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Copyright, The Hardwood Company, 1919 



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

 Mill and Woodworking Machinery, on the 10th and 25th of each Month, by 



THE HARDWOOD COMPANY 



Edgar H. Defebaugh, President 

 Edwin W. Meeker, Managing Editor 

 Hu Maxwell, Technical Editor 



Seventh Floor Ellsworth Building 

 53 7 So. Dearborn St., CHICAGO 

 Telephones: Harrison 8086-8087 



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Vol. XLVII 



CHICAGO, AUGUST 25, 1919 



No. 9 



Review and Outlook 



General Market Conditions 



THE GREATEST SIGNIFICANCE so far as the hardwood indus- 

 try is concerned is the rather abrupt cheeking of the shipment of 

 lumber abroad. The congestion in European markets, dtie to unreadi- 

 ness to receive the very large quantities of American lumber sliipped, 

 and the lack of organization to get this lumber to local consuming 

 points, is responsible for the great falling off in export demand. With 

 this situation has come a marked decrease in the market value of 

 American lumber abroad, it being reported that in some eases tliese 

 items can be purchased in foreign markets at approximately the prices 

 prevailing at mill points in this country. Consignment shipments had 

 more to do than any other one thing in the breaking of the market for 

 export lumber. 



The most peculiar feature of this developing condition is that ap- 

 parently it is having no effect upon the domestic situation. Domestic 

 markets continue to absorb all of the hardwoods that can be furnished 

 and at prices maintaining a consistently high level. Portunatelj for 

 everybody, the past two or three weeks have been noted for a gradual 

 settling down in quotations and it can be said that, practically speak- 

 ing, present prices are approximately the market values for liardwood 

 lumber. There is no reason to believe that for four, five or six months 

 in the future, at least, these prices will show any notable lowering. 



The strong points in the hardwood market outlook are the industries 

 at large including furniture, automobile, talking machines, and allied 

 lines manufacturing products salable direct to the buying public. The 

 weak points are the large industries dependent rather upon funda- 

 mental conditions for their immediate progress or stagnation. Notable 

 among these are the railroads and to a lesser degree the steel com- 

 panies. The latter have not gotten back yet to a full measure of 

 operation and interwined with these important institutions are the 

 various other industrials which feel the same immediate influences. 

 The improvement, however, is notable and insistent in all of these 

 directions and as present price levels are becoming accepted and estab- 

 lished as current and unassailable for the present, it is likely tliat the 

 demand for such goods will continue to be expanded consistentlj- in 

 the months to come. 



The railroad situation, of course, is another matter being controlled 

 by the will of a small group of individuals. Fundamentally, though, 

 tlie outlook is good if for no other reason than that the i^resent ]ate 

 of purchasing is so low as to be incapable of evolving into a worse 

 situation. Normally with approximately 2,.500,000 freight cars in 

 operation in this country with an average lifetime of about ten years, 

 the renewal of 250,000 freight cars annually is essential. It is esti- 

 mated that the average renewal during the past ten years has not been 

 more than from 75,000 to 100,000. With purchasing in all other direc- 



tions practically the same, the answer is certain that buying must 

 begin soon regardless of markets and it is an acceptable fact that 

 anyone in the industries selling to the railroads has an assured future, 

 for under either government or private control the railroads must buy 

 vastly more material than tliey have been buying or shortly be inca- 

 pable of remaining in anything like eiticient operation. Obviously if 

 returned to private control the resulting competition will bring on this 

 purchasing movement sooner. Until a short time ago it was pretty 

 generally accepted as a fact that the railroads would go back to the 

 private owners before the first of the year, but with the widespread 

 labor agitation that has since developed, the actual making over ol 

 the railroads back t-o the owners is now a more uncertain matter. The 

 sentiment of the country, however, is such that this movement will be 

 expedited as much as conditions will justify. 



In the meantime, though, other "ndustries using hardwoods are 

 proceeding on a capacity production basis, that is, their capacity is 

 limited only by the availablity and quality of labor. Retail furniture 

 stores, for instance, are selling furniture as fast as it is put on their 

 floors with mahogany and walnut both in the genuine and in the fin- 

 ishes predominating. Automobile manufacturers, truck manufactur- 

 ers, and in fact all the way down tlie line those supplying the people 

 with directly jmrehased goods, are doing a land office business. 



Building construction is showing persistent advance all over the 

 country except where strikes have interfered, and now with new and 

 unthought of rent levels established, more activity in speculative 

 building may be anticipated as the investment here has again become 

 a reasonably productive proposition. 



Thus as there is no possibility of stock surplus showing at the mills 

 for five or six months ahead and with the buying industries maintain- 

 ing a heavy rate of purchases and with the further development that 

 stabilized prices are rapidly becoming a fact, the next five or six 

 months at least in the hardwood industry show a practical assurance 

 of uninterrupted prosperity. 



Strange Appreciation 



THE FOREST PRODUCTS LABORATORY at Madison, Wis., has 

 attained international recognition through the pure merit of its 

 work. This accomplishment is ijendered doubly commendable because 

 its progress has been won in the face of constant struggle. On the 

 one hand the industries it has sought to help viewed the laboratory 

 work of the first several years more tolerantly than appreciatively. 

 Bool: Icaiiiing to the so-called prwiical man was something which 

 could not possibly teach him anything about the business which he 

 had been in for half a century. On the other hand official Washington 

 has never given to the laboratory one-half the finances which the 

 importance of its work mciited. 



