50 YEARS AGO – JUNE 1950

The movement to bring the Labrador-New Quebec iron deposits into production has received a big push from the the U.S. partners of Hollinger Consolidated. The partners will finance a large portion of the money needed to build a 550-km section of railroad from the existing railroad at the Seven Islands area of the St. Lawrence River to the mine, inside Labrador.

The railroad is scheduled to be completed by 1954, and the amount of money slated for the project is second only to the transcontinental railway venture, completed 65 years earlier. The railway shopping list includes: $50 million for railroad rails and grading, another $50 million for trains and boxcars, $15 million for storage and loading facilities at Seven Islands, and many more millions for tote roads and air strips, a hydroelectric dam and labour.

For the first time, Canada stands on the verge of being one of the world’s largest iron producers, according to V. C. Wansbrough, executive director of the Canadian Metal Mining Association.

In an address to the Canadian Political Association in Kingston, Ont., Wansbrough predicted that by 1955, annual iron ore production in Canada would rise to 20 million tons and that by the end of the decade, with the creation of the St. Lawrence Seaway, annual production levels would reach 30 million tons. At that rate, Canada would be among the top five producers in the world.

Wansbrough added that the steel industry will play an increasingly important role in Canada’s long-term economic development. Since 1939, steel mills have tripled their output and gone to 32,000 workers from 14,000.

While copper and zinc are in short supply and high demand, a glut of lead on the world markets has shot prices through the floor.

Prices in Canada have fallen 5/8, bringing the price to 12.5, while, in the U.S., lead recently fell half a cent to 11.3.

The British market, which used to buy lead from Canada, has an annual surplus of 100,000 tons (in late 1949, the U.K. stopped buying Canadian lead). Meanwhile, American buyers have ceased stockpiling the metal, owing to its growing availability.

Consolidated Mining & Smelting is left in a difficult position. Its ore contains both lead and zinc, and zinc is in demand at higher prices. To cut back overall tonnage would cost them profits in zinc; however, lead produced at the same time during smelting is being left without a buyer. Consequently, the company has decided to increase zinc production and stockpile its lead.

Base metals have never seen a week quite like the past one.

Copper was up 2 to 22.5 and zinc rose 1.5 to 14.5, nearly approaching post-war levels. However, nickel, which had already eclipsed post-war highs, was up a whopping 8 to reach an all-time high of 48. (Our dollar continues to trade at 10 more than the American greenback.)

These unprecedented surges in base metal prices are a boon for International Nickel, Consolidated Smelters, and other, smaller mines, such as Quemont and East Sullivan, which are still tax-exempt. At 8 per lb., International Nickel’s revenue increased (on paper) to almost $17 million a year.