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Mill Conditions Around Memphis 



Tlieie has boeu comparatively little change in the general 

 hardwood situation here during the past fortnight. The conditions 

 growing out of the war in Europe are quite as serious now as at 

 the beginning of hostilities, if not even more so. The export 

 business is almost at a complete standstill. The only exception 

 is that some firms here are allowing shipments on the docks at 

 New Orleans and other southern ports to be loaded for English 

 ports in all cases where the steamship companies regard it as 

 reasonably safe to make the journey from this country to England. 

 In other words, the exporters here are relying upon the judgment 

 of the steamship companies, feeling sure that the latter would not, 

 if the risk were extreme, allow their vessels to proceed on the high 

 seas. At least a half dozen exporters here are letting shipments 

 of lumber go forward under the conditions named. It may be 

 stated, however, that this applies only to business which was 

 booked some time ago, and only to lumber wOiich was at the ports 

 when hostilities broke out on the other side. 



There is no new export business doing. There are a number of 

 reasons for this. It is impossible to sell exchange. It is likewise 

 difficult to make sales of lumber to Europe on account of the 

 demoralized conditions following the general war in that country. 

 The railroads have likewise refused to issue further through bills 

 of lading on lumber shipments and are rather slow about handling 

 further cargoes of lumber to New Orleans or other southern ports, 

 on account of the very great congestion which already exists. 

 Furthermore, owners of lumber do not feel that they are justified 

 under present conditions in shipping lumber to Europe on account 

 of the abnormal risks involved in such an enterprise. It may 

 therefore be said that export markets are closed, and that nothing 

 will be attempted in that direction until the question of the 

 control of the high seas has been settled, and until it is possible 

 to sell exchange to better advantage than at present. 



The attitude of lumber interests here toward production may 

 best be described in the terms of J. D. Allen, president of the 

 Lumbermen's Club of Memphis. There was an executive session 

 of the club here about ten days ago for the purpose of discussing 

 conditions created by the war, with particular reference as to the 

 best method of dealing with the situation. Following adjournment. 

 President Allen stated that it was the concensus of opinion of 

 those present that logging operations should be immediately 

 stopped and that there should be decided curtailment of produc- 

 tion as soon as the stock of logs already on hand had been con- 

 verted into lumber. The representative of Hardwood Record 

 attended this meeting and listened to the discussion of the various 

 members. There was no concerted action taken by the club 

 looking to curtailment, but it is quite apparent that the individual 

 lumbermen and lumber firms realize the gravity of the situation 

 and intend to meet this by very greatly reducing their output. 

 There are some individuals, as well as some firms, which have 

 logging contracts that make it necessary for them to continue 

 running, but, in every such case, efforts are being made to have 

 these contracts either entirely abrogated or so modified that it 

 may not be necessary to take the amount of the lumber involved 

 therein. 



At present, there are very few mills in Memphis or the Memphis 

 territory which have closed down. They have, as a rule, enough 

 logs on hand to last from two to six weeks, and a somewhat general 

 policy of curtailment is expected, as soon as timber on hand has 

 been converted into lumber. There have been few points in recent 

 years on which the lumbermen have been in more thorough accord 

 than that the amount of lumber on hand should be reduced as a 

 result of the stoppage of exports and the less satisfactory condition 

 of the domestic markets. 



The attitude of the banks is quite satisfactory to lumbermen 

 here. The former have given the latter every assurance that there 

 will be funds enough for the financing of present stocks and that 



loans will not be called if the lumbermen pursue a conservative 

 policy. It is also noteworthy that there are plenty of funds to 

 meet payrolls and that there has been no stoppage of milling 

 operations as a result of inability to secure cash with which to 

 meet payrolls and other such expenses. But, while the banks are 

 showing a disposition to treat the lumbermen fairly, so long as 

 they pursue a conservative course, they have given them to under- 

 stand that any speculation or any effort to profit by present condi- 

 tions will result in the calling of loans. From a financial stand- 

 point, conditions are decidedly less strained than they were in 

 1907 when the banks found it necessary to issue clearing house 

 certificates. 



It is recognized that the extent to which the hardwood lumber 

 market will be affected depends very largely upon the length of 

 the war in Europe. The hope is freely expressed that the war will 

 be of comparatively short duration. In fact, there are such 

 enormous numbers of men engaged, and the cost is so excessive, 

 that it is not believed the war is likely to be a long drawn out 

 affair. At the same time, lumber exporters here do not anticipate 

 an early resumption of business with Europe, and they are conse- 

 quently looking around for other outlets. One of the leading 

 members of the trade is authority for the statement that it may 

 be possible to develop some business with Central and South 

 America and with other countries. It is pointed out, however, that 

 requirements in lumber in Central and South America would prob- 

 ably be comparatively small, and that the most direct benefit 

 which lumbermen may expect from business with those countries 

 would come in the form of largely increased sales of furniture and 

 other products in the manufacture of which lumber is used. In 

 any event, it is recognized that a great deal of time will be 

 required for the development of new outlets and lumber exporters 

 here are not looking forward to a renewal of activity in any 

 direction for the present. 



One of the rather surprising features of the situation down 

 South is the fact that officials of the Illinois Central, the Southern 

 Eailway, and other lines, report a decidedly larger amount of 

 freight than at this time last year. They point out that there 

 has been a reduction in lumber shipments and a decided falling off 

 in shipments of logs. They say, however, that the loss in this 

 direction is more than made up by the increase in the tonnage of 

 crops and all manufactured products, as well as goods for com- 

 mercial purposes. Indications are that grain will be moved freely 

 to Europe in a very short time and it is expected that this will 

 further increase revenues of the railroads. 



So far as the domestic markets are concerned, there is no very 

 large volume of business doing. Some sales are being made every 

 day. Shipments are also going forward at a moderate rate. 

 However, there have already been some cancellations on the part 

 of domestic buyers, and it would not be surprising if further 

 developments along this line should follow. It is recognized that 

 the stoppage of exports must necessarily throw a great deal of 

 lumber destined for Europe back on the domestic markets. It is 

 hoped, however, by the plan of individual curtailment, to reduce 

 stocks in this country gradually, and thus prevent a needless 

 sacrifice of values. There are two or three items reported some- 

 what easier, but as a general proposition, the market is unusually 

 well sustained, everything considered. 



One reason why so many people faU to get what they want in the 

 rorld is because so many of them want too much. 



In a recent effort to find out just how much the laborer gets out 

 of the product of manufacture, it was found that of each doUar he 

 gets sixty-one cents and capital thirty-nine. The labor gets twice as 

 much as the capital. That doesn't look so bad for the laboring man 

 nor does it show that he needs any more exemption from anti-trust 

 laws than the owner. 



