. II. U. Eval. RR 3.

CIA. CIA/RR, 3/

Air. nfo C Eval. RR 3-

16U. CIA. CIA/RR,

CS, S,

. Eval.

State, Warsaw. 5 S. Eval. Doc.

CIA. CIA/RR,*

. ' Y.

Ibldi,. S/

Ibid.

CUT nfo. " . Eval. RR 3-

CIA. CIA/RR,.

Ibid.

19ft. CIA7 FBIS, Econonic, Warsaw, ft OFF USE. Eval. RR 3-

Air. 8nfo C.

Eval.RR

9nfo C. - CIA. SO, S- Eval.. CIA. Eval. RR- CIA. SO,nfo S. Eval. RR 3-

CIA. CIA/RR,. 3ft- "

State/Gt Brit, Warsaw. Polish Press Summary,

U. Eval. RR 3-

sacocliodowy, voloarsaw, Jun ft7- U.

Eval. Doc

uchwala planbove).

CTA. FDD Summaryt,eekly Economic Informs-lion"Report on Eastern Europe, OFF USE. Eval. Doc.

SO,9O.

Eval. RR 2.

chcmlczny, Warsaw, Eval. RR 6.

State/Gt Brit, Warsaw. Toli-flh Press Suaaary, U. Eval. RR 3-

Air. nfo C. Eval. RR 3-

Wavy, Warsaw. Rpt1 C. Eval. RR 1.

CIA. & C. Eval. Doc

CTA. CIA/RR,IA. CS,- CU. 2 C. Eval. rwc.

21ft. CIA- RR 3-

State, Board of Economic Welfare- , C. Eval. RR 1.

-

Nev Tines,. U. .

cTT. CS7un - CU. CS,nfo S- -

Navy. 3 S. Eval. RR *.

CIA. FBIS, Dally Report (USSR and Eastern1

p. JJ *. OFF USE. Eval. RR 2.

Brit, Bucharest. Rpt,. 5.

OFF USE. Eval. CIA. CS, -

BBC. SjjPBaryqf World Broadcasts,, pt II b,. 9. U. Evol. RR 3.

CU. CIA/RR,.

CU, FBIS, Economic, Bucharest,

info U. .

USAFE. S-

.

CU. CU/RR,

USSR. bove).

State, Bucharest. . U. Eval. RR 1.

.

State/Gt Brit, Bucharest. mov, no ?M,

U. Eval. RR- State, Bucharest. 7 3- Eval. RR. 1 3. Eval. PR 1.

SO,nfo

Eval. RR j,

CU. SO,nfo .

CU. nfo s/

Evol. RR 3.

RR CU. CS,nfo Eval. RR Air. Treasure9 Eval. Doc.

CIA. CU/RR,

Aurora University, Shanghai. Monthly Bulletin,

U. Eval. RR- . IbTd.

State, Hoog Kong. , l8U. Eval. RR 1.

CIA. FDD Summary,-

OFF USE. Evol. Doc. Air, FEAF, oOCAth AISS. Special Information Rpt

Supplement, C. Eval. RR- CIA. , S.

Eval. RR 3-

ASTAIUSNA, nong Kong. Rpt,

.

CIA. CS,nfo OFF USE. Eval. RR 2.

CIA. FBIS, Dally Report (USSR and Enaternul 5U.

OFF USE. Eval'. RR*. Pauley, Edwin H. Report on Jopanese Assets la Maacburla

to the President bT^he United States, Bval. RRR. ,.nfo C Eval. RR 1.

CIA. PBIS, EconoaicflU, U.

Eval. RR 3.

eiping, OFF USB. . hanghai, U. - CIA. FBIS, Daily Report (Communist3. OFF USE. Evol. RR 2.

, nd. C. Eval. RR 3-

CIA. FBIS, Economic, Mukden,. Eval. RR 3.

CIA. 3 OFF USE. Eval. Doc.

Air. Wringer5 Info C. Eval. RR 3-

Slate, Hong Kong.nfo. Eval.. CIA. FBIS, Dolly Report (Cotnaunlst3

p. OFF USE. -

State, Hong Kong. , C. Evol. RK 1.

, C. Evol. RR 1.

, C Eval. RR 1.

1 S. Eval. RR 3-

CIA. CS, Info S/ . Eval. RR 3.

j..it.

0nfo

Eval. RR 3.

c-T

FBIS, Dally Report (Communist3

p. OFF USE. Eval. RR 2.

. OFF USE. Eval. RR 2.

Air. 0r.fo

Eval.

Ibid.

jEg.

CIA. nfo C. Eval.- ltolnhua Neva Agency. Dally news release, U.

Eval. Doc.

CIA. nfo S ONLY. .

Air,h AISS. Special Information rpt

nfo C. . Bainhua Neva Agency. Dally news release, U. Eval. RR 6.

28l. Aurora University, Shanghai. Monthly Bulletin,

U- Eval. RR

CIA. 6 OFF USE. Eval. Doc.

hina, sec S.

ibid.

Ibid.

STaTe, Hong Kong. , l* S. Eval. RR 1.

3. Eval. RR 1.

,. S. Eval. RR 1.

ap9 3. Eval. RR 1.

, S. Eval. RR lf

3. Eval. RR 1.

CS, Info l8 OFORN/CONT CONTROL.

.

CIA. CIA/RR. 3.

Ot Brit, Rubber Study Group. Rubber Statistical Bulletin,

o U. Eval.Doc.

State, Bern. Dap R- .

Gt Brit, Rubber Study Group. Rubber Statistical Bulletin,

o U. Eval- Doc.

State, Bern- Dsp R. Eval. RR 6.

Air. , S. Eval. Doc.

State, to London. OFF USE. Eval. RR 1

- Ill

Brit, Rubber Study Croup. Rubber Statistical Bulletin,

o- U. Eval. Doc.

State, Rangoon. , U. Eval. RR 1.

CIA. CS, SA ' tate, Djakarta. , S. Eval. RR 1.

30ft. CIA. 1 -

State, Singapore. 1 C. Eval. RR 1.

State, Rangoon. , OFF USE. Eval. RR 1.

The Economist, U. Eval. RR 1.

Stato, Medon. OFF USE. Eval. RR 1.

CTA. CS,nfo late 'Eval. RR 3-

Ibid.

State, Rome. d. C. Eval. RR 1.

CIA. CS,nfo55-

Eval. Doc.

CIA. nfo S. .

CIA. CS,nfo early

.

31ft- CIA. CS,nfo

Eval. Doc.

CIA. CS, info- SA'" .'v..

-

CM. CS, info S. Eval. RR 3.

CIA. CS,

-

CIA/RR CIA/RR, above).

CIA. CIA/RR, *"

CIA. CIA/RRbove).

S-

CIA. CIA/RR,.f. - Air. Treasure U. Eval. Doc.

ir. Treasure. Eval. RR- Air. ,ec 5ft, C. Eval. Doc.

CIA. CIA/RR S.

CIA. CIA/RR,. ft2.

sA"

. ftO-*l.

CIA. CS,nfo S. Eval. De-.

CIA. CIA/RR.

. S. Ibid.

CTAT FDD Summary, l6eekly EconoaicReport on Eastern Europe, OFF USE. Eval.. CIA. CIA/RR, QboveT-

Ibid.

CIA. FDD Summary,eekly Econoaic Informa-

tion Report on Eastern Europe, p. OFF USE. Eval. Doc7"

.

Ibid.

j1

tier, jicport on Eastern Europe,

CIA. FDD Summary,eekly Economic Inforraa-

OFF USE. Eval. Doc.

mr

h AISS. Special Inforaat ion Rptupplement, C. Eval. RR 3.

niversity, Shanghai. Monthly Bulletin,

. U. Eval.y

State, to Port Said. Dsp* C. Eval. RR 1.

War Production Board. Lateral Study III, Chemical Requirements

for S- Eval. RR 1.

CU. CIA/RRbove).

K.N. arodnon; khozyaystve SSSR

(Chemicals in the National Ecouoay of the. U. Eval. RR 3.

prqycktlrovanlyn krupnykh gldr qstantsly v

cnergoslstemakh (Economic Planning of Electrical Distribution

SystemsJ, U. Kvel.- nd. Soviet Union Yearbook, London,

- U. Eval. RR 1.

Council for Economic and Industrial Research, Inc.

llie Rubber Industry of the USSR, by Elizabeth Marbury,

U. Eval. RR- ghurnal khlmlcheskoyosto

U. Eval. RR

Council for Economic and Industrial Research, Inc. 0

bove).

1

Original document.

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