HARDWOOD RECORD 



jinnual National Lumber JManufacturers' Association. 



The National Luinber Mumifaoturers ' As- 

 sociation, which is composed of eleven or- 

 ganizations of lumber manufacturers in va- 

 rious parts of the country, representing in 

 all 1,269 concerns, held its fourth annual 

 meeting at the Jefferson Hotel, St. Louis, 

 May 8 and 9. A large number of delegates 

 were present and also many visitors. 



At 10 a. m. President N. W. McLeod called 

 the meeting to order and read the annual 

 message as follows: 



President's Address. 



During the year we have increased otu- mem- 

 bershii) from 919 to 1,269, and the annual out- 

 put from 11,850,000.000 to 12,000.000,000 feet. 

 This showing fairl.v represents the interest of 

 lumber manufacturers in association worli. 



The lumber business has been referred to re- 

 centl.v in the public prints as the "Lumber 

 Trust." Candidates for pulilic office in some 

 states have made the "Lumber Trust" the issue 

 in their campaign. These misrepresentations 

 were proliably the result of ignorance. There are 

 very few people, other than lumbermen, who 

 realize that the lumber business is a natural, 

 limited monopoly. Stumpage is the raw ma- 

 terial fur this great industry. It is unlilie other 

 great manufacturing industries in that the quan- 

 tity of raw material available for commercial 

 lumber, present and future, is an absolutely 

 known factor. The supply of raw material can- 

 not tie increased as in coal. iron, or other build- 

 ing materials by the opening up of new deposits. 

 With a known, limited quantity of raw ma- 

 terial and a rapidly developing consuming mar- 

 ket — through the increase in population as well 

 as increase in the per capita purchasing power — 

 the price of stumpagre must confcn-m to the law 

 of supply and demand and be determined only 

 by a value that will not retard consumption. 



In the earlier years of our industry the large 

 investment of the producer was in plant, stocks 

 of lumber that were carried, and in accounts. 

 The cost of raw material — on account of the 

 supposedly inexhaustible supply — was nominal. 

 Manufacturers were not obliged to invest their 

 capital in large bodies of timbered lauds, as 

 they inuld secure the raw material required as 

 it was needed. The evolution of supply and 

 demand has changed this condition so that the 

 greatest investment of a manufacturer at this 

 time is in standing timber. Manufacturers have 

 been forced to abandon the old method of taking 

 into their cost of production their timber at its 

 original cost without carrying charges or taxes, 

 and, as they have been forced to acquire fresh 

 supply of timber for their plants, they begin to 

 realize that the manufacturer of luiiiber must 

 occupy a dual capacity, that of a timber mer- 

 chant as well as a manufacturer and distributcu- 

 of lumber. Recognition of the value of raw ma- 

 terial, from which we are making our lumber, 

 has been a potential factor in the higher values 

 obtained for the manufactured product. In 

 analyzing the results from a lumber operation 

 if the actual value of stumpage. considering the 

 quantity available and the demand for its use, 

 was taken into the cost statements. It would be 

 found that the manufacturer of lumber is not 

 receiving the margin that the investment of 

 large sums in plants and equipment — that must 

 be written off during the life of the plant — tuat 

 he is justly entitled to. 



The question of timber supply for commercial 

 use is one that has been given serious con- 

 sideration by the older nations. Our own gov- 

 ernment has realized for a numljer of years that 

 unless reforms were inaugurated in the present 

 methods of converting the forests into lumber, 

 removing only the matured growths, preserving 

 the young timber for future use. that the supply 

 of lumber would — in a comparatively few years- 

 be exhausted. The Forest Service "of the' United 

 States government is maintained on broader lines 

 than the reproduction of trees for commercial 

 use, but commercial forestry is recognized by 

 President Roosevelt and those in charge of the 

 Forest Service, as one of the most important 

 works of the department. The Forest Service 

 has met with considerable co-operation and as- 

 sistance from lumber manufacturers, but when 

 the manufacturers recognize the real value of 

 their stumpage based on the supply and de- 

 maud considered for a period covering the life 

 of their operations, the Forest Department will 

 enjoy the co-operation and assistance of lumber- 

 men to a degree that has been denied them in 



the past. It is believed by students of this 

 qviestion that the actual value of stumpage to- 

 day, considered as above, would justify manu- 

 facturers — who are timber owners — incurring the 

 additional expense iu operating that would be 

 necessary in removing only the matured tim- 

 ber, preserving the younger timber for future 

 use. The Forest Service is equipped to cruise 

 timber lands and give estimates of costs and 

 values in a practical way and demonstrate un- 

 der what method of operation the timber of a 

 given tract can be operated to the best advan- 

 tage. The secretary's report will give a brief 

 outline of otu- department work. In statistical 

 work the government Forest Service and our 

 association are co-operating in obtaining re- 

 liable statistical information. Complete infor- 

 mation as to the production, consumption and 

 stocks of lumber on hand will be compiled and 

 published annually. 



The work of the Credit Rating Department has 

 been successful. We have a department fully 

 organized and equipped to furnisli our members 

 with first-class service as to credits and collec- 

 tions. The department is now self-sustaining. 

 Iiut provision must be made to finance the amount 

 invested in the plan. The bonds provided for 

 this purpose have not been taken by our mem- 

 bers. Therefore, some plan of financing must 

 be provided, or. if it is decided that our mem- 

 bers do not want to maintain a Credit Rating 

 Department, the assets of the department should 

 be disposed of, relieving the association of obli- 

 gation. There is no question that if it is de- 

 cided to discontinue the department, the assets 

 can be readily sold so as to relieve the assoc* 

 ation of obligation and leave a balance in the 

 treasury. I recommend that a committee of 

 eleven, one meml>er from each association here 

 present, be appointed to thoroughly investigate 

 the de[iartment and arrange either to finance the 

 department or to sell the assets to the best ad- 

 vantage. All delegates to this meeting are in- 

 vited to call at the general offices of the associ- 

 ation on the seventh floor of the Equitable 

 building to make a personal Investigation of 

 the Credit Rating Department work. 



During the year various associations have 

 taken advanced positions in exploiting their re- 

 spective products by show-ing the finished product 

 artistically treated. Results iu interior finish 

 and furniture have surprised the lumbermen 

 themselves and the work along this line, it is 

 believed, will materially increase the demand for 

 upper grades of lumber. 



At our last meeting the ciuestion of odd 

 lengths and odd widths w^as discussed. Owing 

 to the limited time for discussion, the matter 

 coming up late in the session, it did not receive 

 the consideration that, in my opinion, it de- 

 serves. I would, therefore, recommend that a 

 standing committee on economy of mill product 

 be appointed to handle questions of this char- 

 acter. 



Under date of March 12, last. President 

 Roosevelt appointed me as representing this as- 

 sociation, a member of an Advisory Board of 

 Fuels and Structural Materials. The Advisory 

 Board is to be organized by the Director of the 

 <Teological Survey and the Chief of Forest 

 Service of the Oovernment to report to the 

 President suggestions and recommendations as 

 to the best methods and use of the building ma- 

 terials and fuels of the United States. The 

 appointment, under the terms thereof, is to the 

 president of this association and to follow to hia 

 successor in office. 



During the year great confusion has existed 

 as to terms of sale. This is a subject of great 

 importance and should have our careful con- 

 sideration, t^niformity of terms would not only 

 simplify the work of accounting, but would 

 eliminate very materially a large number of 

 petty claims and deductions that are made on 

 shipments. 



At otu" last meeting in Chicago a movement 

 was undertaken to provide a fund to endow a 

 chair of practical lumbering at Yale. Committees 

 were appointed to secure the necessary funds. 

 As the value of stumpage Increases, the neces- 

 sity of utilizing the best methods of converting 

 the forests into a marketable product is mani- 

 fest. Graduates of Forest Schools are equipped 

 by their engineering skill, technical training and 

 field work to undertake and economically ad- 

 minister lumbering tiperations. 



The reports of the following standing com- 

 mittees will treat the subjects referred to them, 

 viz : Transportation, Credit Indemnity. Insur- 

 ance. Uniform Export Contract, Endowment of 

 Chair of Practical Lumbering. 



The president then called upon Secretary 



George K. Smith for his report, which was 



given, as follows: 



Secretary's Report. 



The year 1905 passed into history as one of 

 the most prosperous ever experienced by the 

 lumber Industry. This condition was reflected 

 in all associations afBliating and our present 

 iijemoersuip is as follows : 



Mem- 

 bers. 

 292 

 163 



83 

 156 



210 



131 



41 

 16 



85 



60 

 32 



.\pproxiuiate 

 Annual Output, Ft. 

 Yellow Pine Mfrs. Assn . . . 4,000,000,000 

 Pacific Coast Lbr. Mfrs. 



Assn 2.000.000.000 



Northern I'ine Mfrs. Assn.. 2,000,000,000 

 North Carolina Pine Mfrs. 



Assn 1,000,000,000 



Hardwood Mfrs. Assn. of 



the U. S 1.000, (JOO.OOO 



Georgia Interstate Sawmill 



Assn 800.000,000 



So. Cypress Mfrs. Assn. and 



So. Cypress Selling Co.... 600,000,000 



Northwest'n Hemlock Mfrs. 



Assn 200.000.000 



Wis. Hardwood Mfrs. Assn. 200,000,000 

 Southwestern Washington 



Lbr. Mfrs. .4ssn 200.000,000 



1260 12.000.000.000 



Comparing this with the record one year ago, 

 we note several changes in names and two as- 

 sociations merged with their stronger neighbors. 



I'lii- Wisciiisin Valley Assoiiation joined with 

 the Mississippi Valley LnmbiMiLieu's Association 

 to fium the Northern I'ine Association. The 

 South Carolina Lumber Association ceased to ex- 

 ist and all its members joined the North Caro- 

 lina Pine Association. The Southern Lumber 

 Manufacturers' Association changed its name to 

 the Yellow Pine Manufacturers' Association, 

 thus making all the association names descrip- 

 tive of the particular kind of wood they repre- 

 sent. 



There are two active associations — represent- 

 ing large annual outputs, which have not yet 

 affiliated with us, viz. : The Western Pine 

 Manufacturers' Association, of Spokane, Wash., 

 and the Oregon Lumber Manufacturers' .\s,so- 

 ciation. of Portland, Ore. We trust they will 

 see it to their interest to join us soon and thus 

 add to tlie strength and usefulness of this asso- 

 ciation. 



There ,has been an Increase in the membership 

 of practically all the associations named, the 

 total now being 1,209. as against 919 a year 

 ago. 



Each association has been doing efficient work 

 along statistical lines, both monthly and an- 

 nually, and the interchange of this information 

 has become a feature of association work, which 

 is the direct result of the influence of this asso- 

 ciatiim and the opportunities offered for per- 

 sonal exchange of views and methods at these 

 annual gatherings of the delegates and secre- 

 taries of the affiliated associations. 



One year ago we referred to the plan for 

 gathering complete figures, covering output, con- 

 sumption and stocks of lumber, and are pleased 

 to report that the Forest Service has not only 

 co-operated with us. but has taken the lead in 

 this most important work, and since January 1 

 has been making an active canvass of the "en- 

 tire United States, and has sent Mr. R. S. Kel- 

 logg, of the Department of Forest Products, to 

 address us at this meeting. 



This plan has passed the experimental stage 

 and from now on there will be prepared autoen- 

 tic figures annually, covering the three im- 

 portant items of cut. shipments and stocks of 

 lumber. This again proves the wisdom and 

 profit of organization and co-operation. 



During the year the work of covering the en- 

 tire United States in our Credit Rating Book 

 was completed, and the issue of April, 1906, has 

 brought the department to a point where it Is 

 securing the patronage of a sufficient number 

 of members of affiliated associations to war- 

 rant the statement that it is now on a self- 

 sustaining basis. A detailed report has been 

 prepared for the use of the committee on Credit 

 Rating Department, with definite plans for the 

 permanent financing of this most important de- 

 partment. 



It is hoped every delegate will visit the of- 

 fices and work rooms of this department while 

 in St. Louis, and thus gain a personal knowl- 

 edge of its methods and carry back to your 

 various associations a report which will create 

 enthusiasm and largely Increase the support. 

 If the 1.269 members of the eleven associations 

 now affiliating will give this department unani- 

 mous patronage we can cancel our indebtedness 

 in three years and after that time furnish credit 

 rating information at a cost much less than the 

 present schedule. This was the original inten- 

 tion and it rests with those you represent to 

 sa.v when this intention shall be carried out. 



Some months ago a request was made for a 

 copy of the terms of sale and discount in use 

 by the members of the various associations, and 

 on receipt they were reproduced on a single 

 sheet, so that easy comparison could be made. 

 Tlie lack of uniformity emphasizes the neces- 

 sity of keeping this subject before us, in the 

 hope that some progress may be made. 



Copies of the printed terms of twelve asso- 

 ciations will be handed to the committee ap- 

 pointed to give this question consideration. 



Had this report been written a month ago 

 it would have !>een possible to say that trade 



