'^i ^:J^Ay^^^^>>^i^i^TO^^ 



( o).,\ rlsbt. Thb IlAttDwooi) CoMI'ANY. 1917 



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

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



THE HARDWOOD COMPANY 



Edgar H. Defebaugh, President 

 Edwin W. Meeker, Managing Editor 

 Hu Maxwell, Technical Editor' 



Entire Seventh Floor Ellsworth Bnilding 

 537 So. Dearborn Street, CHICAGO 

 Telephones: Harrison 8086-8087-8089 



Vol. XLIII. CHICAGO, JULY 25, 1917 No. 8 



General Market Conditions 



' I 'HE TASK of writing a market digest is a rather onerous one these 

 ^ days, for with so many and rajiid changes, and such a diversity of 

 influeuccs, it is extremely difficult to give a reflection of true condi- 

 tions. As Hardwood Eecord would prefer to refrain from market 

 discussions entirely rather than to give wrong impressions as to actual 

 conditions, the task calls for the most careful perusal of all indications 

 and information. 



Were the situation today unqualified by abnormal effects from 

 other directions, buyers of hardwood lumber in the usual channels 

 might be justified in the hope (though we would hardly put it so 

 strongly as to say, in the expectation), of au easing market. But 

 right at the outset we must repeat what has been urged in this column 

 so often liefore, that the field for hardwood consumption that has been 

 ■ creaftcd outside of the ordinary channels is of mounting importance 

 almost day by day. And to use the extreme case, were the normal 

 lines of hardwood uses to approach a condition of slackness equal to 

 that in the most depressing times in the past, the situation would still 

 remain in the sellers' hands. 



This statement is not made for the purpose of adding stiffness to 

 the backbone of the lumber trade, as the modern organizations among 

 the hardwood men give every assistance whereby their members are 

 kept constantly and accurately informed as to the actual relation of 

 supply and demand. It is on the other hand made for the purpose of 

 stimulating an appreciation by the buyers of the fact that if they 

 refrain from making purchases now they make themselves liable to 

 all kinds of embarrassment in the next few months, due to extreme 

 difficulty in or absolute impossibility of getting what they must have 

 in the way of raw material. There are the same logical reasons for 

 making this assertion as have been urged upon the readers of H.\rd- 

 ■WOOD Record in'many issues in the past: the fact that mill stocks are 

 just as badly broken as they ever were, with even less possibility of 

 replenishment; that the increasing car shortage is making it more and 

 more difficult to get in sufiicicnt logs to keep the mills' going to any- 

 where near capacity; that radically improved methods in accounting 

 among lumbermen has brought an almost universal conception of what 

 lumber is" intrinsically worth, and the realization that the present 

 prices are no more than sufficient to cover increased costs without any 

 excessive profits, hence fortifying the lumberman in his insistence 

 upon good returns as he knows he will lose money if he sells for less 

 than he is now getting. And to this must be added the fact that the 

 government is just beginning to realize its vast requirements in hard- 

 wood lumber. The amount in different woods that it will ultimately 

 rei|uire is so great that the effect of present shipments on the general 

 market is negligible as compared to what must come later. 



The yard man, who resells his lumber, and the factory man who 

 works it up, are both entitled to adopt a policy of caution in the face 

 of present necessities. But the retailer cannot make any monejr 

 unless he has lumber to resell and the factory man cannot pay divi- 

 dends unless he has the raw material at as low a price as possible 

 wherewith to manufacture the goods which he sells. The yard man and 

 the manufacturer therefore should give just as much consideration to 

 the i>ossibility, in fact the entire probability, that not only will prices 

 lie higher in the months to come, but there is a very real danger of 

 their being unable to get what they want at any price. 



If the car shortage is acute now what will it be when the govern- 

 ment requisitions service for troop movements, and then for the 

 endless shipments of supplies and equipment that must be rushed to all 

 parts of the country? Almost simultaneously will come the annual call 

 for adequate facilities for moving the crops. The yield this year is 

 enormous and will be taken care of in spite of all other requirements- 



The farmer has been too busy perfecting his record-breaking pro- 

 duction, which he will turn over at two or three prices, to think aliout 

 plans for spending money, but with the crop out of the way he is 

 going to have millions and hundreds of millions to spend for things 

 which he has never been able to afford before. Country bankers iit 

 all agricultural sections report enormous cash balances held by the 

 farmers at this period when all precedents indicate that the farmer 

 should be practically devoid of cash until his crops begin to come in. 



In short, the general tendency to withhold orders for lumber now 

 merely means that forced requirements coming simultaneously later 

 would deluge the Umiber trade with business which could not j)ossihly 

 be taken care of. And with the average hardwood mill practically- 

 sold up for three to six months ahead, and many of them actually out 

 of the market, the effect of this on prices is easily discernible, to say 

 nothing of the certainty that the users needs could not be supplied. 



Independence from Canada 



A DECLARATION OF INDEPENDENCE FROM CANADA has 

 been declared by D. F. Houston, Secretary of Agreulture, in a 

 letter to the American press, recently sent out from Washington. 

 It related to the paper supply, and the secretary declares that our 

 present dependence upon the Canadian forests for our paper pulp 

 is unnecessary. The matter has come to the front on account of the 

 e.xorbitant prices charged for paper by the manufacturers. The 

 price is so high that manj- of the large newspapers have seen theii- 

 profits dwindle to the vanisliing ]ioint, and book publishers are hold- 

 ing down their output to the lowest point. Still, the demand foi- 

 paper increases. 



Mr. Houston bolls that the exertmcly high prices are not justified 



