-51- 



pending currency legislation caused a. pronounced decline in building activi- 

 ties and a fall in railroad purchases, which were immediately reflected in a 

 sharp reduction of Yellow Pine prices. Under the stress of low prices many 

 small Yellow Pine mills were shut down during 1913. The normal seasonal in- 

 crease of building activities in the spring of 1914, checked the fall in 

 prices for a tiite but this slight prosperity was short-lived. The curtail- 

 ment of pine exports on account of the war increased to some extent the lum- 

 ber to be absorbed in domestic markets, while the general depression in busis- 

 ness caused by the outbreak of the European war stopped much of tne fall 

 building, and what was eyen more significant, the inability of the planters 

 to market their cotton without a European outlet, almost completely cut off 

 the demand for pine lumber in the agricultTirallregions of* the South, 



The effect of these forces was to force -pine prices to sti.ll lo^er level 

 until the end of IS 14. While building permits issued during the first half 

 of 19 15, ($371, 867, 000) were even lower than the preceding year, thus reflect- 

 ing the adverse conditions of the fall of 1914, recovery was already in pror 

 gress, Improvement of business conditions following the study of the effects 

 of the European war, the financing of Southern cotton, the demand for lumber 

 from factories with war orders, increased building activity;, increase cf or- 

 ders from the railroads, large crops and high agricultural prices stimulating 

 building on farms and settlement of the Chicago building strike, all increasec 

 the demand for lumber and started an era of rising prices by the end of 1915. 

 L-umber prices lagged behind prices of other staple commodities, but when the 

 advance in Yellow Pine prices started it was very rapid, 



The accumulation of stocks, and increased production of Yellow Pine sti- 

 mulated by rising prices, the difficulties in securing steel for buildirig c^r: 

 (affecting the demand for lumber used with steel) , the shortage of export ton- 

 nage and the late development of building activity in the North caused a tem- 

 porary set back in the price of yellow pine during the early part of 1816. 



f 



The rapid development of building to a new level of $463,735,000 in first 

 half of 1916, some increased purchases of lumber by the railroads, and in- 

 creased labor costs started Yellow Pine prices on an upward trend in the fall 

 of IS 16, The slump in prices in the early part of 1916, had caused curtail- 

 ment of production and a reduction of stocks so that supplies vvere low, while 

 fears of a car shortage and a general railroad strike checked the tendency 

 toward over-production. 



The demand for pine lumber kept increasing on account of good building 

 conditions and eagerness of retail dealers to replenish their stocks whenever 

 cars could be obtained. This demand was swelled by large government orders f^ 

 cantonment stock and for wooden ships. While the demand for pine lumber was 

 thus rising, the labor shortage was becoming more and more acute on account c 

 the draft, so that a curtailment of Yellow Pine production was enforced. The 

 result was that the Yellow Pine industry secured more orders than it could ii 

 fill, and Yellow Pine prices kept advancing throughout 19 17, until they have nc 

 reached a point that is slightly in advance of the average price of all com- 

 modities. 

 (W. I. B. -359-51) 



