22 



HARDWOOD RECORD 



August 25, 1921 



Manufacturers Fight Rates to Save Mills 



Southern Hardwood Traffic Association Invokes Judgment of I. C. C. to Determine 

 Whether Railroads Can Continue to Strangle Hardwood Industry of South 



"OoniplaiuaiitH t'urtlior say, that as tli 

 ami rate adjustments herein complained of, the mills and jjlants 

 of complainants have the long haul to the great consuming mar- 

 kets are closed and many of them nailed up; that but little 

 hardwood lumber and forest products is now being produced in 

 tlie South; tliat many of the mills are facing ruin and some of 

 the largest are already in the hands of receivers; that hardwood 

 lumber and forest products are selling at these mills below the 



A Plea for Economic Survival 



result of the rates 



to ]iay the [iresent exorbitant freight charges and compete with 

 short haul production and substitutes; that the delay incident 

 to the usual procedure in handling formal complaints will be 

 fatal to the complainants' members and injurious to the defend- 

 ants, since if lumber and forest products are to be made avail- 

 able for market and transportation during the coming winter 

 and spring, the logs must be moved to the mills before the fall 

 raia* set in." — Petition filed by Southern Hardwood Traffic 

 Association «t al. with Interstate Commerce Commission for 



.■ost. of production, but even at these ruinous prices are unalile restoration of rate status prior to Aug. 2.5, 1920. 



Bulletin! 



"Hardwood rate case set for hearing before Interstate Com- 

 merce Commission September 29,"' reads a telegram received from 

 Hardwood Record's staff correspondent in Memphis on August 

 23. "Southern Hardwood Traffic Association has called in all 

 district managers to hasten preparation of information and data to 

 support its contention that present rates are unjust, unreasonable 

 and destructive," the telegram concludes. 



The decisive phase of what promises to be one of the greatest rate 

 struggles in the history of the hardwood lumber industry was entered 

 into when the Southern Hardwood Traffic Association during the week 

 ending August 7, filed formal complaint with the Interstate Com- 

 merce Commissrion, charging that present rates on hardwood lumlier 

 and forest products are "destructive," and demanding, in effect, 

 restoration of the tariffs on these commodities prevailing prior to 

 Aug. 26, 1921. This fight is looked upon as the entering wedge, which 

 will split the .solidarity of the railroads and open the way for the 

 general downward revision of rates, which is indespensable if the 

 eomnu'rce and industry of the country are ever to be restored to truly 

 normal conditions. At present the high rates are an anomaly that 

 throws the country 's entire economic machine out of gear. The busi- 

 ness eyes of the entire country, therefore, will be on this contest. 

 The Southern branch of the hardwood lumber industry is threat- 

 ened with extinction by the present rates, which prevent the profitable 

 marketing of the lower grades of hardwoods. There can be no pros- 

 perity nor even profit in the manufacture and sale of lumber without 

 the nornuil marketing of the lower as well as the upper grades. 

 Therefore, the Southern manufacturer of hardwood lumber has been 

 pushed to the wall. His back is against it and he has got to fight 

 and has begun to fight — the hardest battle of his experience. Not only 

 does the life of his business depend upon relief from these confisca- 

 tory rates, but this relief must be given promptly. The complainants 

 most earnestly petition the Interstate Commerce Commission to hear 

 their case not later than the first week in September, preferably at 

 Chicago, but if not there, then in Washington, in order that a decision 

 may be secured in time to permit manufacturers to nuive their logs 

 into the mills before the autumn rains set in. 



The complaint, which was filed by J. V. Norman of Louisville, Ky., 

 general counsel for the Southern Hardwood Traffic Association, was 

 accompanied by a letter to George B. McGinty, secretary of the Inter- 

 state Commerce Commission. In this letter Mr. Norman declared 

 that "the situation herein presented is a desperate one and requires 

 immediate relief in that, if hardwood lumber is to be produced for 

 sale and transportation during the coming fall and winter, the logs 



from which it is produced must be moved into the mills before the 

 fall rains set in. Under the present rate adjustment manufacturers 

 can not move logs into their mills because they can not pay the cost 

 of transportation and get the cost of production out of the logs and 

 lumber. ' ' 



After this declaration Mr. Norman proceeded to exhaustively elabo- 

 rate the reasons which render the granting of his plea for speed in 

 docketing and hearing a matter of compelling justice. 



Mr. Norman shows that since June 24, 1918, rates have been ad- 

 vanced from 00 to 100 per cent on inbound movement of logs, billets 

 and other rough materials and on the outbound movement of lumber 

 and other products made therefrom and asserts, with emphasis, that 

 rates "have been increased to such extent and by inich means as to 

 stifle the industry and greatly reduce the movement of traffic, thereby 

 destroying the prosperity of complainant members and reducing the 

 revenues of the defendants." He charges that present rates are 

 ' ' unjust and unreasonable and in violation of Section 1 of the inter- 

 state commerce act; that they are prohibitive of the production and 

 movement of low grade lumber and other forest products and that, 

 inasmuch as it is impossible to produce the higher grades, without, at 

 the same time, producing the lower, the result is that the entire in- 

 dustry is stifled and hampered and the carriers are receiving less 

 revenue therefrom than they would receive if rates were reduced to a 

 reasonable basis on which the traffic could move." 



Relationships Destroyed 



Mr. Norman further charges that the advance in rates made last 

 August, together with the method used in their making, have had the 

 effect of destroying relationships, especially on long haul traffic and 

 confining business to short hauls, thus localizing distribution to an 

 unusual degree. He further asserts that the "resulting rate structure 

 on hardwood lumber and forest products is unduly preferential and 

 unduly discriminatory in violation of Sections II and III of the inter- 

 state commerce act. ' ' 



After pointing out that hardwood lumber and forest products con- 

 stitute heavy low grade traffic which, under proper rates and adjust- 

 ments, moves long distances in ear load quantities and is most profit- 

 able for the carriers, Mr. Norman insists that the movement is very 

 much restricted under present rates both as to volume and as to dis- 

 tances, with the result that the defendants are deprived of this profit- 

 able business, that the industry is severely throttled and that the 

 return of normal business and economic conditions is prevented. He 

 therefore requests that rates be restored to the level in effect Aug. 

 2.5, 1920. 



The association is determined to make the greatest fight of its 

 career for the reason that the issues at stake are the largest for 



