Historical aspects of the Welsh slate industry

D Dylan Pritchard MA FSS

  1. It is welcome news that an English Slate Quarries Association has been formed, completely representative of the English quarrying interests. In 1935 the output of the English quarries was 38,878 tons, amounting to only 12.7 per cent. of total British production, so that it has to be remembered that the new Association represents only a small section of the industry and is only a minor but by no means insignificant, contribution towards the re-organisation of the British slate industry.

  2. What About the Welsh Quarries?

  3. On the face of it, it would appear a fairly simple matter for the Welsh quarries to form a Welsh Slate Producers' Association. In the first place the slate producing area is very small. A circle drawn with its centre on the summit of Snowdon and a radius of ten to fifteen miles would include the vast majority of the Welsh quarries within its circumference. In 1935, Welsh quarries produced 75 per cent. of the total volume of home production, representing 87 per cent. of the total value. The fact that so overwhelming a proportion of slate production is produced within so geographically compact an area obviously facilitates the formation of an Association. In the second place, the number of slate producing concerns is small. Table A gives a complete list of slate concerns in active operation in North Wales in 1937, together with the number of quarrymen employed by each concern.

  4. In Table B.  the 32 business units are grouped according to size

  5. Quarrymen's Union's Proposals

  6. Against the foregoing background I propose to reproduce, verbatim, part of a memorandum which has recently been submitted by the North Wales Quarrymen's Union to the Welsh Reconstruction Advisory Council, in which some very interesting proposals are put forward for the reorganisation of the Welsh industry.

  7. "Despite the Geographic compactness of the industry and the comparatively small number of business units - factors which should powerfully aid the integration of the trade - the capital organisation of the industry has always been sadly defective and, needless to say, this has been a great drawback, especially during the last twenty years.

  8. "In 1886 an Association was formed among the quarries shipping slates from Caernarvon. Six years later the Festiniog District Slate Quarry Proprietors' Association was formed. This was a loose organisation and none of its agreements were binding upon its members. Its chief concern was with the establishment of uniform prices in the district. Almost all the slate mines in that district were members of the Association, and in 1910 10 out of the 12 mines were members. The two major concerns - Penrhyn and Dinorwic were outside these Associations, but they co operated with each other in fixing prices. So that from 1886 until 1917 the Caernarvon quarries had one Association, the Festiniog Mines had another, and Penrhyn and Dinorwic Quarries had an informal Association of their own.

  9. "In the years immediately preceding the last War a rapprochement between the Penrhyn and Dinorwic Quarries and these Associations was gradually taking place and by 1911 there was mutual agreement on many matters affecting the industry. Endeavours to bring about a closer working arrangement were facilitated when the Minister of Labour urged all employers to set up National Councils for each industry. One result was the formation of the North Wales Slate Quarries Association in 1917. This Association included practically all concerns in the area, including Penrhyn and Dinorwic, and in 1921 90% of the total output of slate in the United Kingdom was produced by its members.

  10. "The Association hardly ever functioned smoothly and was in fact only held together in a state of tension by the pressure of circumstances, so that there was a danger that it might altogether disintegrate when the pressure was relaxed and that was what actually happened a few years after the war. Up to the commencement Of 1943 the only Caernarvonshire concern in an Association was the Dorothea Slate Quarry Co. The other members were the Maenofferen, Llechwedd, Manod, and the Oakeley Quarries, and the output of the Associated Slate Quarries is about 30%, of the output in North Wales, so that it could not be considered as being in any way representative of the trade. The North Wales Slate Quarries Association has now been formed.

  11. "There have always been two factors which have hitherto vitiated any attempt to set up an effective Association for the North Wales industry. The first is that the Penrhyn and Dinorwic concerns jointly produce much more slate than the thirty other concerns put together. The other factor, which is even more important, has been the impossibility of effectively controlling prices. Members of the Association jointly agreed upon price lists and, so long as trade was brisk, they kept faithfully to their agreements and the Association functioned smoothly. When demand slackened, however, the Association simply fell to pieces, chiefly because it failed to exercise any real control over prices. It is true that there was agreement about printed price-lists but the various concerns did not scruple to offer merchants competitive discounts. It is inevitable that merchants should let this information leak out, so that the news of these discounts soon spread throughout the industry, undermining mutual confidence. The Penrhyn and Dinorwic concerns left the Association primarily because they suspected that other concerns were ignoring price-agreements and underselling them, whilst the smaller units levelled similar accusations against the larger quarries.

  12. The demand for slate is exceptionally inelastic during building depressions. Quarry proprietors realise this and agree that, in a slump, even a great lowering of prices will not bring about an expansion of the total volume of slate sold. On the other hand, a general recognition of this fact does not prevent them from seeking to attract to themselves a more than proportionate amount of the restricted demand by offering larger discounts than their competitors. Cut-throat competition of this kind, which is customary among slate producers all over the world when demand falls off, does considerable harm to the industry. It is inevitable, of course, that prices should be lowered to some extent during depressions, but, under the present anarchic marketing conditions, prices are driven much lower than they ought to go, especially when we consider how inelastic the demand for slate becomes in a depression. It is true that printed price-lists do not show any great variations in prices between good years and bad years, but every quarry proprietor and every builders' merchant knows that the fluctuations in actual net prices are very considerable.

  13. "Internecine price-cutting within the industry force prices down in a vicious circle to an uneconomic level, with the result that profits are reduced and costs of production, especially wages, are forced down. In many cases the margin of profit, which in the case of many quarries, is frequently very small, even when demand is fairly brisk as it was between 1934-38, disappears altogether because of the excessive fall in prices. Consequently there is a tendency among producers to reduce capital expenditure of all kind, including the clearing of unproductive rock necessary for the proper and efficient development of the quarries, to the bare minimum during depressions, and to work only the more productive sections of the quarries. As a result, when the demand for slate revives, the quarries are not in a condition to increase output, so we have the unhappy position of an increasing demand and a falling output. This paradoxical position arose in the last small pre-war boom Furthermore the cutting down of prices to an uneconomic level during depressions involves many production units in financial losses so that a substantial part of the profit earned in the subsequent booms has to be devoted to the liquidation of past losses instead of being put back into the industry in the form of capital expenditure.

  14. Suggested Minimum Scheme of Capital Re-organisation

  15. "In the standard American book on 'The marketing of Metals and Minerals,' edited by Spurr and Wormser, reference is made to the American slate industry in the following terms : "The outstanding marketing error made by many slate producers is the attempt to make sales by emphasising the defects in slate from other districts.

  16. This is, in fact, due to a failure to realise that the real competitors of slates are not other slates but materials of an entirely different character that may be used as substitutes." These words are equally applicable to British slate producers ; the real competitors of, for example, 'Penrhyn' slate are not the 'Velinheli,' 'Caernarvon' or 'Portmadoc' slates, nor again, the slates of Cumberland, Westmorland, Cornwall, or Argyllshire, but other roofing tile, and also roofing materials, more especially the tile, and also foreign roofing materials. To quote again from the above mentioned book, "When slate producers fully awaken to the fact that their interest lies in uniting against common competitors, a brighter future is in store for them."

  17. “What is needed is a central advertising organisation subsidised by the whole industry, or, alternatively, by the quarry proprietors of North Wales. It is unreasonable to expect any of the larger concerns to conduct single-handed this pro-slate campaign as the cost would be too great for them to bear individually. Further, it is a matter that concerns all slate quarries and would be to the advantage of all slate producers. An Advertising Board should be established which should budget for a minimum annual expenditure on its activities. A levy of one per cent. on the value of the slate output in North Wales would amount to £15,000.

  18. "This Board, if it were well equipped and staffed with experts, would prove a tremendous boon to the industry. After all, slate is unquestionably the best roofing material on the market, and it is up to the industry to publicise its merits. That comparative prices is often not the determining factor in making a choice between slates and tiles is proved by the fact that most of the larger houses, costing £500 to £3,500, built before the war, were roofed either with tiles, which are the cheaper, or with green or rustic slates which are 40 to 50 per cent. dearer than the ordinary purple or blue slates. The aesthetic objection to slate, which was a most important factor in the inter-war period, could be counteracted by imaginative advertising on an adequate scale. The tile roof has lost its novelty and there are signs of a reaction against the pseudo aesthetic craze for blatant colours, so that the effect of a well conceived pro-slate advertising campaign might be very considerable. The more progressive among the quarry proprietors seem to be thinking along these lines, and pressure should be brought to bear on the industry to adopt this minimum scheme of co !operation

  19. "Re-organisation should be carried further. There are certain technical difficulties, owing to the varying nature of the slate vein, why one regional marketing organisation cannot be set up for North Wales. On the other hand it would be an advantage if a Marketing Board could be set up for the Festiniog District, and another for the Nantlle District. If this suggestion were implemented there would be four fairly large marketing units in the area - the Penrhyn Quarries, the Dinorwic Quarries, and the two District Marketing Boards. The setting up of District Boards of this kind would mean that for marketing purposes all the different slate producing concerns within each district would form one unit. Their total output would be pooled so that the Board could draw upon the production resources of all the quarries in supplying orders. Builders could place large orders in the knowledge that they would be executed promptly ; customers would be more likely to secure the particular sizes and qualities that they desired. Furthermore, all quarries would be placed on an equal basis in the execution of orders for slates ; through the medium of the Board even the smallest production unit would benefit when a large order was placed. In this way the diversity of the product of the Welsh slate quarries could be made one of the assets of the industry instead of being, as it is at present, one of its disadvantages. The District Marketing Board, enjoying the sole responsibility for marketing slate produced within the area, would be able automatically to eliminate cut-throat competition between its members and, if desired, it could also regulate the volume of production.

  20. "The four Marketing Units would be sections of the Association which would be responsible for setting up the regional Advertising Board ; for the control of prices as between the district ; the regulation of output, and for negotiating with the North Wales Quarrymen's Union, which represents all the slate quarrymen within the region, and has a 100 per cent. membership. It is highly desirable that the Regional Association should set up a Research Station, financed in a similar way to the Advertising Board, and, if possible, subsidised by the State, to conduct research into such matters as improved methods of production, utilisation of slate waste, and matters affecting the health of the quarry-workers.

  21. "The more progressive among the quarry proprietors seem to be thinking along these lines and the industry should adopt this minimum scheme of re-organisation. As the agency representing the interests of all the quarrymen in the region, the North Wales Quarrymen's Union is very concerned that re-organisation should take place along these, or similar, lines, as it is felt that only by putting its house in order in this manner can a great reduction from the pre-war level of production be averted in the post-war period."


Aspects of the Slate Industry 1: A Welsh Slate Producers' Association Advocated

Quarry Managers' Journal May 1943




Statement of a case for a plan