HARDWOOD RECORD 



29 



lumber, and now tor something general in regard to probable future 

 prices. There has been a general demand all over the world, and 

 probably because it is nearer home, it seems to us that this demand 

 has been more insistent in the United States than elsewhere, and 

 for the same reason it seems to the lumbermen that the demand has 

 been loudest for conservation of the American forests. The lumber 

 manufacturers of the United States have been accused of criminal 

 negligence and wilful waste in the manufacture of their timber. 

 Volumes have been written on the subject, and thousands of speeches 

 made by eloquent orators, to prove that lumber manufacturers are 

 wilful criminals for wasting our resources. Gentlemen, has it never 

 occurred to you that the same element of human nature is found in 

 the average manufacturer of lumber as in manufacturers of any other 

 line? Notwithstanding the fact that lumbermen are popularly 

 pictured with horns and hoofs, they are after all just as human as 

 you and people of any other occupation or business. The same 

 elements of selfishness and generosity, honesty and dishonesty run 

 through the average manufacturers of lumber as they do through the 

 average men of any other line of business, and to no greater nor 

 lesser extent. "We are no worse than the worst of you, and we are 

 just as good as the best of you. 



Too many times people without education will criticise the teacher, 

 and people without children, write volumes and talk eloquently on 

 how to bring them up. So it is with the fanatic on the conservation 

 of the forests. You have heard many assail the lumbermen, try to 

 tear down present methods and predict disaster for the future, but 

 how many have even suggested a real remedy. It would be difficult 

 for you to name even one. It requires no brains to criticise and try 

 to tear down, and he who does so with nothing better to offer is a 

 "knocker" who should be without honor and despised of all man 

 kind. In the following statement I make no claim to originality. 

 "Many have heard the voice of wisdom, but few will heed it.'' 

 Many people, in fact nearly all people, are loth to heed or believe 

 what seems to be unwelcome advice. Dr. C. A. Schenck, director of 

 . the Biltmore Forest School, one of the greatest students of economical 

 methods of forestry, one who has had an unusual opportunity to 

 study practical conditions right on the ground, in nearly all the 

 principal forests of the world, states very emphatically that we will 

 never be able to practice real forest conservation in the United 

 States without higher prices — very much higher prices for lumber. 

 Would the jieople generally shout so loud for forest conservation if 

 they knew it meant higher prices for lumber, especially so if it 

 meant higher prices for low-grade lumber? 



The people liave been led by some of the politicians, by some of 

 the ' ' knockers, ' ' and possibly by some box manufacturers, to believe 

 that they are entitled to and should demand cheaper low-grade lumber. 



As previously stated in this article, a little more than half of all 

 the hardwood lumber produced in Michigan, and we have just as 

 good a general run of hardwood in Michigan as in any other state 

 in the Union, is composed of the grades known as No. 2 common 

 and No. .3 common, generally known as "low grade." Taking 

 northern hardwoods as a whole, they produce about the following 

 proportions of low-grade lumber to each thousand feet cut, viz. : 

 No. 3 common, about 340 feet; No. 2 common, about 160 feet, or 

 500 feet out of each 1,000 feet cut is low-grade, and this estimate 

 is conservative as it will take better than the average of northern 

 hardwood to produce as much as fifty per cent high-grade lumber. 

 Now the average price f. 0. b. ears at the mills or the average price 

 received by the manufacturer of northern hardwood lumber during 

 1909, 1910 and 1911, has been as follows: No. 3 common, about $S 

 per thousand; No. 2 common, about $14, an average of rather less 

 than m.ore than $10 per thousand feet. Now here is the other side 

 of it. It costs the average manufacturer of hardwood lumber in 

 labor, and other expenses to log, haul to his railroad, load on cars 

 and transport to his mill, saw into lumber, pUe in his yard, hold until 

 dry, sell, load on cars, taxes and other charges, not less than $11 per 

 thousand feet, or a loss of $1 per thousand on more than half the 

 lumber he produces. This loss is based on actual labor and manu- 

 facturing costs and does not give him any compensation for stumpage. 

 Gentlemen, will you or a fair minded people knowing a condition of 



this kind, persist in demanding cheaper northern hardwood low-grade 

 lumber? Is it right; is it fair to do so? 



Many of the politicians and wise guys, and unfortunately some of 

 the box manufacturers, will cite to the public some particularly high 

 jiriccd item in hardwood lumber as an example of exorbitantly high 

 jirices, and purposely leave the impression with the people that this 

 is a fair example of all the prices that the manufacturers are getting. 

 They do not tell the people that more than half of the lumber pro- 

 duced does not bring the cost to manufacture; that the particular 

 item carrying the seemingly exorbitant price does not constitute more 

 than one, two or five per cent of the entire cut; that it includes a 

 wholesaler's and a retailer's profit, and a transportation charge, many 

 tim.es equal to the cost to manufacture. 



When you come to consider that the 500 feet of high-grade lumber 

 out of the 1,000 feet produced must take care of the loss of $1 per 

 thousand on the 500 feet of low-grade; that the 500 feet of high 

 grade must take care of the stumpage used in producing the whole 

 1.000 feet; and that this same 500 feet of high grade must also 

 provide the manufacturer whatever profit he gets for manufacturing 

 and marketing tlie 1.000 feet, is it any wonder that at least a part 

 of this same 500 feet loaded down with all of its poorer relations 

 should bring a seemingly high price? 



Just a word further in regard to prices, who and w-hat makes 

 them. The manufacturer can and does reasonably claim that the 

 consumer has as much or more to do with the making of lumber 

 prices than he, the manufacturer. Take as an example the fall of 

 1906 and up to midsummer in 190". Early in the'fall of 1906 No. 3 

 common hardwood lumber, such as maple, beech and birch, was selling 

 on cars at the mills at $7.50 to $8 per thousand feet. By October 1, 

 Iftiiti. it became apparent to members of the Michigan Hardwood 

 Manufacturers' Association, through their combined stock reports 

 and the unusual activity of buyers, that there was a decided and 

 unusual shortage of this particular grade. By January 1, 1907, 

 prices had advanced to about $10 per thousand, and some manufac- 

 turers with the courage of their convictions held on until March and 

 sold as high as $12 per thousand — the first and only time in the 

 history of the northern hardwood industry when manufacturers 

 obtained manufacturing cost for their low-grade lumber. By th? 

 time the cut of the winter of 1906 and 1907 was in condition to use, 

 prices had dropped back to $9 to $10, and held at about these prices 

 until the fall of 1907, when you all know what happened. On January 

 1, 1908, our members showed thirty-eight million of No. 3 common 

 hardwood lumber as against twenty-three million on January 1, 1907. 

 This stock kept constantly increasing and by January 1, 1909, it 

 reached fifty million, January 1, 1910, seventy-four million, and what 

 box manufacturers did to lumber manufacturers in the way of prices 

 for No. 3 common hardwood during 1908, 1909. 1910 and 1911 was 

 something that I hope we may never again experience; for as you 

 know, large quantities of this grade sold as low as $6 to $7 pe 

 thousand at the mill, fully $4 per thousand less than the manufactui. 

 ing cost. January, 1911, showed seventy-two million, a very slight 

 decrease in stock but not enough to influence prices materially, but 

 along comes the tie business and our stock sags back to forty-four 

 million January, 1912. \ATiile some of you box makers, as the old 

 saying goes, ' ' do not know the war is over, ' ' we lumber manufac- 

 turers think we have reason to believe it is, and consequently are 

 hopeful for better prices for low-grade hardwood lumber. 



Some of these details may be tedious, but I have gone into details 

 somewhat to show that prices are regulated, solely and entirely, by 

 supply and demand. While many of the manufacturers of hardwood 

 lumber knew positively back in the winter of 1906 and 1907 that a 

 $12 price for No. 3 common maple, beech and birch was too high, and 

 would eventually prove a boomeiang to swing around and smite us, we 

 were just as powerless to prevent this unusually high price as we 

 were to prevent the ruinously low price of $6 and $7 lumber later on. 



The high price for No. 3 common hardwood in the fall of 1906, 

 however, taught us a lesson in forest conservation — a lesson that will 

 illustrate a point previously raised in this article, and a point that 

 may ultimately be of benefit to box manufacturers and other users 

 of low-grade lumber. I have in mind the fact that if the manufac- 



