HARDWOOD RECORD 



JONB 10, 1918 



Occurrences at Washington Interesting to Lumbermen 



Personal Mention and the Activities of Various Boards and Committees 



Perhaps the biggest question of the war from the standpoint of 

 the lumber industry is being gone over now in a series of important 

 conferences among lumbermen and government officials on the sub- 

 ject of fixing lumber prices to the public. Members of the manu- 

 facturing branch of the industry have become reconciled to the 

 idea after a talk with Bernard M. Baruch, chairman of the war 

 industries board, who told them frankly that the government would 

 fix prices to the public on lumber, as it has on steel, coal, copper, etc. 

 It is known that the government will fix a price or prices for the 

 miUmen to sell to other customers than the government. This 

 will apply at first to the pine and fir industries, it is reported, with 

 the prospect that it will later apply to hardwoods and other lumber. 

 The government may also fix the prices at which wholesalers and 

 retailers will sell lumber. Lumber manufacturers say that condi- 

 tions would be unfair otherwise, with no limit placed on the whole- 

 salers ' and retailers' profits. 



The manufacturers, speaking through the directors of the'National 

 Lumber Manufacturers' Association, at a special meeting in Wash- 

 ington this week adopted a resolution accepting the government 

 public price plan, which resolution is as follows: 



In an address before congress on December 3. 1917, the president stated. 

 In effect, that in his judgment, as a government war policy, prices on 

 sommoditles should be so fixed that production would be encouraged and 

 the public safeguarded against excessive burdens. 



In this hour of national stress the lumbermen of the United States 

 recognize that one outstanding concern of all patriotic men is the neces- 

 sity of supporting the president in his war policies, and that personal 

 opinion and Judgment as to the legal rights should be submerged in the 

 larger thought of the nation's needs. 



In the recent convention of the National Lumber Manufacturers' Asso- 

 ciation in Chicago, wherein every branch of the industry was fully rep- 

 resented, it was unanimously resolved that, if in the judgment of those 

 In authority In Washington, lumber prices should be fixed to the public 

 as well as to the government, the Industry would adjust itself to such 

 program. 



Mr. Baruch. chairman of the War Industries Board, has advised this 

 committee that lumber prices should be fixed to the public as well as 

 to the government. 



In the thought, and having faith that the government will deal fairly 

 and justly with the Industry, this committee, duly appointed by the 

 National Lumber Manufacturers' Association to deal with this matter, 

 hereby resolves to record its assent to the policy of the government to 

 fix prices to the public and pledged its hearty co-operation in carrying 

 out the spirit of this plan. 



Whereas, The government has reached the conclusion, as expressed by 

 the chairman of the War Industries Board, and by the request of the 

 president in his address to congress on December 3, 1917, that it is 

 necessary to fix prices on commodities, so that production may be encour- 

 aged and to protect the public from unreasonable prices. 



It is, therefore, Resolved, By this committee, representing the National 

 Lumber Manufacturers' Association, in the absence of any power being 

 conferred upon any agency of the government to fix prices, and having 

 faith that the government will deal justly with the industry, we yield our 

 personal .views and will endeavor to reach a fair and reasonable con- 

 clusion by agreement with the government in carrying out its purposes. 

 The directors have since taken up details of the situation for 

 discussion. They delegated Charles S. Keith, president of the 

 Southern Pine Association, and E. H. Hazen of the "West Coast 

 Lumbermen's Association to confer with each other and with cost 

 experts and auditors in an endeavor to agree for the pine and fir 

 interests upon the economic principles and elements of the cost 

 of production that should be adopted by the government as the 

 basis for fixing prices to the public. 



If this matter is worked out satisfactorily it will be pi'esented to 

 the price fixing committee of the "War Industries Board, together 

 with the lumber manufacturers' idea of what the price to the public 

 should be, for consideration by the committee. 



The fir interests are scheduled for a hearing before the price 

 fixing committee next Monday. The pine interests will probably be 

 heard later. 



A number of wholesale lumbermen are actively at work here in 



connection vdth the price fixing negotiations. They want the whole- 

 sale interests to be recognized in the plan that is adopted. They 

 have been in touch with the "War Industries Board for some time 

 and more recently have conferred with President Kirby of the 

 National association, Director of Lumber R. H. Downman, Charles 

 S. Keith, president of the Southern Pine Association, and others. It 

 is rumored but not confirmed that the government is disposed to 

 allow only one dollar increase over the mill price to the wholesalers. 

 The latter say this is not enough to give them a profit and is not 

 fair, especially as the government has found in certain instances 

 that the retailers' price might be $12 more than the price now paid 

 by the government. 



"Wholesalers do not want the government to fix the wholesale 

 price. If it does not they would be free to charge what they could 

 get over the government mill price. Retailers have been asking 

 an increase in the approved prices for lumber obtained by the 

 government from retail yards for emergency purposes upon the 

 ground that the cost of handling, hauling, etc., has gone up mate- 

 rially. 



If the wholesale price is fixed wholesalers hope that it will include 

 a reasonable amount over the mill price and that it will not be set 

 for any definite period of time, as they say the scheme of estab- 

 lishing prices for a limited period operates to check sales toward 

 the end of that period because millmen believe that their prices will 

 be increased after the end of the period. 



Timber owners of the west are represented at some of the price 

 conferences here by E. T. Allen of Portland, Ore., who says that 

 the economic principle that the price fixing committee may adopt 

 as the basis of price fixing may be of vast importance to timber 

 owners, especially if it involves the value or cost of stumpage, as 

 it very likely will. 



The fir loggers want an increase in the government price on No. 3 

 logs, which the fir mill men are opposed to. The fir millmen want 

 increased lumber prices. The "War Industries Board has author- 

 ized the statement that the fir people have not reached any pre- 

 liminary agreement on the price question. 



It is thought by lumber manufacturers that the government-fixed 

 mill prices to the public will be higher than the prices now paid 

 by the government to the mills, though not so high as the com- 

 mercial market price. However, lumbermen have a theory that 

 the new price to the public from the mill should be high enough 

 to cover the cost of production of any manufacturer. If it covers 

 such peak cost it will insure substantial profit to many mills whose 

 cost of production is less. 



The new prices are expected to be modified from time to time as 

 conditions change, being revised upwards sometimes as costs 

 increase. Periodical price adjustments have been made in the case 

 of steel, copper and other raw materials. 



The government policy in other commodities is to fix the price 

 not only of raw materials, but of their finished products. Thus the 

 fixation of government prices on shoes is to follow price fixing on 

 hides and leather. "Under this policy the government might fix the 

 price of articles manufactured from lumber. 



There are many angles to the lumber price fixing situation. One 

 lumberman says that it has more facets than a diamond. Lumber- 

 men generally do not like the price fixing idea, so far as the public 

 is concerned, but they can not avoid it, so many of them are deter- 

 mined to get what credit they can by accepting the idea and make 

 the best of the situation. They believe that it may have some good 

 results, though they fear not enough to counterbalance the bad 

 results that may follow the government program. 



"Walter E. Chamberlin, Boston; C. H. "Worcester, Chicago, and 

 J. H. Ransom, Portland, Ore., have resigned from the lumber 

 director's staff. It is known that Chamberlin and Ransom do not 

 agree with the plan of fixing prices to the public. Neither does 



