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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 



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Vol. XLVI. 



CHICAGO, MARCH 25, 1919 



No. 11 



Review and Outlook 



General Market Conditions 



HARDWOOD BUYING IS lilPEOVIXG in spite of the fact that 

 there is still a good deal of price pressure being brought to 

 bear by astute buyers who are getting sufficient results to represent 

 a serious indictment of the business judgment and backbone of 

 those who have lumber for sale. That excessive price dickering is 

 not necessitated by conditions is proven by the fact that some of 

 the most notable sales of late have been made by firms having 

 national reputation for knowing the %'alue of their goods and get- 

 ting that value out of them. Seemingly the high peak of hardwood 

 prices as represented by a composite figure of all prices was reached 

 in December, and according to the reckonings of financial authori- 

 ties, the composite price for March 1, three months later, was only 

 two dollars below the high war peak. This is a distinctly strong 

 sign as in reckoning the composite price the many excessive figures 

 on special items in hardwoods reached during the war brought up 

 the high peak of war average composite price on the regular run 

 of commercial items. On March 1 the composite figure, $.58.60, 

 representing hardwood values of that date, undoubtedly is as strong 

 as, if not a little stronger than, would have been the composite 

 price of the same items of normal commercial consumption main- 

 tained during the war period. 



It is a matter of established record that the range of hardwood 

 lumber prices from 1913 to the present date shows an increase of 

 only between twenty and twenty-five per cent, whereas the cost of 

 manufacturing during the same period has gone well over 100 per 

 cent increase. There is no hope of materially lessened cost, and 

 this fact seemingly is being recognized by government officials in 

 the lumber conferences at Washington. The lumbermen there have 

 put up a straightforward statement of their position backed by the 

 same figures of cost used in making income tax reports, and today 

 it seems to be the disposition of the government to accept the 

 statements and make recommendations for stabilizing hardwood 

 prices based on the present level or even on a higher level. 



Even without the stimulation of government support to this end, 

 the economic laws governing will very likely work out to that con- 

 clusion anyway. It cannot be otherwise with such a radical cur- 

 tailment of supply and with production cost sustained at such a tre- 

 mendous increase. It can be stated without qualification that lum- 

 ber sold at lower prices today is sold without profit and even at a 

 loss. This fact may not be recognized by those selling or in some 

 cases it may be recognized and the sacrifice made because of neces- 

 sity for turning a certain proportion of goods into cash. Broadly 



speaking, lumber sold to the consuming trade today at radically cut 

 prices is either showing up in the red on the manufacturer's books 

 or if it is sold by the wholesaler it represents a decision to turn 

 over a good buy quickly at a small profit rather than hold it to get 

 out all he might be entitled to. 



In spite of all the talk about building stagnation, which cer- 

 tainly exists, the fact remains that from month to month there is 

 shown an increasing acceleration in applications for buOding per- 

 mits. Thus the progress made in February shows an increase over 

 the progress made in January so far as the national building situa- 

 tion goes. 



H.VRDWOOD Record has argued repeatedly that it will be impos- 

 sible for the present demand for housing to continue without some- 

 one concluding that it is good business to help supply that demand. 

 In opposition to arguments to tying up such big investments as is 

 required by present building costs, it is a known fact that the actual 

 percentage of returns today is greater than it has been in previous 

 years when building costs were a great deal less. With excessive 

 demand and with a more independent attitude by landlords per- 

 mitting them to eliminate concessions, free rent privileges and 

 similar expensive practices, and with 100 per cent return in rentals 

 on every building in almost every part of the country, the land- 

 lord is getting a more consistent income than his actual percentage 

 of returns figured on past cost of construction and maintenance. 

 The tendency in rents toda}' is upward and undoubtedly will be so 

 for the next year and maybe for the next two years. 



All the above refers to private building enterprises, and it must 

 be kept in mind that this phase of building is distinct from gov- 

 ernment and municipal building. The former is dependent entirely 

 upon the initiative of the people at large for its progress, whereas 

 the latter development is dependent strictly upon legislation. The 

 only reason that the government buUding has not been given a 

 vast impetus is because the machinery necessary to get this work 

 well under way is too ponderous to have been organized in time. 

 With the return of the government to the consideration of national 

 problems, it is quite likely that the demand for immediate start of 

 government building work on a big scale will be so insistent that 

 proper steps to this end will come immediately. Here then will be 

 a vast field for the consumption of building materials and un- 

 doubtedly the active beginning of government projects will have a 

 stimulating effect upon private building projects, and so not only 

 add its direct total to the volume, but indirectly increase the total 

 of building work in the private field. Already many large private 

 enterprises are in the process of being launched. Hotels, depots. 



