OTT' 



flHSMRecoM 



Published in the Interest of the American Hardwood Forests, the Products thereof, and Logging, Saw 

 Mill and Wood- Working Machinery, on the lOlh and 25th of each Month, by 



THE HARDWOOD COMPANY 



Henry H. Gibson, Editor and Manager 

 Edwin W. Meeker) 

 Hu Maxwell J 



Associate Editors 



Entire Seventh Floor Ellsworth Building 

 537 So. Dearborn Street. CHICAGO 

 Telephones: Harrison 8086-8087-8088 



BOT 



Vol. XXXV 



CHICAGO, APRIL 10, 1913 



No. 12 



^\;;gogU5K)ari!^v'Hag:y<!)Xi".ii<itystj-.sya>:^i;:>>ttaiit^t^^ 



^PS^ 



Review and Outlook 



General Market Conditions 



AN ACCURATE ANALYSIS of market conditions and develop- 

 ments during the past two weeks and of the effect of such 

 developments on trade in the immediate future is difficult, because 

 of the many events which have transpired having a direct bear- 

 ing on lumber production, transportation and consumption. The 

 one event, of course, which will have the strongest significance in 

 the lumber trade is the devastating flood condition which has been 

 felt throughout the entire middlewest hardwood producing and 

 consuming territory. Perhaps the most notable feature of this 

 flood is the fact that it was strongest and did the most damage in 

 the consuming territory rather than as usual in the producing sec- 

 tions of the country. As a direct consequence of this, a vast num- 

 ber of hardwood consuming plants were shut down for days and 

 probably it will be a considerable period before they will have 

 straightened things out sufficiently so that they can resume normal 

 operations. 



As a further consequence of the floods in the consuming terri- 

 tory, a vast quantity of lumber in consumers ' yards has been flooded 

 and by silt and sand rendered useless for the purposes for which 

 it was intended. 



Thus on the one hand we are faced with the condition which 

 takes these factories entirely out of the market for a considerable 

 period, cutting off a goodly percentage of the total hardwood con- 

 suming field; and on the other hand, these same consuming fac- 

 tories are faced with the necessity of immediately filling a con- 

 siderable void caused by stock which has been rendered worthless 

 by high water. Most of these consuming factories, furthermore, 

 produce articles of household furnishings such as furniture, tables, 

 etc., immense quantities of which stock was destroyed in the 

 floods. This will cause an immediate and enormous demand for a 

 new supply. The logical place, it seems, to secure these articles is 

 from the territory adjacent to the flooded areas. Hence, it seems 

 probable that because of this accentuated demand the furniture, 

 the table and other factories in the flooded territory will be more 

 than normally active. When in addition to this is considered the fact 

 as stated, that they lost a considerable quantity of lumber they 

 already had on hand, it would appear to be quite evident that 

 the temporary loss resulting from the removal of these factories 

 from the purchasing field temporarily, is much more than offset- 

 by the increased demand resulting from flooded conditions. The 

 natural conclusion is that these conditions will result in very mate- 

 rially strengthening market values on hardwoods. 



A further condition must be considered also, which will have 

 an equally strong bearing on market prices. Probably the heaviest 



sufferers of all the industries affected by the floods are the rail- 

 roads. In several cases complete lines were swept away, and every 

 system or individual company maintaining railroad service in the 

 flooded territory was affected to a large extent. Bridges were 

 swept away, stations demolished, trackage utterly ruined. Hence, 

 the railroads are facing the immediate necessity of rebuilding these 

 various structures including buildings, trestles, bridges, tracks and 

 all kinds of structures. The effect of this condition is not theoreti- 

 cal, as an acute demand has already been noted on the part of the 

 railroads. In fact, so anxious are they to secure stock for imme- 

 diate reconstruction that they are paying fabulous prices for 

 almost any kind of green bill stuff and timbers. The result of this' 

 will be that vast quantities of timber, instead of being turned into 

 lumber as under condinary conditions, will be absolutely taken out 

 of lumber production and will entirely be cut into bill stock, con- 

 struction timbers, and similar stuff needed by the railroads for 

 immediate use. 



Hence, a still further reason is seen here why lumber must 

 necessarily be strong because of the floods. In addition to this, of 

 course, a very apparent condition is affecting the home builders 

 themselves. While the average home builder affected by the flood 

 is not so well able to recuperate as a railroad corporation, still a 

 great many of them are, and those that are not will be backed by 

 outside parties or will be supplanted by outside parties who will 

 furnish the necessary capital to finance the reconstruction of the 

 homes throughout the flooded district. This will undoubtedly re- 

 sult in a tremendous increase in lumber demand. 



Thus it can be immediately seen that there is only one possible 

 trend of lumber conditions, — the demand will increase; values will 

 rise. Northern hardwood producing and distributing sections not' 

 affected by the floods have already felt this condition. 



When it is considered that under normal conditions, had the 

 floods and cyclones not occurred, the demand would have con- 

 tinued in excess of supply, the position of the lumber trade is still 

 further strengthened. One of the most difficult conditions to over- 

 come as affecting the flooded territory particularly, has been the 

 matter of shipping stock in or out. Transportation service has, 

 of course, been practically nil, although at this time it is getting 

 back again to somewhat normal conditions. 



There is every reason to believe that these unusual conditions 

 will result in a material detriment to logging operations. Log- 

 gers have already been seriously affected by high water, and as a 

 consequence there is a probability that production will be re- 

 duced considerably. Production, of course, ceased entirely at those 

 mills which were flooded, or whose sources of log supply were en- 

 tirely cut off. Even if these mills resume on a normal basis and 



