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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 2Sth of each Month, by 



THE HARDWOOD COMPANY 



Edgar H. Defebaugh, President 

 Edwin W. Meeker, Managing Editor 

 Hu Maxwell, Technical Editor 



Seventh Floor Ellsworth Building 

 537 So. Dearborn St., CHICAGO 

 Telephones: Harrison 8086-8087 



Vol. XLVII CHICAGO, OCTOBER 10, 1919 No. 12 



Review and Outlook 



General Market Conditions 



THE PAST TEN DAYS or two weeks have been particularly 

 noted for the return again to the brisk buying and shipping 

 that prevailed up to a month ago. It seems that with the return 

 of more normal weather conditions giving promise of a larger log 

 input and better operations in general, the buying trade concluded 

 that a substantial accumulation of hardwoods would result. There- 

 fore buyers as a whole were out of the market, expecting a material 

 softening in prices. When this development did not show, further 

 analysis of the situation resulted, which revealed that anticipated 

 accumulations were not developing in any hardwood section and 

 that 60 to 80 per cent production prevailing during the past six or 

 eight months was continuing. As a matter of fact, right up to 

 this date shipments are exceeding lumber put on sticks and in the 

 most favored sections production is not over 80 per cent of normal. 

 It is again being realized that this is the general situation and that 

 remaining out of the market will not materially affect these condi- 

 tions. 



At the same time it is a fact that supply and demand have more 

 closely approached each other in the last two or three weeks than 

 at any time since February and it is not to be expected that prices 

 will show a very large further rise. The wise lumber buyer will 

 take on lumber to meet his needs for the next three or four months 

 at least, not stocking up now in large quantities, but at the same 

 time, not remaining out of the market. 



One factor which probably accounted for the hesitancy of buyers 

 was the news of export lumber markets which were not by any 

 means absorbing the large amount of American shipments that 

 went forward very largely on consignment. This naturally had 

 an effect upon American buyers who rather anticipated its having 

 an immediate bearing on domestic supplies, but as a matter of 

 fact, the quantity shipped and what it was counted on to ship was 

 not of sufficient extent to affect the domestic situation. At the 

 same time the short domestic supplies and the domestic markets 

 have been such that all supplies have been assimilated in this 

 country. 



Another influence that would tend toward weakening rather than 

 strengthening the hardwood market and the lumber market in gen- 

 eral is the fact that building activity is not quite so brisk as it 

 was. It seems that a very large bulk of the building work that 

 was absolutely indispensable has already been arranged for or 

 started, and it is likely that from now on for at least some time 

 ahead building construction will not be quite so active as when 

 buildings were absolutely necessary. , The builders seemingly pre- 

 fer to await developments in the line of lessened cost. 



The long anticipated railroad buying has not yet developed nor 

 does it show on the horizon. Probably by the first of the year the 

 situation will be different in this respect and it may be anticipated 

 that a very large volume of lumber will be taken out of the regular 

 market lines by the purchases of the railroads at that season. 



As the general situation now presents itself, hardwood lumber is 

 still climbing though the march upward is now very gradual and 

 not at all marked by the hysteria which prevailed a couple of 

 months ago. Undoubtedly the peak has just about been reached 

 and without question prices are going to keep up to the present 

 level for a few months at least. 



Outside of the fact that business is again picking up after a 

 slight relapse, no particular difference in the situation now exists 

 from that prevailing a short time ago. 



The First Questionnaire Meeting 



THE FIRST MEETING between the Middle West operators and 

 representatives of the Department of Internal Revenue took 

 place at Milwaukee about a week ago. The consideration which 

 lumbermen are giving to this important problem was amply justi- 

 fied by the full attendance which included the principals of most 

 of the firms represented and also the accountants. 



There is no doubt that this is one of the most directly important 

 questions that lumber manufacturers have ever had to face. 

 Proper returns under the income and excess profits and war tax 

 laws will have not only an immediate effect upon the actual amount 

 of money that they must pay to the government, but will have an 

 equally direct bearing upon the tax adjustments in other cases, 

 including state, county and local taxes. The final working out of 

 the questionnaire will be the basis for tax assessments for a long 

 time in the future. Therefore every lumber manufacturer is abso- 

 lutely bound by his own self interest to attend the regional meet- 

 ing and to go there prepared not only to listen but to ask questions. 



The nature of the questions asked at the Milwaukee meeting 

 indicates the very large amount of uncertainty in the lumbermen's 

 minds as to just what they are expected to do and also shows that 

 lumbermen will now enjoy the troubles which it might reasonably 

 be expected would result from the lax methods of accounting 

 which in the years past they have been noted for as a class. 



H.^RDWOOD Record is firmly of the belief that the questions and 

 answers during the Milwaukee meeting give a good indication of 

 the line of thought which the lumbermen must be prepared to fol- 

 low. Hardwood Record therefore arranged for a verbatim report 

 of the meeting and is presenting to the lumber trade herewith in a 

 loose insert (see supplement) a full report of the meeting, partially 

 o-iving the questions and answers verbatim and in the rest of the 



