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BOSTON PUBLIC LIBBARV 

IllllVlll I 

3 9999 06317 513 5 

OFFICE OF NATIONAL RECOVERY ADMINISTRATION 
DIVISION OF REVIEW 



ECONOMIC PROBLEMS OF THE LUMBER AND TIIffiER PRODUCTS INDUSTRY 

By 

Peter A. Stone 
William E. Yost 
D. N. Burnham 
C. Stowell Smith 
Spencer H. Reed 
Sterling R. March 



WORK MATERIALS NO^ 79 



INDUSTRY STUDIES SECTION 
MARCH, 1936 



OFFICE OF KATIONAL HUCOV^'^.Y ADMINI STRATI OF 
DIVISION OF REVIW 



ECONOMIC PrtOBLEMS OF THE LIIIBER AND '^livBER PRODUCTS INDUSTRY 

By 

P -^ter A. Stone 
William ^, Yost 
D. W. Biarnham 
C. Stowell Smith 
Sijencer H. Reed 
Sterling R. March 



INDUSTRY STUDIES SECTION 
MARCH. 19 ?6 



9813 



F R E U H D 



This study of the Lumter and Ti.iber products Industries v/as com- 
pleted by Mr. Uilliam E. Yost, of the Industry Studies Section, Mr. Li. D. 
Vincent, in charge. 

The report concerns one of the oldest and largest industries in the 
United States, but because of lack of time and personnel the original 
plan for a report covering a study of the entire subject of Lumber and 
Timber Products has been curtailed to the basic portions only. Forests 
have been dealt with exliaiistively. Logging and sa^-mills have been co- 
vered extensively, but not as adequately as was desired. Other parts 
of this industry have only been touched. The stresses of administration 
have been pointed out, and their effects an.d results analyzed. 

The National Lumber Manufacturers Association has cooperated with the 
Division of Review by generous contributions of data and by cordial avail- 
ability for conference and discussion. On the page immediately following 
this foreword will be found a statement by the Association. 

It should be pointed out that there are masses of material in HRA 
files and in the files of the Association that are not reflected, or are 
at best inadequately reflected, in this study. The report is precise- 
ly what the cover page implies, work ms,terials for further study. It 
is to be hoped that in some way the subject may be reopened to the end 
that, through further cooperation with the industry, a more complete and 
informative report may be written. 

At the back of this report will be found a brief statement of the 
studies undertaken by the Division of Review. 



L. C. Marshall 
Director, Division of Review 



March 17, 1936, 



9813 



Division of Revie'.?, 

National Recovery Acininistration. 

In response to a req-.iest from the National Recovery Adminis- 
tration, Division of Review, the national Liim"ber Hantif acturers lissocia- 
tion ap-oointed a representative committee to review and comment on the 
work of the Division of Review in the preparation of a study of Economic 
Conditions in the L-mn"ber Industry. Early in December the Committee 
received for comment a copy of the preliminary'- draft of the study. The 
Committee made a brief review of the preliminary draft and sent numerous 
suggestions and criticisms thereon to the Division of Review. Subsequent- 
ly it was informed that the proposed report had been substantially changed 
in scope and content. 

The final draft of the study, except for Appendices II and III 
was received from the Division of Review for transmission to the Commit- 
tee eaxlj in March. Due to the necessity of having the report memeogra- 
phed before April 1st, the time was insufficient to permit the members 
of the Committee to make adequate study of, or comment upon, the report; 
and they have not done so. 

The proposed revised report, however, has been generally re- 
viewed by the Association staff aided by conferences with members of the 
Division of Review. These have resulted in a partial but substantial 
correction of inaccuracies, and of important omissions of fact. Upon 
many points the Association is in entire accord with the statement of 
facts and conclusions 'by the Division of Review. On some points differe- 
nces of opinion concerning the facts and their significance, and lack 
of sufficient time to collect a.nd prepare pertinent data have prevented 
.more complete agreement. On still other points the Association believes 
that the material has been presented in such fashion as to point to or 
at least readily to invite erroneous conclusions p.nd unwarranted infer- 
ences. 

The participation by the ITational Lumber Manufacturers Associa- 
tion in a review of this work does not imply ei^•her agreement or disagree- 
ment with the substance of the report or v/ith its conclusions. 'Nor is it 
to be interpreted as signifying agreement with the approach to and plan- 
ning of the study, the selection of material, the manner of presentation, 
or the concltisions stated in and to be inferred from the report. It is 
in entire accord with the judgment of the Division of Review that the 
time and facilities available for the preparation of the study and the 
difficult cond^itions under which it has been conducted, have not permit- 
ted the full achievement of s, balanced, thorough, and objective study. 

It is understood that a copy of this communication will be 
inclxT-ded as a part of the rer)Ort of the Division of Review on Economic 
Conditions in the Kimber Industry, 



Respectfully submitted, 
lATIOl^IAL LUviBER MITUEACTURERS ASSOCIATIOK 



March 25, 1936 



9813 



TA3LE OF CONTENTS 

.. - Page 

HISTORICAL SUI.MAEY 1 

CHAPTER I . IKTRODUCTION , 7 

A. General Description of the Industry 7 

1. Forest Lands and Species 8 

2. Early History 8 

3. Western Areas 9 

4. Volume of Prod\xction 10 

5. Effect of Logging on Production 11 

6. The Production Cycle 12 

7 . Lator 13 

8. Lumber Uses 14 

9. Production Costs 15 

10. Transportation 16 

11. Distribution 17 

12. Improvements in Products 19 

13 . Other Lumber Products ; 20 

B. Scope of Discussion 23 

CHAPTER II. THE PROBLEMS OF FOREST MANAGSlffiHT 24 

A. Timber Supply and Location 24 

1. Present Forest Area 24 

a. Commercial Forest Area 24 

2. Forest Stand 27 

a. Stand on Total Area 27 

b. Stand on Saw Timber Area 28 

c. Stand on Cordwood Area 28 

d. Stand on Restocking Area 28 

e. Saw Timber Stand 28 

B. The Problems of Timber Ownership and Value 30 

1. Ownership of Entire Forest Area 30 

a. Industrial Ownership 30 

b . Farm 'vl'oodlands 31 

c. Public Ownership 31 

2. Ownership of Saw Timber Stand 32 

a. Industrial Ownership 32 

b . Farm T7oodlands 32 

c. National Forests 32 

d. Other Federally Owned and Managed Forests 33 

G. State, County and Municipal Ownership 33 

9813 -iii- 



Page 

3. Average Stand of Saw Timber per Acre 33 

4. Forest Growth .aiid Drain 33 

a. Forest Growth 33 

b. Forest Drain 35 

5. Value of Forests and Forests Lands 39 

a. Privately Owned Lands 39 

b. Publicly Owned Lands 40 

6 . Stunipage Values 40 

7. Concentration of Timber Ownership 41 

C. The Problem of Holding Timber Land 43 

1. Interest 44 

2. Fire Protection Cost 45 

3. Taxation 48 

D. Pre Code Efforts at Conservation 50 

1. Public 51 

2. Private 52 

E. Conservation Under the Code 54 

1. The Private Forestry Program 57 

2. The Public Forestrj'- Program 60 

CHAPTER III. THE PHOBLSlilS OF PRODUCTION 64 

A. Capacity 64 

B. Production - Volume - Usage 74 

C. Financial Structure 79 

D. Production Costs 90 

1 . Raw Material Costs , 92 

2. Sawmill or Rough Lumber Conversion Costs 93 

3. Dressing or Planing Costs 94 

4. General Expenses and Overhead 94 

5. History of Costs Under KTIA 94 

E. Prices and Mill Realization 103 

1 . Prices 103 ■ 

2. Mill Realization 110 

F. Labor 115 

1. Statistical Coverage 115 

2. number and Type of Employees 115 

a. Wujaber of Employees 115 

b. Seasonality of Employment 117 

c. Type of Employees 118 

9813 -iv- 



^ 



,« 



Page 

3. General Labor Conditions 121 

a. Hazards of ItaploTinent 121 

"b. G-eneral La"bor Conditions on the West Coast .... 123 

(1) High Labor Turnover 123 

(2) C-^.uses of Labor Unrest 124 

(3) Improvement in Labor Conditions 126 

c. G-eneral Labor Conditions in the South 127 

4. Organization and Disputes 128 

a. West Coast 128 

b . South 135 

c. West Virginia 136 

5. Wages 138 

a. Sawmill and Millwork Combined 138 

b. SaTCnill and Millwork Compared 139 

c. Area Comparisons 140 

d. Payroll'. 144 

6. Hours 146 

7. Prodvctivity 150 

8. Code Labor Provisions and. their Interpretation 153 

a. General Labor Provisions 153 

b. Hour Provisions 154 

c. Wage Provisions 156 

9. Operation of Code Lrbor provisions 159 

a. Child Labor Provisions 159 

b. Hourly Previsions 159 

c. Wage Provlcions 160 

G. Production Control 164 

CHAPTER IV. PROBLEMS OF DISTRIBUTION 189 

CHAPTER V 223 

A. Future Stu.dies 223 

B. Timber Ownership Statistics ' 231 

C. Transportation and Cross Hauling 232 

D. Method.ology ■ 235 



APPENDIX I. HISTORY OF PRECODE EFFORTS AT PRODUCTION CONTROL ... 237 
APPENDIX II . TABLES AND EXHIBITS 261 



9813 



APrEITDIX II 

ECOHOMIC PROBLEMS OF TKE LUICBER ArTD TII.fflEE PRODUCTS INDUSTRY 

IlIDZX.Oy TABLES 

TABLE MO . PAGE NO . 

I CoimiGrcial Eorest Area of the United States.... 262 

II Total Stand in the United States of Saw 

Timber Cordwood 263 

III Stand of Saw Timoer in the United States by 

Regions, States, and Classes of Ownership 264 

lY Stand per Acre on Saw Timber Areas 265 

V Production of Liirater in the United States - 

1925 to 1929 266 

V (a) Softwood and Hardwood ProdLiction by States - 

1929 to 1934 267 

V (b) Softwood and Hardwood Production by States - 

1920 to 1934 268 

VI Annua.l Drain of Forest Products (other tlan 

lumber) Averages 1925 to 1929 269 

VI (a) Total Forest Products Drpin (individual 

products ) ' 270 

VII Annual Forest Drain (other tlian Forest Products)271 

VIII Total Annual Forest Drain, based on 1925 to 

1929 average 272 

VIII (a) Timber Cut on National and Indian Forests 

compared to Total Cut 273 

IX Present Current Annual Growth of Usable 

Material on Commercial Forest Areas of the 

United States , 274 

IX (a) Comparison of Forest Prodxicts Drain and 

Forest Growth, . . . ; 275 



9813 



TABLE NO . PAGB IIP. 

X Average St-umpat^e Prices "by States and Regions 276 

X (a) Stuinpace Prices by States - 1928 to 1933 377 

X (t) St-umpage Prices - Selected States and Periods 278 

XI Fire Protection Expenditures 279 

XII Estimated Ann-aa.1 Tax Surden on Commercial 

Privately Owned Forests by States and Eef:ions 280 

XIII Estimated Ann'oal Tax Surden on Coimnercial 
Privately Owned Saw Timber Areas by States 
and Regions 281 

Timber Taxation as related to rate of 

Lumber Prrductinn • • • 282 

Timber Taxation as related to Lumber 

Production and Timber Ovmed 283 

Relative Statistical Position of Principal 

Producing States for Softwood Lumber 284 

Relative Statistical Position of Principal 

Producing States for Hardwood Lumber 285 

Percentage of Canacity and llrjiibor 3f Hills 286 

Lumber Production - Softwoods by States 237 

Lumber Production - Hcrdwo^ds by States 288 

Recapitulation by Intervals of L-omber 

Produ-cers 289 

XIX Recapitulation by States of Known Lumber 

Prodxiccrs 290 

'1 

XX Comparison of Equipment Utilization 291 

XXI Table of Capacity by States and Ratio of 

Stand to Capacity , 292 

XXII Quarterly Softwood Stocks by Eivision 293 

XXIII Quarterly Kardwood Stocks, by Regions 294 



XIII 


(a) 


XIII 


(b) 


XIV 




X7 




XVI 




XVII 


(a) 


XVII 


(b) 


XVIII 





9813 



TABLE HO . 

XXIV 

XXV 

XXVI 

XXVII 

XXVIII 

XXIX 

XXX 

XXXI 

XXXII 

XXXIII 

XXXIV 

XXXV 

XXXVI 

XXXVII 

XXXVIII 



PAGE NO , 

Quartoi'ly Softwood Prodvction by Re^jions 295 

Quarterly Hardvrood Production by Regions 296 

Quarterly Softv;ood Shipments by Regions 297 

Quarterly Hardvrood Shipments by Regions 298 

Southern Pine Costs 299 

Western Pine Costs 300 

Cost and Realization 301 

ConsvuTintion of Domestic L^omber by the 

Constr^action, Wooden Container, and all 

other Industrial Users for the year 1928 302 

Consurrrotion of Domestic Luraber by the 

Construction, Wooden Container, and all 

other Industrial Users for the year 1933 303 

Com?oarison between Total Construction and 

Units Ship-oed per $1,000 of Construction iJor 

Selected Products dxu'ing the years 1920-1934 304 

Lumber and Timber Corporations (Forest 
Products Industries) Condensed Balance 
Sheet and Profit and Loss Data 305 

Lumber and Timber Corporations (Porest 

Products Industries), llumber of Corporations 

reporting Profit and No Profit in each of 

the Classified Groups 3 06 

Corporations Returns Classified by Major 

Industry Groups - PorcentagG of Corporations 

reporting Profit 307 

Corpor':^te Returns Classified by Major 

Industry Groups - Percentage of Asset Values 

of Corporations reporting Profits 308 

Forest Products Corporations, Net Income, or 

Loss, Cash Dividends, and Federal Income 

Taxes Paid 309 



QRT^ 



TABLE NO . FAGE_KO. 

XXXIX Distribution of Hardwood L-ojnbor from Produciug 

Regions to Consurain;'^ P.erionr- and States 1929 310 

XL ' Distribution of IIardv70od L-omber from Producing 

Regions to Consuming Re£:ions and Str.tes 1932 311 

XLI Distribution of Iferdv.-ood Lumber fro:n Producing 

Regions to Cons\3.'nins Regions and States - 1934 312 

XLII Shipments of Principal Softwood Species of 

Lumber to States from Principal Producing Regions.. 313 

XLIII Imports of Softwood Liamber 314 

XLIV United States Exports of Specified Lvmbcr and 

Timber Products to Principal In-jporting Co'Luatrics, 

1933 - 1934 315 

XLV Softwood Exports - United States' Share of V/orld 

Market 316 

XLVI Retail Lumber Dealers - iramber of Dealers and 

1934 Ouesticnnaires Received 317 

XLVII Retail Lumber and Building Materials Code - 

Recapitulation by Divisions of Reclassified Data 

contained in 1933 Questionnaires. Total of Sales 

is Base of all Percentage Given 318 

XLVIII Retail Lumber Dealers - Recaoitulation Expenses 

to Het Sales Dollar, 1934 - Known Dealers 23,531 - 
Dealers Reporting 3, 554 319 

XLIX Retail Lximbor Dealers - Recapitulation Modal 

Cost Details Year 1934 - Knora Dealers 23,531 - 
Dealers Reportin.'^ 3, 554 320 

L Retail Lumber Dealers - Recapitulation for 
Industry - Opera.tion Results 1934 - Known 
Dealers 23,531 - Dealers Reporting 3,554 321 

LI Lumber Cost at Chicago, Illinois, Code Period 

January to ferch, 1934 322 

LII Lumber Cost at 1-Icw York, Hew York Code Period 

January to March,- 1934 323 

LIII Stocks, Shipments and Production of Softwood 

Lumber, 1923 - 1935 324 

LIV Hours of Labor: Ilvjnber of Sstablisliments and 
H'omber of Wage Earners by Prevailing Hours of 
Labor per Week, 1929 325 



9Bi:^ 



f 



EXHIBITS 
EXHIBIT PAGE NO . 

A. Price Trend - Southern Pine Roofers 326 

C. Q-uarterly Softwood ShiiDments, by Regions, 

1023 - 1935 327 

D. Quarterly Hardwood Shipments, by Regions, 

192^ " 1935 328 

E. Softwood Stock on Hand, by Regions, 1929 - 1935.... 329 

F. Hardware Stocks on Hand, by Regions 

1929 - 1935 330 

G-. Quarterly Softwood Prcduction, by Regions, 

1929 - 1935 331 

H. Quarterly Hardwood Production, by Regions, 

1929 - 1935 332 

I. Average Lumber Price Breakdown at Chicago, 

Illinois , 333 

J. Average Lumber Price Bre"'kdown at Hew York, 

New York 334 

K. Average Price of Softwood Lumber 335 



-X- 



9813 



i 



ECONOMIC PROBLEMS OF THE LUMBER Affl3 TI^CBER PRODUCTS muSTRY 
HISTORICAL SIWAIARY 

The Lumber Industry is one of our oldest industries. It ^iffer^ from 
other industries in that the line o^ de-.arc.atinn between Droce.sing and pro- 
duction of rawmaterials is not so pronounced. In lurab^r the T^roduction of 
raw materials is mere analogous to agriculture th^n to industry in the ac- 
ceiDted sense of the latter terra. 

The production of logs and timber perhaps preceded agriculture as an 
activity of the early colonists since shelter, as well as" food, was an in>. 
mediate requirement. Moreover, clearing of land in most cases was a 
^.^f^.^" V^^''^° *^^ ^.^irsuit of agriculture. It is no wonder then that 
the New England colonists engaged in lumbering as a principal activity and 
for more tnan 200 years the forests of New En-land x^roduced not only the 
materials for shelter required in America but could exr^ort considerable 
quantities to the West Indies and to Eurotje as well. 

This do«s not mean that New England was the sole Tjroducer o^ forest 
products during this T)eriod. The Southern colonists also found rich stands 
of timber and rroceded to exT^loit these rasources, Ho'-ever, the natural 
conditions which obtained' were such thaf Southern lumber exDloitation was 
only a minor factor as' comx)ared^ to -agricultural- activities. Nevertheless, 
.ho f°i''lpn' r ^'^^ ^-""Sla-nd were the TDrinci,,al source of lumber u. until 
aoout 1880._ In tnis discussion the region designated as New England includes 

the Sr/T "Tt'"' ^--^^---^ -- --11 - what is now com.oSly termed 
the New England States. - . j m u. 

Vall.f *fL*?l°'li\'^^'" ft "^""^ *^" devlopment of the upper MississiB.)! 
Vall.y, the Lake States of Wisconsin. Minnesota and Michigan became the 

rm^ro.?f T^;'''';°^ ^'^^''■' However, by this time production methods hai 
l^lnTft J' T '^™'^^ '^^^^ '^^^ circular saw allowed for more ra^id 

exploitation of greater areas in a shorter time; hence it was only tw-ntv 

South. " ''""' '""^ "'"^- °' -^°^^-^l- ----^ f-- the Lake sSes lo tL 

ev^loUatiof °%^''°r'''° \°-'^'^ represents the years of greatest forest 
vTtlr^lT T: ^he transcontinental railroads had o^^ned uv vast new ter- 
rate The nhiT-f^'-'/r^' ^""^ villages were b^ing created at a rapid 
cloJ: at L^f/fT^' '"'■ '"'"^ '■'™' ^^^ *°^"^ ''^^ ^^^^^- ^°^-^ts were 
1906 anl 1907 f l^^^^/f relatively chea^. This era reached its peak in 
leAT.r IIT' ^^J^^^/^h^-i^ y-^^s apT^roximately 46 billion feet of lumber 
TDer year were -oroduced. 

be^an^o'J^n*^^ x>eriod after 189D and when production in the Lake States 
the e^lnft.f--' ^'^! ""^^ ^ considerable movement to the Pacific Coast and 
JactoT "he iL\° .'"^'Z ? ''^ '^^'°" °' '^^- N-thwest became an important 
oSenin^ of fv, S .^' °^ ^^'' ""^^^"^ ^"^^^^'^ *^ interior markets with the 
opening of the Northern Pacific Railroad in 1893 and a considerable portion 

ZsTe.lTtTlr.T^'''' '"^ '^'° the-devlooment of the prairie states 
OrSLn and L^' IT'. ^^' ""'^ region which lies west of the Cascades in 
renS?^ an^Washington had T)revlously found its ^rincix^al outlet in the 
requirements of the fact developing State of California. With its timber 



5813 



growirg right doTi to the sho.'e lino it wa^ relaliTely e-^sj to load its ' 
nroducts aboard sailing Tecseis alrr-ost at the p 'int o"^ -Drod-.cti :)n. 

In 1907 after the onenin^ of the Panama Canal, thus -oroviding an 
easie.- access Lo che Atlantic Coact, the TDroduction from the ^acific North- 
west became an i';rortan-t factor in d? stern markets anrl has continued a 
struggle with the South for the softwood market. 

It may be ceen that the Lu-nber Industry has been a constantly 
migrating one, ex-cloiting tne most accessible natural resoui-&es and moving 
on to richer fields when its operating area became more diffcult of -oro- 
ducing both spscalating and operating profits. As the industr moved on it 
left in its wake a less important segment in every region whion had been ex- 
ploited. This segment expanded or contracted as •economi". conditions war- 
ranted, but it was always a factor in the control of eccaatiic problems of . 
the industry, The segment, composed c' small mills wM'h »e-e more or less' 
marginal factors dxu-ing the greatest period of croloitdtion o. an area, 
became the m evgin^: factor which determined the decree cf pr.isnerity during 
the decadent era, 

THE PROBLEMS 

In a ds-? eloping country with rich natural resources it was but natural 
that the best and roost accessible timber should be cut firs'--. It was this 
principle that motivated the ind.ustry to move froiil one area to another as 
rapidly as facilities for transporting the product became available, How- 
ev=i , after the (fevelopraent of the Pacxfic fir region had reached a high 
stage, in which it was produnin^r a^ much aa the South, there .-sre no new 
areas which offered possiblities of easily accessible vlrsi:-. forests. It 
followed then that as the indupcr:v was forced beck int'- the more inacces- 
sible areas rith its conseaucnt higher cost of rea.'hihg the consuming market 
^here was, of necessity, an incrtf 3c in the Thrice lev l . 

At about this time many pvblic spirited people becsme a? p'-med at the 
rate of ercpl citation of the forest an:" were led to pre lict an early ex- 
haustion of forest resources. An im\. a-tant result ot this alarmist at- 
titude which had ca^v^ht the popular fancy was an increase in timber 
speculation. If, reasoned the speed ators, our standirg timber is rapiily 
becoming exhausted, higher values of eiistirg standing timbe.- must 
necessarily follow. As a conseouence large tracts of standing timber were 
TDurchased at motin.irg prices, with no thought at the <-.ime r' converting this 
timber into lumbe:-. Subsequent evpnts forced the csts -liihront of saw- 
mill facilities for the cole purpose of liquidating ti ese investracnta, but 
at the time of acquisition thei e was no thought given ic tr.is necessity. 

Another levelopmenc of this period was the ra-eid increase in the use of 
o'-cel and cen,3nt. The perfection of the Bessemer pv»i.es3 made steel an 
iici-Lcrtant coir.oetitor in buildings and other structure'. Tte process for 
making cement had developed to "he point where concrete, wi.h its lasting 
qualities, entirely displaced lumber for ridewalks and ?t. 'r flooring 
puTTjoses where heavy traffic was a factor, V.his, coupled . itn the rising 
cost of 1-umber, brought about a rapid displacement of lumber and a declining 
r,er capita consuTPDtion. -^his declining conaumrjtion wa-s not ip'^arent to the 
industry -ijjitil after the World War, but toward" the declining period of the 
post-war building boom it became evident that stumuage orices were likely 
9813 



to remain at a standstill, and with mounting taxes sttimTja^e "became a 
liatility. Hence it 'became necessary to tjrevide facilities for liquidation, 
end this, with the adven*- of the de-oresslon, paused a coratjlete demoralization 
of the lumber markets* 

The increase in the urice levels brought about by the migration of the 
Industry into higher cost ar^^as had ano'^her imr»nrtant effect, A« stated 
previously, the smd.ll sawmill with its lack of volxune facilities was always 
a marginal factor. Paying low wages and with small investment the small mill 
could o-oerate in small timber that would be unnrofitable for the large and 
medium-sized mills with the greater investment. However, since the timber 
available to this tyoe of mill is so small, the mill cannot -oroduce at a 
•orofit except at a nrice level that is hi^h enough to warrant such isroduction. 
Such mills operate in cutover areas located for the most part close to the 
areas of consumption. However, the r^->sult of their operation in such areas 
is such as to prevent the full regrowth of a given forest area to a point 
where it might again become .an important producing region lying close to a 
consuming area. When the price level of lumber rose, due to the higher costs > 
the major portion of the industry, there was always the tendency to encourage 
the small mill to again enter production, thus increasing the volume to the 
point of over-production, causing a price decline which would force them to 
retire until the price ros^ a^ain. In this manner the small mills acted as a 
pressure on the market.' , , . 

The need for liquidation of speculative timber became apparent with a 
declining volume of use, particularly, during the latter part of the building 
beora, and it was during this period that many new mills were put into 
operation for that purpose. During the depression this situation became more 
acute and from 1930 to 1932 mills continued to operate fot the purpose stated 
above, although consumption 'had declined to about 25 per 'cent of the peak. 
This, of course, meant an enormous stock on hand each year during the 
depression years. The average 'amount of stock on hand during the 20's was 
about 14 billion feet; - During these years between 25 billion and 39 billion 
feet per year were used, but .between 1930 and 1932. it ran between 10 billion 
and 17 billion feet. ' The stocks on hand at the -beginning of the year 
receded very little, averaging from 9 to 11 billion feet. Naturally prices 
were demoralized, wages 'were cut, and conditions became chaotlc. Although 
this situation might not have appeared so rapidly had construction remained 
at the same level as that of the late 20's, eventually the over-capacity of 
the industry and the need tn liquidate speculative holdings would become 
apparent; and although the depression brought ahout the chaotic condition, 
a depression- in the Lumber Industry must have .eventually come about under 
any circumstances if the industry had continued ■^der the same influences. 

TP CODE '■ .■ ■ 

After the passage of the- National Recovery Act it was apparent that the 
industr'" was aware of the condition of over-capacity and chaotic prices, and 
in presenting its GOde 'it had three major proposals: 

(1) The Regulation of production with a view to cutting 
■ doWn Bt'dcks on hand to meet demand. . 

(2) .An incfease in '''he. wage level, wliich had fallen 
below subsistence levsls, 

981^ 



-4- 
,•.,.-• • : .•?^ n--::(y' •:•■;?■:,;;'- :' ■'■ '■ r . ■■ ' '' " , '\ 

(■3) _ The fixin,? of min^imuri Tjr'ices of luiDoer at a noiiit ■ 
' ■ at which if wars' estimated costs of -Droduction wo-u'ld 
"be recovered. 

The' o'-ber'atioh of the first' ptovi'sioh eventually resulted in some decline 
of ■ stocks. However," it provided for no permanent .improvement; since the 
elimination' of the C'ode the industry is in apDrozimAtely, the same -oosition it 
was in "befoye, as far as the fundamental evils are concerned, although the 
reduction of stocks during the Code -Drovideda teraiDpreiry- "benefit which will 
last for some time. 

The fixing of r^rices aij-oarently failed to "brip?' any .permanent good or 
contri"bute to any permanent improvement in the industry. One of the results 
of fixing of orices at a point of cost r=c6very was to increase- the price 
atove the point which would encourage a greater use. In fact it is "believed 
by many students of the situation tha,t the prices 50 fixed tended to retard 
an increase in consumption. Moreover there were many operating difficulties 
inherent in all attempts at determining true costs or in setting rigid price 
regulations for so vast and complex an industry as this one. In any ex- 
periment toward an improvement through public regulation or even industry 
regulation, price fixing apparently should be the last resort, but in this 
particular industry it is highly improbable that it should ever be resorted 
to since there 'are so many other ways of providing more permanent cures for 
obstacles to progress within the industry. 

As to wa,ge rates, there was a considerable increase in both the Northern 
and Southern sections. Without price fixing th.e increase in wage rates 
alone, -it is'believel, 'would have had a tendency to prevent the incursionof 
the numerous small mills dependent upon a hip:he't price, H/iwg.ver. with this 
increase in price level provider! for under the Code many of the vmall' operators 
believed they could either''raake"a profit at the "higher -prices, even though 
they paid. the minimum wage, pr ejcpe^cted to evade the'higher wages while thye 
collected the higher prices'* During the very earl;^ part nf the Code the former 
was the general rule; that; i'sV. a higher wage level was 'generally paid. But 
as it became apparent that the' products could riot be sold at the price level 
set, there was a greater te'ndericy to .eva'dd the minimum wage. This wage 
lev?l for the South, incidentally,^' was "s'"et at appoint eaual .to that of any 
period in its history. This "eva-s'lon of minimum 'wages produced bitter re- 
criminations, since many of- the sma'll 'and medium-size mills,, havine- once 
entered into production, 'were "ioa-feh to discontinue. Nevertheless, toward the 
latter part of the codal" period a gre'at number of them' did discontinue. How- 
ever, since the elimination of the' Code it is apparent that the general wage 
level has remained 15 to 20 per cent higher than during the depression period. 
In the West Coast it is probably 50 to 60 per cent higher on the avera-^e than 
during the lowest point of the depression. 

. As has been stated, the operation of fixed minimum prices for cost 
recovery proved burdensome and failed of any permanent ^r^od. This provision 
was canceled, therefore, six months prior to the Sche.chter decision which 
invalidated the NBA,' There appeared' no immediate after-effects, since by that 
time the various efforts of other Government departments to' improve con- 
struction began showing' results, which naturally incre?ised the demand. It is 
believed that this deiriand ' had neached a point toward the l-atter part of 1935 
that justified the price level, which had remained at about the point fixed 

9813 



-5" . 

under the Code. However, with a lower stock on hand, in coiriDarison to the 
general demand level, it is believed that -Dricesmay reach a dis-oro-oortionate 
level again if industry, through its own efforts, continues to keet) stocks at 
such levels. 

CONCLUSIONS 

(1) Chaotic conditi'^ns caused by excess stocks were relieiv'='d during the 
Tjeriod of NIRA, hut the Lumber Code f ail =d to provide a rermanent remedy for 
causes of such excess. 

(2) The o-oeration of rrice fixing has proven itself to be im-oossible, 
even under Government regulation. 

(3) Labor has been benefitted by a rise in the wage level, which will 
a-onarently remain and is DroTDortionate to the eeneral wage level of the 
entire country. However, certain inherent cliaracteristics of the timber and 
the TDSychology of those engaged in the Lumber Industry in the South are such 
that labor is not free to use its own bargainins: -oower in any effort to main- 
tain a reasonable level of wages, 

(4) There are certain steiDS which might be taken by both the industrj'- 
and the Government which might, in the long von, tend to im-orove the general 
level of the industry and the labor em.-Dloyed by it. Such imTDrov=ment must 
start with the forests. It is- recognized that for the Durriose of a stabilized 
industry — one that is not only ke-ot at a reasonably high level but is 
continually imr)roving — there must be a continually imrToving forest status. 
In other word's, ^he industr?/ must be removed from one of a migratory nature 

to a more loermanent Dosition. This involves the otjeration of a forest, which 
is the basis of the industry, on a long-time continuous loroduction basis. It 
has been demonstrated in 'Euro-oean countries that this can be done. Not only 
in Eurooean countries are there, continuing forests • — that is, forests with a 
sustained yield — but there are a: number of far-seeing coroorations in the 
United States that have also TDlaced their 0"Derations on such basis. 

It must be remembered that first there are large areas of cut-over lands 
which will not come into rjroduction for many years — narticularly -oroduction 
of saw timber. There are other areas where saw timber would come into nro- 
duction in a reasonable -oeriod if it were allowed to grow, but that is now 
being cut in an immature stage, urodiicing an inferior product at a higher cost. 
For such areas it is a^riarently im-oossible for -private industry to bear the 
burden of taxation and other costs of holding until the timber comes to the 
income--Droducing stage. Such areas might be -ourchased by the Fore^^t Service 
and held until they are income--Drodacing, then sold to -orivate industry for 
private production on the basis of selling the product, and only such -croduct, 
that will permit of further growth and further yield. It is realized that 
this, in effect, recommends the Government ^-oing into the business of managing 
forests on a sustained yield basis, but as already -oointed out, the costs, 
including taxes, fire -orevention, etc., are such that these areas do not hold 
any -oossiblity for -orofit to -orivate industry. These areas are located close 
to the consuming markets for the most -oart and would, in the long run, benefit 
the cons-umer by affecting the -orice level of ''-'amber-, and benefit the industry 
by removing a considerable threat of lumber cut frcn i-rimature trees, thus over- 
burdening the market. 



9813 



-6- 

It is realized that there are cinsiderable holdings of timber areas by 
very small nroducers and farmers throughout' the Southern states to whom such 
holdings are not burdensome. In order to encourage a -oroTDer regard for 
forestry among such holders, the Government might take advantae-e of the 
financial stringency among these holders by forming coouerative grouiDS for 
sustained yield under Government aid in financing and fire and forest 
•orotection. All of these recommendations noted above have been more or less 
accepted by the Forest Service, who ha,ve partially initiated many of these 
■orovisions, 

(5) TransTDortation rates should be lowered from the Atlantic seaboard 
west to Chicago and from the Pacific seaboard east to Chicago. This will 
encourage the use of timber from the Pacific Northwest, where er.ist the best 
resources and gr-atest excess holdings. A cut in rates from the Atlantic 
sea board would -oermit an extension of the market for lumber now moving by 
water from the Pacific Northwest. 

(6) The industry may imT5rove its -oroduct by the manufacture of more 
com-olete assemblies for building -Durrioses and seek to -Dromote shon fabrication 
as against fabrication on the Job. This will enable individual manufacturers 
to obtain markets in which quality may be a selling factor. This would also 
tend to eliminate the more migratory manufacturers and iDromote forest 
management on a sustained yield basis. 

(7) There has been considerable contraction in the lumber market along 
with that of other industries. For lumber this is -Darticiolarly due to the 
loss of the Australian and other British "Empire markets as the outcome of the 
Toronto agreement of 1933, in which iDreference was given Empire markets for 
Canadian lumber as against American lumber. The- adjustment made in the recent 
trade agreement with Canada, in which' some of the restrictions have been 
removed, should be carried forward in favor of the American lumber industry 
into any trade agreement with Great Britain, so as to restore to the American 
industry at least a -oortion of the markets equal to that restored to Canada 
by the United States. 



9813 



_7- 

irTJioDUCTioi: 

A. GLIIEPJIL DESCRIPTIO" 0? 'Tt'Z IIDUST"! 

Tha Liua'cer and ri:.;"ber Prof.x'.ctr, Ino.-ust:y hr.s no clearly iefined 
Units. C-eneral^y spea2cing, it ia conponec. of all those enga<G;ed in 
(a) raanaj-inj the coiTinercial forests of the nation; (b) in the conversion 
of strjidin.s tir.foer into usefrJ. products; and (c) in the distrihution of 
those products to the consui.iers. The priiicipal tinhcr products are: (*) 

Lu'ibcr, lath and shingles 

IPiLvl vrood 

Ileirn ties 

Jence posts 

Pulp r.'ood 

i;ine tinoers r.nd nine props 

Veneers 

Cooperat^e stocl: 

Poles and piling 

Distillation rood 

Trnnin.-; r^ood and harl: 

The Bureau of the Cens'as defines lurnher and timber products as 

"logfjing canps, merchant savruills, combined savmills 
and planing inills, including those engaged in the 
manufacture of boxes if connected -rith a savmill, 
veneer nills and cooperate stocl: i-iills." (**) 

The Lu-.iber and Tir.ber Prot.ucts Industries Code extended a bit fur- 
ther than the Census definition ;u'.d included: (l) Logs, poles and piling; 
(2) savra lumber and other sarai vrood -.roducts of sarmills, and products . 
of planing nills operated in conj'onction -yith sawmills; (3) shingles; 
(4) T/oodrrork (nilluork) , including tl.e products of planing mills opera- 
ting in conjunction uith retail lumber yards; (5) hardnood flooring; 
(6) veneers; (7) plywood; (8) kiln Sried -hardwood., di:'.onsion; (.9) latJi; (IC) 
s.aued boxes, shook crp,tes; (11 plj^ood, veneer and -^irebound packages 
and containers; (12) certain additional minor products specifically 
provided for. (***) 

(*) "A ITational Plan for American Jorestry", p. 214. A report of 
the Forest Service (1933) 

(**) "]rorest Products in 1932", Bureau of the Census, Department 
of Commerce. 

(***) Article II (A), Luuber raid Timber Products Industries Code. 



9813 



1. Forest Lands aJid &3ecies 

The "basis upon "hich the entire industry' rests is, of course, 
the forest land of the United States, \7hich a^nounts to practically one- 
third its total land area, or atout 600,000,000 acres. (Originally the 
forest area of this country was estinated to te 880,000,000 acres.) 
Hovrever, not all of this forest area is available for comnercial use. 
About 495,000,000 acres out of the total o,rea have been classed by the 
Forest Service as comnercial forest lajid capable of producing tinber 
of commercial quantity and quality, according to present day standards, 
and available for commercial use. (*) 

In considering availability of sa\7 timber, species play an 
importr^it role. Not all species are suitable for the same purpose. 
Generally spealiing, the entire species group is divided into two classes 
— softwoods and hardvroods. The tern "softvoods" is generally applied 
to all 01 the coniferous trees as distinguished from the broadleaf 
varieties, and does not necessarily a.pply to the actual softness or 
harcuiess of the wood itself. The term "hardwoods" is generally applied 
to all of the broadleaf trees vhen used counerciaJ.ly. 

The geographical distribution of these species has determined 
to a great extent the divisions of the industry which have been followed 
more or less in its organization. Particular uses have sprung up in 
industrial processes which require certain species. Such species may 
or may not be interchangeable v.'ith other species. This division is 
fundai-iental in the industry's organization, and perhaps accouiits for 
many of its i^roblems, due to the fact that certain species axe native 
to certain sections of the countr;'- only, whereas the use of the wood 
may be nationwide. 

2. Early History 

Since this industry had its beginnings '-ith the early colonists, 
naturally the first forests exploited were those of Kew England and 
of Virginia, both softwood areas. The Hew England forest consisted 
chiefly of ^^ine and spruce, and although they h?.ve passed through a 
cycle of ercploitation and are about to enter into the second cycle of 
production, the area still produces the same native woods, with the 
possible exception of northern white pine which, because of its accept- 
ability for most purposes, Mas used up most rapidly and had not been 
replenished to the same extent as spruce. 

Prior to 1850 llexi England was the principal producing region, 
up to that time acco-onting for more than one-half of the total lumber 
used. However, between 1850 and 1850 ue\' Yor^: and Pennsylvania tool: 

(*) See Table I. See Appendix II. 



98i: 



the lead. (*) Those tiro states, 'iiile havin/; a conr.idera'ble anount 
of soft^'ood, asB.in principally pine njiC. spruce, had a greater anount 
of hardv.'ood, more suitable for !na;:iufact-j.rinifi purposes than for con- 
stractlon. 

r.1iat is said of IJe'.' Yorl: and Pcnns^'lv^jiia applies as v;ell to 
Ner,' Jersey, L.aiyland ajic. Delavfare, tliese five states comprising the 
i.iiddle Atlantic Piegion. In the early periods of production in the 
i.iiddle Atlantic Hegion the Boft"Oor-s were quickly depleted, the hard- 
woods rei:aininf;, since uses for hardrraods had not developed to the 
extent that they ha,d for softvoods. This area is still considered a 
harduood producing section and uiider the Code \7as called the L'orth- 
eastei-n Kard\70od Subdivision, though combined r/ith part of the easterly 
Lake States anc. also a part of the Appalachian Region. 

The ne?:t najor i-iroclucing area, chronologically, '.'.'as the Lalce 
States -- Uinnesota, TJicconsin pnd .Michigan. Here the species nere 
chiefly pine and henloch — both soft -,'oods. Hovrever, this area has 
always had, in addition, a connercial gro^-'th of hard naple, though with 
some slight exceptions as to hemlocy: it novr produces little softwood. 
It is still the principal naple prof-acing section of the countr^r, some 
80 per cent of the maple flooring coning fro:i that area. The peak of 
production for this area was around 1830, in which year the Lal:e States 
accounted for 54 per cent of the totcl lusaber volume. 

i'rom 18S0 to 1919, which was a oeriod of rapid progress in the 
develo-onent of this nation, the forest area of the South, embracing 
Alabana, Arkansas, Plorida, Georgia, kentuclcy, Louisiana, Uississippi, 
Llissouri, ITorth Carolina, South Carolina, OklsJiona, Tennessee, Texas, 
Virginia, and Uest Virginia, was the principal producing area. The 
species in this area consist of yellow i^ine and practically all the 
laiO'.m domestic hardwoods. The forner has become the most important 
cornercially. 

Short leaf pine flourishes on the Atlantic Coastal Plain as 
one 01 the fastest growing commercial species among softwoods, and 
its renewabilitjT' has kept the region a continuous lujuber producing area 
since the 1890' s. 

It should be ■understood that thii shift fron one area, to 
another does not nean that the original areas were completely denuded, 
but n.erely that the new areas of virgin timber presented more attract- 
ive possibilities than the older producing regions, all of -.hiich are 
continuing prochacing regions to a, minor extent. 

3. Tie stern Areas 

Perhaps the most important development in the Lumber Industry 
is the espolitation of the western forest a,reas. These begin in the 
Hocltj- kountaan Region, extendin ; throughout all the Roclc-- l.io'untain Region 



(*) "An Outline of General Forestry", by J. S. Illick, p. 52 (1335) 



9813 



-10- 



Tlie Doxig;las Fir Hegion, although called that, is not oonf j.n'^d ho 
Dougle-s fir but grows hemlock, spruce and cedar in addition. This 
region contains the most lu^curiant stands of cedar in this country 
and is therefore the center of the cedar shingle production industry 
as '.Tell as being highly important in softrood production. 

The ILocky I.iountain Region, \7hich includes the area east of the 
Cascades, together rith the Sieri-a Uevada Range through California, 
gro\"'s 'Jestern pines. Sone spruce and rhite fir are also found in this 
region. 

On the ^./est Coast is foruid the nost lu:curiant gro^rth of timber 
in the United States, with the greatest connercial ijossibilities. The 
average stand per acre in the State of 'Jashington is about 45,000 
feet per acre. This is compared vrith 6,000 to 7,000 feet per acre 
for most of the Southern States. In California, chiefly in the few 
counties in the north central part of the state, lies the Redwood 
Region. Redwood trees are well laioiTn for their enormous size and 
their commercial possibilities. 

Although the Lumber Industry in the West started in the early 
1850' s, it did not become commercially important until the completion 
of the northern Pacific Railroad in 1882. (*) 

As stated at the beginning of this chapter, although lumber 
is only one of the products of the forest it is bj'- far the most impor- 
tant since the saw timber area consists of approximately five-sixths of 
the total commercial area. The o\7nership of this area therefore in- 
volves the Lumber Industry in the problems of forest management. How- 
ever, most of the industry itself has only lately given adeo^uate con- 
sideration to such problems. With the shifting of the industrj^ as each 
new area was tapped, the acquisition of the virgin forests became one 
of the important factors in the development and management of the in- 
dustry, Iluch of it was included \7ith the land grants to the trans- 
continental railroads in the latter part of the nineteenth centurj'-. 
Some of it was acquired ^oj those who were interested only in specula- 
ting on the increased values, but for the most part lumber producers 
attempted to acquire sufficient acreage exid stumpage to assure them- 
selves the longest possible period of continued operation. 

4. Volume of Production 

Turning now to the voluie of lumber used in this co\mtry, 
it is found that a peak was reached in 1905 and 1907 with the large 
total of 45,000,000,000 feet for each of those years. Up to that 

(*) "An Otitline of Oeneral Forestry" , by J. S. Illick; p. 53 (1935) 



9813 



-11- 

ti;ie It had teen continuo-asly incroar.in;;. After that time it started 
on a do-mvard trend. Kovevor, ImfDemen, intent on acqiiirin^j a volume 
Oi" stuj,!^Da{^-e for their operatioi., chiefly speculated on the increasing 
trend ox production and vfere many years too late in "becomins a.r/are of 
the declinii_j volu;.ie of consuription. Tliv.s lurabemen found thenselves, 
at the ■beginning": of the deprcsrion, overntoched rrith tinber acreage. 

It nay be veil to ercplain here that the tern stumpage is 
applied to the standing tree, ajid the value ox stumpage is the value of 
the lujnber content of t]T.e trees -■ithout regard to the land upon nhich 
they groT'. This is usually calculated in board measure, log scale. 
The term "log scale" has variotis neaaiings and is applied rith different 
rules in different areas, being particularly applied to a given species 
than to given geographical e,rea. Ilov-ever, in speaking of lumber pro- 
duction the tenn "board measure" is used, irrhich ueans one board foot 
equals a board one foot long, one foot i:7ide, and one inch thick. 

Tlie first saraiill v/as established, according to one historian, 
in Jai.iesto'.-ni, Virginia, in 1625. This, as rrell as other early colonial 
saTmills, vas ojjerated either by r/ater po-.7er or v/indinills. It is be- 
lieved that the ma;:inim capacity of these early savrr.iills ras not more 
thaji 500 board feet per day. 

The first record of steaiii application was in Her/ Orleans in 
1311. Hovever, shortly s-fter that ■•^eriod, in 1814, the circular saxr 
T/as invented, but it did not cone into general use until about 1840. 
The first band saci was exhibited at the Philadelphia Centennial Ex- 
hibition in 1876. Such a sav.- today, nith all other modern appliances, 
has a capacity of approximately 100,000 feet per day. (*) 

5 . Effect of Logging on Production 

One inportant factor in the developnent of the Lumber Industry 
has ^oeen that of transporting logs from the noods to the mills. In the 
original development of the industry water transportation of logs by 
floating, and latter by rafting and similar methods, was the principal 
means of transporting logs. In tl.ie woods, horses aaid mules provided 
the chief motive power for dragging the logs to places where they could 
be transported by water, or directly to the mill located in the woods. 
Indeed the production of logs was more a separate part' of the industry 
in the first half of the nineteenth century than it has been. since, due 
to the fact that logs were floated to central booms and could be 
purchased by mills which had no timber lands of their own. iln open 
log market exists today only in the far Korthwest. 

Beginning about 1880, with the developnent of lumbering in 
the Lake Ststtes, railroading started in prominent use in log trans- 
portation, and has since become the principal factor for such trans- 
portation. This is an important factor in the cycle of tinber areas. 



(*) "An Outline of General Forestry", by J. S. Illick,; pp. 51, 56. 



981c 



-12- 

In the earlier tir/iber developments uhere the noro prinitive nethods r/ere 
used, a liraberin/; operation developed to uhat viould nor/ "be termed a raedi-ura 
size operation, but never to the enomous size of present day operation. 
This restriction was due to the limited means of supplying logs. ¥ith 
the development of railroad logging, however, operations grew in size, 
and tov/ard the latter part of the Lcdze States Iwi'berin..^ period the ne'7er 
enterprises were much larger than the earlier onos. 

6. The Production Cycle 

Tlith the more i^rinitive neans of logging, clear-cutting, that 
is the cosiplete denuding of an area, was not prevalent. It was economic 
to tL"'J:e onlj'- the most available logs, and there was a "thinning out" 
operation rather th-an a complete "logging off" opercition. It is probable, 
for this reason, that the older areas have continued producing for a much 
longer period thaji the newer areas, and their renewability has been more 
pronoTinced. This fact brought about a cycle of developments which are 
illustro^ted in parts of Penns;''lvaaiia and the Ap'oalachian Ilegion. The 
cycle consists of, first, what might be teamed preliminary operations of 
fairly snail size, then the ejqploitation of an area on a large scale, 
and then the return again to snail, portable operations. 

However, with the development of railroad logging this cycle was not 
so pronotuaced. Eailroad logging sometimes involved the laying of a rail- 
road 80 miles in length. When an area was cut out the most economic thing 
to do was to salvage the rail line and completely abandon the workings. 
The upkeep and overhead of a railroad logging operation being so great, 
it wasn't feasible to continue on a small basis with the remaining thin 
stands. This also tended toward a complete cutting out opera,tion rather 
than a thinning out operation, and in a measure is responsible for some 
completely/ abandoned areas of the Lal:e States and of the far TJest. In 
such areas the hope of sustained yeild opex-ations presents much greater 
problems than in the older areas of the Appalachian and Southern districts. 

The foregoing description briefly brings us up to the situation 
of the late twenties. In 1929 the Lu.iber Industry, as defined by the 
Census Bureau, was comiDOsed of approximately 18,556 units doing more 
than $5, 000, in business anntially, accovinting for a total production amount- 
ing to $1,962,000,000, and had 539,775 wage earners, with an annual wage 
bill of $567,202,000. The mere figure as to the number of sawmills is not 
of important significance when it is considered that the first census 
giving the number of sawmills in 1840 recorded 31,650 sawmills in the 
United States. However, the 18,556 sawmills reported in 1929 had an an- 
nual capacity of 70,000,000,000 feet, whereas the 31,650 recorded in 1840 
had a probable capacity of 7,000,000,000 feet, although the total produc- 
tion recorded for the year 1839 was only 1,603,000,000 feet. (*) 



(*) Forest Service estimate. 



9813 



-12- 



There is still a large nuij'ber of very Gnall nillr ''ith a capacity 
of aroTmd 5,'')00 feet n, dp.y. On the other hand, sone of the laxgert 
mills have a capacity of as ntich as 1,000, ")00 feet a da'"'. The im- 
portant factor in the difference today is the fact that the smaller 
mill aust compete in the sane market as the giant producer, and herein 
lier, the beginnin;-; of m-.ny oi' the problems of prodviction. 

The peal: of m-oduction v7-xs in 1W6 and 1907 rith 46,000,000,000 
feet. It cnist be rcraemoered thn.t this pesJc of production came before 
the rich areas of the Douglas j<'ir Hcr^ioja and the western Pine Region 
viere fullj'- developed and that the capacity in these areas, T-'hich is 
the greatest part of the total mill capacity, has been developed since 
that time. Coincident nith thip cr^r.city development there has been a 
declining voliirae of production. Since 1917, vith the exception of 
1923 and 1925 ;7hen a total of 41,000,000,000 feet Fas reached, at no 
tine has a total of 4(',000,0>;0,000 feet been reached. In 1926 a total 
of 39,000,000,000 feet was rerched, Horrever, in 1929 ^-'hich is gener- 
ally considered the peak ye-ir of industrial production, only 
37,000,000,000 feet of liinbor vere produced, Pollo-'ing that year, 
of course, came the deprnrsion, the Iott point being reached in 1932 
rrith only 10,000,000,000 feet of production. 

At the beginning of 1930 there -vere stocks on hand of 9,500,000,000 
feet. The depression did not become fully effective, as far as the 
Construction Industry vras conct^rned, until the latter paxt of 1930, al- 
though shipments dropped from an averrge of 7 , 0(,.0 , 000 , 000 feet per 
quarter in 1929 to 5,000,000,000 feet per quarter in 1930. Stocks 
increased during the latter half of the year 1930 to 10,250,000,000 
feet. This grea.t stock on h.-nd, together ^•'ith the pressure of liqui- 
dation of the indebtedness incurred in the development of the Uest 
Coast Region dujring the Tdooli period and particiilarly in the tv-eritiB,s 
gave ris'-^ to the most important problems of production, (*) 

7, Labor 

Uliile no figures are available a,s to the number of employees in 
the earl3'' days of the industry, there has be n a vast fluctuation 
during the later years, ■oa.rticularlj'- for the period from 1919 on. 
Prior to 1919, although there has been a migration of the industry, . " ■-' 
^"■here it dropped employees in one area it would pick them up in 
another, bringing about a migration of employees as well as a mi. :ra- 
tion of the Indus trJ^■ itself , Hovfever, in the period of declining 
production, the effect of the crop in production on employees may be 
mea'"'ared hy the fact that the number of employees declined from 
539,775 in 1929, when the total production was 37,000,000,000 feet, 
to 178,000 in 1932 r-hen the production was 10,000,000,000 feet. 
While it is possible to estim.ate the number of em-oloj'-ees in the in- 
dustry back in 1906 and 1907 ''hen the total volume was 46,000,000,000 
feet, actual statistics on th^t score a.re lacking. 



(*) Figures from national Lumber iianufacturers Association 



-14r- 

In general, employees mry 136 divided into two main groups-loggijc^ 
employees and sav»'mill employees. There ic some difference in the 
type of la.hor aJid living conditions "betv/een the tv;o. In those older 
areas v/here the more primitive methods still prevail, woodsme'^ still 
Saw dovm the trees and te^-msters haul the logs to the main point of 
trajisportation, whether that he mill pond or some gathering point 
such as railroad siding or fluming center. In the Northwest and in 
some of uhe larger operations of the South, particularly where rail- 
road lojsjin ; is involved, more mechaiaic.al methods are used. Heavy cahles 
are stining over a wide area and large logs are "brought to the railroad 
"by means of electric or steam donlcey en^iijines and loaded onto the cars hy 
steam loaders. More recently caterpillar tractors ha.ve been used in log- 
ging to an increasing extend, one advantage heing that it is less de- 
structive to remaining trees than the vaii-ous cahle methods. 

The actual falling raid "bucking (sav/ing up the felled tree into logs 
of 16 to -1-0 feet lengths) have char-ged little from the original methods. 
One of the later developments is the use of a. porta-hle gasoline sav? for both 
falling and biicking. 

All of this involves a higher tiroe of labor, with a consequent higher 
staxidard of living and a higher wage rate. However, the significant divi- 
sion between -awnill and logging labor is its method of living. Loggers, 
for the uio'-.t "-■art, are by necessity forced to live in cajnps v;hich can be 
moved aboiit from one center of log.^ing to another. With modern methods 
it takes but a sliort time to log all the commercial trees on quite a large 
a,rea. It is not feasible to have those engaged in these operations living 
too far from their work. Tlierefore there are very few permanent living 
qua.rters fo:''- loggers. This means, of course, that they are, for the most 
•part, unL-flarried ajid more or less transient in most of the producing areas. 
Where logging are?s are more or less- contiguous to agricultural areas, as 
in the .^outli cr.-l Appalachian Region, logging labor is more or less inter- 
changeable; Vv-j th that . of agricultural labor and there is no cloar-cut divi- 
sion het'.-'e.e.'i i-h'-m, most loggers working part of the year in logging opera- 
tionn hut h-.vliig their permanent residences on the farms in tae neighbor- 
hood. 

Savmill wor'-ers ma.;;!- be likened, for the most part, to any other 
factory lnbGr,and in the western arean they are less transient than 
loggers.. 

In tho South negro labor predominates in both sav/mill and logging 
operai' -''■-:.'' , '[-c'c oven here the negro labor in the Liomber Industry, partic- 
ularly t"i,v,t o-£ logging, Can hardly be set apart from the agricultural 
negro labor of the South, of which it is also a part. Likevdse, sav/mill 
labor in the South, although for the most pa,rt negro, is somewhat similar 
to all factory labor in the South. The fact that such a great percentage 
of labor in the South- is negro labor, and that there is considerable 
difference in the density of the timber stands of the South aiid those of 
the West, led to the important differences in Code wage provisions and gave 
rise to the im;'iortant labor problems of the inc'justry. 

8. Lumber Uses 



The cons-umers of lumber ma;^'- be divided into three general classes. 
9813 



-15- 



Pirst, and foremost, is the Construction Ind^'-istry, including railroads, 
which consvjnes approximately 65 to 70 i-ier cent of the total, llext in 
importniice are the Wooden Paclr.a;i,'c I/idastries , including; "boxes, "barrels, 
etc.-, v/hicli industries consu.n^- froni 15 to "0 -.'er cent of tho total. The 
"balance goes ii'xto other industrial uses of varied sorts. Thij;s it may "be 
seem that t?-e most important determinnnt of where Itijifoar is used is the 
volume of constiT.ction in different places and at different times. This 
also means t'nat Ivixnber is used to the gre.^/.test extent in centers of pop- 
ulation. On the other ha^id the gi'^atest centers of merchantrhle timber 
lie where there is the least population, Tiiis involves an important 
factor in .Marketing, 

At the oiitset it was stated that the ind\istry may "be divided "betv/een 
the hardwoods and soft'./cods. In the softwoods, industrial consumption 
aside frora wooden pac]q?;.ges aiuounts to an insignificant factor, perhaps 
not more than two per cent,; wooden pachages a'bout 32 per cent, and con- 
struction and railroads about 75 per cent,(*) Construction l-um"ber as 
used here includes planinj mill products and raillwork used in "buildings. 

The softv/ood areas of t "lie East and South are so located that their 
shipments, to the centers of popula.tion of the I-.iiddle AtLantic States must 
"be "by railroad. The Western forests, on the other hai:id, "being located 
on the coast with its har'bors, require very little transportation to 
Waterside, . thus- offsetting the apparent nearness of the Eastern softwood 
areas of production to the centers of population, and "bringing about an 
important comtetive condition. The combination rail and water rates in 
the West mp2;es this coinrietition more acute. 

9. Production Costs : 

This competitive transportation factor rea.ches into production, 
which ma^:es the cost of production also an important factor in competi- 
tion. The corapa-rison between the cost of .production in the Southern 
Pine Region and the Douglas Pir. Region is as followsr 



Sturap3,ge ...... "".'s v' ' 

Log^:ing and- mill- labor . . . 
Other logi'.ihg aiid mill costs 
Shipping and selling labor 
Other shi-oping and selliiig 
Officers' and owners' pay 
Adirdnistrative overhead 



Douglas 




Southern 


Fir 




Pine 


Per n fee 


t 


Per H feet 


(Per Cei- 


_tl 


(per Cent) 


ls. 1 




17.6 


27.6 




30,9 


35,5 




25,0 


5.7 




6.5 


6.5 




4,4 


3.? 




4 . 4 


G.A 




11.1 



100.0 



100.0 



{*} Table XLIII 
9813 



-16- 

In view of the v/ide difference in the type of lator employed . . 
and the dissimilar conditions of oper,-.tion, the similarity of the 
proportidnate relation of costs ■bet\7een the two areas is remarkahle 
and indicates that methods have teen worked out to meet the competi- 
tion rather than to talce the greatest possitle advantage of the area. 
The importance of transportation as a competitive factor is reflected 
in the "breakdovm of the selling price of Douglas Fir and Souther Pine, 
which shows that manufacturing costs are 46 per cent, transportation 
costs 30 per cent, and distritution costs 22 per cent ^f the total 
price. Thus in spite of the com;jaratively small selling mai*gin, 22 
per cent, the manufacturer received less than ona-half of the consumer's 
dollar. (*) 

10. TransTportation 

The chief means of transporting lumher has teen ty water and rail. 
The use of trucks in lumher transportation is a comparatively recent 
development. Water has always "been considered the most favorahle means 
of transportation because of the hulkiness of the product, except for the 
finer grades of some species easily damaged in handling. In the 1870' s, 
when canalization was making rapid strides in this country, this means 
of transportation was used to considerahle extent. In 1872 necrly 
1,500,000 tons of forest products moved into the Hudson River from the 
Erie and Champlain canals. The development of the railroads, of course, 
brought about the replacement of .canals to a greet extent, as shown by 
the fact that by 1907 the canal movement of lumber had dropped to less 
than 250,000 tons (**) 

In the 1880 'g when the center of prodx^ction had :ioved to the Lake 
States it was quite natural that water transportation should be the 
chief means used, and this is shown by the figures reported for 1885 
'when 659,000,000 feet of lumber were shipped via the G-reat Lakes and 
149,000,000 feet' moved by rail. Howevf^r, as western railroads developed 
this also changed, and in 1897, 379,000,000 feet moved by rail- into 
Chicago, as against 89,000,000 feet by water. It is stated in the above 
cited report that in 1885, 81 per cent of the lumber reaching Chi cago 
cajne by water. In 1913 less than nine per cent arrived by this route. 

When the center or production moved to the South in the 1890' 3 
water shipment of lumber, to the North Atlantic ports was most important. 
In 1890 out of 99G,000,000 feet delivered by water to the port of N«»w 
York, 393,000,000 feet or more than one- third of the total cejae from the 
South. As late as 1907 out of a total of 447,000,000 feet of Southern 
pine shipped to New York, 224,000,000 feet were discharged from vessols. (***! 



(*) Tables LI and LI I 

(**) Report on Transportation by Water in the United States, by the 
U, S. Commissioner of Corporations^ part II (1909). 

(***) Report on Transportation by Water in the United States, by t'he 
U. S. Commissioner of Corporations, Part II (1909) 



9813 



--17- 

However, after 1907 as the netv/ork of railways in the South 
increased, rates competitive with water transportation vrere established 
and the area closest to tidewater was logged out, 'jhich meant that as the 
centers of production receded ihLcaid, the water-torne movement of Southern 
pine on the Atlantic seahoard decreased to an insignificant amount. 

The early development of the Lui^iher Industry on the Pacific Coast is 
largely linked with water tronsportation. California was the earliest 
market for the products of the Douglas fir region which, as has teen shown, 
lies west of the Cascades, north of the Callifornia line. Many Mills in 
the early days were erected for thti sole purpose of shipping lumber to 
California "by water, and as heretofore sho--n it wasn't until the comple- 
tion of the Northern pacific Hallway in 1882 that rail shipments figured 
at all in the production of this oxptc. 

In the ye. r 1902 something over 571,000,000 feet of lumber were 
shipped from the State cf rjashington by water as against 562,000,000 feet 
by rail. jU- though production increc.sed by 1906, there, was a slight change 
in the proportion shipped by rail and water,, the former talcing the le^.d. 
Total water, shipments inthat'yiar amounted to 1 ,100,0^10,000 .feet as 
against 1, 500,000,000' feet by rail. However, in .the early 1920' s the 
shipments of Pacific Coast woods to the Atlantic. seaboard began moving 
through the Panama Canal in subtuntial volume. The year 1922 saw 
1,122,000 tons of forest products going throu£;h .the canal from the 
pacific to the Atlantic seaboard (a ton equals approximately 800 board 
feet). By 1926 this volume had increased to 3,312,000 tons. This de- 
velopment of wet er tran, sport at ion has been the most serious factor of 
competition and has placed .Douglas fir ona- ^ari'ty with Southern pine in 
spite of the latter' s niore . favorable location with respect to consuming 
markets. 

The fact that trucks becatie a f£j.ctor in transportation during the 
period of the depression has been noted. This was chiefly dae to the 
increrse in highways during. the boon period of the late twenties, extend- 
ing through the years 1930 paid 1931. It is chiefly a development in the 
delivery of lumber from the Southerpi pine area and Southern hardwood 
areas to the l.Iid-Atlantic end Torth. Central States from the more nearby 
producing areas to those locations. This form of transportation received 
some impetus during the Code. period, since in most cases, with fixed 
prices based on costs, the amount of transportation was the, only competive 
factor. Such transportation may have been further accentuated by the fact 
that throughout the entire period of depression purchases were made in 
minimum quantities. Minimum quantities could be delivered by truck at a 
much lovrer cost than the less-than-carload rate generally applicable to 
lujnber shipraents. 

11. Distribution 

In the early history of the inaustry, with the small output per 
day, mills usually sold their output in their im'iediate locality. Lumber 
was used close to its sourroi of production since centers of pupulation 
and the centers of production were not so widely segregated. As villages 
grew into towns and lumber output increased there developed the retail 
lumber dealer. Por many yec?rs the retail lumber dealer was the sole' 
distributor of Itunber products. In those early days the retailer's 
field was considerably broader than that of today. Evidently there was 

9813 



-18- 



some competition 'between, mills selling direct within a given retailer's 
area and the retailer, for it is recorded that in 1850 a convention of 
lujnter retailers protested against manufacturers selling to their cus- 
tomers — undoubtedly the local builders. 

Not only was there an increase, in the number of individual retailers, 
but with the advent of the large band saw mills, with their enormous pro». 
duction, such mills established their own retail yards in the newer 
tovms and cities. 

No records are available as to when the wholesaler enetered the 
picture but it is quite probable that with the demand for larger and 
larger quantities a distributor might require the output of a large 
number of mills. Further, the number of retailers had been growing at 
a rapid rate. All of the new towns which sprang up in the last 25 years 
of the nineteenth, century and t he early part of the twentieth century, 
due to the development of the new transcontinental railroads, resulted 
in an excess number of dealers when such nev; developments fell off. 
However, dxiring the period of this development , retailers, dae to their 
number, had no access to all possible sources, and it is quite probable 
that the earliest .development of wholesaling was that of the establishr- 
ment of distributing yards to serve other retailers who were established 
in the larger cities. All of this is very much in the nature of surmise, 
since no historical records of these developments are available. 

Records do show that the National Aaerican ^olesale Lumber Asso- 
ciation reported 573 members in the year 1928, and estimated that in 
1933 there were approximately 1,438 persons engaged in that business, 
although there ware only 238 members of the Association. Roughly it 
may be estimated that during the boom period of the late twenties there 
were approximately 2,000. persons engaged in the wholesale business. 

The term "v:holesaler" may be applied to various types of dealers. 
Little is kno\7n of the development of each type. Ho '-'ever, the original 
type, vrhich still fxinctions, wa3 the wholesaler who sold only to re- 
tailers requiring the output of several mills. This type of whole- 
saler maintains regular salaried employees v;ho call upon the trade, and 
is distinguished particularly by the fact tliat he su:pplies credit to 
the mills, ofttimes financing some of the smaller and mediumsized mills 
through a contract arrangement whereby he disposes of their entire output. 
It is quite probable that with the development of the lumber market, 
which occurred at a considerable distance from the sources of produc- 
tion, the smaller mills had fewer facilities for disposing of their 
product andvere forced to turn to this type of distributor rather than 
sell either direct to consumers, which at best could be only local con- 
sumption, or to retailers at distant tovms oii'- cities. 

Coincident with the development of this type of distributor was 
the establishment of distribution yards. Such wholesalers maintained 
central yards within a given area from which they could supply smaller 
amounts to the local retailer and furnish quicker service than could be 
obtained if the retailer had to depend directly upon the mills for his 
source of supply. Many mills, particularly of the larger type, also 
maintained such distributing yards in principal centers of consumption. 

9813 



.19v. 



A third type of wholesaler ceune rith the development of large 
buildings. It became apparent to contractors requirin;^ 20 and more 
carloads of lumber for a single project that the j"" , should be in a 
position to purchase their requirements either from wholesalc-rs or di 
direct from the mills. The older established retailers, afi shorai here- 
tofore, have always considered themselves tn be the main contact be- 
tween the consumer and the source of supply, whether that supply be 
from t he. whole '^aler, distribution yard or t he mill. iTaturally such 
retailers were at all times under vigorous o. ..josition to wholesalers 
who acceded to the demands of the large builder in supplying such build- 
er's needs. Quite naturally they used every means at their disposal to mai 
maintain such business, and their principaD. m^ans was the boycott of 
wholesalers or mills which engcged in such dealings. This led to the es- 
tablishment of wholesalers, who depended in t he main upon the business 
of large contractors and other large users. 

There bas also developed in this industry, a s in most other manu- 
facturing industries, the broiler and the commission m.an. There is 
very little distinction between the two, the princi;oal distinction being 
the fact that a commission man. usually aligns himself with one producer 
and represents that producer in all his de-r^lings, whereas a broker feels 
free to sell lumber on a commission basis, transferring the order to any 
prodvx.cer he thinlcs can fill the needs and v;ho can give him the greatest 
advantage. Brokers, as a lule, are not expected to supply credit to 
either the producer or t he buyer, but merely to act as an intermediary 
betwesn the two. 

12. Improvements in product 

In the early days of the indu.stry, vdth the inadequate facilities 
of the lumber mill of that time, it is but natural that the product was 
rather crude, being but a slight inrprovemont over the hand sawn product. 
Dimensions were irregular and there was an inadequate loiowledge of the 
properties of the various species, which led to considerable misuse of 
lumber, prejudice-s grei;' up Y.'hida had no foundation in scientific fa.ct. 

The first stsp toward icrprovements in lumber wa.s a realization of 
the importance of the djying process. The water content of lumber 
determines its shrinkage; hence v/hen green lumber, that is, newly cut 
lumber, is used it may shrink considerably upon drying out, causing 
the product made from, that lumber to become loose and function inproperly. 
In the early days air drying was the principal method used, a method 
which is in considerable use todr.y and is, in many cases, the cheapest 
way of curing lumber. However, to improve the product and to make it 
usable as soon as possible .after samng, the establishment of dry kilns 
became common. Kiln, drying is merely a method of drying the lumber by 
heat in buildings built,. e:q3ressly for that purpose. The process, con- 
trolled to prevent too fast drying which will warp and clieck the lumber, 
enables the producer to accurately control the water content of the 
product he sells. This process is slso import^-snt in the competition 
between the small mills and the large mills. The small mills, with 
inadequate facilities or a small production which does not warrant the 
investment required for dry kilns, produce, on the whole, a poorer 
product than the large mills. 

981S 



-20- 

The investigation of the properties of wood was a further step 
in the improvement of 1-umher. It was found that various pieces from 
the same tree had properties different from other pieces. Also, the 
effects of knots upon the structural properties of lumlaer and timber 
were measured* 

¥ith these refinements came the estalllishment of grades. Origin- 
ally the knowledge of hardwood grade was kept from the consumer. It has 
been stated by a prominent hardwood lumberman that one of the eajrliest 
conventions of the hardwood lumber producers was marked by a vigorous 
fight to oust one of their members who had disclosed some of the se- 
crets of grading to one of his customers. This tendency to withhold 
grades from Ithe customer, ?/hich allows ma,nipulation by unscrupulous 
dealers, though deplored by the majority of members of the industry, 
has so far failed to become of sufficient moment to the producers to 
induce them to mark the grade upon the product except in some instances. 
There has been, however, considerable agitation for grade marking in 
the past fev7 years and grade marking has received considerable impetus. 

There have been a few recent refinements in sawing lumber. However, 
many of the old prejudices remain, and for general competitive purposes 
the buying public has not yet been educated to the point of demanding 
individual quality. Hence there has been no encouragement to individ- 
■ual producers to improve the quality of their products. 

As yet the properties of the producers rather than of the con- 
sumers, which malces lumber a product that competes vathin certain class- 
es chiefly on price, the general species of softwoods being considured 
competitive with fe&ch"'other» 

13'. Other Lumber Products 



Up to this point the discussion has been , conf ire d princi- 
pally to the production and distribution of liomber. However, the 
Lumber Industry under the Code considered itself as including woodwork, 
hard'-ood flooring, veneer and -plimood, dimension, and wooden package 
producers. 

Woodwork is generally considered to include planing mill 
products, that is, ..such items as molded pieces, sash, doors, frames, 
and other products for building requiring more fabrication than just 
plain 1-umber. Woodwork, in turn, may be divided into two branches 
namely, stock millTrork and special millwork. Stock raillwork is con- 
sidered as the product of those producers who manufacture, sash, doors, 
blinds and other millwork of standard dimension, including, of course, 
molding, which, in most cases, is manufactured directly in connection 
with isai/Tmills and is usually stock. Ivlany large sawmills , have woodwork- 
ing departments for the production of stock millwork. 

Special millwork has no defined limits; there is no 
point where the craft of cabinet making is sei^arated from that of 
special millwork. Special millwork, besides including sash, doors and 
other building products not of standard dimension, also includes special 



9813 



sliciper- and carved work wlierever t..e Tjdxxcer of suc.i millwork feels 
that lie is ;:-l3le to prodace it. T e ip-ct tlir.t tliere v/,?,3 no such defined 
limit was tl.e source of tlie :n-, '-t Jitter jarisdictionr.l dis:mte during 
the entire codal period r.s it coiicerned tie Lvjnber Industry. Ll^'Jiy of 
tliese products, which r.re ra, de to order chiefly frOiA architects' speci- 
fications, are liiade in shops connected with retail Ivunber yards. 
However, such shops cm produce the requirements; for only small pro- 
jects. Tlie large ouilding project requirin;!.; special woodwork must 
look to the large sh.cps caprble of producing such.. i.iuch of this is 
done in factories whose p-rinci-vai output is tLiat of stock millv/ork. 
iisnce it becomes iiard to strictly divide f-.e entire woodwork industry 
betv/een sawr.-iills, stock millwork producers and s/jecial raillwork pro- 
ducers. Some hiills are' capable of producing the most intricate of 
woodwork designs, while other, mills do not extend beyond planed lunber. 
T.iere ?.re some stock millwor!.c producers and, indeed, some special 
millwork producers among tl:'.e groups v/itli' s.r^.ller shops, v/hc, if given 
such an order, v/ould have it executed in a larger plcnt capable of 
mo re e c o nomi c p r o due t i on . 

hardwood flooring producers have for a long time been organized 
as such, due to tl^.e fact that this 'iroduct is m.ade on special machines. 
It. does not follow the-usaal channels of distl-ibuticn , rlthough most 
lurnber dealers stock hardwood flooring. '.laving p, larger number of 
grades and the methods of production and distribution being different, 
hardwood flooring has generally been considered a separa.te part of the 
industry, althougLi its base product is hardwood lumber. Due to the 
fact that hardwood flooring is produced in special machines, some of 
it is made by those eng.-^ged in producing flooring and not lumber. 

There are tiree genc^ral branches of this industry, namely, 
the ock flooring producers, whose product is oal; flooring produced in 
an area which centers 'around iiemphis, Tennessee, and extends through 
tie Appalachian and U orth Central hardwood producing states; tlie 
ma.ple flooring producers, located cliieil.y in tlie vicinity of Cadillac, 
Llichigan, with a production amounting to r.pproxima.tely 80 percent of 
the total used, about 15 percent being produced in tie New SnglrJid 
Spates and a small amount in the Southern States (however, the ma'Dle 
flooring industry considers itself chiefly a hichigcji producer); and 
special flooring producer;3 v.ho are eng.aged in producing made-to-order 
types of hardwood flooring. 

Both veneer and pljA-'oods are produced by maiiuf acturer-^ w::io 
are very closely allied with tlie Lumber Industry in view of the fact 
tiat tney are produced direct from tlie log rather than from manufactured 
lumber. Tliis is a newer part of " the industry and represents the most 
economical utilization of the tree, the veneers being sliced off the 
log in tliicknesses of one sixty-fourth to one-quarter of an inch. 
'Alien two or more layers of such 'wood are, glued together they are called 
plywood. The finer and more decorative woods are produced in this 
manner cud. for such things as furniture ' are ror'ly com-jetitors of solid 
lumber. Among those samnills tir.t .-.Iso ;_"--r,:,duce veneers and plywood 
the principal reliance is en sr.wed lumber. ?lywo;-d, particularly, is the 
one part of the industry that is growing, since new uses are being found 



9813 



; „ -22- 

for this I'jroduct in late years. As a co,n;;r3titor of solid lurnber, 
l^lywood, although, producing an increa^se in dollar voliiiiae for the amount 
of tree' that it uses, may "be largely responsible for decrea.sing the 
amount of solid limber in industrial and construction uses. 

The next most important Division of this industry is tlie 
vVooden Package Industry. Tliis branch of the- industry is further sub- 
divided principally into the Sawed Box and Shook Division,, the. others 
being such Divisions as Plywood Package, Egg Case, tVirebound Box, and 
Wooden Pails and Tubs. It has been stated that wooden packages 
' represent approxii'nately 15 to 20 percent of the entire lumber produc- 
tion. In some Divisions of the Lumber Industry, however, a,s, for 
instance, the Western Pine, 33 percent of the production goes into 
wooden boxes and shocks ("shocks" is the term a.pplied to the finished 
pieces that go to malce up the wooden box). This product is preponder- 
antly maniifac tuT od in factories connected with sa.v/mills and. is an out- 
let for m'?"li Oj. -,iie lower grades of lumber and the poorer species of 
tirabcT", 

In 1'3>0 out of a total of 18,356 producing plants, 792 pro- 
■duced FOoc..'-n box products. The VTooden Box Division is also the more 
seasbn.able :i"a.r : n" the industry because a grea.ter part of its products 
are used .for shipping agricultiiral products, a.nd the sea-son therefore 
follows ths harvest season. 

The independent esta.blishjnents in the manufacture of wooden 
cfates, boxes, etc., are located chiefl.y in the East and away from the 
lumber producing centers. Such plants purchase their lumber, usually 
the lower grades, for- the manufacture of the various types of boxes 
and pa.ckages for industrial use. It is this' part of the Wooden Bex 
' Industry that has been the hardest hit by thp substitutes paper board 
and paper boxes, the paper box field having not yet been extended to 
include agricultural products in any substantia.1 amounts. 



Another Division included .as a part of the industry, chiefly 
because the product is manufactured in connection with sawmills, is 
that of the Kiln Dried Hardwood Dii-iension Industry. By hardwood di- 
mension is meant both the cutting ajid siiaping of wooden parts used in 
industrial processes. This branch of the industry plays an important 
part in tlie application of wood to industrial products, an illustra- 
tion being tlie Furniture Industry. Y/ooden parts for furniture, in 
fact entire peiccs of unassembled furniture are now manirf a„ctured in 
sawmills, the only process required to make them into finished furniture 
being tha.t of assembling and finishing. 

Tliis industry has developed rapidly witliin the -^xist few years, 
chiefly because it represents a method delivering wood products nearer 
to its point of distribution with less waste. In some instances as 
much as 40 percent of the l.jimber used in the majiufacture of various 
wood products represents waste. The savings from malcing finished parts 
nearer the point of lumber production, and the avoidance of the shipping 
of waste products, re-iresent a considerable saving to industry. Eiis 
development is a further step in the integration of the industry and 



99.17, 



seems to Iiold tlie cliief lio:?es of o/ir.t inrlustr/ in maint.'^.inini2 a higher 
ratio of hr.rdwood liirauer consiijir''tirn. 

Practically all of these auxiliary Divisions, while not 
contrilDutin,!; very sit^^iiificantly to the basic iTrobleins of the Lumber 
Industry, were included under the Cde, bringint;, \iit'.\ tiCm all of 
their minor ^:)robleras to courlicate t^io j -erati:n of the Code, which, 
in the first I'^lace, was jointed tovr.rd tie solution :f the -problems 
of the L-oraber Industry. 

B, • SCOPE OP Discussion 

To sum up, the broad oaCxJiTT-iund of the enti'.-e Lumber Indus- 
try as it presented itcelf u;; to the time of the Code hc^s been out- 
lined here. The purpose of Code action \'ic,s a solution of the problems 
of the industry. Prora tiis point forward the discussion of these 
problems is divided into the followiu:'^; fields: 

Pirst, the basic problems of strndin;^ timber, which is the 
base of the Lu;Tiber I^dustr.}^. Tl~.ese orobleras concern themselves with 
volume, location, tiinber o?mership and value, and costs of holding, 
Fjad efforts at conservation — in fact, all of the problems of forest 
management. 

Second, the problems of produ-ction. Tliese, vtoile closely 
related to species and the 2'^roblems of forest management, are also 
concerned with special problems revolving around volume, costs, labor, 
capacity, capital, credit, etc. 

Tiiird, the problems of distribution. Involved here are the 
factors 01 competitim, bet.; regional and species, the demjind factors, 
the problem of substitutes, prices, transportation costs, etc. 

Fourth, a resune of the atteinpts to meet these problems 
througji the i.iediujn of a code of fair coiapetition and an analysis of 
the operation of that code, and 

Finally, the p-resent status of the industry and issues re- 
lating to its f\iture needs. 



313 



-24- 

GHAJTK4 II 

THE PR03LEIIS OP FOREST IIAIUGZI^'J"}! 

Forest mr.na.';ement has a vide rpn^'^e of mesnings 6epenc"in~ u'oon tae 
loxirposes "un&.erl'''ing it. Thus in commercial forest manfigement there is 
a terjdency to stress the lorirjciples of- profit and maximum ^rocluction, 
T7hereas in -oublic forest management special emphasis is -.isual 1"'' placed 
iipon the -orinciples of sustained yield and highest use and service of the 
forest. The Society of American ?oreste"s '■'efines it as follo^Ts: "For- 
est management is the practice or application of forestry in the conduct 
of the forest business." 

A. TIIvBBR SUPPLY AiCD LOCATION 

Like all natural resource industries, the successful development and 
management of the lumber and timber products industries are (dependent 
upon: (l) The location of ra^i materials '.vith resioect to consumer require- 
ments; and (2) upon the form, character, volune and accessibilit"'- and, 
therefore, cost of ma,terial in a specific region r/hich vould permit its 
use or conversion at a profit. 

These de"oendencies involve problems of cutting, of transportation, 
of competition vith similar proc^ucts rnd "oos'^dble substitutes, of costs 
of ra"' materirl and conversion, and of demand. Tlie sixppl;-.', location, and 
other characteristics of the principal kinds of timber a.vrilable for con- 
version into useful -orocucts are described in this section. 

1. Pressnt "J'orest Area 

From the original forest area of more tlian 800,000,000 acres, ap- 
proximatel"' 304,000,000 acres, or 38 aer cent, have been ^'ithd.raivn from 
commercial timber growing. This "."'ithc'raval is made up of 150,000,000 
acres chie:^l ^ c\\t to clea-"- land for farms in earfy days and the timber 
destro3''ed becruse of no raa.rket; 10,000,000 acres of reservations, 'oarks, 
preserves, etc.; and the balance cut over for tinber and subsequentl"'" for 
use for other purposes. 

The conversion of forest land into farm lanc^ is still going on, 
parti cularl"'' in the '.est, 'iiere the removal of vir~in timber of relative- 
ly low present value for com-iercial purposes releases good soil for farm- 
ing. It is estimated that eventuall^' some 2,000,000 acres of commercial 
forest land in the '.'/est '"'ill be removed for this purpose. In the East, 
however, an opposite tendenc^"- is being manifested on a major scale, for 
here farms are being abandoned and becoming increasingly a.vailable for 
forest use. Alreadir some 52,000,000 acres are estimated to be so avail- 
able, and it is estimated that from 25,000,000 to 30,000,000 additional 
acres of abandoned farm and other lands ma.""" be ad.ded to the commercial 
forest area b;'- 1950. Further, 3,000,000 acres of treeless prairies could 
be planted if the need for increased forest area develops. This acreage 
of abandoned or potential forest area, on accovint of its variable oiianti- 
ty, is not considered in this study* 

a. Commercial Forest Area 

The remaining 495,000,000 acres left of the original 800,000,000 
9813 



••25— 



acres of forest a""ea, after deductin^'^' the 304,000,000 acres cited above 
r,<^ ^vithdrai''n from connerci'l. timber rro'.'inr, constitute the ■Trere;:it com- 
mercial forest area tijid enconro8.r;-:- tlie f oXlo'' ir. '•: c'iscusr.ion. 

The South coiitains the Ipr^iest arer of comnercioJ. forest lanes, '."ath 
a-o-orozii.irtel-'- 40 per cent of th^^ tot£il '"o^ t^ie United State?. The Pacific 
Coast reiS;ion ranks next, T'ith a Tittle over 13 -oer cent; closel'" follor-ed 
by the Central re.";ion 'fith aboat 1 j -per cent; and the La'.ze re.n^ion, '.7ith 
sli.^htlv over 11 pr?r cent. These four ref.^i'-'ns contain aoout 76 per cent 
of the total com'iercial forest area. The liiocle Atlantic re,-.;ion contains 
the smallest area, or about 5 per cent; ■.'lile the other threo regions, 
irsTf Jln'^lanc ••'ith 6 per cent anc" the I'orta anc Soufi "^.och" I.'o-.mtpins ''ith 
7 per cent and 5 --er cent, ren'oectivel'-, -oossess tlie rest of the acres.f;e. (*) 



Ap-iro'-.imatel"-' ?S5,000,000 .-crer:' 
f crept Irnds lie ea'-t of the C^rert ? 
'.■"cst"pr^' fron the '""oclc- Loi^x tains. 



7'1- per cent, of the coiimercii'.l 
3, '".'ith the bf'lrnce n tret chin,': 



About 30 per c..:-.t of '"he total conner'cir.l forci'^t r-eo of the 'Jnited 
States is chercCtE'-i'^ed b- t-ees lar^e enourh "or ':^:-"" log^, in accordance 
vita "orevailin'; lo-'ln™ r".id nillin-; ■•-'ractic'e, and ir therefore designated 
as savf-timber area. Of t li s prea, ''"'" 'oer cent is located ea.^ t of the 
Great Plains. Here again the So-.xt'. leadc ii: tais ty-oe O"^ land, clairain- 
30 per cent of the total, 'rhile the Pacific Coast ran':s next ""itn 23 ^er 
cent. The Lalre States contadn tlie lea^st ,"a""-tinber land, or aj"oro:".i.nataly 

3 "per cent of the total, .^ollo-.'sc by the Liiddle Atlrntic Staters '"ith abo'it 

4 per cent. 



(*) Throu^-hout this re-no-?t in di?c"..\j 
regions are referred to a^ f oilers: 



'?. ti'ibar or tinber lands various 



ilen :H]n~land 



Hiccle .Ltlantic 



Central 



Connecticut 

Maine 

Mas sachus e 1 1 s 

New Hampshire 

Rhode Island 

Vermont 



Delaware 
i !:aryland 
i^e\7 Jerse^r 
ITev York 
Penns''"lva~nia 



Michigan Illinois 

;;innesota Indiajia 
North Dsl-ota Iowa 
".'i scon sin Kentuclc' 



liissouri 
Ohio 

Tennessee 
"Test Virginia 



Sotlth 



Jr'acific Coart 



'"-Ocky Lit. 



-10 C 



:t. 



Alabama- 
Arkansas 
Florida 
Georgia 
Louisiana 
Mississi'Toi 
Forth Ca.rolina 
Oklahoma 
South Carolina 
Texas 
Virginia 

9813 



California, 
Oregon 
Va.shin :ton 



I daho 
Montana 



Arizona 

Coloraido 

i'evada- 

1 ea' : e:;ico 

South Dakota. 

Utah 

TTyomin,": 



-26- 



r.ventv-four (24) ner cent of the comnercial forest lands contain 
trees too small for sa'".' logs but ler^e enough for cordnood, re.~f.rdless 
of ^Thether the sta,nd is to te cut for cordvooc" or held for san timber. 
As \7ould be e::pected, the states east of the Great Plains contain most of 
the cordr^ood areas, or about 85 per cent, due to the fret that a greater 
proportion of the virgin timber in the Ear.t has b?rsn cut over, thus re- 
leasing the lands for second grovth. 

The bul': of cord'vood lands, or 44 per cent of the total, a?'e located 
in the South. The Central States come ner.t, rith 21 -ler cent; folloned 
bj'" the L'iddle Atlantic and Lal'e States v;ith 9 ano 7 per cent, res'oective- 
" ly. Fe'" England has the least, aporoximatel:'' 4 per cent, rnd tae other 
threo regior.s possess approximatelv 5 per cent each. The relatively 
smrlT cord'^'ood area in the Pacific Coast States is c!ue to the high per- 
centage of virgin so;' timber on tieir total corriercisl forest area. 

."Restocking arer"^. comprise Irnor that once supviorted a stand of tim- 
ber and •.■■hich rre no'- oeing rene' ed. The bulk of this nev; growth is 
smaller than cordrood size. 7filr to satisfactor"- restoc]:ing areas, ac- 
cording to -oresent standards, ma-" be defined as lands 40 -oer cent or 
more eestocked ^ith connercial species, i-hile areas v'ith a lo^'er "restock" 
percentage are considered poor to non-restocking areas. 

Restocking lands constitute aboxit 37 iDer cent of all commercial 
forest lands anc, as is to be expected, tlie'"- rre found in those regions 
where the largest volume of lumber hps been produced over a considerable 
period of time, nemely, in the Sov\th and the Lpke States. The South 
contains over 80,000,000 a.cres of such area, or 16 per cent of the total 
comnercial forest area of the entire countr;;-. Oi this amount nearly one- 
half is considered fair to satisfactor;"- reprocuction. The Lake region 
contains restocking lands amotuiting to 8 per cent of the total commercial 
forest lands, v.dth 67 per cent of them fair to satisfactor;"-. 

The eastern regions contain nearl"- si:-: times as much re;orocucing 
area as is foiind in the western regions, md the pro;portion of fair to 
satisfactory restocking lands to total restocking lands is raiich greater. 
Reproducing areas are in the best condition in the Te\: Sn^rlfind and' Central 
regions, approximately 70 "per cent containing fair to sa^tisfactory re- 
production. The poorest reproduction is fo-and in the South Roclcy '.foun- 
tain region, irhere onl-,?- 9 per cent of the re-^roducing areas are fair to 
satisfactor3'-. 

It is ap-oarent that the ccviercial forest Irnds of the United States 
are, generally speaking, so cistributed as to produce future supplies of 
forest prodiicts fairly close to la/rge -oopulation centers, fn'." therefore 
to e:rpected (demand. Possible exce":)tions a:''e the Vev: .iHngltJid and the 
Middle Atlantic regions, r/here the expansion of forest industries to any- 
where nea,r their f orraer cr-pacity might necessitate the dra'-ing of "oartial 
future suo'ilies fro-n the South and 7est. The commercial forest land.s in 
these t^o regions, hov/ever, if intelligently mana^^ed, ma-'- be e^rpected to 
■iDroduce forest Tjroducts considerably in excess of their coi'S-om-ptive demands. 
Of course there may be a trend of future forest incusti'ies torard regions 
of abundant supply, a, movement uhich has characterized such industries in 
the -oast. 

9813 



-27- 

2. Fore-t Stand 

Prom the standpoint of future ejenerations, the forest area nov/ 
available will furnirh siiff icieiit Ir.no for the .^rorin..-; of required forest 
crops. For the T5reoent anc irr!;ieciate future, the sup-oly of timber novi 
stpnrlinfT, its location '-ith ro^-oect to the need for forest products, and 

its marketabilit'','' are of ori'ie concern. 

In 1928, through the i^cSt'e iney-L'ciTar';- Act, Con<^;:re!-s a.uthorised a 
national surve3'- of the timber re^ourcen of the United States. Its objects, 
for the suri-ey is not yet cor-r-lete, rre: (l) To ma'';e an inventory of the 
jresBnt supply of timber and other forest -rodiicts, (2) to ascerta.in the 
rrte of ^rowt!-;, (o) to oeternine the drrin .on the ■^orept'^. tnrou^h indus- 
trial and other uses, anc fron fir-?s, ciserse, etc., (4) to deteiTnine the 
•oresent and -orobable fu-ture reouirenents for timber a.nd other forest pro- 
ducts, and (5) to correlate the fii^cin.^;? ''ith existing-; a.nr oJitici^oated 
economic conditions. 

Althou.^h the field '-'ork on over 150,000,000 rcres hap been completed 
and Gubstantial 'T^ro^ress nsds on the comolicated office Trork of this 
nationa.l survey, no ?'esult^- a^e "-et e.vrilrble for an;'" one state or gro\\p 
of states. The area, stand, ;i:ro''"th pnc -oartial drain fi Tares in t:iis re- 
port, therefore, have be:n la'-'^-el-^ ta'.cen f ror-. U. S. ?ore"^t Servico 
sources. (*) 

Preliminary and uriof."icirl ertin te= gedned f'^om th.j survey cited 
above indie? fce that some of t.ie st; nc rnd ,.>; ro^'th fi,ijures tD]:en from the 
Forest Service reports are too Ic'. It is believed, therefore, that the 
conditions described and conclusions rer.ched in this report are conserva- 
tive. 

a. Stand on Tota,! Area 

Products derived from the forests £.re of '"'idel'" varyin;-^ character, 
anc their unit volume is expressed, in a n-.imber of difi"erent rrays. Thus, 
Inmoer and log's are e>7nressec in feet, board neasare; fuel wood, pulp 
rood, distillation vood, and ot/ier cord ''ood, in corc.s; nenn ties, fence 
oosts, staves anc. hoo'os, shiniTle'^, poles and pilin;~, in nieces; roiuid. 
nine timbers, in cubic feet; and slaa: he,', car.g and ti;~ht heading co- 
operage, in sets. The onl"' ■oo^siDlo connon denominator of measurement is 
cubic feet. Chart II and Table II she the tota,l stand, erroressed in 
millions of ci\bic feet, of all .forest "orO(. uct? ectir.iated. to be rta.nding 
in tree forra on the a,o'oro::imatel-- 495,000,000 acres of commercial forest 
Irnd. 

Fift'"'-si:: (55) per cent of the forest pt-nd of the ^.'nited States is 
in the ¥est. The Pacific region, ^.'ith 39 oer cent of the total, hrs the 
largest stfnd. The South is ne.--t, 'ith 23 ;;jer cent, and the La.ke re.^ion 
lapt, "'ith 4 per cent. 

(*) U. S. Forest Service. The Forest Situ"bion in the United States; 
a s'oecia.l renort to the Timbe" Gonservrtion 'Joard, Janurr;^ 30, 1932; 
and Senate Doci:iment ^12, A Tationgl Plan for Americexi Forestr^'- , 1933. 

9813 



-23- 

Softv'ood comprise?, about 74 per cent of the total stf-ijJ. in the United 
States. In the eastern re/?ions 40 per cent of the stpnd consists of soft- 
r'ood, and in the \7estern re,'jions practically lOi^ per cent is softnood. 
Hard'^'oods predominate in the T.ev England, Kiddle Atlantic, Lake and Cen- 
tral regions. Only one region east of the Great Plains, the Soutlt, con- 
tains a greater volume of softvrood than hardwood.. 

b. Stand on Sav; Timber Area 

The stend on the .sa'^-timber area comprises 75 per cent of the total 
United States stand, with ha.rdwpod predominating in the eastern region 
and softwood in the ITest. Sighty-one (31) per cent of the total stand 
on tie saw-timber area is softwood. The stand on the sr^'-tinber area is 
further discussed in terms of boarc feet, under the ca^otion "Saw Timber 
Stand. " 

c. Stand on Cordwood Area 

The stand on the cordvrood area amounts to 20 per cent of the tot?.l 
stand of the United States. About 81 per cent of it is located east of 
the G-reat Plains. Thirtjr- eight (38) per cant of the Eastern total and 
99 per cent of the Tie stern total is softv/ood. The South has the largest 
cordwood stand, i. e. , 39 per cent of the total, of '"'hich 61 per cent is 
softv'ood. In all of the Eastern regions, e::cept the South, hardwood 
greatlv predominates in the cordwood area. 

d. Stand on Hestoclcing Area 

The stand, on the restoc'cin.':: area amounts to 4 per cent of the total 
stand in the United States. ( *) A breakdown of the restocking area into 
soft'"ood I'nd hardwood is impossible from existing d.ata. Of the various 
regions, the South ags.in leads in vororne of stand on the restocking area, 
with 42 per cent of the totl volume. The i'orth Hocky i^oiintain region 
is ne::t, with over 14 per cent, follo^'ed bv the Pacific, Middle Atlantic 
and New England, regions. The South ?t0ck;'- iiountain region has practicallj'- 
no volume on the restocking a,rea. 

e. Sa'"- Timber Stand 

From the standpoint of both the lumber industr?'' and the public, the 
amoiint of saw timber, its character, and its availability are forest 
mane^gement problems of fundamental importance. Not only does the su-opl^- 
of sa'" timber take care of current l^omber and other important reouire- 
ments but it governs present and -oossible future competitive conditions 
for the industry and forest prod.ucts users. Chart III and Table III show 
the present sa\7 timber stand of softwood and hardwood and the various 
classes of ovaiership. 

The saw-timber stand in the United States is estimated to be 1,637,- 
803,000,000. feet board measure. Of this 59 per cent is privatelv owned, 
and the balance is owned or administered by the public in the form of 

( *) Omits data for Lalce region, which are not available. 
9813 



-29- 



national, Indian, ctpte, coxxnty, rnd mimicipal forests.. Of the ■nrivatel:'- 
owned timber 38 per cent i r. O'r.cc b"- l.^rrJ, l-.inber, pulp r.nd pproer, and 
mining companies; naval stores o-oerators; railroadr,; and niscellaneous 
individuals and a!-':encies; rnd the balance by farmers. 

All of this suppl',^ is not iraMeoiatel-'- available ueco-use o" noor lo- 
cation i.lth respect to transjortation facilities, -densit-'- of stand, com- 
oosition of stand, and other factorr.. Obvio^isl''- it? conolete conversion 
into forest "oroducts is governed bv the ^:fillingness of the public to lay 
t ".e cost of getting out the mora inaccepsible and scattered timber. 

Availabilit}'- in the 'Test is illustrated by the Strte of California. 
In a study of the timber situation in that state in 1914 the cuestion of 
accessibility nas carefully considered. (*) For oxirposes of the stud^s 
the state, .outside of the red-.-ood region, vb'.s divided up into three zones 
of accessibility, in vrhich the lo.'jging costs vere estimated at $6.50 per 
M feet or lesr for Zone 1, ;J;6.50 to $9.50 for Zone 2, and over $9.50 for 
Zone 3. It v'as found that 34 per cent of the total stand, both publicl-' 
and -orivatel-y ovned, Mas available at $S.50 or lesp, 45 -^er cent at Zone 
2 cost, and the balance at Zone 3 cost. In 1914 the average logging cost 
for 20 representative uine mills in California '.'^as $5. "4 per H feet. In 
1934, however, according to statistics furnished by the "estern Pine As- 
sociation, average log -ring, cost in the ^ine region of California- '"'P.s 
$8.61 per K feet, or still rithin the Zone 2 cost limit of 1914. 

The average xirice received in 1914 by the 20 representative pine 
mills in California for their product f.o.b. shipping ;ooint vrs $15.08. 
Although average price figiares for 1934 are not available, average prices 
Tdy s"oecies f.o.b. ship-oirt ■ooint a.re reported b;'- the TTestern Pine Asso- 
ciation as varyi-.g frora about 318 to about $4?, '-ith aO estimated avera.ge 
for all species in the -oine re-^ior. of California of a^o-;5ro::imatelj'- $25. 
Thus, the logging cost in 1914 -'n.s 31- ^er cent of the selling price, or 
substantiallv the sane ra'-.io a'^- in 1934. This indicates that as logging 
costs increase due to rela-ive inaccessibility^, either selling "Trices 
increase or the pro'^uct is sole oelov cost. Further discussions as to 
the effects of eithor of these courses '"'ill be found in a later chapter. 

Another "oroblem incident to forost manrgem3nt lies in the trend 
away from lumber as a orinaaT forest "oroduct and to^aro /mterial that 
can be converted into -p-al.-o end tnen made into a variet""' o:^ "oroducts. 
Timber difficult to get out in log form may be e:rploited in cordrrood forra, 
which is more suitable foi:- oulp conversion, and at a substc;rtia,ll3'- loner 
cost than that reo"uired for the removal of sa'' logs. 

Of the total sa\"'-timber su-rpl^^ 39 per cent is softvrood and 11 per 
cent hardv/ood. About 83 per cent of the total cut during the period 1929- 
1934 vas soft'-'ood. It is thus seen that the relative demsn.d for softv.'ood 
and hardwood is in about the same proportion as the supplv of soft\7ood 
and hardwood saw timber. (**) 

(*) Smith, C. Stowell, Ascistsr.t District Forester, The Lumber Industr^'- 

in California: c-n unpublished report of the U. S. Forest Service. 
(**) Table V (a) of tais report. 

9813 



-30- 

Seventy-nine (79) per cent of saw timber is located west of the 
G-reat Plains. Of this practically all isooftwood. It is strikingly 
evident, therefore, that the 'bulk of softwood saw timber is not in close 
proximity to the centers of population and demand, as is hardwood saw 
timber. However, the location of softwood on the Pacific Coast makes it 
possible for producers to take advantage of water transportation through 
the Panama Canal, with consequent shipping costs low enougii to permit 
considerable back haul by rail from the Atlantic Coast before equaling 
the all-rail cost overland if the haul were made that way. This favor- 
able freight differential, together with the relatively larger timber 
and denser stands on the Pacific Coast, has made it possible for Pa^ 
cific Coast liiraber to compete successfully in the East with lumber pro- 
duced close to points of consumption. 

It is not necessarily unfavorable to have timber, the raw material 
for certain forest products, raised under conditions of maximum growth 
and at lowest cost and to have the material transported considerable 
distances to the industries requiring it. The important matter is an 
adequate supply of suitable material at reasonable cost to the industry 
or other consumer making use of it. 

The Pacific Coast region contains the largest stand of saw timber 
(62 per cent of the total in the United States). Of this, hov;ever, less 
tnan three-tenths of one per cent is hardwood. The largest supply of 
softwood is in Oregon, followed by Washington and California. Most of 
the hardwoods in the West are found in Oregon, 

The next largest stand of saw timber, approximately 12 per cent of 
the total, is in the South, with 61 per cent softvzood and 39 per cent 
hardwood. The North and South Rocky Mountains come next with a little 
less than 9 and about 7-1/2 per cent, respectively — practically all 
softwood. 

The Middle Atlantic region possesses the smallest amount of saw 
timber, about 1-1/2 per cent, of which 68 per cent is hardwood. The 
saw-timber supply of the Lalce sind Central regions is also preponderantly 
hardwood — 74 per cent and 91 per cent, respectively. 

B. THE PROBLEM OP TlivIBER OWNERSHIP AND VALUE 

1. Ownership of Entire Porest Area 

a. Industrial Ownership 

Over one-half of the total commercial forest area is owned by land, 
lumber, pulp and paper, and mining companies; naval stores operators; 
railroads; and miscellaneous individuals or agencies. (*) 

Industrial forest-land ownership is the predominating type of own- 
ership in the eastern regions, comprising over 60 per cent of all 



(*) Chart I and Table I. 
9813 



-31- 

ownership. Eighty-six (86) ..per cent of the industrial acreage is in 
the East^'and 14 per cent in the West. The South contains nearly 50 per 
cent of the industriil lands of the entire United States. One-third of 
the total area under industrial ovmership is classified as saw-tiraber 
area. Because of the large areas of softwood and hardwood forest which 
were originally culled of softv/ood alone on account of easy river driv- 
ing, leaving an essentially unliroken old growbh hardv;ood sav/ timber for- 
est, over 50 per cent of the New England region is classed as sa'.v timber. 
In the Lal^e region less than 10 per cent is saw timber. 

Cordv/ood areas industrially owned in the United States amount to 
23 per cent of the total area industrially owned, with about an equal 
amount of fair to satisfactory restocking areas and somewhat less of 
poor to non-restockin;; areas. 

The Eastern regions . contain 74- per cent of the industrially owned 
saw timber, 93 per cent of the cordwood, and 90 pet cent of the repro- 
ducing areas. Although' the Western regions contain a relatively small 
percentage of industrial ownership, that ownership, especially in the 
Pacific Coasi regiion, is very' important because it includes land that 
is potentially highly productive and also because considerable areas 
possess virgin stands vhich are pressing, for liquidation. Industrial 
ownership in the Soutn includes 30 per cent of all restocking lands in 
the United States. Of this 44 per cent is classified as fair to satis- 
factory. * 

b. Earn Vn'oodlands. 

Aporosimately 26 per cent of the commercial forest area consista 
of farm woodlands. Of this, 95. per cent is in the East, where it c(*i- 
stitutes approximately one-third o'f ' the Eastern commercial area. In 
the Central region it includes pibout one-half, and in the South and 
Middle Atlantic about one-third of the conaercial acreage. Earm wood- 
lands consist of 23 per cent saw timber, 34 per cent of cordwood, and 
38 per cent of restockin,?; lands. In the South, where the largest area 
of restocking farm lands is located, slightly less th?,n 50 per cent is 
in fair to satisfactory condition. In all other important farm-wood- 
land regions the bulk of the restocking areas are in fair to satisfac- 
tory condition, with the exceotion of the Pacific Coast region, where 
54 per cent of such areas range from poor to non-restocking. 

c. Public Ownership. 

Approx.imately 20. per cent of the comiuercial forest area is pub- 
licly owned. Of this amount about 90 pfer cent is owned or managed by 
the Federal G-overnmcnt, a little less than 10 per cent by the states, 
and the balance by other public agencies. ' Eighty-five (85) per cent 
of public ownership is in' the TTestern regions and includes about 
75,000,000 acres of national forest.. Acquisition of lands for national 
forest in the Eastern regions did not start until' 1899. The largest 
ares, of publicly owned .commercial forest land is in the Pacific Coast 
region, amounting to 34 per cent of the total. 



9813 



-32- 

Srxty-three (63) per cent of the total pulalicly owned area consists 
of saw timber, 16 per dent cordwood, and 21 per cent restocking area. 
The greatest publicly owned saw-timber acreage is in the Pacific region, 
followed by the South Rocl'Cy and the North Rocky Mountain regions. The 
public owns a little over 10 per cent of the total cordwood axeas and 
about the same per cent of the restocking area. 

2. Ownership of Saw Timber Stand 

a. Industrial Ownership. (*) 

G-enerally speaking, the saw-timber industrially owned is the best 
and most accessible. It includes 52 per cent of the total saw-timber 
stand. Sixty-six (66) per cent of the industrial saw timber is in the 
Pacific Coast region, consitituting 55 per cent of all classes of owner- 
ship in that region. The percentage of industrial to all classes of 
ownership in the various regions is as follows; New England, 82 per 
cent; Middle Atlantic, 53 per cent; Lake, 61 per cent; Central, 48 per 
cent; South, 59 per cent; Pacific, 55 per cent; North Rocky Mountain, 
27 per cent; and South Rocky Mountain, 8 per cent. 

Industrial ownership in the United States as a v/hole is divided 
into 86 per cent softwood and 14 per cent hardwood ownership, although 
in the Eastern regions the ownership is 52 per cent softwood and 48 per 
cent hardwood. 

Next to the Pacific Coast, industrial ownership of saw timber is 
greatest in the South, accounting for 17 per cent of the total. New 
England follows with 5-1/2 per cent of the total, and the North Rocky 
Mountains third with 4-1/2 per cent. The smallest industrial ownership 
is found in the South Rocky Mountains. 

b. Parm Woodland 

Of the 7 per cent of saw timber owned by farmers, 55 per cent is 
softwood and 45 per cent hardwood. The bulk of farm ownership of saw 
timber is in the East, accounting for 78 per cent of the total. Of 
this Eastern group, the South leads in farm ownership, with 39 per cent 
of the total; the Pacific region is next, with 20 per cent; and the 
Central region third, with 14 per cent. 

c. National Forests 

The national forests claim 33 per cent of the total saw-timber 
stand, of which 99 per cent is softwood and 1 per cent hardwood. 
Ninety-eight (98) per cent is located in the West. The national for- 
ests are concentrated in the Pacific region, which holds 65 per cent 
of the total. The North and South Roclcy Mountain regions contain 34 
per cent. This leaves only about 1 per cent for the rest of the United 
States, of which 56 per cent is in the South, 18-1/2 per cent in the 
Lake region, 17 per cent in New England, 7 per cent in the Central re- 
gion, and about 2 per cent in the Middle Atlantic region. 

(*) Chart III and Table III 



-53- 

d. Other federally Owned or Managed Forests 

Appi-oxim,itely ^ .,'x cent of the total saw-tiiaber stand, largely- 
Indian, is ledei-ally owned or managed in addition to the national for- 
ests. It is almost entirely softwood and all but 2 per cent is located 
in the West. Seventy-six (76) per cent is in the Pacific region, V7ith 
the balance scattered. New Bn/j;iand does not nave this type of ownership. 

e. State, Coionty and Municipal Oivnership 

Approximately 3 per cent of the total saw timber is -onder state, 
county or municipal ownership. Of txiis amount, 97 per cent consists 
of softwood. Ninety-three (93) per cent of the saw timber so ovvned is 
located west of the Great plains — 62 per cent m the Pacific region; 
27 per cent in the North Rocky Mountain region; about 3 per cent in each 
of the South Rocky Mountain and Ne'v England regions; and the balance 
scattered. 

3. Average Stand of Saw Timber per Acre 

One of the principal factors affecting the cost of logging is the 
density of stand, or amount of timber per acre on the forest area. 
Adverse factors sometimes offset the advantage of dense stand, such as 
rough topography, swamps, etc., but in general the forests of greatest 
density can be logged at the lov/est costs. 

Table I''^ shows the stand per acre on saw-timber areas. It will be 
noted that the heaviest stands, 33,127 feet per acre, are found in the 
Pacific region and are under industria,l ownership. 

In all classes of ownershio the Pacific region likewise leads in 
density, with an average stand of 23,598 feet per acre; whereas the 
Central region ranlcs last, with 1,651 feet per acre. As the Central 
region contains over 90 per cent hardwood (*) and is located in the 
heart of a large hardwood consuming section, the conversion of relatively 
small trees of 1o\y yield per acre into saw timber is normally profitable. 

The average stand per acre for all classes of ownership throughout 
the saw-timber area is 8,841 feet. Publicly owned timber lands lead in 
stand per acre, with 10,393 feet, followed by industrially owned lands, 
with 9,551 feet, and farm woodlands, with 3,456 feet. The relatively 
low stand per acre on farm woodlands is probably due to the continuous 
selective cutting on such lands, partly for farm use. 

4. Forest G-rowth and Drain 

a. Forest Growth 

In the following discussion computations of growth are based upon 
past standards of forest products utilization. In the case of saw 
timber it refers primarily to those species possessing certain physical 



(*) Chart III and Table III 
9813 



_ . . -34- 

and mor-iia.nical qualities which have appecled to consiiraers, so long as 
they could be secured at reasonable competitive prices. Future require- 
ments may call to a considerable extent i^or species which will produce 
the greatest volume of v/ood in the shortest possible time. Some of the 
most rapid growing species, at present considered as "inferior," may 
well be in the desired class. Accordingly, the growth data given may 
prove to be considerably belov? present estinates. 

The total current growth of usable material on the commercial for- 
est areas of the United States is estimated to be 8,912,000,000 cubic 
feet. (♦) This is a "net" estimate, which allows for so-called "nor- 
mal" losses from decay, insects, etc. Abnormal or unusual losses from 
disease or insect epidemics, fires, hurricanes, etc., are taken care of 
in the estimates of drain, (**) 

Of the total current annual growth the South leads by a wide mar- 
gin, claiming 54 per cent of the total. This is accounted for by the 
fact that the Ssuth, besides possessing some of the best timber-grow- 
ing conditions and fastest growing species, contains largely second 
growth or young timber that is putting on volume at a much more rapid 
rate than trees in regions containing mature or over-mature forests. 
The Central region ranks second, v^ith over 12 per cent; the Lake region 
third, with 7 per cent; and the Middle Atlantic region foiirth, with 
slightly less than 7 per cent. 

Softwood accounts for 55 per cent of the total growth, 62 per cent 
of which is in the South. The Pacific Coast ranlcs next in softwood 
growth, with ©ver 7-1/2 -per cent of the total, followed by the North 
Rocky Mountain region with 4-1/2 per cent, ajid the South Roclr,'- Mountain 
region with 2 per cent. 

The South also leads in hardwood growth, followed by the Central 
region, the Middle Atlantic, and the Lalce region. 

The comparatively low growth in the Pacific Coast region, consti- 
tuting a little less than 8 per cent of the total, is acco-'onted for by 
the fact that the forests are largely matiire and over-mature and hence 
putting on very little new growth, although that region includes the 
fastest growing species in the United States. Only by cutting off the 
mature timber aoid releasing the land for reproduction can the potential 
grovTth capacity of the Pacific Coast region be realized. The same situa^- 
tion applies, but to a lesser extent, to all forests west of the Great 
Plains. 

The total United States saw-timber growth amounts to 11,731,000,000 
feet board measure, of which the South has 58 per cent, followed by the 
Pacific Coast with 15 per cent. New England with 5-1/2 per cent, and 
the Central region with approximately the same. The Lalce region has 
the smallest annual saw-timber growth, almost entirely laardwood. 



(*) Chart IX and Table IX 

(**) Table VII 

9813 



-35- ... 

Greatest hardwood saw-ti,iit)er growth is in the South, or 54 per cent of 
the' total hardwood. growth. The Central region is next with 20 per cent, 
follov/ed;by_ the fiddle Atlantic region with appror.imately 12 per cent, 
arid New Engljjid with neerly 9 per cent. , 

b. Porest Drain 

In addition to the supply oi availat)le timber, the rate at which 
it is "being removed and reproduced constitutes a major problem of forest 
management, and is' of prime importance in taic balancing of forest ac- 
count s . 

This removal, or drain as it is commonly called, is brought about 
in many ways, chiefly 'oy cutting for corainercial purposes, by fire, dis- 
ease, etc. For purposes of this report, the average annual drain for 
1925-1929 has been used unless othervrise specified, because statistics 
en average drain for subsequent years are available only for l\imber. 
Obviously, the use of only Imnber data would distort drain figures, for 
lumber comprises more than One-half of the total forest products' drain 
and the forest products' drain accounts for 89 per cent of the total 
drain. The yeaj.-s 1925-1929 cover a period of generally ercpanding busi- 
ness, including the peaic lumber production year of the past -24 years. 
Each of those five years shor.'ed a higher production thein at any time dur- 
ing the past twenty years, .with a few exceptions. Farther, there was a 
general decline in lumber production from 1925-1929 in spite of a gen- 
eral increase in the production of commodities of a covapetitive nature. 

The Luiaber Industry has no assurance that in the future the for- 
ests will be utilized exactly as .in the past. On the contrary, a. new 
conception seems to be lorning as to what products shoiild be produced. 
For instance,' clear bpards are possibly no more valuable, and perhaps 
less- valuable, than built-up pl^r'Vood'. Such substitution of plywood for 
clear ■ boards" would mtJce presently available mature timber, suitable for 
vekeers," sufficient to supply the demands of a market thirty times as 
large as the one which now exists for clear boards. Thus, there may be 
a potential surplus of clear boards. Farther, large-dimension timbers 
can- not now successf-ully compete with steel or reinforced concrete for 
many purposes. 

Clearly, new. developments in the utilization of forest products 
have effected a decre^.sed demand for tiiose products which in the past 
have formed the bulk of requirements , and at the same time these develop- 
ments arc making available a very much larger volume of raw material 
than would have otherwise been the case. In brief, any anticipation of 
what future consumers ox' forest products' will demand must be predicated 
upon present conditions rather than upon those of the past. Any dis- 
cussion of forest drain must taice into consideration this changing market. 

It is common practice in describing the relation of growth to drain 
to make this comparison without taking into consideration the large sup- 
ply of standing timber which must in many regions be removed before the 
full possibilities of growth can be attained. Again, the relationship 
of gross drain to total stand is frequently/ stressed without reference 
to either ciurent annual growth or potential growth. The first prac— 

C 



-36- 

tice overlooks the fact that the production of any comniodit-/ is ordinar- 
ily governed, so far as financial exigencies will -erinit, by the amount 
of stock of raw material in inventory. The second assumes tnat the for- 
est is static, that it consists onl/ of what can "be seen and meosured at 
the present time. 

In order, therefore, to give proper perspective to the problem of 
dram, a compaxison of forest-products drain and. forest growth in relar- 
tion to the available stand of timber is here presented. Thus the pos- 
sible life of our forest resources may be predicted wxth so le degree of 
accuracy. (*) , 

The upper half of Table IX (a) shows forest products expectancy, 
assuming that the lumber drain, otaer' forest-products dr^in,. and drain 
occasioned by fire, insects, disease, etc. , will continue indefinitely 
at the 1925-1929 rate. 'The lower half of the table is based upon the 
.;assumption that the drain of lumber and other forest products will con- 
tinue at the 1929-1934 rate; and that fire, insect and disease drain will 
continue at the 1925-1929 rate. This latter drain should steadily de- 
crease as methods of control are perfected. Ho\vever, since the rate at 
which this reduction will proceed is unknown, past experience must neces- 
sarily be used. 

Considering the entire commercial forest area v/ithout regard to 
the ultimate use or form of its products and assuming no increase in the 
.current annual growth, it is estimated that the average 1925-1929 drain 
of all forest products can be maintained without total depletion for 65 
years in the Unitf-d States as a whole. However, d\aring this 65-year 
period, growth will increase as additional growing lands are released 
by the cutting of mature timber ojid improved forestry practices are put 
into effect. (**) On this latter basis it is estimated that growth will 
exceed drain to such a degree that a perpetual supply of forest products 
at the 1925-1929 rate of drain will be available, even with a substantial 
increase in consumption. It should be re-emphasized, however, that this 
prediction refers to the total vdlvime of wood available for the total 
volume of wood requirements and not to certain specialized products such 
as lumber. 

As for the saw-timber area only and considering only saw-timber 
size trees, assuming the 1925-1929 rate of drain, and that growth will 
continue at its present rate, a-35-yeaxs' supply of saw timber, accord- 
ing to c-urrent manufacturing practices, is available, varying from a 
7-years' supply in the Oentrai' region to a perpetual supply in the South 
Rocky fountains. Allowins~ for increased growth as mature forests are 
removed, hov/ever, and applying. the same assumotions just cited, there is 
a sufficient supply for 49 years, with a minimum of 8 years in the 
Central region. 

(*) Table IX (a), Comparison of Forest Products Drain and Forest Growth. 

(**) Code of Fa.ir Competition for tne Lumber and Timber Products 
Industries; Forest Practice Rules. . 



9813 



-o7- 

Accepting the above assuiniDtions of drain nd grov;th, it is ap- 
■oarent that a shifting of lun"ber ^production from certain regio is to 
ot.iers is indicated. This vill autOTi..tiCc..ll ^ tako place, as it has in 
the past, as available supplies of sav? timber become temporrj-ily e:i-r.,... 
hausted. On the other h.nd, the conversion of increasing' quantities 
of trees too smdll for saw timber into products v.-hic-i directly compete 
v'ith lumber, aay occasion a shift to ns'.v i70od-manuf acturing enterprises 
in certain regions rather th,..n a shift to ,ne-v7 saw-timber fields. 

The data in the upper half of Table IX (a), b'\sed upon the 1925- 
192S average drain, is ordinarily ta]<:en as an indication of the maicimum 
probable relationsnip of for-st drain ojid growth to the supply of stand- 
ing tiraber or to the inventor-'- of raw material from which forest pro- 
ducts are derived. A uuch sounder analysis is possible from a consider- 
ation of the lower half of Table i:Z (a), in which the probable drain of 
forest products is esti .ateil to be the average of the 1S29-1934 period, 
with the exception of the fire, insect and disease drain (1925-1929). 

The lower h;,lf of Table IX (a) snows tnat on the entire commercial 
forest arec a volvjne of j-aaterial equal to tne total volume of sill forest 
drains will be avauall'- available for over 700 years, even though no in- 
creased grov.'th io ta'cen into conf.ideration. Tilth anticipated increased 
gro\/th, it appears that nearry twice the 1929-1934 drain can be perpet- 
ually maintained. 

On saw- timber areas onl- and considering™ no increased growth as 
mature timber is re-ioved, tne sav/-ti)nber size trees will sustain the 
1929-1934 drain for an averaj^e of 73 years, './ith a minimum of 15 years 
in the Central region. With anticipated increased growth, the supply of 
saviT timber is expected to l;.'st 204 years in, the Unitea States as a whole, 
varyin;-:: from 19 years in the Central region to a perpetual supply in 
New England, the I addle Atlantic section ;nd the South Hoclcy Liountains. 
Before the expiration of 204 years, and if sound forest practice pro- 
visions such as v;ere provided in the Code axe carried out in the megji- 
time, it csjx be confidently er.:pected that the forest ledger will be per- 
manently 'balanced *ith respect to supply and demand. 

In view of this prediction it night well be contended that the 
timber supply problems of forest areas and forest industries are en- 
tirely solved tnd require no further cooperation between the industries 
and the public. The probleas are not that simple. If liquidation of 
forest properties existing prior to the Lumber Code were allowed to con- 
tinue indefinitely, at least some of the following results -night be ex- 
pected during the ne::t few decades, or until the cut-over areas in cer- 
tain regions had had in opportunity to recuperate; 

(1) A shortage m supply of certain of the most desirable species 
or grades and the necessit3'- of either subistituting other species or 
grades or other materials for them, or going without d^rring the period 
of adjustjnent. 

(2) A continuation in certain forest regions of the cutting of 
immature timber during the period of its greatest volume gro-./th, there- 
by reducing the wood-producinr capacit;'' of those regions. 

9813 



-38- . . . 

(3) Gradually increasing cost of forest products as the most acces- 
sible and best quality material is removed. This in turn decreases con- 
sumption and forces a liquidating industry to again reduce its cc-^ts 
through the conversion of only the best or most available material, with 
a further depletion of the growing stock. Thus a vicious circle is es- 
tablished which makes the competitive problems of the industry more acute, 
prevents the maximum utilization of the forest resources, and interferes 
with the economic stability and general prosperity of the entire country. 

(4) A shifting of forest industries from locations of scarcity of 
raw materials to new fields, or th^ir tenporar-/ discontinuance. 

(5) A further concentration of production on the Pacific Coast and 
in the South. 

It is a basic premise that both the public and the forest indus- 
tries have an interest in seeing that ample supplies of forest products 
are continuously available at reasonable prices, and that stability of 
employment through industry prosperity is maintained. The removal of 
all possible obstacles to that result is therefore the obligation of 
both the industry and the public. 

Based upon the evidence of migrating forest products industries, 
rapidly increasing populations and consumption, and a rather sketchy 
kno^Tledge of potential forest areas, stands and growth, it was but na^- 
tural that a considerable number of persons, some 35 to 40 years ago, 
should raise the cry of an impending timber famine which has since large- 
ly resulted in the moulding of public opinion and in the fixing of public 
policy toward forest resources and those industries dependent upon them. 
It seemed logical that the current rate of consumption of forest pro- 
ducts, which had developed during a period when wood was cheap and plenti- 
ful and housing and all industry was expanding, should continue indefin- 
itely. The "timber famine" idea caught the popular imagination and was 
at least partly responsible for the establishment and support of the 
national forest system and the other Federal and State measures affect- 
ing the conservation of timber resources. 

In many regions the time at \¥hich the timber resources were es- 
timated to disappear has long since gone by, yet forest industries are 
still much in evidence. The three factors which vrere eventually largely 
responsible for dispelling the belief that a timber famine was impending 
were: 

(1) A general, declining lumber consumption during the past 
two decades, not only per capita but total. 

(2) Inaccurate data covering the total available supply of 
standing timber, the interchange of species for given uses, 
and particularly the ability of the forests to renew them- 
selves after removal of the mature timber with little and 
inexpensive assistance from man. 

(3) An evolution in the method of utilizing the raw material 
through its manufacture into veneer and plywood or its 
conversion first into pulp and then into pressed boards 

9813 



-3S- 

and other products whereby a greater arao-ont of finished 
prodiAct rri;ay Tdg sec^jxed from the same vol-ume of timber 
than if sawn into lumber. (*) 

Although any prediction o" future forest-products requirements is 
largely speculative, sufficient facts are availaole to clearly indicate 
that a "timber famine" is improbable. This does not mean that reasonable 
care should not be taken of tne present forests and commercial forest 
areas, both in the interest of the industry and the oublic, nor that local 
shortages in supply are not likely to occur temporarily in certain regions. 
It does mean, hov^/ever, that the forest problem in the United States as 
a whole is not one of timber shortage but rather one of proper protection 
and management of the forested areas, including adjustment of production 
of forest products bet-;^'e(;n and ■'dthin the various forest regions, so as 
to secure the best results from e::isting forest grooving stock. The area 
now covered with commercial forests and likely to renain available for 
that purpose is more thsn sufiicient to meet an/ predictable future de- 
mand. 

Aside from the prudent conversion of forests, to whicn the "timber 
famine" idea soecificallr applies, there are other and important problems 
that must be taJren into consideration in any national conservation policy. 
These include the protection of watersheds where forests or other equally 
or moie suitable cover m;-3y exert i::iporta.nt influences on absorption and 
run-off; recreation, and the orotection of fish and game. Since, however, 
these values apply onl/ indirectly to the industrial use of forests, and 
since the industrial forsst user is interested in their maintenance no 
more than is the average .?;ood citizen, tney do not constitute a part of 
the present industrial pict-ure. 

''%i Value of Porests and Porest Land 

a. Privately O'-^ned Lands 

The total estimated value of land on which the comuercial privately 
owned forests of the United States are standin,-- is a little over $1,000, 
000,000. (**) On this land is timber with an estimated value of $4,759, 
000,000, or an estimated land fmd timber value of about $5,836,000,000. 

Land values are estimated at from $2 to $4 per acre, with an average 
of $2.72; saw timber at from $1.58 to $15.55 per M feet, depending upon 
species end location; and cord-vood at from $0,35 to $1 per cord. 

The average softv/ood value is estimated to be $3.36 per M feet; 
hardwood $6.34. 



(*) If consumption had continued at the 1S05 or even at the 1915-1916 
rate, and if fire protection had been longer delayed and less 
readily accepted, a timber famine would have been in sight at the 

present time. 

(**) Table XI 
9813 



-40- 

Of the tnt«i Xand and timber value, 33-1/2 per cent applies to 
fx>r-crs-rs in the South. The Pacifi-c Coast region comes next with 31-1/2 
per cent, the Central region next with a little over 10 per cent, fol- 
lowed by ilew England with nearly 8 per cent, the Lalce region with 7 per 
cent, and the Middle Atlantic with' 6-1/2 per cent. The forests in the 
South Rocky Mountain region are of least value, being valued at less than 
1 per cent of the total. 

b. Publicly Owned Lands 

It is impossible to estimate closely, from data available, the val- 
ue of publicly-owned forest lands and timber. Questions of relative ac- 
cessibility, species, stand per acre and quality of the land itself for 
other use if the forests were removed, all enter into the pict-ure. 
However, certain facts are known and from them a general idea may be 
obtained. 

Publicly-owned or controlled lands include an area of 98,559,000 
acres. (*) These lands contain 672,636,000,000 feet of softwood and 
6,878,000,000 feet of hardwood saw timber (**) as well as 175,424,000 
cords of cordwood. (***) 

Tor the purpose of estimate, publicly-owned lane, values are figured 
at $2 per acre (****), softwood st\iinpage at $2.50 per M, hardwood stump- 
age at $5 per M and cordwood at $0.50 per cord. On this basis the land 
value would be $197,318,000; softwood timber, $1,681,590; hardwood tim- 
ber, $34,390,000; and cordwood, $87,712,000; or a total value for pub- 
licly-owned land and timber of $2,001,010,000. 

Thus, the total value of all commercial forest land and timber, 
regardless of ownership, is estimated to be slightlv less than $8,000, 
000,000. 

6. Stumpage Values 

For several years the United States Forest Service, in cooperation 
with the Bureau of the Census, has been collecting data on stumpage 
transfers. In some years and in some individual states the volume of 
such transfers has not been sufficient to accurately determine true 
values. Accordingly, records for the years 1924-1933 have been averag- 
ed to secure estimated stumpage values of softwoods and hardwoods by 
states and regions. (*****) 



(*) Table I 

(**) Table III 

(***) Forest Service, Department of Agriculture, A "ational Plan 
for American Forestry . (1933) . Senate Document No. 12, 
Table 9, p. 188. 

(****) Qj^ ^Yi^Q basis of value for grazing. 

(*****) Table X 



-41- 
/ 
During that perioicL the total volume of sales reported amoxinted to 
104,784,859,000 feet bpard measure, for vzhxch a total price of $392, 
097,586, or $3.74 per M feet, was received. 

By regions, the highest average price was received in New England, 
namely, '$6.64. The Middle Atlantic w-s next with $6.55, then the Lake 
region with $6.35, the ;Central region with $6.14, the South with $5.43, 
and the Pacific Coast and North Rocky Mountain regions with $2.97 and 
$2.96, respectively. Not enough sales were reported from the South 
Rocky Mountain region to provide a reliable figure. 

The downward trend- in sturapage value during the past several years 
is quite marked. (*) During the period from 1928 to 1933 reports of 
total stumpage sales show that soft'.700d stiunpage dropped 27 per cent; 
hardwood stumpage 32 per cent; and the aggregate sales of "both hardwood 
and softwood stumpage 30 per cent. 

The above percentages ba,sed, as they are, upon a large volume of 
sales throughout the timbered states, should be fairly reliable as they 
iron out the discrepancies aropearmg in individual state reports. Each 
stumpage transaction has peculiarities which make averaging difficult. 
The value of a given block of timber depends upon its location with res- 
pect to market, topography, soil and climatic conditions, species, tim- 
ber stand per acre, and several other factors. Thus, the averaging of 
soft\70od and hardwood stumpage sales within individual states and by 
individual j^ears is subject to considerable criticism. 

In a few states, however, the number and voluiiie of stumpage sales 
have probably been sufficient to justify averaging over a three-year 
period (**), and these may be considered as representing current values 
of accessible stumpage. 

7. Concentration of Timber Ovmership 

As a result of the U. S. Senate and House resolutions enquiring 
about the high price" of lumber ond the possibility of combinations of 
lumber manufacturers and- timber or/ners in restraint of trade, the Bur- 
eau of Corporations' of the Department of Commerce and Labor conducted 
an investigation from 1907 to 1910. This investigation included the 
amount of standing timber, timber ownership in important regions and 
land holdings of large timber owners. (***) 

Although the investigation TwaS made about 25 years ago, it is 
believed that the principal consolidations of tiniber ovmership had been 



(*) Table X (a) 

(**) Table X (b) 

(***) Bureau of Corporations, Department of Commerce and Lebor, 
The Lumber Industry , Part I, issued January 20, 1913, and 
Parts II and III, July 13, 1914. 

9813 



. .-42- 

completed prior to tnat time. Certainly for tne oast several years, 
with decreasin,:;- stumpage -values, the tendency has been to break up large 
concentrations through sale, often forced, or to liquidate the timber by 
increasing production. 

Considering the industry as a whole, the. situation has develo-pod 
somewhat as follows; 

'In the beginning the most available timber was converted; that is, 
timber which was located close to market with low delivery costs,, timber 
of high quality and occurring in dense stands, und. timber found under 
■ conditions of easy, logging and manufacturing. All of this meant low op- 
erating costs. The gradually increasing value of stumpage over a long 
period indicated. to speculative lumbermen -that this would continue in- 
definitely. Accordingly, large investments, often far from the then ex- 
isting market, \7ere made in standing timber v/hich could be retired only 
through eventual conversion. 

As the areas of virgin timber ■bega'i to fail in availability, new 
forest areas were opened up farther' away from the market, thus increas- 
ing the cost of delivery which in some cases became as great as. the total 
of all other delivered costs. Costs were a:lso increased as the industry 
had to go farther and farther back in rougher country to reach the timber. 

Thus the industrj^ ■. as faced with two alternatives — either to get 
a higher price for the product or to reduce costs. Both courses were 
taken. The quality of the product was improv.d through careful grading 
and seasoning, which made it more desirable to the consumer. New, lower 
cos-t s.ystem of lodging were employed. In spite of these efforts the in- 
creasing cost of holding timber, due to interest, taxes, and other carry- 
ing charges, necessitated a price for the product that permitted many 
substitute materials to successfully compete with it, and made possible 
the exploitation of young immature timber which had been left behind in 
previous migrations. ' ■ ■■ 

Up to about 1921 to 1923 lumber jprices were generally appreciating, 
and thus compensating in part for gradually increasing costs. About 
that time, however, the competition of 'other materials became acute, 
with the result that lumber prices could no longer be maintained. 
Furthermore, stumpage values began to decline for the first time in his- 
tory. Thus, many units of the industry faced v/ith steadily mounting car- 
rying charges found themselves forced to a policy of liquidating their 
surplus supply of timber almost regardless of cost. Up to the time that 
the Lumber Code became effective this policy was generally in effect. 

The above outline of industry development covers only the general 
long-time trend. There were many deviations from it. For example, 
whenever a satisfactory price situation was attained, new manufacturing 
facilities would enter the production field, and e"isting ones would be 
increased in capacity. Over-production would then inevitably follow 
with a resultant price drop, thus forcing the high-cost operations to 
close down, and stay do',7n, until curtailed production and increased 
prices again permitted them to compete. 



9813 



All oif these factors have plsyed a part in removing- txie iiicent^vt 
to large concentrations of OT/nership. 

In view of the above facts the conclusions of the Bureau of Cor- 
porations are of little present application, although its findings cover- 
ing concentration were of interest in shelving how mistaken the Lumber In- 
dustry and the public may be va predicting future economic trends. 

The Bureau found that at the time of its investigation t-,70 rail- 
roads and their subsidiaries, through land grants, and one timber company, 
held nearly 11 per cent of the estii.iated total privately-owned timber in 
the United States. A large j-.mount of the railroad tiiaber has since come 
back into public control. It was estimated that the above holders, to- 
gether v/ith five others:, iield over 15 per cent of the total private timber. 

In California, Oregon, "cshington, Idaiio, and Montana, it was esti- 
mated that 37 holders o-.7ned aoproximately one-half of the privately-owned 
timber in that region. 

In tne South it vvas estimated that 67 holders owned 39 per cent of 
the long leaf pine, 29 ner cent of the c-'press, 19 per cent of the short 
leaf 8Jid loblolly pine, and 11 oer cent of the hardwoods. 

In the Lake States it was estimated' that 215 holders owned 65 per 
cent of all the timber. 

Uo records are available to determine the present degree of owner- 
ship concentration, but experience during the past several years has 
shown that it is not noi; a material factor in the economic problems of 
the industry. 

C TH2 PHOBLEi/i 0? HOLDIJG TIi.BER L.\iID 

The cost of holcing timber land includes administration, interest 
on money borrowed to acquire the land, fire -no. other protection expend- 
itures, and taxes, i^lo data are available on administrative costs, and 
are incoirplete on the balance. However, it is possible to roughly ap- 
proximate the theoretical annual burden on the forest products industries 
through their sav/ timber and saw timber holdings, as follows: 

Interest on indebtedness $ 63,122,835.00 

Fire protection 2,541,391.15 

Taxes 40,470,862.00 

$106,135,088.15 

The Lumber Industry obviously does not pa3'' the annual bills for 
all forest products mdustri :s. However, it produces approximately 50 
per cent by volume of all forest products (*) of every kind. Moreover, 
it is common knowledge that, as compared to most other forest products 
industries, the Lumber Industry carries a considerably larger reserve 



(*) Table VIII 
9813 



-44- 

supply of timber to justify its plant and railroad investment. Therefore 
it seems safe to assume tha.t it should stand at least 75 per cent of the - 
expj..i^o of holding the ".privately d' -ned .saw-timber area. On that basis 
ity annual burden would be: 

Interest on indebtedness $47,342,126.25 

Fire protection 1,906,043.36 

Taxes 50,353,146.50 

$79,601,316.11 

Since conversion of timber into lumber must, in the long run, be 
relied upon to meet the- carrying charges, this annual cost, if charged 
to lumber production per ivl feet would be: 

Based upon 1934 production $5.14 

Based upon average 1929-1934 production 4.01 

The bases for these estimates are developed in the following 
sections: 

1. Interest 

The largest cost involved in holding timber consists of the interest 
on the money invested in it. With a total stand of privately owned saw 
timber amounting to 988,289,000,000 ft. b.m. (*), and valued with the 
land at approximately $4,208,189,000 (**), interest at the rate of 6 per 
cent would amount to $252,491,340 annually. 

It may be contended that interest represents profit on the invest- 
ment and, therefore, has no place in the cost of holding timber and tim- 
ber land. This might be conceded if the privately owned timber land was 
paid for. However, that is not the case and the interest on money bor- 
rowed to acquire and convert it has to be p;:iid through conversion in the 
long run. 

Studies made in California and the Southeastern States in 1914 (***) 
show the following relationship of indebtedness to total investment: 

Ntimber Total Bonded Per Cent of 

of or Indebtedness 
Opera- Total Other Indebt- to Total 
Region tions Investment edness Investment 

California Pine 12 $ 19,248,014.32 $ 9,029,672.48 46.9 
California Redwood 18 38,691,393.63 17,139,710.30 44.3 
Southern Pine 108 137,476,360.63 52,629,210,63 38.3 



(*) Table III 

(**) Table XIII 

(***) U. S. Forest Service, The Lumber Industry in California , and 

Timber Ovmership and Lumber Production in the Southern Pine 

Region; unpublished reports. 



9813 



~^5- 

The a'oove fle^irer,, represent ins; pro"ba"bly the lar^nst and most im- 
portant operations in the regions ctiicSicd, indicate that a sulDstajiticl 
portion of the money inrested in the entero-rises in 1914 was "borrov/ed. 

A consideratle portion of this consisted of honded indeotedness 
incurred larf-i^elj"- for the p-urpo-e of acquiring ti-uher and to- extend 
short temi ooligations over a period of years. Such bonds were sold 
with the provision for a sinl'ing fvnd to retire them within the speci- 
fied period. Us^ially from $2 to $3 per M feet cut (log scale) and to 
"be laid aside for a sinlcing fond. Bonds carried 6 per cent interest as 
a rule and sold at from 90 to 98, thus making the actual interest obliga- 
tion 7 per cent or over. Short term notes sometimes tore interest at 
10 per cent or more. . 

It is thus shovvTi that in 1914 the larger operators in the United 
States were carrying a debt varying from 38 to -47 per cent of their 
total investment, The condition of the small operators is unlaiown, but 
there is no reason to believe that they were in a substantially different 
position e:ccopt that their obligations wore generally'' short term end 
their interest rates corresponaingly higher. 

Statistics of Income from the Bureau of Internal Revenue for 1933, 
covering 6,161 producers of irrcst prodr.cts, show that bonded debt ioid 
mortgages amounted to only 17 per ceat of the depreciated and depleted 
capital assets, ".To dataware available to show other possible liabili- 
ties against the capital assets, nor is there information on interest 
rates now prevailing on indobbedne3s„ Accordingly, for the purpose 
of this discussion, ■■ certain assumptions are necessary. 

Tlie first is that 23 per cent of the present total investment in 
saw-timber lands consists of indebteduesr. The sacond is that this 
indebtediiess bears at least 5 per cent interest. The th ltd is that the 
Lumber Industry pa.ys the bij.l on 75 per cent of the saw-timber lands. 
On this basis the annual interest charga against the Lumber Industry 
would be $47,342,126.25 or $2.28 per 1.1 feet on the 1929-1934 production. 

2. ?iro P rotecti on Por ts 

Since public and privately-owned forest lands in certain regions 
are intermingled or adjacent, it is often impractical to protect one 
class without protecting the other. AccordinglYp there has developed 
the cooperative system financed jointly by both p-^blic and private in- 
terests, with the benefits spread over all lands included. In alditionj 
there are large blocks of public and private forest lands not so situated 
that the cooperative plan is feasible. These may be protected by the 
particular interest involved. Frecuently, in addition to coo-ocrative 
expenditures, both public and private agencies spend substantial amounts 
in order to strengthen the protection of their own lands. 

Porests are not alwa^'-s foimd in solid blocks, but frequently include 
grazing and other types of land. As fires are no respecters of bounda-rj^ 
lines, for the pixrposes of tnis report the protection of such included 
lands is considered a necessary and proper part of the whole protective 
effort. 



9813 



-46- 

The total annual ej^Tenditure for fire protection, both prevention 
and suppression, is ap;oroximately $16,400,000, (*) or one cent per M 
feet on the total stand of sa\7 timber in the United States regardless of 
ownership. Of this, $9,049,077.49 is spent by the Federal Government 
direct to protect National Forest, Indian, and national Park lands. The ' 
bulk of this effort is in the West where the largest areas of such lands 
are located. The largest expenditure is in the Pacific region, 33 per 
cent of the total, followed b;- the I'orth Eocl:y Llountain region, with^ 22 
per CQnt, and the Lake region with 14 per cent. 

Outside of these straight Federal e.-q^enditures for the protection 
of federal lands, there is spent annually for cooperative fire protection 
approximately $6,000,000. Of this the Federal Governnent contribiites 32 
per cent; the States 48 per cent, and private timber land owners the 
balance. This cooperative effort covers privatel^z-owned'. State, and some 
Federal lands on the theory that only through a pooling of resources can 
a satisfactory job be accomplished and the public interest in all forest 
landsV" regardless of ownership, be safeguarded. Such cooperative effort 
is administered by the States. In addition, private owners spend ap-.ro::i- 
mately $1,300,000 for the more intensive protection of their own lands, 
thus mal-ring available approximately $7,400,000 annually for the protection 
of private and State lands. 

Of this amount 31 per cent is spent in the Pacific region alone, 19 
per cent in the Lake States, 15 per cent in the South, 11 per cent in the 
Middle AtlaJitic region, 11 per cent in the. ilorth Eocl-:y Mountain region, 
and 8-1/2 per cent in the New Sngltuad region. Less than 1 per cent is 
spent in the South P.ocliy Mountain region. 

Charging the entire fire protection expense, outside of straight 
Federal expense, to the. average Irunbor production of 1929-1934, gives an 
average aiinual charge per K feet of $0.37, varying from a maximum of 
$2.84 in the Middle Atlantic region to a minimum of $0.07 in the South 
Rocl^y Mountain region. It is obviously incorrect to charge the entire 
cost of private and cooperative fire protection on State and private lands 
to the Lumber Industry, since other forest products industries participate 
to a considerable extent in some regions. ITor is the fact that lumber 
constitutes only approximately 50 per cent of all forest products produced 
a safe guide, since the Lumber Industry' is better organized, holds more 
forest land, and generally cooperates to a greater extent in any fire -oro- 
tection movement than most forest industries. It is therefore assumed 
that 75 T)er cent would better represent the Lumber Industr:^,'-'s stake in the 
fire protection effort. On that basis, the cost per M feet produced 
(average 1929-1934) woiold be $0.28, varying from a maximum of $2.13 in the 
Middle Atlantic region to a mininram of $0.05 in the South Eoclsy Mo-'ontain 
region. 

If charged against the stand of saw timber industrially o\7ned, the 
anmial cost of the /present fire protective effort (private and cooperative) 
would be abou.t 8 mills per M feet for the United States as a whole, vary- 
ing from 2 mills in the South Rocly Mountain region to $0,135 in the Hew 
England, If charged against the total saw timber stand privately owned, 
which includes, induiitrial and farm ownership, the averaite per M feet for 
the United States would be 7..mills, varying from 2 mills in the South' 
Roclcy Mountain region to $0,058 in Hew England. 

(*) Table XI. 
9813 



Since the forest products industries a'lnually pay $2,541,391.15 
of the total private urA coopei'^.tive exaenditurcs of Eporoximately $7, 
400,000, and since the Lumter Tndusti^'-'^ sao.re, is asp^ined to be 75 oer 
cent, its annual expenditure wouD.d amount to $1,906,043.36, or $0,096 
per M feet on the average 193-1984' ■Droduciion. 

The U. S. Forest Service estimates that coinplete aiid adequate pro- 
tection for State and private forest area ..'ill cost $13,381,100. annual- 
ly. This would involve protection of 209,557,758 acres in addition to 
the 280,422,032 acres now protected. 

The proportion of protected to •'unprotected State and private for- 
est areas and the degree of present protection vary widely in different 
forest regions. Thus in New England the entire State and private for- 
est area is under some sort of protection, r.nd the forest industries 
and the Federal and State agencies, are spending approxi-nately $641,453. 
48 oJinually, or 61 per cent of the $792,000. estiuat^d to be needed. 
However, in Massachusetts and Itliode Island more-noney is "being spent 
for fire protection txian is believed a.bsoratel_,^ necessary in comparison 
to the other States. 

In the Middle Atlantic region, where nearly 1,430,260 acres of 
State and private forest land are still unprotected, approximately $808, 
000. is being spent as against needs for $955,000., or a coverrge of 
about 84 per cent. Tne amount of private expendittjre in this region is 
relatively smell. 

In the Lak-3 region as a vmole, where all State and private forest 
areas are protected to some extent, e:-:penditur.es are 82 per cent of the 
amount needed, altnoiigh in Wisconsin slightly more than the renuired 
amount is being spent, whereas Minnesota is considerably short of its 
needs. 

In the Central region over 65 per cent of the State and private 
forest area is unprotected, and only 16 per cent of the amount needed 
is being spent for fire protection. 

In the Soath, v/here only 32 per cent of the State and private for- 
est area is protected, the per cent of actual to estimated required ex- 
penditures is only 20. 

In the Pacific region, \7here fire risk is very great and where 
most of the State and priva,te fore;:t area is under protection, the an- 
nual expenditures for fire protection are esti^arted to be approximately 
$2,275,159.02, as against $2.135,0u0. needed. Over 60 per cent of the 
total is paid by private agencies. In Oregon and Uashington more tnan 
the estimated amount required is being spent. 

In the North Rockj-- MoTintain region, another region of high risk, 
where approximately 95 per cent of the State and private forest area 
needing protection is protected, .private expenditures are over one- 
half of the total expenditures for fire irotcction. Total expenditures 
are approximately 125 per cent of the amount estimated to be needed. 



9813 



"48- 

In the South 'Rocky Mountain region, v.ith only a nominal fire risk, 
about 80 per cent of the State ,: nd private forest ijxoi. is "being pro- 
tected. In this re(;;ion only $44,100, is considered necessary for ade- 
quate protection, or less than the ar.aoj.nt required for ,aost individual 
states. Abovtt one-half of the required aniount is "being spent. 

3. Taxetion 

The annual "burden of taj:ation on nature standin,^ timber is one of 
the most important single factors, in stinralating- the sale or cutting of 
tira"ber and proportionally influencing the manufacture of forest products 

■ without due regard to current mar'cet demand. Upon the solution of this 
pro"blem substantially depends the present and future security of ormer- 

•ship of privately owned timber as well as the maintenance of reasonable 
balance between production -suid consumption. 

Late in 1931 the Secretary of the Timber Conservation Board re- 
quested the opinion of the members of its Advisory Board on the subject 
of the timber taxation. (*) The Advisory Board ras composed of 22 
leading authorities on the suliject, including foresters, economists, 
educators, conservationists and executives. To the question as to 
whether state and county tarcation had become a sufficiently heavy burden 
in enough regions and instances to be an important factor in determining 
ownership ajid management plans for mature timber, all answers directly 
received vifere in t"ne affirmative. 

To the question as, to ".iiether ta;:ation had in any important degree 
already hastened cutting undesirably, from an industrial or community 
vievi-point, the replies were in the affirmative, although two members em- 
phasized the IocfI rather tiirn the national effect. 

In January, 1932, tae National Lumber uanufacturere Association 
addressed a questionnaire to prominent Itunber producers throughout the 
United States for the purpose of determining the effect of ta:-:ation up- 
on lumber production. (**) 

The questions were: 

First: "I)o you think ta^:ation is in any important degree the 
cause of hastening timber cutting undesirably from an indus- 
trial or community vie'wpoint?" 

Seventy-three opera,tors answered unqufdif iedly in the affirmative. One 
answered "No", one "Not in this section", and one "Difficult to say." 

Second; "Plave you put ixny tiuber into production in order to 
carry tajies?" 

Forty-five operators tinswered "Yes", ind 27 "No." Two operators answer- 
ing "No" stated that they owned no timber. 

(*) Timber Conservation Board; Taxation (Questionnaire (1931) 

(**) Table XIII (a) 

9813 



-49- 
Third: "How much ca-n&city to produce have you added?" 

Of the replies received, 19 indicate! i.icroased capacity aiid in several 
cases specified the aiiio-iiiit. 

The catove cro'^.s-section of industry and public opinion is suifi- 
cient to indicate the serionsnesr of the existijT"; ta:-: system in its ef- 
fect upon the hcindlin^j of privately-ovmed tiirber lands. In adf^ition to 
the cuiTent and known tax 'barden, the undert?.dnty of the future offers 
little enccuragenent for tiiaber-land cwn^^rs. This is illustrated by 
Table XIII (b) and the follo\/ing suraraa-ry based upon reports from '62 
lumber manuf actiu'ing companies owning ti-iber aaid producing lu.aber during 
each of the three years 1909, 1919 and 1929. 



per per 
Cent Cent 
In- In- 
Total Total Per crease Per crease 
Timber production M ft. from IJ ft. from 
Year M ft. b.m. M ft. bcm. Gross Q-.vned i: .09 &it 1909 

1909 44,504,507 2,051,1G9 $ 856,136.47 $.019 $.417 

1919 37,315,154 2,177,278 2, 27;;;, 312.31 .061 221 1.044 150 

1929 30,719,042 2,343,737 2,799,205.80 .,091 379 1.192 186 



The rfitio of increase since 1929 is not known. At any rate the 
owner of timber lond faced witn a possible tax increase of from 200 to 
400 per cent every 20 years is hardly .iu'^tifj ed in withholding such 
land from conversion indefinitely, particularly since stumpage has 
shown a consistent decline in value during the past suveral years. ( *) 

The estimated present annual tax burden on commercial privately- 
owned forests is $58,356,675. (**) Tnis. applies to 396,239,000 acres 
with an estimated land value of $1,077 j 169,000 ; saw timber amouritiiig 
to 988,289,000,000 feet board me.-.sm-e ;:nd 926,719,000 cords of cordwood, 
together valued at $4,758,498,540; or a total for land and timber of 
$5,835,667,520. Land values, without timber, are estimated nt an average 
of $2.72 per acre, varying frcm $2 to $4. Unit stuffipage values (***) 
averaged $3.40 per M for softv/ood and $6.'^5 for harawocd. 

The timber of highest value is found in the Pacific region, namely,- 
$1,771,472,580. The South is next with ■51,397,561,450. and the South 
Rocky Mountain region last with ^24,150,500. 
__ _____ 

(**) Table XII 
(***) Table X 



9813 



-50- . 

The ratio of assessed to total value varies from a high of 9^.6 
per cent in Wisconsin to a low of 1P..7 per cent in Iowa. 

The total estimated nasessed v.-ilue of $3,313,398,247. is based upon 
the total estimated land and timber v.nlue for each state multiplied by 
the ratio of assessed to total value for that state. 

The highest assessed value of Imd and timber is in the South, 
$998,073,936., followed by the Pacific Coast region with $937,388,826., 
the Central region with $381,526,562., and the Lake region with 
$354,815,452. 

On the basis of an estimated one per cent tax on total value, the 
South pays the largest timber land and timber tax bill, amounting to 
over 33 per cent of the total, followed by the Pacific Coast with a 
little over 31 per cent, and the Central region with a little over 10 
per cent. The South Hocky Mountain region pays less than one per cent. 

The estimated current annual tax burden on com^riercial privately- 
owned saw timber areas is $40,470,862. (*) The maximum is in the 
Pacific Coast region, 41 per cent, followed by the South with a little 
over 31 per cent, New England with about 9 per cent, and the Central 
region with slightly less. Thus the Pacific Coast and the South pay 
approxim.ately 70 per cent of the total tax bill on comrmercially-owned 
saw timber areas. 

Charging the entire tax burden of $40,470,862 on commercial private- 
ly-owned saw timber areas to the Lumber Industry would mean $2.04 per 
I.*: feet produced (average 1929-1934). Assuming, however, the same 
relationship in obligation between the Lumiber Industry and the other 
forest products industries as in the case of interest and fire protection 
costs, namely 75 per cent, its annual tax bill per I' feet produced would 
be: 

Based upon 1934 production 1 $1.96 

Eased upon the average 1929-1934 production ...$1.53 

D. FHE-CODE EFFORTS AT COFSEHV^TICK 

It is well to reiterate that both the public and the forest products 
industries have an important stake in conservation. The public wants a 
plentiful supply of various forest produats at reasonable prices. It 
also desires permanent and prosperous forest industries which will pro- 
vide stable employment, In addition, it wants its soil and navigation 
safeguarded through watershed protection, its fish and game supply 
fostered and increased, and a reasonable area of forest lands' kept in 
forests for recreational purposes. The forest products industries are 
interested primarily in the perpetuation of their supplyof raw material, 
but at a reasonable cost and in location, form and volume most attractive 
to the buying public. 

The operations of the forest products industries in the past have 
been neither conducive to stability of emplo^mi ent, nor to the protection 
T*) Table XIII ! ~ 

9813 



-51- 

values other than tnose affe'ct^.rii:,- tupir i;nir>pii??te timber suTjrily. 
Such protection hs v/as given- w?s usuf>liy ccnjrined Co the tim<^ necessary 
tn retire a cneciiic f'ri'e^t iiivect-nprt. Forpstis '."Rre £.-■•> r;lentiful tnat 
the cuttint^' oat of i given locality sxTOjly meant n^ovinii' to a new owe. 
Thus there develo-ned tai^ gensral idf^a tViat Torest iudiiotrie" vere no 
more perrranent turn mine?.-, oil wolis, cr ctn?-r indust.'ieo based u:ion nAn~ 
renewable •oroducr,s, Foxsst i, bo^- w :S l-Ji-i^f 1/ ioj iiijra.it <ind selciOiD re- 
mained long at one oper;.,tion, ■ regaral -^s uf its ■neiTn^jiPncy. 

As tne forer.t industries moved fartaer r.way from their markets and 
a« costs of delivery correspordingly ii-'crpas^d, leaders in the iniustries 
began to realize, that i;imber i^as pocsibly not inexaausuible, ac least 
such timber as could be cnnverted at a co^t low enough to assure its 
use in large vol\ime in competition witn its viarious substitutes. 

Tne public alS'i develoned increasing intierest in the- future of its 
wood Pupplies, as evidenced uy uhe es tabli Gi^'^en-t of fore-it schools and 
various public a^encie« .fur "ohe -Durpos.- of stud::in:; cLe f6r''"Sf problems 
and assisting in their scluticj.. In tuis m-:ven'.ont th;'- "'"^ureavi of 
Forestry, IT,3. Department cf Agric-iil t\\i-e (now- it;Signaoed Forest Service) 
assumed lea^ersuip. •probably vo other nitural rf. sources have received 
the same amount of con oidera'^ioi?. arid the .sp.xae, amount of ■nlanaing as to 
what should be dohe-abcat 'it as have the fr'rest_s. All of tnis atudy and 
discussion has resulted in a clearer urderstandlng of tnepublic and 
industry -oroblems involved and the d'evelo-umeut of a . long-time Drogram 
for solving them. ' ' ■■.-,; ;;-..-■ 

Meas-ares .taten to meet tne situation -Dr+Dr t';; the Code of -Fair Coa- 
petition, for tne Lijmber and Sinioer Products Industries are as follows: 
■>. ■ . ^ . : . ' 

1. Public 

The -first major develo-nment in forest. cons.(°T-'ra.*i-r?n in the United, 
States dates from 1E.91-, in' which' year QoLgcosry ^x\-hui±zed the President 
to -Bet apart as public reservations suc'h r'f the j5*il^ll,r; Irnds., as contained 
timber or ■aiidergro..;tn. As a result of tnis autn'oriz3r*''i'>n, t.ogetner. with 
later legislation permit ,.ing exch;mge and o-ircrLass, npproximatoly 
155,000,000 acres of national fo-^-e'sts have baen. act. afiide under mrmage- 
ment of the Forest £er\'icc, U. G. Eepartmen-i of.AeXJxuiture. These lands 
are not reserved in th'e r-*jnne that the ti-S':>\xrci-et aro- ^.O.cked -up. On the 
contrary the G-over::'Jiient- -;olicy is to permi t ' their ,\--^,.s, . cut. under such • 
conditions that tncir •r'ei^pwablu resources, s-j.;!Hr aP tfX/ber, .and forage, 
- ylLl.be increased in volUEre and quality to the",'i;oll Jattnoity cf the land. 

In addition to the national for<-sts, ^•ov>Toy.inpt<Ji y 11,700,000 acres 
ef tlLiber and wood land are fouxid en Iiidian xer.ervatirN^>6 under tne juris- 

" diction 'if the Com.Tissioner. of Indian Affairs ,- Droartincmt of the Inferior. 
The«e laada are handled, in subs bant i ally t-ie • ciaa-* ffiani!«-"r as tne national 

.. iflrcste — tnat is, to .improve v/hile wisely ^if^lng tae.. rofiJUTC^s- 

The National Park Service, under the I)i--r}^.r*}:r<-r.t of tne Interior, 
also has-,iuj:-isdiction over approximately IS-iC-OiOGO RCi>as of puclic 
-..lands, of wnich sligntly; less than -one-half Lr/ tianb-sre-,^ The timber 
r«sc-arc<>fi. on .. 



98X3 



-52- 

these lands are kept in as nearly a natural state as possible withoiat ■^.■ 
regard to maximum (.rrowth. Tney are not subject to exploitation. 

In addition to the Federal Government, several states have set aside- 
or purchased considerable areas of forest land which, outside of jiarks 
and p,ther special use areas, are managed under policies somewhat similar - 
to those of the Federal Government. Nearly 16,000,000 acres of forest 
lands are estimated to be under state control. 

2.. Private 

The problem of forest conservation by private timber and timber land 
owners has generally encountered insuperable difficulties. These have 
long been recognized by the forest products industries and to some 
extent by the public. The objective of keeping all timber lands, both 
private and public, in a high state of productiveness is fully endorsed 
by leading members of the forest industries, and they have been willing 
to assume their full share in a broad program of national forest con- 
servation. However, many of them have felt that alone this could not be 
accomplished on most of the privately-owned forest area. 

The condition of the Lumber and Timber Products Industry may be 
briefly summarized as follows: (a) A top-heavy investment in standing 
raw material — approximately $6 ,0'"'0,000,000 worth of land and timber 
and an unknovm amount in plants, railroads, etc.; it is inconceivable 
that this investment under its present and increasing load of carrying 
charges can be^ retired without severe loss to capital assets; (b) a 
manufacturing capacity far in excess of reasonable market consumption 
resulting in recurrent periods of over-production and low prices; (c) 
a drastic reduction of market requirements due to a decline in domiestic 
use of v/ood and increasing restrictions in foreign trade. 

To better its financial situation, leaders in the industry have from' 
time to time explored the possibilities in consolidation and in coopera- 
tive control of certain important factors affecting it, such as product- 
ion or prices, but without material success. The first failed from lack 
of adequate finances and the second from lack of assurance from Federal 
and State authorities that the cooperators v/ould not be held liable under 
State and Federal anti-trust laws, ^'he only assiirance possible to get 
from Federal agencies has been that the legality or otherwise of a sug- 
gested coiarse of industry action would be considered after and not before 
the action had been taken. Under such circumstances few industry leaders 
were willing to jeopardize their investments or reputations by subscribing 
to any effective price or production control plan. 

The result has been unrestricted competition between producers of -^ ; 
single species or similar products within a region, competition between 
different producing regions, and competition of all regions with other 
materials. 

As an illustration of the Lumber Industry's current situation, the 
record of lumber consiimption is ill-uminating. In 1906 the visible con- 
sumption was approximately 45 ,000,Ono,0'"0 board feet, or over 500 feet 



9813 



r-53- 

per capita. In 1926 it had dropped to 38,ono,Ono,Ono toard feet, or a 
little over 300 feet per capita, and in 1932' it had dropped to 
12,0^0,000,000 board feet, or 95 feet per capita. 

In 1926 the nximber of v.'age earners engaged in primary conversion 
was aprroxirriately 455,000 as compared to slightly over 155,000 in 1932. 
In order to keep costs down and remain in business, long hours of opera- 
tion and low wage scales were inevitable in some producing regions. 
As a result of competition, laborers in one section of the country re- 
ceived for a long day's work a smaller wage than did laborers in another 
section for one hour's work. 

In the past the Lumber Industry had usually been considered as a 
so-called, "wasting" industry because the forests had persisted for 
nearly three centuries v/ithout economic necessity for replacement. 
Only in close proximity to markets capable of using Iximber derived from 
second growth trees had it been feasible to establish permanent forest 
enterprises based upon timber regeneration. Forest management had 
generally meant protection of mature stands, and the young growth had 
possessed no demonstrable value except in a few localities accessible 
to markets which could absorb low-grade material from second growth 
stands. 

Forest ownership is divided roughly as follows: About 50 per cent 
of the mature saw timber is owned by industrialists, over 7 per cent by 
farmers, and 38 per cent by the Federal Government. I'ost of the cut- 
over land not needed for agriculture is privately owned, although from 
50,000,000 to 75,000,000 acres may return to public ownership through 
tax delinquency. Over 50 per cent of the cut-over area is fairly to 
satisfactorily stocked with growing forests and capable of producing 
annually more l\amber than was cut in 1934. 

Recognizing that fire is the greatest single menace to forest 
replacement, and that adequate control of fire will solve one of the 
major problems of forest management, the forest products industries 
have vigorously advocated .fire protection and have cooperated with the 
State and Federal authorities financially and otherwise to secure it. 
Toward this whole protection effort on private and state forest lands, 
including cooperative and private non-cooperative expenditures, private 
interests spend nearly 35 per cent, the states 39 per cent, and the 
Federal Government the balance. 

In 1934 over 65 per cent of the private and state forest lands 
believed by the U . S. Forest Service to be in need of protection were 
receiving it, varying in degree from practically 100 per cent coverage 
in New England, the Lake State and Pacific regions, to a little Over 
30 per cent in the South and Central regions. Of the amount necessary, 
in the opinion of the Forest Service, to secure adequate protection, 
approximately 55 per cent is now being spent annually. In the Pacific 
and North' Rocky Mountain regions, where the heaviest stands of mature 
timber are found and where the fire risk is very great, more than the 
amount necessary to do a good job is now being spent. Of the total, 
private interests put up approximately 60 per cent. In the Central 
region and the South the lowest ratios of actual to required expenditures 
are found, namely 16 and 20 per cent. 

9813 



In spite of t.he uncertainties in the long-time holciih;^^ of timber 
lands such as unpredictable carrying charges, fire and other, risks and 
uncertain future markets there' has been a considerable effort on' the 
part of the forest industries to practice forestry. A suryery conducted 
by a Committee of the Society'" of --imerican Foresters in 1930 shov/ed that 
288 companies and individuals, each owning tracts of more than 1,000 
acres, were making conscious efforts, to grov timber com'^ercially upon 
nearly 30,000,000 acres of forest land. Forty of these had put their 
holdings on a sustained yield basis. .(*) 

Such was the situation on June 16, 1933' "vhen the N.I.R.A. was 
approved and the Lumber and Timber Products Industries were invited 
to submit to the Federal Governmient a plrm, the objectives of which 
were to. include, the rehabilitation of those industries, conservation 
and sustained production of forest resources, sustained yield forest 
management, and permanent sources of forest products employment. 

E. CONSERVATION UNDER THE CODE 

At a general meeting of the Luinber and Timber Pt-oducts Industries 
on July 1, 1933, the outline for a Code of Fair Corripet'ition was sub- 
mitted for consideration by representatives of the National Lumber 
Manufacturers Association., the largest and most important federation of 
forest industry groups. In presenting the tentative code, it was pointed 
out that the industry could not permanently thrive while destroying or 
witnessing the, destruction of the sources of its own livelihood, ' and 
that no rehabilitation would be either complete or lasting which did 
not effectuate the protection and maintenance of th'e forest resource 
itself. It wa,s further stated that although the unsatisfactory forest 
situation might be largely due to past unwise land policies ^^hd present 
unwise state tim.ber taxation policies, which contributed largely to ex- 
isting destructive competition,, the remedy was beyond the combined forces 
of the Federal 'Government, the State' G-overnments and the forest owners 
and industries. It was then suggested that the NIRA afforded, the forest 
products, industries an opportunitj'-., through public cooperation, to 
establish effective standards for dealing with the problems of occupancy 
and administration of forest lands and forest resources. 

( *) During the Code period only 10 concerns were granted extra allot- 
ments for being on a sustained yield basis in accordance with the Code 
provisions. However, a considerably larger number of applications were 
in process pf examination at the end of Uay, 1935. It is undoubtedly a 
fact, that a large number of operators who were actually 'on a sustained 
yield basis' declined to make application for various reasons; including 
the following: '. , _ 

(1) Unwillingness, to bind the corporation indefinitfely into the 
future by action of the Bo.-^'rd of Birectors, as com-nitted to arpermanent 
sustained yield piolicy. 

(2) . Unw,illj.ngness to spend the_ necessary money f.qr technical ser- 
vices to make' forest examination and prepare management plan'. 

(3) Fear of imposition of higher locp.l taxes following acknowl- 
edgment of use values resident in cut-over lands and reproduction. 

(4) .'Necessity, of retaining the right to cut heavily in over-ripe 
stands and stands menaced by insects, diseases, etc. 

(5) Inability to qualify as eligible because of financial l-'mi^"'^ ■ 
t'ion'3 OT- i"Tr"ii -rmpnt c 



-55- 

As a result of this meeting a "Liiniber and Timber Products Industries 
Code" was submitted to the President by the National Lumber Manufacturers 
Association, acting in behalf of 48 associations representing almost the 
entire national range of timber products industries which, after public 
hearings, was approved by the President on August 19, 1933. 

This Code declared amon.^ other purposes, "and to conserve forest 
resources and bring about tne sustained production thereof." Article X 
provided for the conservation and sustained production of forest re- 
sources as follows: 

"The applicant industries undertake, in cooperation 
with public and other agencies, to carry out such practicable 
measures as may be necessary for the declared purposes of this 
Code in respect of conservation and sustained production of 
forest resources. The applicant industries shall forthwith 
request a conference with the Secretary of Agricultiire and such 
State and other public and other agencies as he nay designate. 
Said conference shall be requested to make to the Secretary of 
Agriculture recommendations of public measures, with tne request 
that he transmit them, vith his recommendations, to the President; 
and to make recomm.endations for industrial action to the Authority, 
which shall promptly take such action, and shall submit to the 
President such supplements to this Code, as it determines to be' 
necessary and feasible to giv-^ effect to said declared purposes. 
Such supplements ohall provide for the initiation and administra- 
tion of said measures necessary for the conservation and sustained 
production of forest resources, by the industries within each 
Division, in cooperation with the aprroprinte State and Federal 
authorities. To the extent that said conference may determine 
that said measixres require the coop'3ration of federal, state and 
other public agencies, said measures m,ay to that extent be made 
contingent upon such cooperation of public agencies." 

Article VIII, v/hich refers to control of production, provided: 

"(i) The Authority may modify, or cause to be m.odified, 
production quotas and allotments determined hereunder, and 
the bases therefor, in such manner and to such extent as may 
be necessary to effectuate the purposes of th^i *^ode in respect 
of the conservation and sustained production of forest resources. 

"(k) The Authority, as promptly as practicable after 
its action pursuant to Ai-ticle X hereof, shall submit for the 
approval of the President appropriate changes in the basis of 

allotments." 

Immediately after approval of the Code by the President, the National 
Lumber ^'arlufacturers Association, on behalf of the forest products in- 
dustries affiliated for th.-it purpose, requested a conference with the 
Secretary of Agriculture to lay before him proposals for effectuating 
the purposes of Ac'ticle X. In the meantime, at the joint invitation of 



9813 



-56- 

the Secretary of Agriculture and the Lumber and Timber Products Indus- 
tries, the Fulpv.,'ood Industry, the Naval Stores Industry and the owners 
of farm woodlands were invited to pnrticipate in the proposed conference 
through their various organizations. 

^f'ith their request for a conference, the forest industries submitted 
to the Secretary of Agriculture a complete program for industry and pub- 
lic action, and in doing so emphjisized the belief that the purposes of 
the conference would not be served by a review of past conservation his- 
tory but rather with a consideration Of the present and the future, and 
the hope was expressed that public agencies would join with industry in 
the planning and establishment of permanent productive forest industry. 

The Secretary of Agriculture issued a call for a conference. The 
first session was held on October 24-26, 1933 and was participated in by 
delegates representative of the regional d.ivisions of the industry and 
of public agencies, including Federal, State and other conservation 
agencies. The Secretary of Agriculture was represented by the U.S. 
Forest Service, which took leadership in representing public agencies. 
The purpose of the first session was to formulate a preliminary conser- 
vation program to be subm.itted to the regional agencies of the Lumber 
Industry for critical analysis and suggestions prior to adoption of a 
final program at a later session. Initial deliberations were on pro- 
posals submitted by both public and industry representatives. In order 
to facilitate discussion and the forming of conclusions appropriate 
committees made up of public and industry members of the conference 
were designated to deal with various .subjects. The reports of the com- 
mittees were laid before the general conference, freely discussed and 
acted upon by a vote of the whole conference. 

Following the first session of the conference the proposals as 
adopted were submitted to the regional agencies of the industry for 
their further study and recomm.endations f^nd with instructions that each 
regional agency prepare rules of forest practice applicable to its 
region for presentation at a later conference. So sim.ilar were the 
proposal's of industry ana the public on forest practices that an execu- 
tive committee was provided and instru-cted to reconcile the proposals 
into a joint statement. This statement was later submitted to the 
regional divisions of the industry. 

In recognition of the im.mense task of preparing regional reports 
and formulating regional rules and regulations of forest practice, the 
second session of the Conference was not called until January 25, 1934, 
Representation at this session was the same as on October 24-26, and 
the subject matter was handled through the same committees, with all 
reports and recommendations finally acted upon by the general Conference. 

With notable unanim.ity the Conference representatives agreed upon 
a well-def inedplan of procedure to accomplish the objectives of conser- 
VFition and sustained production of fofest resources. The program called 
for definite action on the part of the Lumber Industry in the prompt 
initiation and administration of forest practices designed to promote 
the conservation of its resources; it called upon the States and the 
Federal Government for a cooperative program of public action in respect 

9813 



-57- - 

jtp forest pj'otection, putlic timber disposal, public acquisition of 
forest 'landb. forest credits, forest taxation, forest research and other 
aspects of the forest problems involving public responsibilities. 

1. The Private Forestry Program 

On February 26, 1934 at a Public Hearing there was presented and 
approved a schedule of forest conservation rules based upon the Confer- 
enee findings and officially recommended and adopted by the Lumber Code 
Authority and unofficially approved by the Secretary of Agriculture and 
his representatives. As a result of this hearing the National Recovery 
Administrator submitted the recommendations applying to industry to the 
President on N''areh 21, 1934 and they were approved by him on March 23, 
1934, becoming amendments to' Articles X and VIII of the Lumber Code and 
designated as Schedule C. 

The declared purpose of the amendment to Article X was to conserve 
and sustain forest growth. This was to be accomplished in several ways: 
First, by improving logging methods so as to conserve yoxing growth and, 
where possible, to leave part of the original stand, and by the intensi- 
fication of forest protection. A long-time goal was the orderly trans- 
formation of the industry from a quick liquidation basis to sustained 
yield. The industries subscribing to the Lumber Code declared this to be 
an industry undertaking, and public representatives agreed that it should 
be aided by a broad program of State and Federal legislation to remove 
certain economic obstacles and to aid in research. 

The amendment to Article VIII provided that persons securing their 
raw material from forest lands operated on a sustained yield basis might, 
upon securing the necessary certificate to that affect from the Code 
agency \mder whose jurisdiction they were operating, have their product- 
ion quota as allocated under Article VIII increased by 10 per cent. 

In submitting these amendments to the President for approval, the 
Administrator said: 

"From the testimony taken at the hearing, it is apparent 
that these amendments represent a tremendous step toward the 
establishment of- effective mechanism necessary to carrying out 
a successful program of conservation and sustained production 
in one of the nation's most important natural resources. 
As you know so well, the means of embarking on such a program 
has long been sought in this country, but the divergent 
interests involved, while seeking a common goal, defeated each 
other in its attainment by failing to reconcile their opinions 
in the matter of detail. In the light of this knowledge, the 
' \ananimity of opinion supporting these proposals revealed at 
the hearing can only be regarded as promising much in future 
achievement. That this reconciliation has been possible is 
undoubtedly due more to your interest and leadership than to 
any other force," 



9813 



-58- 

Immediately folloving the apfrovnl of these amendments there were 
set up under>1the .Lumber Code ten adininistrative agencies, to formulate 
local rules of forest practice, and to administer locally the provisions 
of "both amendments. Each division or subdivision agency consisted of 
one or more committees, composed of industry men and having as advisory 
members representatives of the State Forestry Departments and the United 
States Forest Service. Rules of forest practice suitable- to local con- 
ditions were formulated, approved by the Lumber Code Authority and, in 
the absence of disapproval by the Administrator, became effective. June 
1, 1934. 

Production, control, to be effectuated by a mechanism specifically 
set up in .the L\amber Code, promised to'correct one immediate economic 
ailment of the "subscribing forest industries, -and at the same time it 
was recognized as offering a basis for the permanent .e»eouragement , of., • 
sustained yield forestry. ■ ■ • ■ ■. . , ..,■.; 

The subscribing industries now undertook to do three things: (l) 
.to change over ^ gradually; but as rapidly as possible, from ^uick liqui- 
dation to. continued' forest production; (2) improvement of woods practices 
and general strengthening of forest protection upon all lands, particu- 
larly those being, logged, wnich was to be accomplished by the forest 
practice rules; (3) a broad program of study to improve logging praciices, 
encourage ,sel.e.ctive cutting and to train technicalpersonnel , which was 
to be undertaken in cooperation with organized public agencies. . 

Direction of conservation in the divisions was handled by 25 
technically trained foresters. The United States Forest Service organized 
a st.:aff of approximately the same size, chiefly specialists in economic 
study and. men with considerable experience in contact with the industry, 
to cooperate. At the end of the first year of ap-61icatian of Article .X 
.•to the woods (June,. 1933 - June, 1934) approximately 60 per cent of all 
operations were estimated by the Code Authority to be fully complying 
with the forest practice rules, and an additional 30 'per 'cent were com- 
plying in part. Definite progress had been made in fire protection. 

Prior to the Code the largest holders of timber land were well 
aware of the over-supply of timber, the over-capacity of the mills, and 
the chrqnic over-production of the Lumber Industry, flowever, nothing 
effective , could be done about regulating production to demand on account 
of legal' restrictions against cooperative action to that end, and the 
thousands of small producers that could not be controlled even if there 
had been no legal objection. 

..During the Code period it was found that the larger operators were 
interested in and anxious to observe the forest practice rules, and the 
colossal task of educating some 27,000 operators was well under way. It 
was impossible, however, to discpver all of the scattered small operators — 
even those who came under the jurisdiction of the Code. If they had been 
found and educated as, to their privileges and obligations, the problem 
of Code effectiveness would still have remained unsolved, owing to the 
fact that farmers, owning 12-1/2 per cent of all. the saw timber in the 
United States and in many instances producing forest products for the 



981S 



-59- 



general market, were specifically exempt from its provisions. In 
addition, the important forest-using groups producing pulpwood, dis- 
tillation wood, mining timbers, etc., not subscribing to the Lumber 
Code were entirely outside the scope of Article X and its amendments. 
This was a serious disadvantage. 

The Administration, as well as the Lumber Code Authority, recog- 
nized the difficulties involved in this situation through lack of suit- 
able forest practice rules applying to those industries, different v<'age 
scales, and other factors directly affecting the successful operation 
of the forest practice rules as applied to the forest products indus- 
tries under the Lumber and Timber Products Code. Accordiiifly, on March 
12, 1934, at a Public Hearing' called for that purpose, there was presen- 
ted by the Authority the so-called "President's Amendment" to Article II, 
Section (a) of the Lumber and Timber Products Code, providing for the 
inclusion under the jurisdiction of that Code of the products of those 
industries which were not specifically covered by a Code of their own. 
Coincidentally, there was issued by the Administration, with the approval 
of the Authority, an "Office Order" which provided that all codes then 
under considerr.tion or '-hich might later be considered and which covered 
primary forest products not then clearly \inder the Jurisdiction of the 
L\imber and Timber Products Code , should include forestry provisions sub- 
stantially equal to those in the Lumber and Timber Products Code. 
It was further proviced that the Deputy Administrator _ in charge of the 
Lumber and Timber Products Code should be consulted as to the adequacy 
of such provisions. The purpose of this order /^as 'to ^niarantee that all 
timber lands, except those owned by farmers ard which v/ere specifically 
exempt, by the NIRA., should be haiidled ■'oniformly and' in accordance with 
sound forestry practices. As a result, forestry provisions were included 
in a proposed Code for the Pulpwood Industry, nnd suitable amendments 
were prepared for. an' existing Hardwood Distillation Code. 

At the date upon which all Codes were terminated, the so-called 
"President's Amendment" had not been approved. 

Althoua-h accomplishments under the forest practice rules of' the 
Code were sxibstantial during the short time it was in effect, it was 
apparent that if those persons subject to them had been exclusively large 
timber ov/ners and producers, those accomplishments might have been 
materially increased. Thus, from the public standpoint of getting the 
timber land under suitable forest mai'ia£;3ment . with the least possible 
delay, greater concentration . of ownership might have been a decided 
advantage. . ' 

A second difficulty, and one which made almost impossible a proper 
administration- of the forest practice rules in some regions, was the lack 
of jurisdiction over nil forest products producers. 

A third difficulty, the effect of which it is impossible to appraise, 
was the delay that occurred in getting the public portion of the forestry 
program under way. Article X of the Code provided that if the Conference 



9813 



-60-. 

should determine that the measures initiated by the industry required 
the cooporrtion to sone extent of federal, State and ot ler public agencies 
said measures might to th,at extent be made contingent upon such cooperation. 
Schediole G, the ajnen'mont to Article X, did not contain this language, but 

stated,; " it being recogni'.;.ed -that the extent tr v/hich these undertakirgs 

by the Ltunber and Timber Products Industries are capable of successful 
accomplishment is dependent u^Don the extent and character of public cooper- 
ation in each state." The industry' promptly put into effect the forest 
practice rules, and it is reasonable to gu.ppose that the failure of public 
agencies to initiate and carry through the public measures approved by the 
Conference during the life of the Code may have seriously interf erred vrith 
successful administration of tlie forestry provisions by the Code Authority. 

Thus, at the end of the Cede period the obstacles to continued pro- 
gress in private forestry largely remained. 

2. The Public forestry Frog:i'am 

The Conservation Conference of October, 1934, and January,'-, 1935, re- 
commended to the Secretary of Agriculture a definite program of action v/hich 
would form the contribution of the JTederal and State governments to round 
out the private Code measures in a coordinated plaji of American forestry. 
As provided by Article X of the L-amber and Timber Products Code, the 
Secretarjr of Agriculture made recommendations to the President for a Fed- 
eral program. There recommendations f Dlljued those of the Conference s-nd 
v/ere presented in the form of a bill drafted by the Forest Service and de- 
signated e.s the "Omnibus Forestr-- Bill." The presentation to the President 
took place on May 9, 1934. Congress nas anxious to adjourn and the Presi- 
dent felt it inadvisable to request the proposed legislation at that Con- 
gressional session. It is probable that the large appropriation called for 
in the bill may have influenced his decision to some extent. Undoubtedly 
some of the provisions could have been omitted and the amounts called for 
reduced in some, instances v/ithout materially affecting the public's immed- 
iate obligation toward the whole forestrj'' program. Some of the proposals 
of the Omnibus Bill are, hoi/cver, being met temporarily in other waye/ 
For esp.mple, increased cooperation v;ith the states is being carried on thr- 
ough increased appropriations under the existing Clark HcHary Act (43 Stat. \ 
683). The usual fire protection efforts have been supplemented by those 
of the Civilian Conservation Corps. Emergenc;?- funds have oeen made avail- 
able to acquire large areas of land for national forest puri^oses and credit 
has been extended to several lumber companies by the Reconstr'action Finance 
CorporPtion. The extension of long-term G-overnment credits to forest ovmers 
through a forest credit bank, to enable them to handle their properties on 
a basis of sustained production of timber crops, as recommended by the con- 
ferences, was presented to the 74th Congress in Senate Bill 3417 on August 
14, 1935. In a.ddition, on Januarjr 2, 1935 the President wrote to the Gov- 
ernors of the several states urging them to call together representatives 
of the Federal and State Governments and of private industry'' to consider 
tax deliquency on timber lands and other forestry"" questions as set forth 
by the Conference, Some such meetings have been held. 

The future of forest management necessarily rests upon continuity of 
forest ownership. Unstable ownership prevents long-time planning and dis- 
courages efforts to refine mana^f^emcnt m.ethods. At present nearlj'' 80 per 
cent of the best forest Icinds are privrtely owned. There is small lilreli- 

9813 



-61- 

hood that public funds can be made available sufficient to recapture a 
large portion of these lands ar.d the timber upon tnera nithin one or even tT7c 
decades, even if the public should desire to do so'i Ormership, then, must 
remain predominantly private, and the task is to secure continuity by re** 
moval of the recognised obstacles such as excessive carryin,^ charges, un- 
certainty as tD future mrrlcets, ineffectual protection assistsjice by the 
public and inability to r-ecure lou-cost financing. 

At the close of the session on January 25, 1934 the Article X Forest 
Conservation Conference provided for a comiittee consisting of an equal 
number of public and industry rooresentativcs Tjhore duty it should be to 
take promptly su-C^h action as might be appropriate to give effect to the 
recommendations of the Conference, 

- It wan provided further that the Conference should not definitely 
disband, but should consicier itcslf in recess, to be reconvened on re- 
commendation of the Joint Committee upon the approval of the Secretarj'- of 
Agriculture. 

This committee met frequently during the period of the L^'omber Code, 
and again on J^one 12, 19S5, after the Code had- been dissolved. After con- 
sultation Tzith public and induijtrj'- lerders it found: 

"That the Joint Conservation Prc^rara, recommended by the 
Forest Conser'/stion Conference and fur\;ber developed and estab- 
lished by ap'oro"^ri■^te agencies "nd a-oproved by this Committee is 
adequate, feasible, and should be carried forr/ard v/ithoao change, 
except as to method; 

"Tliat the Lumber and Timber Products Industry be urged volun" 
tarily to continue to carry out the provisions of Schedui C and the 
Rules of Forest Practice throvigh their trade associations and by 
their individixal members; 

"That all other forest-using industries and all oxmers of for- 
est land, ^j-hether oublic or private, including farm woodlots, be 
urged to join voluntarily in this entei'prise; 

"Tliat the U. S. Forest Service and other public agencies, federal 
and state, be urged to coninuo and enlarge their cooperation in carry- 
ing out the v/ork toward the objectives set up under Article X; 

"That in the p-arsuit of the federal aiid state forest acquis- 
ition program,. pro~pt step?- be t?k:on by the U. S- Forest Service 
to bring about cooperation of federal and state authorities and the 
forest industries in \7orking out the place of each tj^e of ownership 
in sustained yield "oi'a ts; 

"Tliat the legislatures of the several states containing forect 
lands be urged to meet the wishes of the President of the United 
States, as expressed in his letter of Janioar:'- 2, 1955, by early en- 
actment of appropriate laws to aid in carr;-ing for:'ard this joint 
program; 



9813 



. -.62- 

"That the President of the United States be respecrtfully urged, 
as promptly as is compatible V7ith the national interest, to submit 
to the present Con;3resK the profrrp.m of forestry legislation founded 
upon the recommendations of the Joint Cnminittee nf t?ie "National 
Article X Conference and ar^proved by the Secretary of Agriculture; 

"Tiiat piiblic r.ta.tej'ientr, of intention to carr;,'- fonvr.rd the forest 
conservation program be issued by authoritative spokesmen of both 
industry and the public." 

The National Limber lianufacturers Association, a federation of the 
principal regional lumber manufacturing associations which ha.d functioned 
under the Lumber Code as Division and- Subdivision Agencies administering 
Article X, as well as other provisions of tho-t Code, hs,s declared the in- 
tention of its member organizations to proceed volimtarily with the indus- 
try' s part of the agreed, program. This membership represents considerably 
more than half the lumber production of the coimtry. 

The personnel of the U. S. ^Forest Service, previously assigned to 
■this work, has continued to cooperate in b3.sic studies and in educational- 
activities among private operrtors. 

Tlie Porest Service has also prepared a revision of the original "Om- 
nibus Bill" for consideration of the present Congress, which is calciolated 
to give effect to the recommendations of the Conservation Conference. The 
outstanding features of this bill are proposals to: (l) Increase the 
Clark-McFary cooperative fire money authorization from $2,500,000 to 
$5,000,000; (2) authorize an ap-oropriation of $1,000,000 to carry on For- 
est Service end State and private forest cooperation; (3) authorize an 
appropriation of $6,000,000 for completing the Forest Survey plvis authori- 
zation for an annual aj^propriation of $250,000 to keep the data current; 
(4) provide authorizations for forest research along several lines; (5) 
authorize the Secretary of Agriculture to enter into cooperative sustained 
jj-ield management agreements with private operators, vdio should place their 
forests in units to be jointlj'- manr^e'^^!. with public forests; (5) provide by 
bond issue, or otherv/ise, for a large-scale Federal forest acquisition 
program to be carried, on for ten yea.rs b;r the ap-propriation of $50,000,000 
per year to permit acquisition by the Federal Government of 224,000,000 
acres of forest land and 150 "billion feet of privately owned timber. 

As already stated, there is before the Congress a proposal (Fletch- 
er-Caldwell Forest Credits Bill) to extend the fpcilities of the Farm 
Credit Administration to the field of forest management, in order that 
forest ov/nors who desire to operate on a sustained yield bgsis mav secure 
loans at low rates of interest commensurate with the risk and return. 

It is apparent that this joint conservation program contains the 
beginnings of an effective national forestry enterprise. Three actions 
are necessary: First, the Legislatures o.f the forested states should 
overhaiil their tax systems, should arrange for Sta.te management of tax 
"reverted lands, and should assure the raainte.nance of adequate Forestry 
Departments; second, the Congress must enact legislation to carry out 
its recognized obligation to encourage continued forest ownership ajid 
thus make private forestry'' possible; third, private operators and timber 
owners must carry on that portion of the joint program assumed by the 

9813 



-63- 

Lumber Code Authority under Article X. It is also necessary to bring into 
the picture owners of f8.rm v/oodlots and forert users not members of 
existing lumber man\ifactarers' associations. 

Although the forestrjr provisions of the liumb'er and Timber Products 
Code were in effect less than one year, that experience was s'ifficient 
to demonstrate that the system of control set up under the Code was sound 
and would adequately meet all the needs of the public interest in private- 
ly owned forests if it had continued to receive the wholehearted support 
of all those tinder its jurisdiction and public forestry agencies and if 
it had been legally enforceable. 



9813 



CHAPTSR III 

THic FROBLais or FaO r'ICTIOII 

A. CiiPACITY 

Capacity, as related to samnills, is a relative term, and the basis 
for tlie v.se of the \7ord in this cha;pter is as follouj;: 54 hours per u-eok, 
50 weeks to the year (2,700 hours) nultiplied hjr the rated hourly out;.mt 
of the saTT-.rill equipment. .Some such arbitrary basis must be deternined 
for the reason that there are many samnills that are equipped to operate 
only diu'ing the hours of daylight, while other and larger plants are so 
equipped as to permit operation during all hours of the twenty-four. 

On the basis of the formula outlined above, the annual capacity of 
17,467 se.w.uills to v/hich a rated hourlv capacity was allocated under the 
NPiA Code, amounted to more than 69,000,000 M b.ra, (Thousand Feet Board 
Measure.) (*) The largest production within the last ten years was 
39,000,000 li b.ra, (**) And it is a matter of record that many of the 
verj'- largest mills in the country operated regularly on a two-shift day 
during the year 1929 when this pea!c of production was reached. 

In discussing the capacity problem the standing timber will be 
referred to as being in areas or in regions, but when reference is made 
to sawmills and production the reference \dll be to divisions as compre- 
hended in and established by the Code of Pair Competition for the Lumber 
and Timber Products Industries. The divisions and subdivisions under the 
Code generally follow the geographical boundaries of the regions, but for 
specific delineation of any division, reference should be made to the 
Code in Appendix I. 

Area,s of merchantable standing timber have been or are now in ex- 
istance in practically everj^ state in the Union except Kansas, Nebraska 
and Horth Dal'ota, and as the settlement of land progressed from New 
England and the Eastern seaboard, small sawmills were established to 
supply local needs. These mills v/ere followed by larger units for the 
commercial production of lumber, and then as the supply of merchantable 
timber was exliausted, or as centers of demand developed closer to other 
areas of merchantable standing timber, commercial sawmills were established 
in these new areas. Thus many small neighborhood cjid some commercial 
samaills have been left behind in areas practically or completely denuded 
of comi.ieirial saw tinberand in areas where saw timber is available but is so 
far away from the centers of demand tha.t it is not possible for the fin- 
ished product to compete with raraber from other areas more advantageously 
sit'uatcd. 



(*) Unpublished compilation by Research & Planning Division, NRA, Hill 
Caioacity Statistics , June 1, 19L-.5 - and Table XIX. 

(**) Table V, 



9813 



-65- 

With the chan,5e of production centers for lumber influencing 
the establishment of neii^ mills, it can readily be seen thpt a very 
considerable portion of the rrted capacity of the sawmills is not much 
more than a fig'are of sneech. It is known that many hundreds of mills 
still carried on the records as being able to produce have not act\ially 
producfed, find thn.t many thousands of other mills have been in operation 
for but a very small fra,ction of the basic hours -oer year, in any year 
of the pa.st ten. This, is true particularly of several thousand small 
mills located in the Northeastern Softvrood and Hardrood Divisions and 
in the North Central Division where the supply of virgin stands of saw 
timber was virtually eliminated several years ago and only second growth 
timber is now available or i s becoming available. Many of these small 
sawmills have reverted to original tj^pe and are operated only to supply 
an immedaite neighborhood lumber requirement. 

Many of the small sawmill s do not have the type of equipment 
that would permit them to produce a grade of lumber that would compete 
with the output of the larger mills in the principal consuming markets. 
Coupled with the fact, as nreviously discussed, that so many of these 
mills are located away from the present centers of production where 
distributors tend to congregate, the lower grade of output and the 
difficulty of placing the product in the market would normally tend to 
reduce the effective capacity of this very considerable group of mills. 

There must also be taken into consideration the fact that as a 
resiolt of the movement of centers of production and the consequent change 
from large mill to snail mill operation within nroducing centers, there 
are known to exist many large mills with ratpd hourly capacities ranging 
upward into the thous-^nds of feet that can not produce more than a frac- 
tion of this rated capacity for the reason that the timber supnly either 
has been completely ei±austed or is so far removed from the mill site 
that it is practically impossible to deliver logs to the mill in quantity 
sufficient to keep the machinery operating even the theoretical number 
of specified hours. 

These sawmills, under liandicap of location, are always potential 
producers of lumber but seldom actually produce except when the price of 
lumber reaches a level that rill permit recovery of high costs from the 
sale of this marginal production. 

The West Coast Region is an exception t^ the general statements 
above. In this region the standing timber areas had been the object of 
speculative purchase since the period of the land grants to railroads, 
and particularly after many in the Lumber Industry became convinced that 
when the supply of virgin rine of the Southern states was exhausted there 
would be no further production from that region and the only available 
softwoods would be those of the West Coast Region. MaJiy large and costly 
mills were erected in the West Coast Region to meet this expected demand, 
but the South continued to produce softwood lumber when much second growth 
timber began to reach maturity or merchantable size, and that region has 
not yet failed to offer competition for its share of the consumer demand 
for softwoods. 



9813 



With Southern pine -conpetition continuing, the West Coast mills 
could not find a profitatlo maz-ket for lumber from all of their in- 
stall cd capacity, and many have never -lanufactured even to 50 per cent 
of the rated capacity. In fact, soi'ie of the finest sa\Tmill machinery 
Drocurable has never operated i,n actral production althouf^h installed 
in West Coast Region sawnills bacliEi"'. hy ownership of standing timber 
sufficient to sustain capacity ot)eration for fifty years. 

Carrying charges of interest and taxes ultinately became too great 
a burden and in many cases i't ras necessary to liquidate the investment. 
Under this economic pressure large areas of standing timber was converted 
into saxTmill products even though it was recognized that this center of 
production ivas handicap-oed by a location distant from the then existing 
centers of demand and that difficulty would be encountered in marketing 
such products in competition v.'ith those originating in areas much more 
advanta,geously located. Data (*) indicate'^ that rated mill capacity in 
the West Coast Division is equal to several times the annual effective 
demand for its products. This excess capacitj"- and the economic demand 
for liquidation of the investments in standing timber have forced saw- 
mills to produce when there was no effective demand for the lumber and 
when the market was created largely through reduced ririces and without 
regard to return of total cost of production. 

Seasonal weather conditions and the terrain upon which the merchan- 
table stp-nds of timber are located also have a decided effect upon the 
actual as comiDared to the theoretical or rated capacity to produce. In 
the Southern Pine Region the land is fairely level and the weather con- 
ditions will permit woods -o-oeration and consequent sawing of lumber 
practically throughout the. year, ■ In the West Coast Region generally 
favorable wea,ther conditions are also encountered but there is a more dif- 
ficult terrain and logging- o-oerations can not always be carried on. 
Moving inland to the Western Pine Region, generall comprising the mountain 
range country, severe seasenal dislocations and unusually rough terrain 
are encountered, adding to the difficulty of -producing logs. Ra.t;ed cap- 
acity of the sawmills in these latter two regions is undou'jtedly a very 
different quantity froip effective- capacity to produce lumber. 

Other ■ fa.ctors governing capacity of ■ sawmills are size of trees;, 
compactness of timber stand and character of logs. It has been pointed 
out that production in the Southern Pino Division is now largely re- 
duced to utilization of second growth, and consequently smaller trees 
"are being logged and worked into lumber with greater ease of operation 
than would be the case if a virgin stand of large trees was being utilized. 
The stand of trees is not heavy but the logs are sound and clean. It 
is true that the small trees will not produce lumber in similar quantities 
and grades as will the large virgin stock, but the case of operation per- 
mits lar'^e use of manual .labor and does not require expensive mechanical 
equipment for logging and handling to the saws. 



(*) Unpublished compilation by Research & planning Division, NRA. 
Mill Capacity St. atistics , June 1, 1935. 



9813 



-6J- 

The production in the Tfest Coast Region is nractically all -from 
virgin timter. The trees are large, the stand is very dense, and most 
of the OTjerations are "clear cuttin;^" (talcing all merchantatle trees 
and disregarding condition 'of reniaining yc-ong growth) so that logs 
of all sizes and conditions reach the saws- (*) Being required to handle 
a preponderance of large logs over difficult terrain, these, logging 
camps and large sawmills are highly mechanized units requiring that the 
majority of the employees shall have some degree of technical training. 

The production in the TTestern Pine Region is largely from virgin . 
timber and over very rough terrain. Here again clear cutting until 
recently has "been the rule but the timber stands range trr^m sparse to 
very dense, and the trees from:smali to very large. To fit these widely 
differing conditions the sawmill capacity is made up of many small mills 
and some few large mills. All mills are required to handle the miscellan- 
eous types of logs resulting from clear cutting. 

Hardwood is produced in every state in the Union except Arizona, 
New Mexico, North Pa'cota, South Dakota and Wyoming, the production in 
the states of California, Nevada, Colorado,. Idaho, Montana and Utah being 
very slight. (**) Small mills predominate but tuere are a few large 
mills. The canacity of these large mills is largely talcen up with pro- 
duction for special orders 'and for use by integrated processing plants. 
Selective logging (cutting trees selected as best'-.suited to produce the 
type of lumber desired) is largely prr^cticed in' the hardwood divisions 
and usually the mills have only first class logs'to handle through the 
saws. ' - 

:. . The over-extended capacity to produce lumber has t andeci to the 
establishment of excessive inventories,' 'for 'in many instances the shadow 
of. this unused capacity has forced other operating units -into production 
schedules which they knew to b'e in excess of rjie effective deraand for 
their product. Ylith the unused production capacity .in ■existence it has 
always been necessary for those sawmills producing lumber to. avoid any 
semblance of under-riroduction that would tend to a:, real or an imagined 
shortage of lumber. This was demonstrated about the 'time the Lumber Code 
was being discussed, and when it was expected that there would be a very 
considerable demand for lumber in the carrying out of the then proposed 
Government building program. It has been reported that many thousands of 
small mills in the Southern Pine Division were then encouraged to, and 
actually did start operating under the reported prospective shortage of 
lumber as a result of that proposed building program. Not only did the 
small mills go into production but many of the large mills stepioed up 
production, not only in the Southern Pine Division but in the TTest Coast 
Division and in the Western Pine Division; and this hopeful production 
was indulged in despite the -fact that tbo industry then had on hand a 
heavy inventory of wholly or i>s«-ti«»iJ-y raaunfactured stock and the effective 
demand for the p-rior -r^ar had been at the low for more than fifty years. 



(*) Oregon and Washington have slash disposal laws which do not allow 
consideration of young growth. 

(**) Table XVII B 



9813 



-68- 

References have been nade to the three major softwood divisions 
only, as these' three divisions have -Droduced from Gl to 84 -oer cent of 
all lumber consumed over a •oeriod of years. Reference also has been 
made to the-Southern and Appalachian Hardwood Divisions, which two 
divisions have produced apiDroximately 70 ner cent of the total hardwood 
consumption. The above quoted figures are particularly anplicable to 
the^period from 1929 to 1934, inclusive. 

Commenting briefly on the above displayed data, and bearing in 
mind that production in the year 1929 was the largest in any of the past 
ten years, it will be noted that the peak production of 1929 utilized 
less than 50 per cent of the Southern pine rated capacity and slightly 
more for' Western pine, -while TlTest Coast utilized about 70 per cent of 
its rated capacity, with the Appalachian and Southern Hardwood Divisions 
utilizing less than 25 per cent «f their rated capacity. 

When the results of the depression began to be definitely felt in 
1931 and 1932 the position of these four principal lumber producing 
divisions was rorticularly acute, and the actual utilization .of the rfited 
capacity of the sawmills in those divisions, as indicated by the data, 
was almost negligible. 

In viewing these data it should also 'he borne in mind that the 
rated capacity of the sawmills in the Southern Pine Division is about 
equally divided between small mills and large mills, and that this con- 
dition also largely prevails in the. Western Pine and the Appalachian 
and Southern Hardwood Divisions. The rated capacity of the mills in the 
TYest Coast Division is largely that of the big mills. 

■ ■ • Remembering that large mills generally are expensive installations 
almost universally backEd by extensive timber holdings all requiring 
considerable, investment, and that the small mills are almost universally 
without extensive timber backing and usiially represent but small invest- 
ment in equipment, it can be seen that the economic pressure of taxes 
and of interest would be less severe on the small 'mill capacity than 
on those divisions in which the large mills predominate. These economic 
considerations woiild largely dictate whether mills actually continued 
operation in the face of declining prices and over-extension of stock or 
whether production would stop and the rated capacity be not utilized. 



9813 



-69- 

The excess capacity of the sawmills may 'best be illustrated 
by the tvro following very brief tabulations: 



Sawmills:... Eatio of Rated Caijacity for 1934 
to re-QOrted Production in the Princinal 
Lumber Producing Divisions 

Southern West Coast., Y^estorn Appalachian 
Pine a/ Fir, etc. a/ . Pine a/ & Southern 

Hardwoods b/ 

10,147 5,217 5,315 



1929 Product 


ion 




(million fee 


t) 


11 , 63( 


Year 






1929 ■. 




,2.3 


1930 




3.6 


1931 




6.1 


"?•"■? 1932 




8.0 


1933 




6,4 


1934 




5.8 



1.4 2.1 4.2 

1.8 2.7 3.8 
2.6 4.0 4.4 
4.4 6.0 5.7 

2.9 4.7 6.8 
3.2 4.1 6.6 



1934 Production 

(million feet) 4,680 4,275' 2,649 1,950 

a/ These softwood producing Divisions reported 81 to 84 ner cent 
of all liimber shi-oraents originated therein. 

b/ This hardwood -oroducing group shipned a,pprox:iraately 70 ■oer cent 
of all hardwoods. 



9813 



-7C- 



Sawmills: Ratio of Ha.ted Capacity for 1934 

to reported Troduction in the minor 

Lumber Producing Divisions 







Hortheas 


■tern 


TTortiic 


■rn 


Northern 










Soft^oc 


ids 


Henlock 


Pine 


Hed-^ood 


Cynress 


1929 Product 


ion 
















(million fee 


:t) 


"46 




■ 486 




352- 


590 


.-381 


1929 




2.4 




1.4 




1.3 


1.3 


1.6 


1930 




2.8 




1.8 




2.2 


1.6 


1.6 


"'•-X 1931 




4.7 




2.7 




5.0 


2.7 


2.4 


1932 




6.6 




6.2 




8.2 


4.4 


5.2 


■■:" ' 1933 




6.0 




6.0 




9.8 


3.7 


5.4 


1934 




5.4 




3.9 




5.7 


2.2 


5.6 


1934 Product 


ion 
















(million fee 


t) 


290.9 




110.3 




84.4 


350.5 


110.3 



In connection vith this group of data relating to minor lumber -oro- 
ducing divisions, it should "be considered that these various divisions and 
the capacity and the production listed represent, for the entire groxsp, 
only from 10 to 15 -oer cent of all lumber used; so while the figures are 
informative and are presented for comparison rlth similar data for the 
principal 1-umber producing divisions, this indicated excess of ca-oacity 
would have no serious effect upon production in general. The above com- 
ments do not apply exactly to the Redvrood Division, for in this particular 
type of operation the large mills and highly mechanized operations are 
again found, but the number of operators is very limited. It will be noted 
that the data disclose the Redwood Division onerated at nearly 80 percent 
of its canacity in the pealc year of 1929; that in the low year of 1932 
it was operating at less than 25 per cent of its rated capacity; and that 
in 1934 the mills were operating at nearly 50 ner cent of their rated 
capacity. 

As would naturally be supposed, with more than 17,000 sawmills lo- 
cated in nractically every state in the Union, many different manufactur- 
ing methods are involved. These methods can be roughly classified into 
the methods and practices followed by the small sawmills, the methods 
and practices followed by the intermediate size sawmills, and the methods 
and practices that are a necessary part of the ox)erations of the large 
sawmill units. 

Aside from the size of these operating units there must also .bt con- 
sidered the methods cf manufacturing used by the different tyoes of saw- 
mills. Generally sneaking, a considerable TDart of the Droduction of the 
small hardwood mills is custom sawing. This is simply the bringing in 
of logs by their owners who desire them to be sawed up into certain 
specified articles of lumber generally for their own consumption. Another 
type of small savmill is more prevalent in the Southern Pine Division. 
Here are several thousand mills that are engaged in the manufacture of some 
lumber products from the available standing timber in their particular 
neighborhood. The production by this group of mills is a more direct and 
less purposeful utilization of the standing timber. It is in fact a type 



9813 



\ 



-71- 



of operation that may best "be described as mopping up an area. In 
other words, these sawmills are engaged in the sawing of logs from trees 
that are too small in siz3 or too far removed ib6 make their utilization 
profitable in regularly established sawmill operations. The purpose is 
simply to get the most possible out of the logs and to get that pi'<j'liu;t, 
all too often of a low grade, into tho market and sold for ginything tiiB.t 
it might bring. Most of the equipment is of low efficiency and -Droduces 
lumber of' distinctly substandard quality. Among mills of this classi- 
fication is the group known as "roofer" mills of the State of Georgia. 
Thes* mills produce lumber from small and immature trees and the product 
is usually the roughest, the poorest and the most irregular of any lumber 
production worthy of that name. The products of these mills are, as the 
term would indicate, simply rough boards of varying widths and lengths 
that are used as a foundation for other lumber or substitutes for lumber. 
Thesis boards do nfet have to be of any particular width or length and they 
simply replace better manufacturing material in any type of construction 
to which they are adapted. 

Manufacturing of lumber products of standard grades, sizes and re- 
presentative qualities cannot vary considerably between mills in the 
same species area or between mills in areas producing competitive stDecies. 
Th? lumbpr must bfl produced and sold in competition with the products of 
all other mills of similar character. Hence the manufacturing processes 
and procedures must be such as to produce lumber comparable in grade and 
sizes with other mills prudncin/r tvh^-; vf^mc or i^umpt- (■i f.ive suocies. 



9813 



-72- 

There is another t:/pe of mill, and one Tvhich added a distinct factor 
to the general protlem of orod^iction — those mills which are produ- 
cing lumter from their OT.-n tre^:s, in their own mills, :7hich is not ex- 
pected to and generally does not evei reach the channels of distribution 
■for the reason that' these products are put into other processes for 
finishing special items for their own use. These sawmills with inte- 
grated operations created a distinct problem under the Code administra- 
tion and a problem which apparently had not been given adequate conside- 
ration and had not been solved in the drafting of the Code. It is 
plain to be seen that if one of those integrated operations — the , 
making of sawed- wooden boxes -- was carried on by a sawmill manufacturing 
its own material for the box making oparcitions, it would have a distinct 
competitive advantage over other box plants. Not only v/o^ald such an 
integrated mill have the advantage of being able to use short length 
and low grade 1-amber from its actual lumber producing operations, but 
it also would be possible for it to transfer gill of its products over to 
the box making factory at a price which might .result in a loss for 
the sawmill but in an exorbitant or \mreasonably large profit for its 
box making activities. This is just a sample of several of the per- 
plexing conditions which arose through failure to properly comprehend 
and provide for the effect of integrated manufacturing operations 
within the sawmill industry. . , , 

The method of manufacturing b?/ the various types of mills as 
discussed above added one other phase : to the general production 
problem. It can be readily seen that the small mills operating spo- 
radically would secure their labor onlv from people in the immediate 
neighborhood who would necessarily provide themselves with other 
means of livelihood than working in the sawmills. In fact, practically 
all of the labor in such type of mill was purely the type that used 
the sawmill wages as a supplement to other earnings. This type of 
mill could suspend production at ajiy time or fail to resume production 
at any time and it would still not seriously affect any considerable 
number of wage earners. This same condition oreva.iled also in con- 
nection with other small sawmill opei-ations whether those sawmills 
were of the movable type or whether they were of reasonably perma.nent 
installation. In either event, with production not being forced upon 
the mills, the labor that would be employed in those mills would or- 
dinarily be supplementing other earnings with their sawmill wages. 
Also, as a general rule, these small mills were not burdened with any 
investment in standing timber and consequently added no burden of 
interest and taxes to be met reg'alarly. 

But the condition would be very different when the production of 
the larger sawmill units would be interrupted. These larger mills 
were accustomed to and were expected to operate about 60 or more hours 
per week. It was thei-efore necessary for them to build a reservoir 
of labor upon which they could depend for the sustained ho\irs of 
Operation. As a consequence of these conditions, labor migrated 
to the vicinity of the sawmills; in fact there had been many towns 
and small cities located or built up around sav/mill activities. 
These mills were dependent upon this labor and this labor was de- 
pendent upon them. The mills also, because of their size, the 
amount of capital required for their building and the securing of 
the necessary timber to back them up, involved very considerable 

9813 



-73- 

investraent aiid the properties './ere all subject to taxation. In connection 
with thia i^roiips of lar^e mills, economic pressure for continued operations 
wrtuldi in raaiiy cases, force these savmiills into production even when 
there v/as no imnediate demand for their products. With demand hein^ 
redu-ced, prices would decrea:;e under the pressure of the increasing- 
suoply and these sswmil'i.s found themselves compelled to operate at a 
direct loss, Thi; necessarily caused the labor wa^e to be reduced. 
The v/a/je of labor v/rs the most important factor of the out-of-pocket 
or actual money cost of production; it v/as the one which would be 
subjected to the most pressixi-e for reduction and in most instances 
vv'as the least fixed it-sm of cost of any that had to be met currently 
by the mills if they were to continue in ■sxistence, 

■ After the adoption nf the Code many hundreds of these small 
mills, fe.ced v/itli the necessity of payin^^- a minimum wage and supplyin^;^ 
information relative t» their operations, did not a^ain resume saw- 
in^'. The Ic.r^-er mills, however, were not able to dispose of this 
problem so easily, but v;ere actually faced with the necessity of 
continuin-'j their manufacturing,- operations. They paid the minimiun 
wa^-e specified in the Code; t}iey operated the maximum number of 
hours peraiitted; they produced their liomber and jTilt it on the market 
exoectini^; to find it mflvinj]; in the usual channels of trade at the 
minimum prices set by the industry Code Authorities, only to be faced 
with c, volume of productioii from other similarly located mills that, 
in the u^r^ve^sXet vvas more than the market was demanding. Those mills 
were virtually forced to continue production and their products had 
to be disposed of in some manner and at some price so th^-'t additional 
money could be secured for continuing operations. 



9813 



-74- ,. 

B. PRODUCTLON - VOLUI^E ~ USAGE . > ■: 

Lumber prodiwtion is l,'=rgel;v i forced aiid irvoliantar^'- process. It 
is not similar to factorv production vhera specified materials are pro- 
cessed to make par.ticular products. Articles produced in the usual factory 
may te for orders already" in hrnd., for replenishment of stocks, and in 
anticipation of results from a pr.earran-;ed selling campaign. JJsually 
tnese production -processes may he trought to a stop at rny time and not 
leave any large stock of raw materials on hand to hui'den the cash re- 
sources with recurring; fixed charges of interest and taxes. ' 

ti'erchantahle standing timber is the raw matepial of the saw mills. 
It must be either owned or controlled, in such quantities as to furnish 
sav; logs at the mill for such n period as Y/ill be economic justification 
for the establishment of the converting -units and at such a cost as will 
permit the sale of the resulting lumber products at a price, under 
reasonable competitive conditions, that vill return' a profit. Standing 
timber must be converted into logs and other forest products under pressure 
of nature, for trees reach maturity- as do other crops and then deteriorate, 
and slowly but certainly lose value. Logs usually must be so sawed as to 
produce the best possible assortment of sises and grades of lumber, 
whether those sizes aAd grades are vranted or needed. I 

Thus it will be seen that in the -production of savmill products, 
as a usual thing, there cannot be a particular choice of the raw m.aterial, 
and that the product will', to a very large extent, depend upon the size 
and quality of saw logs, "the efficiency and ability of the men, and on 
the type of mill equipmient operated by them. ?his is particularly true 
where lumbering operations are carried on purely as a salvaging operation. 
In later years, salvaging of values from standing timber has been the 
predominant factor in the production of lumber, as the mills were estab- 
lished and equipped and the standing timber had been acquired, all of 
which necessitated payment of the carrying charges for the investment 
vhich in turn forced the savmrdlls to operate without regard for the 
immediate value of the products. 

Other economic pressures required that quantities of standing 
timber be converted into sawr'ill products. Land under lease must be 
cleared before the lease period expired. Standing tim.ber purchased to 
be paid for out of progressive utilization demanded liq-ciidation. Vast 
holdings of standing timber (*) acq\iired possibly as a speculation and 
covered largely by mortgages and bond issues, demanded sufficient oper- 
ation to realize cash to pay carrying charges of interest and taxes. (**) 



(*) Table III - Stand of Saw Timiber in the United States by Regions, 
States and Classes of Ownership. 

(**) Tables XII', XIII, XIII (a). XIII (b) 



9813 



-75- 

These conditions were particularly true of the larger virgin timber 
lends in the West Coast region, and competing woods, while not possibly 
under the same economic pressure for liquidation saw their market dis- 
appearing unless they in turn stepped up production even though the 
products were in excess of demand and had to be sold only on a glutted 
and falling market. S'rom the earliest days liamber has been produced to 
meet a natural and not a created demand. It is true the industry has 
made many refinements in its products, largely to meet the competition 
of its own members, but except for these, the products of most mills 
today are little different from those of the earlier mills. The princi- 
pal products are not readily susceptible to any uses other than those of 
long-established custom. 

The capacity to produce lumber has been shown to have been always 
in excess of the demand for the product. (*) Changing centers of demand 
and changing centers of production have worked one with the other to build 
up a capacity to produce that has always been a weight upon the industry. ( **y 

Ascending volume of Ixomber production marked the westward movement 
of population with the settling of new farms, and the opening up of towns 
to supply the new farming communities. This impetus to production was 
followed by a long maintained demand resulting from, city improvements, 
better buildings on the farm, and finally by the turn of population to 
the city requiring other and further duplication of habitation. (***) 

( *) Table XX-Comparison of Equipment Utilization. 

(**) See Table IV - Percentage of Distribution of Lumber Production, by 

Hegions - 1849-1934; the Evidence Study Series No. 22, "The Lumber and 

Timber Products Industry", W. E. Yost, Division of Review, NRA. 

(***) The Department of Commerce, Bureau of Foreign and Domestic 

Commerce, Forest Products Division, published in January 1935, 
data indicating that the peak cons\imption of lumber was from 1904 to 
1913. During this period the consumption of lumber did not fall below 
40 billion feet, and in the year 1906 reached almost 45 billion feet. 
From 1914 on to 1928 consumption fluctuated from a low of 28 billion 
feet in 1921 to a high of 39 billion, 700 million feet in 1923. 

This high consumption of lumber in the period from 1904 to 1913, 
and which was partially maintained up through 1917, very closely follows, 
and it is fair to assume is linked with the movement of population that 
is very definitely shown in a publication by the U.S. Department of 
Commerce, Bureau of the Census, entitled "State of Birth of the Native 
Population" (l932.) This publication is based upon the Census of 1930, 
and on page 11, Table VII, the migration of population is very clearly 
depicted covering the period from 1870 to 1930. Data therein presented 
shows that Ner England constantly lost population and that the Middle 
Atlantic States also showed a continual loss, gradually, however, de- 
creasing to 1930. The West North Central States gained population con- 
stantly fjrom 1870 to 1910; then this section began to lose its native- 

9813 



-7t^ 

The downward treud of. the VQlumc of Imnber production has been 
marked by the well-recogiiizud turn or treud of population from the rural 
to the urban centers. (*) Then the density of city population required 
more and larger buildings, bringing about fire hazards and result in^ in 
the adoption of stria,5ent fire ref^ulahions restricting the use of wood 
for construction purposeG in mpny of the larger cities. Coupled with ■ 
this downward trend of luraber use and as one of .its contributing causes 
was probably the development of the use of brick and the dev.elopment 
of the use of concrete ai"'d construction materials which had, come ontp , 
the market with the development of science, and. the arts. This influx 
of materials, new. in fact or nev;- in use, was of prime importance, to' the' 
Lumber Industry as. it. coincided with a period of rising costs which had- " 
made necessary rising prices for a great' mar".y of the products' of tlii's ■' ■.' 
industry. With these increasing prices diuunishing the' price different-- :-3-''- 
tial between liomber products and these new building materials, there 

(Footnote continued) ':■ - •: ;. 

born population. The Soxith Atlantic and' the East South Central -.St-ateg ■. ; 
all lost population throughout this 60-year period. • ..; ., . ... . 

There was a. gain in population in the West South Centxal States 
and in the Mountain and Pacific Region. 

The movement of population i.nto the West Horth Central States 
reache.d its peak in the. period 1890 through 1900. The movement of 
populatiori into the .West . South Central States, while continuous from 
1870 to 1930, reached Its pealc from 1900 'to 1920. Beginning in 1910 

and' continuing through 1930 the Pacific Stntes absorbed population. _ 

apparently from every other group of states, as those sections which 
were .losing population registered heavier losses in the years from';'l910 
to 1330, and usually tho.se sections gaining population gained-at -a lesser 
rate in this period tlian in the prior period. • •■-''- - 

(* ) In 1933 the U. S. Department of Commerce, Bureau of the Census, re-' 
printed a part of Chapter I, Volume 2, 15th Census, Reports. on Popular- 
tion. In this reprint, oh page 9, are displayed data concerning 
urban and rural population. In Table III are published data from 
1790 to '1930, and it is therein cle-arly sho-,wi.. that -population in places 
of 8,000 or more has increased from 3,3 per cent of the entire population, 
in 1790 to 49,1- per cent in. 1930. It is fixrther shown that one very 
definite movement took place between 1880 and 1890, and that from 1900 to 
1930, the Tovement to urban centers of 8,000 or more increased more tlian 
17 per cer.':- 

It tz a3 so shown in Table IV that the population concentrated in 
places f3c::i 2.500 i.pwf r-l increased from 3r 4 per cent of the popular- 
tion in I'j^O ho 5.),? i^v cent of the pop j'.' -.tion in 1930. It is also 
interf^o'i in.j ;,o i;;' o ^i -.- i; this same tabic r-hows tliat the greatest concen- 
tration :ni. : -rate' ;i.r.LS be.-.n in places of ore irdllion or more, although all 
size grov.-oi iuiir--, .aed i., population excep!' tliat group of cities between 
500,000 aru 1,000,000 e. .cept fo.r a slight decrease in the population 
centers of 100,000 to 200,000. 



-77- 

was a constantly increasing trend evar/ from the use of l-uni"ber. (*) 

Dtiring this time- when this IhtVar movement, v.as in progres and was 
contributin,^ to the decrease i;: the effective aenand f'^r l-LLT-lier products, 
the capacities of the nii.lls had bc;?n increasing:_ largely throu=;h. ths es- 
tablishment of nev/ production centers in the Lrke Stpl-es, thin in the 
Southern pine section of the country and tntn in the Vi'e.. t Coast region. (**) 

Apparently it was thoufht that with the increase in population of 
the United States tnere would never cease to be a prOiP^ressively increas- 
ing demand for lumber products which v-oald drive to their approximate 
capacity the vast number of sawmills which hsd br-i-n put into operation 
in the United States. During the last oO years vhere has te^n an enormous 
increase in the nurnber of uses to which luir.ber has been put, but in spite 
of this wider use the actual volume per capita has declined and the total 
volume of consumption and of effective demand has been constantly on the 
decrease for a number o-fJ years except for the peak period of production ■ 
in 1928 and 19?!9. 

Up to the beginning of the depression there had been a constant 
increase in the capacity of the sawmills in the United States and this 
increase was inst-^lled m the face of the constant decline in the use of 
lumber both in total volume ana in consumption per capita., 

After the adoption of the Code and even under the maximum hours 
limitation and in spite of otner specific methods adopted to control 
production, it was practically impossible to apr.reciably reduce the total 
stock of lumber products on hand awaiting demand, (***) 

It is fair to state that this condition did not arise as a result 
of increased production but largely did reGu].t from the unforseen and vn- 
predictable constant decrease in demand for 1-jjibor products. L"'amber 
simply did not move. There was practically ro der.and for it as its best 
customer - the Construction Industry - was virtually out of the market in 
1932 and in 1933. So in spite; of all the actions that were tsken to 
place the Lum.ber Industry in a better eicnomac position, it is found that 
as a result of the overcapacity of the mills and the economic necessity 

(*) Table XXXIII, comparison between total construction and units shipped 
per $1,C00 of construction for celccced products during the years 
1920-1934. 

(**) See Table IV - Percentage of Distribution of Liarber Production, by 
Regions -1849-1954; the Evidence Study Series No. 22, "The Lumber 
and Timber Products Industry," W. E. Yost, Division of Revie"', NRA. 

(***) Table LI II - Stocks, shipments and production of Softwood Lumber 
1923-1935. 



3813 



-78- 

for most of them to operate at least some of the time, and vath the 
decrease in shipment of lumber to the consuming market, the stocks on 
hand continued to "be unwieldly and an actual threat to the ultimate 
souridness of the industry. After the adoption of the Code and with the 
promulgation of minimum prices and more stable conditions in the indus- 
try in general through the elimination of many unethical trade practices 
there was a general settling down and the reduced production was more 
nearly "balanced by effective demand for lumber and timber products. 
There was later a very noticeable drop in the demand, and with production 
remaining at the established minimum under production control there was 
another short period when stocks of lumber on hand again increased. 

However, until a very considerable quantity of the over capacity 
of the sf'wmills in the industry have been eliminated by the passage of 
•time, which will make many of these mills ineffective, and \antil a con- 
dition of more stability in the industry has released many of the units 
from the econeffiire-necessity of producing lumber to raise money for 
carrying charges, there will still hand over the industry the constant 
threat of unrestrained production vfhich can again over balance stocks 
and bring a chaos of price cutting and the consequent wrecking of 
industry units whenever prices rise to such a point as will make it at 
least seemingly possible for this vast overload of marginal capacity to 
gain some advantage, however slight, from again operating this class 
of mill. 



!)813 



-79- 

C. FINANCIAL STRUCTURE 

The capital or financial, stnictnre and the changes therein over 
a period of time naturally constitute a very imnortant nart of the 
protlems of the industry. To proioeriy study this plia.se of the industry 
there should be available quite detailed data concerning the assets, 
the liabilities and the capital structure in addition to -orofit and 
loss data of the organizations or firms in the industry. There are 
not available any authoritative and reasonably comx)lete data on these 
phases of this industry. There are a number of firms and organizations 
purporting to suo-nly certain of these data, but each covei:.s only a 
limited sector of the whole industry. 

The Bureau of the Census conducts n census of manufactures in the 
odd-numbered years. The classifications ado-oted by them are not 
exactly comparable with classifications of the industry used by other 
reporting services and esDecially by the Bureau of Internal Revenue. 
The census of manufactures also includes data from individuals and 
partnerships, but excludes all below '^5,000 annual volume. It does 
not report any balance sheet or -profit and loss data for these business 
units so reported otherwise. The Bureau of Internal Revenue, in its 
annual vol^ume "Statistics of 'Income," is the only dependable source 
giving the related balance sheet and the nrofit and loss data. Their 
figures are presented only for corporations classified as forest product 
corporations which include, in addition to sawmills and t)laning mills, 
manufacturers of furniture and vehicles. The .u:ber of corporations so 
reporting to the Bureau of Internal Revenue ranged between 5,500 and 
7,200 for the years from 1920 to 1935. The Bureau of the Census reports 
many additional organizations of comparable classification but, as 
noted above, this grout) of figures includes all types of financial 
organizations. The Lumber and Timber Products Code Authority under the 
NRA variously reported that manufacturers of lumber and timber products, 
exclusive of manufacturers of furniture and vehicle products, numbered 
anywhere from 17,000 to 24,000. The largest ^number of cost reports 
Beciared by them under Coae administration was about 5,000, and there was 
no information from any of these reporting members of the industry as 
to assets, liabilities and type of financial structure. 

As the data published by the Bureau of Internal Revenue are the 
most reliable data tliat can be secured and cover not only "the financial 
factors but also the profit and loss rosults, 'these are the data which 
have been classified and analyzed, although it is recognized that such 
data also represent only a cross-section of the industry as they do not 
include reports from many of the large-;" corporations in the United States 
which, while not principally engaged in sawmill and lumbering activities, 
do control a very considerable area of standing timber and produce a 
large volume of sawmill products; nor dp the figures include any of the 
business results of a not inconsiderable group of the partnership or 
sole- trader type of financial organizations. 

Remembering that stands of merchantable timber exist in nea,rly 
every state in the Union and that conversion of this standing timber 
into sawmill products is being carried on by practically every type and 
size of sawmill equipment under conditions of weather and terrain 

9813 



-so- 
differing just as widely, it was only to be expected that there would 
te a wide range of financial results secured hy the differing tyoes of 
mill operations. These were affected also by the varying methods of 
conversion made necessary by the changes within the industry that 
largely resulted in the establishment of mills with rated hourly 
capacity of production largely in excess of any effective demand within 
the later years. 

Wliile this industry is mostly one of manufacturing and the actual 
usable products are the result of one or more inan'ofacturing processes, 
the industry itself is based upon a natural resource. It must -orovide 
a dependable source of the ra.w material for its manufacturing plants, 
and by the very nature of this raw material the industry, as it has 
been constituted up to this time, has been compelled to ca,rry very 
heavy investments in standing timber. Owing to the shifting bases 
of production made necessary by actual or effective elimination of 
first one area of standing timber and then another, and to a certain 
extent by the shifting centers of demand, the industry has built up a 
duplication of manufacturing equipment and has acauired an excessive 
supply of the raw material or standing timber. 

While it is true tha,t a considerable portion of this duplication 
of manufacturing equipment a,nd of the ownership of excessive q^uantities 
of standing timber may be charged to faulty judgment on the part of the 
industry, such a condition actually does exist and must be considered 
in the broad view of the industry necessary for a study of its economic 
problems. 

Viewing the industry only from the standpoint of the actual available 
figures covering not all but most of the corporations engaged in the 
industry, the following analyses are submitted. All figures auoted herein 
are from Statistics of Income, Bureau of Internal Revenue, or are de- 
veloped from those statistical data. 

While the presentation of data by the Bureau of Internal Revenue is 
quite complete for the industry as a whole, the classification of data 
is not as detailed as might be desired for the forest nroducts industry. 
The deficiencies principally to be noted are that there arc no separa- 
tions of capital assets into: 

(a) Standing timber. 

(b) Plants and plant facilities. 

( c) The related depreciation and depletion are not 
separately disclosed. 

There is no segregation of the source of borrowed capital employed 
in the industry. It would be particularly desirable if information were 
available as to the current loans from banks and from individuals and 
parent or subsidiary corporations. 

The published data of the Bureau of Internal Revenue do not permit 
a classification of the invested capital of this industry but it is 

9813 



-81- 

telieved that a very considerable portion is And. must "be in standing 
timber, and without definite da.ta as to the exitent of this particular 
investment one especially interesting' viev? of the industry is either 
completely obscured or very materially foreshortened. 

Over, the period of j'-ears ret)resented by the statistics, the 
cornorations whose renorts are tabulat-^d in the yearly Statistics of 
Income, Bureau of Internal Revenue, from 1926 to 1933, inclusive, are 
classified by the Bureau as corporations reporting: •. 

1. Net income 

2. }In not income. 

3. Inactive 

These classifications and data cover a period from the year 1926, 
most commonly referred to as the major or standard year, up through 
the year 1929 and the following years of the deiDression, which reached 
its depth insofar as this industry is concerned in the year 1932, 

The Bureau of Internal Revenue does not require all corporations 
to. accompany their income data with balance sheet information, so that 
while the cornorations actually reporting to the Bureau have ranged in 
number from 7,862 in 192& nv to 7,947 in 1928, and since that date 
continuously declined to 6,707 in 1932, with a sli-^ht increase to 6,879 
in 1933, those corporations which have submitted balance sheets. have 
been smaller in number and have decreased from 7,244 in 1926 to 6,137 
in 1931, with a slight increase to 6,147 in 1932 and to 6,161 in 1953. 
Therefore, data concerning assets, liabilities and capital structure 
are from a group of corporations about five per cent fewer in number 
than the groups submitting data as to income. 

The division of these corporations into classes of those reporting 
a net income and those having no net income will nrobably offer as 
complete a gauge of the actual trend in this industry as any- other 
possible factor. (*) 

The corporations r'e-oorting a net income n'onbered 4,591 in the year 

1926 and 4,135 in the year 1929, decreasing to 2,340 in 1930, to 1,525 
in 1931, and to 541 or just about nine per cent of the total number 
reporting in the year 1932, In 1933 profitable operations was reported 
by 1,638 out of 6,879 corporations. Except for the elimination of some 
1,100 corporations between 1926 and 1932 this difference was naturally 
taken up by that class of corporation which j-eportcd no net income. 
This group numbered 3,271 in 1926, increasing slightly each of the years 

1927 and 1928 and being "oractically the s-me in 1929 as in 1926, Be- 
ginning with 1930, however, the number of corp'^rati jns reporting no net 
income in the forest products group numbered 4,868, a 50 per cent in- 
crease over the previous year, and this group had increased to 5,929 

in the year 1932 and decreased to 4,882 in 1933. 

(*) See Table XXIV 



9813 



-82- 

This review of the res^ults of TDusiness operations of the corpo- 
rations is given as one of the details concerned with the very definite 
and marked changes in the capital structure of the industry as reflected 
by this group of comorations. While the very marked decrease in 
corporations reporting incomes and increase in number of corporations 
re-Dorting no net income has been one of the imiDortant reasons for the 
change in capital structure, one other factor should be considered, 
which is that the corporations as a class, irrespective of the yearly 
profit or loss results, continued to disburse cash dividends. (*) 

These dividends and, income tax payments to the Government were in 
excess of earnings .in each of the years from 1926 to 1929, inclusive,- 
and dividends we're paid 'in the years 1930, 1931 and 1932 although t he 
industry as a whole had lost nearly $110,000,000 in 1930, more than 
$177,000,000 in 1931, more than $202,000,000 in 1932, and $66,000,000 
in 1933. Some corporations reported a net profit each year, but in no 
year were the reported earnings of the industry as a whole eq\aal to t'le 
cas>i dividends paid out by all of t':e corporations reporting the pay- 
ments. 

While the year 1929 was generally represented to be and is shown 
by the statistics of most industries to have been t/;e peak business year, 
t'iis condition was not true in tl:is industry. Tne dollar value of gross 
sales of the industry was t..e >-ig]:iest in 1926, being slig-'.tly more than 
$2,900,000,000. Gross sales decreased to $1,910,000,000 in 1930, to 
$794,000,000 in 1932, with a slight upturn to $923,000,000 in 1933. (**) 

Analyzing the balance siicet figures of the industry as a whole 
from the close of 1926 to the close of 1933 (***) it will be noted that 
the assets decreased from more than $4,023,000,000 to less tlian 
$2,549,000,000 or 36,.6 -ner cent. In tiiis very material shrinkage of 
assets over this period of eight years the following items are of 
interest and should, in themselves, reflect information important to 
those interested in the industry. 

Cash and receivables, the -principal elements of the current assets 
of this industry, reached their -neak of about $751,000,000 in each of 
the years 1926 and 1928, and beginning with 1929 decreased sharply to 
about $360,000,000 at the close of the year 1933. Tlie other very 
important factor in the current assets position, tha:t of inventories, 
also registered a very material and a much greater loss shrinkage from 
a high point of $770,000,000 in 1926 to a low of $338,000,000 in 1932, 
with a slight upturn to $367,000,000 in 1933. 

A reference has previously been made to the fact that in these 
statistics the capita,l assets of this industry were not segregated as 
to standing timber and- plant facilities, sc the shift in this class 



(*) See Table XXXVIII 

(**) See Table XXXIV 

(***) See Table XXXIV 

9813 



-83- 

of assets cannot be as accTirately and as cr-rtmlctcily analyzed as it should 
te to "bring -oat the true conditions. The group cf car)ital assets, less 
depreciation and depletion, shrank ahout !^400,000,000 over the Tjeriod of 
seveh years from the hi^h mark of $1,854,0(30,000 in 1926 to the low of 
$1,448,000,000 in 1932. If it were -nossible to segregate the canital 
asset group into its principal factors cf standing timber and of plant 
and mill site and manufacturing facilities, it would doubtless be shown 
taat many of these larger corporations Jia,ve divested themselves of 
considerable values TJreviously invested in standing timber. While there 
are no definite figures available, it is safe to say that during the 
period from 1926 to 1929 there was a very heavy investment in sawmill 
machinery and in rilants. Necesrarily during those years when -Droduction 
was auite high there was also a corresnondingly high decrease through 
depletion of the dollar value of the standing timber assets and de- 
preciation of the plant facilities. It is also believed th-at the 
forest iDroducts industry has made but very little addition to its ■ 
capital assets of mill sites and eauipment since the close of 1929. As 
a consequence of these factors and because of the fact that most de- 
preciation in mill site and equirrment is on a basis of amortization with 
the natural resource and not on a straight line basis, much of the equin- 
ment and many of the plants have suffered actual deterioration consider- 
ably larger than that measured by the write-down of the values reflected 
in the comoosite item of capital assets, which, by reason of paucity 
cf data, must include these two very differing t.ypes of assets. 

As the total assets em-olcyed by this industry had decreased 36.6 
per cent over the period of seven years and '-iS the current assets de- 
creased ap-oroximately 50 -oer cent in that period of time, the changes 
in the current liability and bended indebtedness position of this in- 
dustry also reflected a -differing but understandable trend. The current 
liabilities did not -oace downward with- the ciirrent assets, the shrink 
here being 49.4 xier'cent instea,d of 63.5 percent. • The capital "liabili- 
ties represented by honded debts and mortgages were about $160,000,000 
in 1926 when the caiDital assets were over $1,860,000,000. These capital 
liabilities had showii a constant yearly increase vco to $265,000,000 in 
1931, decreasing to $231,300,000 -in 1933. But during 'this time the 
capital assets unon which these cariital liabilities were based h^ad 
decreased more than $400,000,000. The data compiled by the Bureau of 
Internal Revenue classified "other liabilities" under one general heading. 
Without the details and the information that would come therefrom the 
bare statement of the change in this particular liability is not as in- 
formative as it might be. Nevertheless it is very important to note 
that this group of liabilities decreased from nearly $462,000,000 in 
1926 to about $168,000,000 in 1933.- 

With the very definite shrink in the assets employed in this 
industry it v/.mld be expected that the stockholders" participation or 
interest in the corporations would have changed materially. There has 
been a change in the actual capital structure as preferred' stock has 
decreased from $285,000,000 in 1926 to $176,000,000 in 1933, and the 
common stock has decreased from $1,378,000,000 in 1926 to $1,159,000,000 
in 1933. 



9813 



-84- 

Naturally the greatest measure of decrease in the stockholders' 
interest is represented in the decrease of the surt)lus accounts. This 
decrease was from $1,047,000,000 in 1926 to $463,000,000 in 1933. In 
this connection it should 'be noted, however, tliat all of this decrease 
in the stcckholders' participation is not alone tlie'result of losses, but 
can be largely attributed to the dividends, both cash and stock, that 
were disbursed to the stockholders as previously referred to, Tlie cash 
dividends over this rjeriod of eight years araoiinted to $593,000,000, and 
stock dividends -Were declared amounting to $56,717,000. 

In consideration of the broader problem of credit which is also 
connected with the financial "oroblera, tiie analysis of th.e balance sheet 
data of the corporations classified by the Bureau of Internal Revenue 
as members of the Lumber and Forest Products Industry show tlie following: 
Current assets (consisting of cash, receivables and inventory) repre- 
sented 37,8 per cent of the total assets in the year 1926, 27,4 per cent 
in the year 1932, and 2R.3 per cent in the year 1933. The capital assets 
in 1926 represented 46 per cent of the total assets; in 1932, 53.5 per 
cent; and in 1933, 52,5 per cent. Miscella.ne(Dus assets and tax exempt 
securities together represented 14,2 per cent in 1926, 19,1 per cent 
in 1932, and 19,2 per cent in 1933, As has been noted previously, the 
total fund of assets of this group of corporations decreased more than 
36.6 per cent from 1926 to the close of 1933. 

In a similar analysis of the liabilities and the capital structure 
or proprietorship items other very startling changes are found. In the 
year 1926 all liabilities represented 32.7 per cent of the assets and 
the capital stock and surplus represented 67.3 per cent. In 1933 total 
liability had been reduced to 29.4 per cent of the total fund of assets, 
and the capital structure represented 70,6 per cent. Considering tlie 
separate classifications of liabilities and their percentage to the 
total of all liabilities, • it is found that in 1926 the current liabilities 
represented 52,7 per cent cf the total and tliat the capital liabilities 
represented 12.1 per cent. The classification of "other liabilities" is 
a very indefinite ene, but as tabulated these liabilities represented 35.2 
per cent of all liabilities in 1928 and 22.5 per cent in 1933. In 1933 
the current liabilities represented 46,7 per cent of the total liabilities, 
this being a drop of six per cent as compared with -1926, and the capital 
liability represented 30,8 per cent of all liabilities in 1933 a.s com- 
pared with 12.1 per cent in 1926. 

In the period under comparison the changes in -the capital items 
have been quite sharp. In 1926 the stock, both common and preferred, 
was equal to 41,3 per cent of all assets,- while in 1933 it was eq^ual to 
52.4 per cent. In 1926 the surplus of all of these corporations was 
equal to 26 per cent of all the assets, but in 1933 this item had de- 
creased to 18.2 per cent of all assets. Again it must br remembered that 
during the period. 1926 to 1933 the total fund of assets had shrimk more 
than 36.6 per cent. 

In, analyzing these data from- the credit standpoint, consideration 
must be given to those factors which affect the credit of the industry 
and probably the best gauge is the simple but effective and long-used 
formula of the banking fraternity, namely: that current assets must be 



-85- 

at least two and one-half times the current liatilities "before S 'business 
is considered to be in a current borrowing state. De-nendine: u-oon this formvila, 
^he generally acce-oted elerfient o-^ curront assets should be further analyzed. 
This com-oarison wo\ild not be.' n fair one if consioeration was not also given 
to the -particular character of this industry. And this is tjarticularly so 
when the inventory factor- of the current asset ^rou-o is considered. While the 
available fisu-res and data do not defi'-.itely disclose these facts, it is 
reasonably ass-umed that this industry must include as inventory in the usual 
cycle of manufacturing a very considerable quantity of so-called raw material, 
de-oending upon the -Dractices of the individual manufacturer, ranging from logs 
in the yroods, down through trans-porta-tion from woods and uv to the so-called 
saw-deck and then through to the drying and the -planing -orocesses. 

In many instances and in several localities the cycle of broduction 
extends over a number of months in each tjroduction year. In some sections 
it is not -Dossible to fall trees in the winter. In other sections it is not 
-Dossible to trcins-Dort logs from the woods to the saw-deck during all -oeriods 
of the year. In other sections and with certain s-oecies of wood it is not 
conducive to good first quality -oroducts to ciit logs in the woods if they can not 
be almost immediately sawn into rough lumber -oroducts. With these considera- 
tions in mind it is natural that, this industry as a whol?- should carry an 
inventory which in other manufacturing indiistries would be considered excessive. 
The com-oarison to be now given should be read with the above facts in mind. 

Based on the amount of inventory of the industry a^- the close of each year 
it is found that in 1926 the gross sales were sli-ehtly less than four times 
the inventory and this condition -orevailed with gradually decreasing -ner- 
centage through the year 1^29. Beginning ^ith 1930, hoTOve.r, with the 
inventory remaining high and the sales constantly decreasing, it is found that 
the sales for 1930 were just about three times the inventory; less than three 
times in 1931; about two and one-half times iii 1932; and two and 6ight-tenths 
times .in 1933. The cost of goods '.'sold' o-*^-"ers a more reliable, indicator of 
merchandise turnover,' and..' using- this as' the basic f-i.'nire to be. com-oared with 
the inventory on hand it is found that in no year between 1926 and 1933 did 
the goods or merchandise moving out into channels .of trade amount, to three 
times the inventory. ' In 1933 the cost of goods sold aggregated less than 
twice the value of the goods on hand to b" sold. 

In addition to this slow turnover o^ inventory, the analysis of the 
figures also indicate collections for billed merchandise to have been very 
slow. In 1926 on the basis of the usual method o-f com-outation (the -oer- 
centage of outstanding accounts to total sales a-p-olied to th=5 days in the 
year), the average sale was not collected until 75 days after invoice date. 
This condition had gradaslly grown worse even during the -oariod u-d to 1929, at 
which time the average between invoice 'and 'collection was 84. days. Naturally 
during the' de-oression -oeriod this condition was aggravated, and in 1932 there 
was an average of 150 days between' the da^te of invoice and the date of -payment, 
and this excessive number of days was almo-S't a 50 -oer cent increase' over the 
year 1931, when the average ela-psed -period between invoice and -payment was 
105 days. In 1933 this neriod between billing and collection had decreased to 
117 days, but even tnis reduced -oeriod is very much in excess of the ez-oerience 
record of other industries not indulging in sales on the deferred or installment 
-olan. 



9813 



-86- . 

A compilation has been rasde presenting as .to all major classifica- 
tions of industry an analysis of the number of firms in each such indus- 
try that reported profits for the years from 1920 to 1930, inclusive (*) 

While it has been usual to refer to the year 1926 as the basic or 
measuring year, an analysis of the data shows that actually 1920 was the 
best year for the greatest number of firms in all industries to report 
profits. In that year 73 percent of all renorting corporations in the 
forest products group earned a profit. This percentain;e was. exceeded by 
only two other major groups - those of Paper pulp and Printing and 
Publishing, which had respectively 80 and 79 percent of their numlser 
reporting profits in that year. 

Even diaring the so-called peak years of 1928 and 1929 the groups 
of corporations did not report such high percentage of the number of 
members of the industry making profits. 

From this relatively high point of 73 percent in number reporting 
profits in 1920 (1926 to 1929 ranged between 58 and 53 percent), the 
data show that in 1932 only eight percent of all corporations in the 
forest products classification reported a profit. This is the poorest 
record of any class of corporation, as no other industry group shows 
less than 10 percent of its total number reporting profits. 

Extending this comparison and using total capital employed as 
the basis (**), again it is found that the Forest Products Industry 
was among the highest in 1920 and the lovrest in 1932, During the year 
1920, 89 percent of all assets employed in the Forest Products Industry 
earned a profit, but during 1932 only 11 percent of all assets employed 
in the industry reported a profit. Again this 11 percent is the lowest 
of all classes of corporations, the nearest beinp the Metal Industry 
in which only 16 percent of total assets employed were able to report 
profitable operations in the year 1932, 

The Bureau of Internal Revenue has furnished for the years 1931- 
1933, inclusive, certain data concerning corporations classified on the 
basis of the extent of the assets employed. This information is 
included herein as Table XXXV. 

It will be noted that the corporations are grouped begin^^ing with 
all of those having assets of under $50,000 each; the next grouping is 
from $50,000 to $100,000; and the final grouping is of corporations 
having assets of over $50,0 0,000 each. It will be noted from the table 
that a very considerable number of the corporations in this industry 
fell within the first two groups, namely, corporations having total 
assets of less than $100, 000 each. In each of the years tabulated the 
corporations in the two groups of less than $100,000 totaled more than 
50 percent of all corporations, in the industry, 

T*) See Table XXXVI 
(**) See Table Xl-iVII 



9813 



-87- 

It is shown that there hf:d beeh a gradual downward shifting: of the 
corporations from the larger-asset classifications. This is natural and 
normal in view of t)reviously discuss's'i shrinkage in all classes of assets 
employed in the industry' over the period covered 'by the statistics fur- 
nished by the Bureau of Internal Ee'v^MLie, 

As the number of corporations in '^his industry reporting; profits 
during 1933 was more than three times those reporting profits during' 193?, 
it would be natural to eJipect that this change from a loss status to a 
Tjrofit status would be relatively normal in the various' classifications 
and this is Dorne out oy detailed figures with one or tv;o notable 
exceptions. In the classification of ^bOjOOO cor'porations the change 
over 1933 was. less than two and one-half times, but in the next three 
higher groups the change was at a ratio of more than three to one. This 
classification wr s not prepared by 'the B\ireau of Internal Revenue prior 
to the ye'ar lb(31; consequently the comparison can go no further back 
than that year. 

As has been mentioned before, the Bureau of Internal Revenue does 
not publish complete .details iii connection with the sub-classification 
of "capital assets". -lTe:'.ther do they publish any information upon which 
an accurate division could be made of notes and accounts bearing interest 
as distinguished from those accounts payable upon which no interest is 
tq be computed; nor is there any information as to what constitutes 
"other liabilities". 

In viewing all "capital assets" of the corporations reporting to 
the Bureau of Internal Revenue (*) it is found that from the close of 
the year 1926 through. the' close of the year. 1933 the "bspital assets" on 
Eecember 31, 1926, in the amount ot $1, 85o; 868,000, . had been subjected 
tc a write-down of $708, 453., 000, This sum is made. up of $454, 061, ©00 ■ 
of depreciation and $254,392, 0'^O of' depletion, 'Considering these 
amounts written against "capital assets", it is' developed that as of 
December 31, 1933 there haye been added, d.uring the period, assets of 
the net value of more than $194, O00,6o0,_ 

There is no information upon which can be basfed any real computa- 
tion of the values added', to 'the capital assets classification, but the 
figures do show that in J;he year ,1927' mo r'e th'an' $41,000,000 of net values 
were added; this addition 'in 192.8 amounted to m'ore than $173,000,000 and 
in 1929 to nearly $44,000,000', with a net addition in ly30 of more than 
$65,000,000. In 1931 there was a' net redaction in "capital assets" of 
nearly $85,000,000; about $500,000 reduction in the year 1932; and 
nearly $45,000,000 measures the decrease in the year 1933, These 
additions end deductions must be computed without any information as 
to the value of "capital assets^' sold, upon which profits and losses 
were sustained 'oy the industry. The published figures do not show any 
information on this subject for the years 1926, 1927 or 1928. In 1929 
it is shown that prafits on the sale of "capital assets" exceeded 
$27,000,000, but there are no data as to any loss that might have been 
incurred. Beginning with 1930 the xsureau of Internal Revenue separately 
tabulated and published figures representing both losses and profits on 
the sale of "capital assets". In 1930 they reported profits of $6,636,000 

(*) See Table XXXIV '' ' \ = 

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and losses of $6,879,000; m 1931 profits of $6,504,000 anci losses of 
$6,9j8,000; in 19o2 profits of $2,332,000 and losses of $14,321,000; and 
in 1933 profits of $4,795,000 a.nc losses of $9,894,000. These quoted 
figures can be only partial inf ormati-..n, as t;.e actual nev; additions to 
plants and equipment and to stpndin,e; timber caji not be gauged without 
knowing- the cost value of these assets which had been sold during the 
period. 

In connection with the liabilities it ifould be informative to know 
the extent of the amount upon which interest vould have to be paid and 
the rate of that interest. However, vdthout complete information as to 
the character of these liabilities only an effective rate of interest 
upon the total of all liabilities at the close of the year can be com- 
puted, ^his interest rate starts with ,0376 in 1926, increases to 
,0443 in 1928, and is reduced to ,0425 in 1931, ,034 in 1932 and ,0318 
in 1933. 

One of the larger elements of cost in tnis industry is the amount 
of taxes paid other than jTederal income tax. Again complete informa- 
tion is not a,vailable; hence it can only be stated that beginning with 
1926 the reporting corporations paid almost $41,(^00,000 in tajces, and 
these taxes were gradually reduced in amount to $30,000,000 in 1931. 
This latter amount is a reduction of nearly $5,000,000 over 1930, and 
is the greatest single reduction in any one year of the period mentioned. 
However, between 1931 and 1932 there evidently was either a sharp 
reduction in the amount of taxes actually accruing or else this group 
divested itself of a very considerable amount of values, for the tajc 
burden in 1932 had been reduced to about $23,600,000 and there was a 
further reduction of about $500,300 in the taxes paid in 1933, "Ry 
reason of the lack of information these reductions can not be classified 
or explained but can only be cited from the actual published, and in 
most cases, audited figures. 

In connection with the profits and losses sustained by this indus- 
try, it can be pointed out, but without a full discussion by reason of 
the lack of information, that durine- this period oi eight years when the 
industry actually incurred a loss of $235,496,000, it reports other 
income, to the extent of $696,943,000, Of this sum about $160,000,000 
was received from interest, rents and royalties, about $52,000,000 was 
received as dividends from other corporations and the industry received 
from tax free investments the sum of $17,139,000, 

The forest products industry is based upon a natural resource and 
it would be expected normally to find that most, of the depreciation and 
the depletion of the physical assets and of the standing timber would be 
computed on an amortization basis that would extinguish the assets with 
the actual resource. The figures presented by the Pureau of Internal 
Revenue very largely sunport this general premise, but it is also evident 
that a very considerable portion of the physical assets are depreciated 
upon some straight-line basis. For the right years of operati-on the 
■industry charged out against cost o± goods. sold, depreciation and depletion 
amounting to $843,731,000, The percentage of this charge remained fairly 
constpnt during the first four years when the industry had a reasonable 
amount of ■Drod.uction, In 1926 this rate "••as 6 percent of the cost of 
goods sold, increased to 6,46 percent in 1928, and V7as reduced to 6,12 
percent in 1929, Beginning with the depression, however, the percentage 

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of the cost of goods sold represented by these items of cost emoanted to 
7.27 percent in 1930, 7.46 perc^rt in l^ol, 9.17 percent in 193:^, pnd- 
9,18 percent in 1935. 

' With' the vast preas of timber land ovned by the organizptions making 
up the Lumber and Timber Products Indi.:stry, and with shiftint; centers of 
production as well as shifting centers of d.ernand having caused, a "duplica- 
tion of production capacity far in excess oi the actual effective demand 
for the products of the industry, it is a noteworthy fact that the data 
from' the J^^eau of Internal -c-evenue (known to not, cover the entire indus- 
try) show that the capital structure of this not inconsiderable grout) of 
corporations (having over $4,000,000,000, of actual assets in 1926) has a 
remarkably conservative division between that contributed by owners and 
that contributed by creditors, especially those .creditors of the more 
formal class whose indebtedness is represented by bonds and mortgages. 

This industry "is faced vdth the necessity of carrying in its own 
ownership standing timber sufficient for the production needs of its 
lumber manufacturing equipment for periods ranging from 20 to 25 years 
in the Southern Fine Division and from 50 to 75 years in the Iffest Coast 
Division, with all the a.ttendant carrving charges of a fixed nature such 
as interest and taxes. It laast provide for the carrying of a considerable 
body of costs into its production schedule that are more in the nature of 
production or manufacturing costs. 

The costs of production constitute the next problem of this indus- 
try to be considered. 



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D. FHOrUCTION COSTS 

The cost of production in the Lumber and Timber Products Industry- 
is primarily concerned with costs of log.'^ing and of aanuf p.cturing, plus, 
of course, f:eneral -verhead expenses of the unit and the shipping and 
selling expenses. 

Logging includes all operations in the roods from falling (the 
cutting down of the tree), bucking (cutting the tree into log lengths), 
skidding and/or yardin.';: (moving of logs from where felled to loading 
center for trans-nortation to mill), and the many and varied operations 
of establishing the logging cpmps on the site of the standing timber 
(timber or logging chance). 

Transportation is the moving of the logs by any of several methods 
from the logging chance to the sawinill yard or log pond. 

Manufacturing is the conversion of the saw log into usable lumber 
products. 

The logging of standing timber is variously performed by casual 
workers in their own timber lot or on their own small forest holding, 
by groups of men especially engpged for that particular work either 
on the timber lot of one uwner ^r of several, as the case may be, and 
by groups of men regularly empluved bv the organization actually 
owning the timber and sawmill. It can be seen that the costs of such 
widelv diversified operations will oe from the verr/ sketchiest to the 
most definitely recjrded figurep. 

In connection vith logging costs there also must be considered 
the general subject of transportation of the logs from the stump to 
the rail or other transportation head and from there to the saw-deck. 
This first transportation may consist of skidding over the ground for 
a limited distance by motor or other comparable power, or by the use 
of air lines. The second stage is usually by ,iotor truck, spur rail- 
roads or common carriers and waterways. 

V/ith the logging operations (and transportation) being variously 
performed under varying conditions of climate, thickness of the .stand 
of timber and size of trees, and differences in the topography from 
the swamp lands of the Southeastern section where cypress is produced 
tu the steep and rocky mountain sides of the Western section of the 
United States, it can be seen that the actual cost of the saw log 
delivered to the sa"-raill can and necessarily iaust vary considerably 
as the conditions briefly sketcned aoove '-'ill vary in the different 
localities. 

Along with differences in the kind and the cost of the actual 
logging of timber will come the cost of that standing timber. Standing 
timber, as one important problem of this industry, has been thoroughly 
discussed in a previous chapter. The cost of standing timber will 
naturally varv depending upon whether the organization has owned and 
has been prying the maintenance ana carrying costs upon the timber 

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land lor a nurabei* of yeprs, and aiDon vhether the logger or the sawmill 
operator is ou.ying a tiarticular stand of timber or is only buying so 
many thousand feet (log scale) uf 1o?j;s os and when actually removed 
from the forest stand. The cost will also vary for the same soecies 
in different localities uf the same general timber rrnge, and also for 
competing species in entirely differeht sections of the United States, 

In considering the subject of milling or manufacturing costs it 
will be found that the vrriations in size and character of sawmill 
plFint will have a very noticeable effect uoon the total cost. The 
number, location and capacity of the savmills, the c^^cle of development 
in the character and size of the mills and the changes in lumber manu- 
facturing centers have been treated previously. The larger plants 
necessarily must include among their costs a great many items of expen- 
diture generally classed as ad:iiinistrative anc overhead, to -vhich the 
smaller units are not subject in the same degree. The larger plants 
generally keep a reasonably complete set of bookkeeping records but many 
of the smaller plants operate with only the sketchiest, if any, definite 
records of their costs of o-oeration, 

Viith this review of the field, vhich necessarily can touch only 
the high spots of the existing differences, it can be seen that the "cost 
of production" must be subjected to m?ny differing treatments producing 
figures in many instances of the most doubtful validity. 

The history of the industry, from the standpoint of its accoianting 
and its general efforts at development of costs of production, has been 
altogether a history of relatively siarll 'i,TOupE of uanufacturers in the 
same general field working together in smpll associations covering only 
a fractional part of the industry for the gathering' and consideration of 
costs. It has been variously reported that., many of . the larger units 
have very extensive and informative cost records. NJiA has not had an 
opportunity to examine any. of these recounting or cost records and has 
not had an opportunity to directly review the finished -orOducts of the 
systems in the form of definite costs. 

Certain associations of manuf acturei s, uf certain species have 
attempted to pccuraalate costs from their members and to gather these costs 
into averages for all of those participa.ting in the cost gathering. 
Apparently there has been a disposition on the part of the member of 
the i'ldustrv not' to participate in such an undertaking, and consecuently 
practically .^11 of. the costs which have been developed are sa.aples of 
only r' part, and a .small part at that, of the industry. 

The costs of log.'^ing and of sawmill operation have also been the 
subject of study by the Ui S. Department of Agriculture, Forest Service, 
through the iorest Products Laboratorv. These cost studies necessarily 
could be only spmples and not actually representative of the entire industry. 

Costs concerning the Lumber Industry have been gatr.ered uv the U.S. 
Tprriff Commission. (*) 

(*) U.S. Tariff Commission Report to the President on Lumber - Report 
No. 32, Second Series (1931) 

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This report '"f s isQv.ed. in ly.'^l -nd '-rr. onsed arjon p study covering 
the costs of the year 19£9. Tiie ^asis ol this C'jst stidy "'?ti covered, 
as to the United States, bv 17b -nills lucated in: 

The NortheL.tern States: Maine, FeiF Jlampshire 

»nd Massachusetts. 

The Lake States: I'/irnesota and '.Jisconsin 

The Inland Emr)ire; western Montana, Forthern 
Idaho, Eastern n'ashin^ton, 
and Eastern and Central Orefjon, 

The Pacific Northwest: ':et;tern OreiT^on and '.estern 

Ivashinf t.^n 

The Southern States: Alabama, Arkansas, ilorida, 

C-eorg'ia, Louisiana, Lississi-opi, 
Forth Carolina, South Carolina, 
Texas ^nd Vir-j:inia. 

It was soufe'ht to develop the costs based on average cost per thousand 
feet board mea,sure of dressed luinoer, and it ^-s accordin-^ly necessary 
to develop first the cost of roigh lumber anc then to add the cost per 
thousand feet of dressing the lumber. This separat ion was necessary by 
reason of the fact that aisny oi the mills did not sell dressed lumber 
and that in most instances even where the mills oid have facilities for 
the dressing of lumber, a considerable portion oi their output was sold 
as rough green or rough dry lumber. In developing the costs for the 
production of lumber it v-as necessary to exclude certain costs that were 
not involved in the prodaj.ction of lumber and it '-as also necessary to 
exclude sources of income and of loss other than those connected with 
production of lumber. 

The normal grouping of costs entering into production of lumber may 
be described briefly as follows: 

1, ilAW tlATERlAL COSTS 

The logs are either produced as a part of tne sai^mill operation or 
are purchased from independent loggers or other sources. i.hen so purchased 
the raii" material costs are a k-no'^n and definite factor, "'hen the logs 
are produced b^ the mill the cost has to be ascertained and these costs are: 

(a) Sturapage either as a charge covering 
depletion of timber holding ov-ned or 

Payment made on various contractual 
bases for the privilege ol cutting 
timber under either public or private 
oii^nership. 



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(t) Costs for '"nods orernti m, incluoin-"; 
direct lr:bor, i-uoplici, ?nd e..perses 
of felling the trees anc catting the 
lo£;s, pno 01 other ■oreppration of tne 
■logs for movement to the niill. These 
expenses may je either rctuslly DE.id out 
f or • the various services perforiQcd directly 
for the loe;^':er or sa'"'inill operator, or may 
be paid in a lump sum on the uasis of so 
mixch per thousand feet to some one vho is 
superintending; such opcr?tj.ons, 

(c) Transportation of the logs from the stump 
or woods to the mill includes the operation 
of the logger's own transportation ecuipment 
and payraents made to others for the actual 
transportation. 

(d) There is also the element of general and pq- 
mmistrative expenses vrhich must be apportioned 
between log;-;ing operations, sai^mill operations, 
planing, mill operations, and selling and delivery, 

2. SAV.MIL L OE. HOUGH LUI\£3ER C01\TVERSI0IT COSTS 

The varying practices oi the 6?'='iaills in. the difierent sections of 
the United States as to inclusion or exclusion of certain factors in 
sawmill costs reouire some explanation ano some reaj-rarigement of the 
data assembled. The conversion costs generally include direct labor, 
operating expenses and supplies for the sav';.riill proper, "dth "vard costs" 
and a proportion of general and administrative .expense. Yard costs gen- 
erally include all costs of handling the logs from the. pond or sawdeck 
to the saY/s and the handling of the lumoer after it is first away from 
the saws through the drying and ref inishing proces.ses to the yard piles, 
and sometimes includes loading and handling for sjaipment. 

In the Douglas lir division a part of the "vard costs" usuall.y are 
charged to rough lumber and a part to dressed lumber. 

In the Southern Pine Idvision in the Inland EM'^ire arid in the 
Uorthestern Division "yard costs" are not commonly divided bet"'een rough 
lumber or s'^wmill .operations and plrning or dressing operations. 

Shipping or leading expenses consist of costs incurred in loading 
the lumber, either rough or dressed, for shipment. And again the method 
of treating tiiese costs varies in different' mills... Such variances range 
from total inclusion of such costs into and with "yard costs," to a 
partial se£;regation to roufh lumber costs and a partial segregation and 
taoulation with selling expenses and witn costs of dressing lumber. 

It is necessary also- in developing costs to give consideration to 
and to uniformly treat various methods used ov the sawmills in the same 

9813 



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divisions and bet'^een divisions in the hancling of credits to the cost 
of production. These credits normplly come from the sale of "^sste 
and of some bv-produ.cts. Other credits, derending upon the specific 
o-oeration, mieiht come from the sale of electricity or -DOwer generated 
as 8 vart of the sa^'-mill operation. It is necessary also to consider 
credits for certain lumber prodacts, especially lath and similar items, 
ii^hich in some divisions am^dnted to considerably more than in other 
divisions. 

3. DRESSING OR PLANING COSTS 

These items of the cost of prepr-ring the finished lumber for market 
include labor, operating expenses of the planing mill, of the dry kilns, 
and an apportionment of general acministration expenses. 

4. GENERAL EXPENSES AND OVERHEAD 

Incidental to all of the operations up to the production of the 
rough or dressed lumber must come those expenses generally classed as 
overhead items, including interest, depreciation upon machinery and 
equipment, and taxes other than Federal Income Tax. 

The depreciation of the Pnysical property as distinguished from the 
depletion or exhaustion of the natural resource of standing timber is 
comuonly computed in this industry upon a oasis that will '.i^rite down 
the value of the plant and other physical properties with the declining 
quantity of raw material available. This is especially true when the 
sawmills own the timber, but where, as in the nest Coast Division, .nany 
of the sawmills are operating on logs purchased from commercial loggers 
and own very little if any tiraoer, such depreciation is computed upon one 
of the accepted straight line bases. 

In the developbient of costs it has been the practice to allocate 
the general expenses, including depreciation and taxes, to the various 
types of operations carried on. 

In the final taoulation of the cost data it is sought, by selection 
and tabulation, to show the averages computed according to species in 
the various sections of the country for the character of the operations. 

As costs have been developed by the various agencies concerned, 
the above detailed plans has been generally followed. This is especially 
true of the cost data gathered by the Vestern Fine Association and by 
the Southern Pine Association, and was more or less the general policy 
of costing adopted by the Lumber Code Authority as discussed i,n the 
following sub-chapter. 

5. HISTORY Qj' COSTS UNDER NRA 

One of the problems that faced the industry and the NRA, from the 
earliest discussions concerning the Code was, in general terms, "how 
could the industry increase hours of employment and hourly wages and get 
back at lepst the ' out-ol -pocket costs' of production of lumber?" 

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This was especially troubltsorie in the fpce ot the kno"'n lacts that: 

(a) the industry had oeen ooerati'nr &t a loss for a 
number of years, 

(u) stoclcs of luraoer in th.- hands of the manufac- 
turers were very lar 'e. 

(c) demand for lumber had been decreasing i or 
several years. 

(c) the construction' industry, vhich annually ab- 
sorbs a considerable -oo, ti3n oi lumber, vas at 
the absolute lov point of its history. 

As a partial solution of this problem it was mutually agreed 
that pny of the additional charges incident to the Code could be as- 
sumed by industry only I'^hen sucn increased costs could concurrently 
be recovered by cora-oensating adjustments in prices for lumber and timber 
products. It was realized that this principle involved the application 
of minimum prices, and in recognition of the fact that there ra-ast 
be protection of the public agfinst the abuse of the pov er to fix 
minimum pricea.there must necessarily rfisult a formula for determining 
cost of production. It was therefore proposed that reighted average 
costs should be deter^iined and that lumber and timber products should 
not be sold or offered ior sale at prices ^hich did not cover such 
costs. 

The record is clear that industry v.-ps rot e^-pecially interested 
in determining pure costs of production, and apparently the KPJL also 
was not, at least in the beginning, especially concerned with this 
matter. It seemed to be the paramount consideration on the part of 
both industry and KRA that "cost protection" was the object and the aim 
rather than "cost of prodaction. " 

Throughout the record, the recommendations and the reports in 
connection iwith the Code of J'air Competition for the Lumber and 
Timber Products Industries there runs this continued reference to 
and consideration of "cost protection" and direct' "out-of-pocket 
costs." Also throughout the record runs discussion of the necessity 
for the establishment of a "lorriiala ior cost protection" and the 
necessity of establishing a "minimum p rice" that ■ ould permit the 
industry to maintain itself on the price "hich it could secure for 
its products. 

The record of negotiations leading up to the presentation of the 
Code also is replete, wdth discussions concerning debatable items that 
must be in some manner included in any formula for the development of 
cost of production but '"hich might or might not oe included in a formula 
for cost protection. These debatable items '^ere; 



9813 



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(a) vplue of stumppge. 

(b) depreciation. 

(c) cost of conserving and replacing as mach 
timber as was harvested. 

Article IX of the Code was titled "Cost Protection" and gave the 
Code Authority the right to establish and revise minimum prices f.o.b, 

mill "to protect the cost of production of lumber and timber 

products," when in its opinion it ^rps able "to determine cost of pro- 
duction" as defined in Section A, Article IX. It was also provided in 
Article IX of the Code that "current veighted average cost of production 
.... shall be' established by uniform accounting prj-ctices," and then 
followed an itemization of all of the direct and indirect costs of pro- 
duction and sale of the product and the administration of the properties. 
There '"ere certain limitations, however, 

(a) selling costs should not include adver- 
tising or trade promotion 

(b) insurance should not incluoe insurance 
oS standing timber. 

(c) taxes should not include amounts on 
standing timber in excess of a 12 year 
su-pTDly. 

(d) interest was not to include any charges 
accruing on obligations to carry timber 
in excess of a 12 year supply. 

It was also specified in Article IX, that depreciation should not 
be included "until such time as the Authority shall have formulated and 
secured the general application by the several Divisions and Sub-divisions 
of the methods of accounting" by which the depreciation was to be ac- 
curately ascertained .... It was specified also in Article IX, that 
depreciation should be computed "on straight line method and based on 
fair value or the cost whichever is lower . . , ," and that this item 
should also include amortization of investments in logging railroads, 
docks, and other logring and plant facilities. 

The cost of production for each species determined as specified 
in Article IX, was to be allocated by the Authority to the several items 
or classifications of lumber or other products for which minimum prices 
were to be established. It was specified that "weighted average min- 
imum price of all items and classifications for each species shall not 
be more than cost of production" including all of the items specified 
in the cost formula nor "less than said cost after deducting capital 
charges of dfpreciation and the fair market value of standing timber 
that was to De determined bv the Administrator," 

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Thus it will be seen thst there '■-s erected under the Code, a 
so-c?lled formalp for ascertaining cost of production i^hen the 
actual and avowed purpose of the industry vas to develop facts as 
to costs and that as to e?ch Pivision or Suj-division or group of' 
members of the industry tnes-e costs i^'ere to oe developed on "the 
weii^hted averafje" of all in the particular group of manufacturers and 
that this '"eighted average cost oi production was to be applied purely 
for the purpose of protecting the rainiuiam prices that had been or were 
to be eptablished by the Code Authority. All of this involved proceeding 
was to be carried out ov the Code Autnority of an industry of vhich it 
was stated "adequate, uniform, and realistic accounting particularly 
among small establishments is not charpcteristic of this industry." 

Here was an irdustry composed of at least 17,000 manufacturing 
units operating in practically every state of the union, that, most 
emphatically, i?'ps not cost conscious. It was not a nev^ industry, and 
although the principal producing centers had shiited very materially, 
in general the manufacturing processes remained largely similar. It 
had successively passed through .lany periods of famine and of plenty, 
but up to, and even through the code period the great Majority of the 
members of the industry had not oeen educated to the necessity of 
knowing their costs of production. 

It cannot be overlooked that the industry does offer some con- 
siderable obstacles to exact costing. The products of the irldustry 
are numerous, -and many of the variations betveen products are too 
often matters of expediency, rather than actual differences in character 
of product. 

Costs of production can and should be deterviined for the industry. 
Only with true and dependable costs as a backgro-ond, c»n the industry 
hope to find its way out of the difficulties in ^hich it is no immersed, 
and to solve its rnfny problems. 

The determination of direct costs is not unduly difficult. It is 
in the interpretation, analysis and distrioution of indirect costs 
that the principal difficulty is usually encountered. ith the "-ide 
geographical spread of this industry and with the necessity of compiling 
costs for the small neighborhood sawmill and the vast manufacturing 
plants of the .est Coast Kegion, the task of determining true costs 
for this industry was mcsi unlikely of successful accomplishment. The 
determination of "we ie:hted average out-qi -pocket costs" with all of the 
indef initenesses coraprehended in such an undertaking would be the 
accomplishment of a super-man. It is not deemed unfair either to the 
industry or to FL.A to state in retrgspect that had the industry and ITEA 
sought to estrblish true costs of production i or individual sawmills 
and then to properly and intelligently interpret these, facts, many of 
the difficulties met in ■ attempting to utilize the methods of expediency 
that were adopted in the attempt to determine and to recover out-of- 
pocket costs and to protect prices would not have been encountered. 
Both industry and C-overnment have profited by this experience and .it is 
safs-to state' that neither w-juld- 'again eabtirk-upo^i .such- -an- -indef ini-te 
project. 
9bl3 



-98- 



Doubtless, one of the fruits of the code experience has been a 
cooperation betvern manufacturers in a division end between divisions, 
and the consideration of TDrobleras common to them all. 

Under the authority granted in Article IX oi the LumDer and Timber 
Products Industries Code the Code Authority began the imDlication of 
price bulletins in October, 1953, and completed the issuance of this 
first edition in December, 1933. These miniraam prices thus established, 
i^ere cased upon data incomplete anc unsatisfactory for the purpose 
of determining cost. Data had been received from many of the divisions 
of the Lumber Code Authority, A considerable portion of this cost data 
was available for study by the Lumber Code Authority late in December 
of 1933, This material v^as plainly labeled "Cost Substantiation Data." 
Upon this information other price bulletins were issued. The accountants 
for the Lumber Code Authority, in discussinii- this cost substantiation 
data, raised many points as to its authenticity. It was recognized 
that the costs that were to be secured vere not upon the usual ac- 
counting basis but vere purely upon an industry basis as specified 
under the Co:'e. It was recognized that much of the information first 
gathered was not reliable and that the basis of cost gathering for 
purposes of later minimum price substantiation must be changed, There- 
UTjon, the industry, acting vxion advice of its Code Authority, developed 
a ne-' cost auestiornaire which was issued to industry jneraoers in April, 
1934, and requested submission of cost data for Januar:/, February, and 
March, 1934, 

This latter-mentioned cost data was raach more definitely arran^ced 
than any of that previously submitted and, under reasonable conditions 
of compliance on the part of the sa'^mill operators, i^ould have supplied 
the "Administration and the Code Authority with standardized data from 
all divisions, Naturally, many of the members of the industry were 
not accustomed by past practices to the orderly and systematic develop- 
ment of cost' data; others were not interested enough to present such 
data and many others had no records, so there was considerable variation 
in the extent of their' compliance with the request for this material. 
These variations naturally tended to destroy a considerable part of the 
inherent '"Orth of these cost data. 

One of the deficiencies in the cost data submitted under the 
Code Authority was lack of inventories. Data concerning inventories 
of raw material and of finished product were ignored in the prepara- 
tion of the cost data for the first three months of 1934, although 
the industry was advised in Novemoer, 1933, that it then appeared im- 
perative for all Code Division and Sub-Division Autxiorities to prepare 
their calls for information in such a manner as would require the in- 
dividual operators to furnish the inventory material, (*) 

(*) L.CA, 33-45, dated November 30, 1933 - C. Arthur Bruce, 
Executive Officer, Lumber Code Authority. 



9813 



-99- 

The cost datfL for the first three months of 1934 were iar{;ely in 
the hands of the Lumber Code Authority in ./'ashintjton early in June, 1934. 
In reviewing these data many inconsistencies with established account- 
ing loractice and even with the formula e:?qDrcssed in the Code were 
"brought to the attention of the Code Authority by their own depart- 
ment of Costs and Prices and by the accountants under contract. 

Many revisions of the cost data wex-e necessary, ranging from the 
substitution of estimated for actua.l costs to the necessity for vir- 
tually a complete abandonment of the procedure outlined in Section IX 
of the Code which also involved the chan.-ing of the Approved Cost For- 
mula published as a part of that Article. 

The changes most far-reaching in effect on actual costs were as 
follows: . 

(a) Substitution of approved stumpage costs for actual 
stumpage costs i*^ 

(b) The arbitrary determination that all depreciation must be 
comiDuted Qn. a straight line basis (*) 

(c) The invoking of a new principle - "adjustment of inva- 
riable overhead costs." ; 

Certain of the incongruities in the cost data were as follows: 

(a,) The failure to provide comprehensive data concerning 
grade and size outturn of the product of the saw-log 

(b) 'iThe computation of de-ijreciation on a straight-line basis 
",: and on present value of assets, when it had previously 
been commuted on the diminishing supply basis, with 
production only a fractional part of the usual pre-do- 
pression production and of the capacity to produce. (**) 

For the first time cost data were sought on the basis of all mills 
in a division without regard to the species predominating in the pro- 
duction. Such procedure did not particularly affect the costs deve- 
loped in the Southern Pine Division, for in these states the production 
of the mills is generally predominantly Southern Pine, althoiigh in 
some sections some cypress would be cut and in other sections some hard- 
woods would be encountered. In the western area where Douglas Fir, 
hemlock, spruce, ponderosa pine and Idaho white pine are generally 
found intermingled in timber stand, the development of costs by areas 
rather than by mills producing specific species offered considerable 
obstacles to the development of costs for this period comparable to 
costs develoood for prior periods. In most instances the cost for 
the production of combined species has generally been considered the 
cost of the principal scecies. Thus we find in the West Coast Division 

(*) This was mandatory under the Code. 
(**) Mandatory under the Code. 



9813 



-liDO- 
where Douglas Fir, spruce and hemlock are interningled, that the costs are 
considered as representative of Douglas Fir. Similarly, in the Western Pine 
Division in vmich Pondtrosa arid Idaho v/hite pine, -.Tith some Douglas Fir, are 
the major scecies, the costs that were developed were considered as re- 
presentative of Ponderosa pine production. 

Costs /or southern pine for the years 1921 to 1930 shown in the ta- 
"ble published by the Southern Pine Association (*") in July 1931, present 
a very informative and interesting group of data as to costs of large 
mills, each -oroducing more than six million fejt per year. The mills, 
some 100 in number, are reported to have produced over 32-1/2 billion 
feet during the period, or an average of 3-1/4 billion feet each year, 
or 32-1/2 million feet per mill, per year. 

This information is presented in Table XXVIII, and interpolated 
in that table are data secured by the U. S. Tariff Commission. (**) 
Also interpolated with these data are costs developed from the industry 
questionnaires for January, February, and March, 1934, which were sub- 
mitted to and reviewed by the Research and Planning Division, NRA. (***^. 

In considering the data displayed on this table it should be borne 
in mind that the data for ten years from 1921 to 1930, inclusive, were 
all developed on the sojne set plan, but that the .U. S. Tariff Commis- 
sion figures were developed on a slightly different base and do not in- 
clude shipping and selling expenses. It should be noted that the South- 
ern pine Association presented costs of $25.80 per M feet, for the 
year 1929, including shipping and selling expenses amounting to $2.13 
per M feet, and the U. S. Tariff Commission for the same year, 1929, 
developed costs of $25.41 per M feet without including any shipping 
and selling expense. Ftirther analyzing those samB figures it will be 
seen that one of the principal items of difference was the stiompage ■ 
cost which the Southern Pine Association shov;ed as being $6.04 per -M 
feet, and the U. S. Tariff Comiaission found to be only $5.23 per M feet. 
Other diffeiences will be noted in comparing the items but not all of 
these differences are as great as the first comparison would indicate. 
The Southern Pine Association in determining the costs segregated all 
depreciation amounting to $1,62 per M feet, but the U. S. Tariff Com- 
mission did not segregate this depreciation but included it as a part . 
of the costs of the various operations, principaDly in logging and mil- ^ 
ling^ — — - * 

The costs for Ponderosa pine and Idaho white pine, both species 
being largely produced by the same mill groups, were presented in re- 
ports to its members by the V/estern Pine Manufacturers Association, 



(*) Economic conditions in the Southern Pine Industry presented to 

U. S. Timber Conservation Board by the Southern Pine Association, 
page 53, (July, 1931.) 

(**) U. S. Tariff Commission - Report to the president on Lumber - 
Report No. 32, pages 21-22 (1931.) 

(***) Unpublished report of Research and Planning Division, N?A, "Cost 
Protection Prices and Cost Substantiation Data," dated May 6, 
1935. 



9813 



-101- 
as follows: 

Operating Costs 1927 - Circular #3920, 3/21/28 
II II 1929 - 'I #-1446, 5/23/30 
I' II 1932 - I' # 431, 3/25/33 
1934 Production Costs in Circular #081, b:/ the TJestern Pine Association. 

This information is Dresented in Table XXIX with dato, collected by 
the U. S. Tariff Commission i*^ for 1929, and also cost data tabulated 
by the KRA (**"). 

It will be noted that the arranj^'eraent of the costs as compiled and 
TDublished by the Western pine Association varies somewhat from the detail 
of costs presented by the Southern Fine Association. This variation in 
presentation of costs by two G^O'U-PS of manufacturers in different sec- 
tions of the United States who -oroduce competing products, to a very con- 
siderable extent, is just another evidence of the general attitude of 
the members of the industry toward one another, and of one group toward 
another group. The failure on the part of the members of the industry 
to agree among themselves as t o a reasonably standard form or method of 
presenting their costs of operations crystslized when, under the Code, it 
was imperative that the industry should, through its Code Authority, pre- 
sent cost data reasonably unifoi'm in form and content. 

The Code of Fair Competition for the Lumber and Timber Products In- 
dustry did not provide that NRA should have any direct supervision over 
or control of any of this cost data,. There were no provisions making 
it possible for ITRA to pass upon the sufficiency of the cost data as 
secured or upon the minimum cost protection prices that were to be es- 
tablished by the Liimber Code Authority and based upon such cost data. 

It is true that a representative of the Division of Research and 
planning of iniA had attended a conference in Chicago in April, 1934, 
when the Cost Committee of the Code and the cost representatives of the 
Divisions met to develop the form and content of new cost reports which 
were to be used for the development of the costs by each of the various 
Divisions for the months of January, February, and March, 1934. 

The cost data was collected and collated by each Division and re- 
ported upon by it to the Lumber Code Authority. The Lumber Code Au- 
thority performed a review of such data through their own Cost and Pri- 
ces Committee and their own accountants under contract and based all of 
their actions upon such reviews. The Code did not require results to be 
submitted to NRA for approval. 

NRA did not have access to any of this cost data until late in June 
1934 at which time the Lumber Code Authority was moving toward the 

(*) U. S. Tariff Commission- Report to the President on Lumber - Report 
No. 32, pages 21-22. 

(**) Unpublished report of the Research and Planning Division, NRA, nCost 
protection Prices and Cost Substantiation Data, " dated May 6, 1935. 



9813 



-102- 

declaration of the emergency as finally proraultjated "by Administrator 
Johnson on July 16, 1934. Between June 20 and July 16, a great deal of 
this cost data was presented to the Research and Planning Division of 
NRA. This Division reported adversely upon such cost data as it had 
"been able to review tut the emergency order was signed and included 
most of the already published price bulletins then in effect. Thereafter, 
from time to time, the Division of Research and planning made reports 
upon specific groups of cost as it was enabled to progressively com- 
plete its review. In this review work, many questions arose as to the 
adequacy of the data submitted. These questions were referred to the 
L\amber Code Authority for answer by them or by the Division affected. 
The answers to the questions and much additional information developed 
as a result of the questioning was all included in and given effect to 
when final reports of the Division of Research and Planning were made 
as to the cost of production for all of the divisions and subdivisions 
of the Liomber Code Authority which had been in existence on March 31, 
1934. 

The entire and voliminous record covering the investigation and 
including report statements of costs for each of the divisions with ap- 
propriate explanations, has been prepared and is in the files as "Re- 
port on Project, Cost protection Prices and Cost Substantiation Data 
of the Divisions and Subdivisions of the Liiraber Code." 

It would bo virtually useless to enter into any discussion and 
comparison of the cost data submitted by the industry as referred to 
above. That data now is purely historical and those interested in de- 
tails may peruse them in the above mentioned report. 

The objectives of the National Industrial Recovery Act (declared 
and interpreted") were sought to be attained under the Code of Fair Com- 
petition for the Lumber and Timber Products Industries and the question 
will long be mooted as to whether the industry and the National Recove- 
ry Administration, either, neither, or both had adequate concept of the 
scope of problems clamoring for solution and well thought out, workable 
methods for their solving or if the necessity to compromise differing 
views to reach Article IX of the Code made abortive all attempts under 
it to orect "minimvun cost protection prices" founded upon "weighted 
average cost of production." 

Further segments of this whole problem are discussed in the fol- 
lowing chapter on Prices and Mill Realization. 



9813 



-103- 

E. PrJCES 1I"L KILL iillALIZATIOI' 

1. Prices 

ITaa.t is virice? Wo.cv., rxiC. where ?;':c'. for v'hat steps in the move- 
ment of Ivj.foer ^.rocucts frci.i che sr ■«iill to the -.iltiinate consumer 
shov-ld the )rice of that liuitier oe corisic.ered? Ihese are some of the ^ 
questions thrt i.iast be ansv/ered uefore fx-.y {vienerr.l discussion of the 
price of liTnLer c-n be inteili /tntly carriec on. 

Prices 'i nder the co. petitive systeia, .is pii expression of the 
meetin£j ox the mine's v/hich represents a co. .riforaise betv;een t]ie juyer 
and the seller. It is not \:hr.t the bviyer would lilie to secure nor is 
it exactly v/hat the seller v;i si.es to pay. G-enerf lly, a price is mace 
in the open market and always is affected with a /.iblic inter^-st. Pro- 
ducers are baJanced p^~r-inst consiuaers as producers v;ish to sell at the 
highest possible price obtainr'ble rnd consiv/iers vash to b\iy at the 
cheapest price posr;ible. Erch is controlled, to a ^^eat extent, in 
the desire to drive the best oossible bar-.-ain rnu is prevented from 
overreachin.^ himself by the rivalry of other procaicers who sell rjid 
of other consumers to b~iy. The pi'ice so detenained cannot be s.n aoso— 
lute thi„g ^ut is rlwpys relative p^iC ±n the abstract the contractions 
of supply- and cemand meet to make a price, which, after a fashion, 
represents liberty of contract between the buyer and the seller. 

Price in orth-odoz economics is (i'cnerally considered to oe nn 
expression of the mar-liirl cost of production, but price .and cost ai'e 
in diffeient rerli.is. Price is a definite sum generolly quoted in the 
market rr.C- always knorn to the buyer and seller. Cost, however, is 
seldom definitely Ijiown :.s it is -asually derived from the rainif icrtio.is 
of the industriEl process by involvea and teclmical ca.lculations. ^lat- 
ever may be the philosophy rnd the theory of prices tnd of costs, it is 
n ^elf-evident fret that over r reasonably extended period the price 
of a na^u'.facturerd article r.ai.st be in excess of the cost of manu.fr ctvrir.j; 
pnd distributing , or thone a':encies v;hich are i'nvolved in those processes 
will eventually fade out of the licture, ustially thrciv,'h the bcijiknaptcy 
courts, after rll invested crpitrl h?s oeon ;. exhausted anc. all possible 
credit ha,s been secLired. 

A jrice, even thou.'^h it mry ..le eased upon cost is relftiv.e and not 
absolute in the majority of inst^inces. A specific price may not retva-n 
cost, but the nrice .-^nd the cost of the article may be related, to the 
price :nd t;.e cost of other rrticles manufactured' in the same procesres 
and tkesj -oriccs ai'id costs rll talren to/^ether merge into composites 
that are economically spund . 

Prices of lumber products have been, rnd continue tr be, g,et 
largely on the basis of this irinciplfe. It is known thrt the cost of 
production of the v,arious articles nanui^.ct- .red -nd of the various 
maiiufacturing plrxits v^uit v-..y p-valy ^■nH si.nply upon the basis of 
their cost structure rnd of the iir-rket f'or the articles manufr,cturec.. 
In the LujTiber Industry, rs iw every other indiistry heaving a ;,iultiplicity 
of produ.cts, :a'ny of Y/hich rre cl- ssecl as mr jor products rnd m-^ny others 

9813 



.. -10-ir- 

01 v.'hich rre clrssed rs ninor .'rocucts but rll rcGiilti-.i;; i'ro;:i the srrne 
process of inrm.if-cture , it vrs only -..'turrl thrt rn rllocr.tion of the 
cost of n'ocuction would be rar.Ce lrr,\;el,/ • uon the brnis of the price 
v/hich tliese (.'.ifferent articles would brin- in the mn,r":et br.sec- upon 
past e:: J c ri caic e. 

Lvery ioot of rou :h lur;;oer ;;5roauced by the "r-.vs from the s'-j.ie sr.v; 
l»gs usurlly i". considered to have cost ex.-'Ctly the sme in r.-^w r.ir.terir.l, 
direct Irbor, rnd mr^nuf "Cturin^j; overhead. But some of the lumber pro- 
duced jiiay br of the poorest -rp.de rue nell rt the lower end of the 
price scale r^nd some may be of the ■d:^^hest grade md sell at r correo- 
Ijondinj hi^.:h price. Acttially, the low ;;jrade product im.i.st be sold at a 
heavy loss ■''nd the hi,;h rrade lui.iber will ret\irn r relatively lar;:;e 
profit if exact "nd true costs rre to be considered. It is common 
practice r-nd in conformity with the nbove principle to relrtu the costs 
to 'the prices of the products so th^t er.ch p/roducu result m;; from a 
coi-ir.on process will theoretic 11^, r-bsorb its relative nart of the 
cost and return its relative portion of the profit. 

'w'hen .'^nd where rre the prices to be consit'ered? Is the price rt 
the mill to be trhen as the criterion and is th t jjrice at the mill to 
be corisicered when mr.de to the v/holesaler or when hirde to the mill 
directly to rn industrirl or construction consuiaer or to a retailer? It 
is a fret _;roven by -^n ertendec su.rvey of prices quoted in these dif- 
ferent fields of ,-ctivity th.-t exr-ctly tlie sr^me size, species and jrade 
of Tomber \.'oul( be quoted at ■" retail :rice biit that the products 
wou-lc. move in diflerent aurntitiet; unt.er thrt retail price and at every 
pof:,r;ible li^^ure from thrt iri^e downwrrd to an even below the quoted 
mill piice lor t:-e srne jirotuct. '/ith the constrnt competition existing 
betv/een the saTimills, the wholesalers, the conanission ;.ien rnd the 
retailers for the consujviin;;: ^a-^rJiet, the price of liombei- for ,, ears hrs 
been lar.i;ely dependent -.pon the enc.\\;y of the buyer in e:djaustin^7 t]ie 
various chrjmels throu'h v.-hich his needs could be met anc in pittin^i; 
a,;;ainst one another erch of these varioiis sup-:)lyin;" ardencies. 

The competition between mrnufnctiirers rnC c.istributors of lumber 
products for the market, in not the only competition that the Lumber 
Industry has been compellec. to meet. There has been the competition of 
a,rticleG readily siibsti tutable for the luir.ber products. There has been 
the chr.n^.:e in fashion and in type of builo.intj construction and there 
has been the barrinj from the mai-lcet or lar^e sections of the market 
of the li^jnber procucts by the buili.in^,- restrictions or r e^u.lations of 
urb"r. cei ters. 

The sup^)ly of rxi -rticle on the m-^rhet, coupled with the demand 
for that article, must necessarily a-ve r very considerable effect upon 
the price ^t which the carticie cm be sold. «»'ith ^11 of the economic 
factors as tefore mentioned pressiri'^ for the production of liunber rnd 
with very little, if any, cohesion oetween the manufacturers who were 
wa,^in._, rn independent fij^ht for individurl existence, the price of 
lumbei has not rercted to many of the economic theories nnd princi'dcs 
b^^t has been Irr, :ely dependent upon the old natur.^'l Irw of t}ie sun/ivrl 
of the fittest. 



981C 



-105- 

The price of lumber ir> r. co;.ipo;;lte of these mrny. elements ""nc. is 
not r.olely ^.ependent upon, nor is it po'-itively controlled by cny one 
o I til em, 

Tl.e Lviiber I'.iriiufr.ctia-ii' ■ Industry is quite i^enerrlly sprerd 
tlirou.hor.t every St^-te in the union. There r.re, of course, ccrt'^.in 
v/ell-deilne,;. centers of ,)ro'..uction end it hrs been sljQivn thp.t the 
principal nirmifrctr rin;; centern rre now in the Southern Strtes for 
Southern pine, in the V/er;t Co' ct rejior; lor Lou^^lr.s fir, -ind in the 
V/estern Pine He.. ion for Pono.eros? ]>ine. It hns .--Iso been shown that 
the princi|)r.l consuinin/,- centers rre in t'^e Centrrl St' tes with 
Chicr,;jo, Illinois, rs the princippl o.i stilo' tin ; center, and in the 
Northerstern Strtes vath Kev; Yorl: .' s the princi;;"l distributing center. 
Lumber in some of its mu"! titucdnous forms is consimned^in every vicinity 
of the United Strtes. 

With savmill prodi'.cts rpn^,;in; from rou^jh :";reen lumber rnd timber 
to the hi;.;hly linishec, l,:iln Crieo., olrned nid iDolished cabinet 
woods for mill v'ork and inteiior finish purposes, the iroducts to be 
used for this c.Lisciission will oe limited to the most common species, 
gr des and sizes. After rll, the eonnnonly.used. species, grades rnd. 
sizes ua:e u.p the preponL.erant part of the products of the incustry. 

The question of nrice then, will be considered from the stpaidpoint 
of the sav.Tnills (ra; nuf.-^cturers) , the vmolesalers and the retrilers, 

and tiic u.ltimate consusaers of liunber procucts. 

With the progressive westward .'^nd southwestward movement of popu- 
lation, the procuction centers moved from the northeastern states to 
the Lrl:e rnd Centrrl States rnd then to the South vnC. Inst to the 
western region. 

Hasily accessible st.^ncr- of comi.ierci"l saw timber in close 
pro::imity to the demrnd, estrblished rxid for rar.ny years raaintainea 
lumbei prices vt sv.c. € l.'evel as to nake it the cheapest anci most, 
favored br'Hclng;. material, ''-nien the softwood area of the Lrke and 
Centrrl States regions had been effectively eliminated, from the ord.i- 
nary softwood competition by high costs rnd chrn ;es in use of the 
lumber, leaving the Sor.thern Pine Hegion as the principrl softwood, 
producing center, the distance between producing rnd consuming centers 
involving high transportation costs begrn to register its effect upon 
the ;.u'ice of lumber to the conrjumer. 

The reaction of this increase in price was first to bring 
back into production some o.f the mills in the former production 
centers v/hich could eke out r nrofit on some marginal production; 
another effect wrs to foster the small mills thrt could rendily move, 
to small areas of timber that by rerson of distance from established 
uiills could not have been advrntrgeously workec. by them. Then as 
distcnce incre-'^sed between procuction rnc c.'T'iisiuTiption centers and 
as production of established mill- bcc; me more costly rs the result 
of increasing inrcces^.ibility ol t'le st-^nf'in- timber, the Vest Coast 
region came into proc'iiction. As iirs be.n discussed t.ie.;e were other 
reasons for this rc;-ion to come into procuction, but riter all the 
sellin_, )rico of lumber in consvmin,- centers v/rs the m,-ior considerrtioi 

9813 



-106- 

The .Tcrathtrn Piue He ;ion hp.c. cut rvr.y p11 of its re dily 
r.cces::il:)2.e timber contiguous to ^^r-'terwrys. *^onnequently, rrilror-d 
tr,'^.'j;^-)ortc.tic:-. v.- s r.ecesr, ?ry to .et 'ce ijroc.iict tn the er.3tern aevr- 
borrd, to the nouthv/est , rnC to the miex'..le v.'e[;t conHUJiiii'}, ; centers. 
At thin -'oir.t .u'lces be,_ ru to re. ul'rly re'-ch hi, her levels nnd r.bo\''-t 
thi'; ti:!K r.lso en le t]ie ooenia-; of the Fciirmc. Crnr-,1. Prior to the 
)eai:. : oi the Pr.nciiiv Cmr-l tl:e i;;enerrl competitive position of tne 
rej^'ions rocAicin : s;oftr/ooc\ liiuber y/r.s r.bcut as follows: The IJp.^tern 
States, the Lrke St.-^tea rnc: th.e Ctntrr.1 Strtes offered Ifit very 
little competition to oonthern pwie for softwood liirnbex' ii. constnactior 
'^nc". in j,io:it iiic'.ustrirl uses. 

Prior to the o^enin; of the Crjirl, houjlrs lir from the Meat 
Coast wr.s prrcticrlly barred from e^'stern seaboard marhets, but vath 
the )cninj of the Crn.-l, this '.Test Coast he :ion, by rerson of low 
water tirnnpoi'tption r; tes, v/rs enaoled to deliver itn prod'icts on 
the eastern seaborrt. and to orc.d,.;ii.l to laany er-^stern 'territorial 
cons\''j.''.in_ joints i/i direct competition witLi rril moved Southern 2^i-".e 
Liimbcr. 

The trrnfjport^ tio:. cost of lumber has alv/ays been r very 
considerable prrt of itr, cost to t.;e consumer, rnd. durin ; the Code 
period when minimxiin prices at tr.e mill were in effect for 'the larnu- 
frcoured jrodi.ct rnd vmen the ret' il cerlers, rlso "^nder r. Code, v/erc 
required to limit their cost of hrncl .n ; to certriu definite per- 
centa._,eb oi mr.rlaip on their cost, rersonably comp'^rfble fi .ures cov.ld 
be secured. Tables LI rnd LII, in ApjendixII, .;ive coiiiMarisons of 
these costs at Cldca.po .•"nd ft Kev- York. These costs arc qn.ite aefi- 
nitely divided oetween i.irn\..f " ctiiriii costs, frei,:ht, -m. the costs 
of the ret-iler, rnd fll of the drtr as p;vplyin:.; to erch of the three 
principrl coftwood ■roc.uci.i'; re ion;-; were .y-^thered under the spxne 
general pirn rnd on the scune peneral forii'iula. It will be noted in 
anal:, sin, : the information of Trble LI that the f rei.,ht rate on DoU;;,las 
Pir to CV.ica;:jo, Illinois, was 35. Lb x^er cent of the tot-l cost of the 
Itimber nt retail. This coru)",,es w, th la-anuf acturinj rnd L.istributiU;^ 
cost of 5o. 17 per cent '^nd with letail h.'^ndlin;; costs of 51,27 per 
cent of the totrl cost. 

This table ver;/ definitely brir.j;s out the preferentirl .-osition 
of SoutJiern pine rnd Western pine ar. co';i;rei". with Doti/l' s fir in the 
Chlca^jo market, rs it is shown th,- t tlie trr.isportation cost of 
Southern hie rep'revented 21.58 per cent of the totrl cost p.rd that 
'iVestern ., ine cou.lc ue trransoortot. to tL.e Chicago ;arr"_:et rt ^2.92 :?er 
cent of the totrl cost. 

Considerin: Trble III rejjresentinp tj;.esc. costs at i"ew fork 
rnd considering; only the Loxiglas fir rcachin,; th-t mrr]-et by water, 
these drtr. show that Doi'..;las fir v.'cre or; cticrlly exclt^c.ed from fre 
Hew fork mrrket o:. rril trrnsportation, out thr.t Dou :las Pir movin/j 
by '..'ater and rlfjioivh payin^;: in freijht for trans. >ort<ation char/;es 
rn nnount equrl to 25.63 -tr cent of tiie totrl cost, coulc. still be 
Irid i.ov/n ii- hew York a-t prr coicalli' s>10 ucv a less thrn Southern -ine 
movinj .y rail. 



981S 



-107- 

These instr^nces '.vill serve to rej^resent in ^;enerrl the proportion- 
ate :.T.rt of tlie finrl cost of Imnber borne by the trrnsport^.tion chrr^es 
of the i.irterial from produ.ciA. ■ to cou'".'jain,:-; centers. 

The cost of trrnsportin, ; Ivjnbcr f.oi:- producer to cjns'umer, bein;: 
a very comiderrbl^ factor in t';e price of Ivuaber, has been the 
point aboiit which has turnec'. l '^ or.i time to time, the fortuiies of cor- 
sic.errble sectors of tlie sr,r:nill im''Ustry. 7/ith t?ie turn of the 
century Southern pine v/rs in ujii.ispv.tec. Ic-'d over all other I'OJTiber 
producing rreas. It tlien jrot o.ced nearly 32 per cent with the Ldie 
r.nd Central States' procuction n.iountin.; to about 2., per cent and 
the Western States producin,; les'^i thrn 10 per cent. Ten years later, 
Southern ;.3ine production was ■^--4.9 per cent, the Lalce Stntes 12.3 per 
cent, and. the V/estern Strtes 18,4 per cent of total softwood luraber 
prodtice"d, 3y 1919 the Southern .)ine production represented 46. 6 per 
cent, the Western States 29.2 per cent, and the Northeast a.nd the 
Lolce States v/ere out rf the competition. When 1929 arrived, Soxithern 
pine ha,d surrendered dominance of orouuction to the Western States 
and Southern Pine in thrt year produced 41.9 per cent, the V/estern 
States 43,4 per cent of rll softwooc" production and in 1931 these 
percenta:^-es were Southern pine 36.2 per cent and Western States 50.7 
per cent of total production. 

Sotithern pine had hy this tiiae cut out most of its virgin 
timber adjacent to the mills; costs hr.d increased, and West Coast fir 
could D-XiC cad come throu^,h the canal and cover the eastern seaboard 
with water rates rnd bpclchaul rail rates and meet or ujidersell Southern 
pine in those rarrkets. 

For many years the Leunber Industry had been primarily a sawmill 
indiistry shippini;,' some nf its products to other mills and factories for 
further fa.brication. As the producin;; centers receded farther from 
principal industrial cons"i:u..ini^, centers -rnd costs of raanufr-cturinj in- 
crep.sed pud the trrnsport-tion costs continued to become m increasinj 
factor in the cost, lumber f -^bricrti'^n tender to turn bach upon the 
sawmills. 

To eliminate the trrnspcrt; tion cost on r ,reat deal of the 
waste that results from manuf r cturin,; .-.nd fabrication, the mills and 
pla.nts for the utiliza.tion of I'omber tended to c^esert their former 
loca.tions and were esta.blished adjacent to or as .a part of the sawmills 
producina; the lumber. This inte;;ration ^f the industry has eliminated 
competition for ma.rlcet at e. price on a very considera.ble jortion of t]ie 
mill production of certain ^-ra-cies and species of lumber. This is par- 
ticularly true of the manufacture of sawed wood containers where the 
shoohs now are lar^jely manufatctured in plants connected with sawmills 
and the finished shook ma.terial ship.ed for a.ssen.blin ;,■ at the plants 
where used. 

Price had alv/ays been the factor influencin,,- control or dominance 
of market and thus largely governed sectors of the inuustry in its 
desire to" obtain a profit, and then, ,■ Imost in desperation, to permit 
liquidation of and at least a iiartial s,: Ivr-an.: of the investment in 

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strnt.in^: timber rnd in sa'.-vraill eqi.i.n.ient. Becruce oi" this element of 
price ciid its effect v.;>on the inc i.;stry, ip.r.ny ei'forts hc.ve been i.ir.c-c to 
control or to estrblish a bottom for prices. I.iostly these efforts vere 
by snrll ^'roiips snd had no rerl rnd Ir'stin.™ effect, as it appeared to 
be impossible to control nny conaideraL/le nruber of the inenDers of the 
indu-stry. But yrhen certain sections of the industry had ^,-otten tojetl^cr 
on a pro;_:rrji that bade frir to be successful, the ' p.nti- trust lav/s v/ere 
invohed and industry pirns har. to be .abandoned. 

a. Price under the Code. 

Ihe TRA. Code for the Lui'nber .?nd Timber Products Industries 
offered another opportunity for the industry luembers to eliminate 
cut-throat competition pnd the continued aestruction of industry 
units throU;^;h bpnliruptcy oy the estrblishiiient of f price that was 
planned to return to the )rodvi.cei's r.t least tjie cost of production, 

Witli all ~f the known cdfficulties surrcuiidinj the establishment 
of a price for products manufactured and ^old throughout the length 
mid breadth of the United St^.tes rnd v;ith all possible gradations of 
products manufactured in the v;ic.est ran.,,-e of factories as to equipment, 
labor rnd me,rlceting cbility, the Lioriiber Industry boldly set o\it to 
determine "minimi^jn cost protection 'irices. " 

The record of the hearings jrecedent to the Code contains 
much testimony or evidence on minimi'in prices and cc^st protection. 
The indv.stry imderstood that it avust r.cccvt some minimum hourly wa^;e 
rate v/hich v.'ould add materiii.lly in most sa.m.iills to the cost of pro— 
ducinj; luvfcer rni. it bf.r.^-lned for and obtained the ri.;.ht to establish 
mini;. .urn prices nt v/hic. its proco-icts should be sold. The industry 
selected as its point for the determination of these minimum prices 
the movement of Iwaber from the sr-v-raills or the manufacturei". It sou ht 
to deteimin.e what tliese iiiiuiraun prices ii/ould be upon the basis of 
"protecting the cost of production. " The industry rnd 1\THA were both 
definitely fearful of the effect on the piiblic of the establishment of 
these minimiian prices and realized and recognized that tnere must be 
some protection for the .ublic against the abuses of svich o pover. It 
v/;- s tlic purpose to establish a mathematical foncula, for determining the 
cost of proo-uction rnd then to limit prices that were to be established 
so that there coidd not possibly be any element of pjrofiu includot. in 
such minimfan cost protection prices. The theory v.'as a good one but the 
practical obstacles to'. its reasonable performajice were majiy and almost 
ins'Lirmountable. The difficulties surroimding the securing of cost in- 
formation and the establisli-nent of the basic nverr,_^e of cost have been 
discv.ssed elsev.'.iere iii triis reoort. 

With the establishment of prices at the sa'.'nnill tliere necessarily 
o.rose the problem of determinin;^- v/h-r t was or would be the proper adii- 
tional cost of the hrjndling of the lijmber in its various stages from 
the mill to the consumeri' It was so;.jnt to establish various fair 
trade practices wiiich largely v/ere the e.'xpression of past methods of 
doin^; business and to define pnd to control the rctivities of the 
principal h.andlers of luinber in so-cnlled v.holesale quantities. At 
this point the varied activities of the mills in the sale of their 

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proc.ucts, in conflict ar. they were nith vihs.t the v/holesale trc.de con- 
sic.ered to oe their ri jhts rm.. cutics, rncl nil of the self-preservpr- 
tion tactics of the mills i'lv the hnr ,;^inin:_j c?.prcitie:; of the buyers 
enterec. to create dissension and to establish a problem in the -opei'r tion 
of the Code that tended lar^^ely, through its non-solution, to the final 
breaia"ov/n of the mininiuiri price rnd e."iier ;,ency provisions. 

The industry was not ■^C.r^^iteo. to tlie main':.enn,nce of minimum 
price for its multitudinous .iroucts, for it has been accepted a,lmost 
as rji a::iov.; that if minimum pricec rre to he established there must 
be cohesion in the incaistry, rnd r'urdnistratio.i facilities of the 
or^\?jii zation crpable of maintainin,,- co^iplirnce must be available and. 
there must lc a reco,;;nized standard of products and <? relative bal- 
ance between supnly rnd the dem-^nd. 

Pxirsufint to the nrovisions of tlie Code, the dode Authroti^^y 
for the indiistry i)roceedec' to estrolish miniiiwa prices rna publish 
these in "iviinimum Price Eulletins. " 'These miniiaum prices as pub- 
lished :'.;eneially affected the incus tr,/ members as vouid any other 
price sta,bilization plan by ere- tin : serioi^.s dislocrtions in the in- 
dustry, Hrjiy of the operatin,; -on'its v/ere rdversely effected by thc;-.e 
miniLrom prices and there were many ccmnlr;iuts thrt such minimuni prices 
were so lov/ as to further contrijute to the ba,n]truptcy of the orga- 
nizations. There were laaterirl benefits resulting, naturally, as the 
lov.' cast mills v/ere able to produce rnd tonmalre a profit which they had. 
not bec-n able to cio under prior conditions. The stabilization of 
prices nrturally stiimilated output which, of course, in this inL.ustry 
was to a certfiin extent controlled by the procuction control features 
of the Code, but in most cr.sez the operators raajiufoctured their quota 
whether or not there was a marhet for the product. Most of the estab- 
lished minimum prices were somev/hat in excess of prices that had. been 
prevailing; theretofore and this tended lar^.-ftly to a reduction in the 
effective cemand for the liunber products. 

By June, 1034, the Code Authority for the L-omber and Timber 
Produ.cts Industry,' realized t]ia,t the minimiim prices were not being 
lived up to by the manuff cturers. The price structure had also been 
seriously affected by the failure of the v/holesalers to be governed 
by the Code as it was interpretec by the L\:uaber Code Authority. Price 
cutting ha.d become prevalent and. v/hen the Code Authority requested 
the MA to start proseciitiori there wr.s immediately ra.ised the point tlia^t 
the Governnent had not had a hand in the making of these prices rnd 
that it cox^-ld not and should not set out to prosecute violators of 
re julationu not made by the Government, On the other hand the industry 
claii.ied tha.t in approving the Code the Government had r.pproved. the ri ,ht 
of the industry to set .'riceg tinder the Codal limitations and thrt there- 
fore it (the Government) was obligated to enforce those provisions. 

These contritions were teiT.ii.i;' ted by an Order of -Adjuinistrator 
Johnson issiied on July 16, 1054, r eclrriug ;n enerrency and adopting 
and proLiulgatin-^- with some cha.n .es, as Government prices, the jjrices 
that ha,d. ''oeen set up by the Lrjiiber I.idustry in its minim^'orn price 
bulletins. 



9813 



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With tnese minira-um price? becoming 3^rices set ''o-j the G-overnment, tlie 
storr; of j^i-'otest a,,^;:oinst these 'rices nnc". other f..ctors in the Code "becojiie 
of Fuch proportion th-it the ji.dmii.istr tioi; v/-b coinjielled to tahe cogniz',nce 
of it,-,ind the -ie?.rint; on minimiim prices in the Limber I-,',dustry v/as called 
for December, 1'324, As o, result of the he;\ri;t;^ an Order vas issued lo.te 
in Decemher, 19o4, withdrr.v/i:".^; the minimvini price piovisions of the Code, 

i.In.ny .nd dire prophesies i di Leon in;-.de ■^s to cae ellect on the in- 
dustry of this withdrawal of miniraun •••rice':- tut none of these forpc sts 
Ii.'.ve cone true, as the industry ]^„^ co:^.tinued to act and react just ahout 
as it a.id throughout most of the later /ears of its existence and there 
was no s-ii^rp readjustment of ~ricer, in fact, fre'?d frci control, prices 
rose. 

Betvi/ron Decemher, I'^C'ia, iv'nen arices '.-'ere virithcrawn :".nd Ma;^, 1935, 
vdien the Su^ireiae Court rendered its decision in the Schechter case, there 
had 'been considerable grunhling; ancl discontent in the industry "because 
many of the nemuers v/ere still alaidin.'^,' by the miniraimi v/a^,e provisions and 
were living up to production control schedules set ''oj the Code Authority, 
With the coiTTilete abando:ii:ient of Code activities the industry in ^-eneral 
lias fuiictioned very largely in a normal v/ay. The memherr of the indixstry 
apparentl:,' .i:.ve ret.lned many of the fruits of the cooaeration resulting 
from their associati'jn mider the Code, 

E, Pilic::s KiVi: mill a5;ALIZATI0;.I 

2, Mil l Hea li zatl'hi ' 

There is r.lmost a corplete lacl: of authentic c.-ata u on the subject 
of re ^liz'',t \on from the aroduct of the mills during any period of time 
and especially diirin;^; period;^ covered by available data as to cost of 
production. Certain associations of Itimber producers ho.ve mf'.de attempts 
to secujre costs, >-,s previouslj- disctissed, hut the record is almost d. 
complete blanl: on the subject of mill realization or value of mill pro- 
duct until the Code period. Consequently this discussion must be almost 
exclusively concerned with. th£ dci,ta submitted during the Code period. 

Differences of opinion exist 'as to wricLt is the proper definition of 
"mill realiz^i.tion. In some branches of the industry mill realization 
is considered to be the net retllrn to the manufacturer for the i^roduct 
sold. This is not either gross sales :r ;iet siles, but is, in many 
instances, net sales less freight paid and less selling ca '.missions , and 
in many cases also less cash discounts. Mill realization is also frequently 
considered to be the value of the mill production whether sold or not. 
In other or .nches of the industry mill realization maj' mean pny combination 
of the above b.ases rnd the mienbioned deductions therefrom. 

Mill realization finally, of course, is Y/h^t the product actually 
brings in casli or othei' values w'len such ^iroc^uct is moved from the possess- 
ion of the ma.nufacturers. As the ultimate factor this crji not be ignored, 
but it v/as also re.alized that in. determining prices under a system governed 
by an irbitrar;." maximimi of cost' of production, the quantities of product 
manufictured but not disposed of must be considered. 

It has been more or less conmvon practice in the industry to consider 
9813 



-Ill- 
gross mill realizr.tion for n.l.i 1101111)6.' -.rooucts to he represented "by the 
selling price ot certain £,ri,des c.nC. sizes of finislied Itunber erpanded 
"by the calculable hut indefinite nd lOiifixeu factor of the "average 
outturn of the aver^ige log," In no inst'vnce within the availatle record 
has any one inill, let "lone rxi-j sub-divi?lon or division of the industry, 
proved this hy::)othctic"l mill realiz vtion by definite facts concerning 
sales or saleabilit;- of ohe product manuf '.ctured. 

The indi.istry itself ms recognised the f ;,ct that such a computation 
of fverage realization baset on the average outturn of the average log 
would be subject to many variables. Two sawyers worlting in the same 
mill and on exactl the same log would not produce similar gro.des, sizes 
ana quantities of roo^vlT- green lumber. The rou^^h green lumber as it 
came from the saws nifiit be subjected to cariabions in grade and tally, 
and tliat post certainlp the luinclin^-- of the rou«n;h green lumber in air 
drying and especially kiln drying v/oald cause variation in grade, de- 
pending upon the treatneiit ^.ccoro.ed it in those o'erations- 

During the depression "oeriod esTecially, if not before to the same 
extent, there iir.d been "swoetening of gr..cl9s" if not the actual billing 
of a certain qur^ntity of higher grace of lumber ^s and at the price of 
a lower grade. 

With all of these conditions existing, or T;ith any considerable 
number of them entering into the qiiestion of mill ret-lization, it is 
patent to even the most disinterested observer that any mill realization 
co.-puted upon an unsuT: stantiated average outturn of the average log 
v/ould be a very weal: reed, upon which the industry could lean. But this 
v;as the only t:rje of inf orm£i,tion submitted in su:p-iort of mill realization 
and without the backing of any considerable data concerning sales for 
any particular period to be offset a,gainst or considered y/ith the cost, 
qtiTintity ana grade?' of lumber jvi-oduced during that period. 

It i? realizet tlicat an f\t':em;.)t to develop an average figure of 
mill realization for any specific period will be a difficult, if not 
an a.lnost impossible procedure. The cliar,acter of the -oroduct of the 
mill will differ as betv^pen -neriods depending urpon: 

(1) Character of the timber from ?/hich the saw logs are being 
produced 

(2) Efficiency of the machinery, equipment, and management 
of the mill 

(3) The efficiency of employees 

(4) -Competitive position 'of the industry and the particular 
producing unit being consic'cred. 

With the industry --producing lum'^cr,' its fin 1 usable product, of many 
different anc' competing specier, with v ri-.t ..ais in manufacture as 
previously outlined and with commonly used tr do terms having mea,nings 
different from those given ..n the r icti on-iry and the commonly accepted 
meaning of those same wordr, it c n oe re .dilv seen that even reports 
accurate as to o^^uantity and vxAt price, only cross sections of the 

9813 



-112- 
determinat ion of o.n avoro.^e •irice for the product or otittTorn of the log. 

It vn.s ,'^,cce;~'ted as a tasic conclusion by }1^:A tlir.t this 'bothersome 
question of mill realization could not he c-~.tisfictorily ansv/ered unlers 
and until the reporting unitr of the industry accepted it as a fact th^'-t 
the mill realization could c-e determined only on the b.-isis of inventory 
of production unsold and on hand e.t the end of any cost accounting 
period, coui^led with analyses of actuzil sales. The NRA realized just as 
clearly as did the industry tlnat this basis was not absolutely correct 
for, until the mr.nufo.ctured. product was actually sold, influences of 
v;eather and of tine were tending to de^^raae that product. 

Ail import;;,nc factor in determining^ mill realization for the pro- 
ducts nnnufo.ctxijred is the coMj>arability of the several species. In 
certain m-rhets and for cert,\i;i uses Southern pine lumber of a g;iven 
grade, and size conmiards a someTifiu\t higlier price thrm the corresponding 
Douglas fir lumber. It is reco-'^nized that the j.iroportion of the higher 
grades is not so j'-^reat in Southern pine as in Dou£;las fir, Wliile Douglas 
fir and Soutacrn ;jine are coripetitive v^oods cind interchangeable for ma.ny 
uses, they are not the so.me species or identical -.TOods, and for some 
uses they i.re not e>Tictly comp:irable, and they are not ratarketable at the 
same price. However, eacn of these species had, thro-agh custom, developed 
exclusive raarl'ets, relatively speaMng, and infirl:ets in which they vrere 
directly competitive. This • competition between species is a factor which 
very materially affected the realization of the mills. It ¥;as not 
possible, or at le^st it was not considered possible by the industry, 
tliat prices of sizes and grades of 'rs species could be determined purely 
on the basis of the cost of th-^t species. The competing species v/ith 
its cost and rel.ated price al^o Itul to be considered. In tills coordina.- 
tion betvifeen specier- it W'.s ::'otijid tliat very definitely determined minimum 
.cost protection prices based on weighted average costs in the producing 
divisions must necessarily' be .adjusted either upward or downward so tlia.t 
one or the other should not be, by the establisliment of such price eliminated 
from or eliminate the other from p. market in which both had participatnd 
prior to the :^,do"-'tion of the Cod.e, 

Actually itnd.er the Code eo.ch division of the Lumber a.,nd Timber 
products Industry ]")resented certain data concerning mill realization. 
As previously stated not one of the act-i:u;il lumber producing divisions 
presented conclusive material on this subject. Certain data on mill 
realization were presented by the Southern P^ne Division but were based 
on studies of several years prior. Other divisions were in practically 
the sojne position and the statistics quoted as mill realization v;ere 
in the majority of cases theoretical as they applied to the then current 
conditions. 

Cert .in uat"'. as to reporter" cost- and reported realization under the 
Code and .au-ing a Code period of January, 5ebru?.ry, o.nd March, 1934, 
compared with the Tariff Coirudssion costs of 1929, are presented in Table 
XXX, The data fron the industry are fouiio in an u:"ipublished report of 
the Uese'irch end Planning Division, SRA, (*) 



(*) Unpublished report of Resi^.arch and planning Division, NRA, "Cost 
Protection prices ; nd Cort Substantiation Do.ta, "May 6, 1935, 



-iic;- 

and the info-rrap.tion fron the Tariff Conr.dssion (*) licx!? boen dincussec]. 
previously. 

The infoj-mation is cupplier'. oil;' ;id to cert:'iu of :he divisions 
under the lumber Code Authority v/hich produced a very lar^e percentage 
of all lumber. The Soutliern Pine Division submitted cost reports from 
136 large mills .^nd 181 smr-ll mills. The large mills produced 410,705,000 
ft. b, m, , which quantity v/as reported to be about 76 per cent of the pro- 
duction of all 1' rge mills, x.ie cost reports from the 181 small mills 
covered 56,705,000 ft. b. m. It war. "Iso estimated by the Southern Pine 
Division tliat 50 per cent of the production of Southern pine came from 
the sm,all mil^o in tliat division. It v/ii be noted tlu.t ohe cost of 
production and the re^'^orted realization was -.p'roximately $4 per thousand 
less for the small mills tlian was reported by the lar(_^e mills although 
it may be noted tliiit the productr are different. The U. S. Tariff Com- 
mission corts of 19.?9 did not distinguish between small mill and large 
mill costs. There is one other point to be considered in this comparison, 
namely, the costs c'evelo'^ed by t-ie industry included selling costs and in- 
terest as pa.id or accrued v/hile the costs developed bj'' the Tariff Com- 
miscron did not incluJe r:,ny selling cost but did includ.e interest ?.t six 
per cent on the depreciated value of fixed assets (including standing 
timber and land) and the average v ;.lr:.e of inventories as shovm by the 
boohs of the companies investigated, 

Tlae cocts for iicvrdvrood were not developed by the U, S. Tariff Com- 
mission. Under the Code costs were developed for the tv;o principal 
iiardv/ood grox-^os, the Appalachian Hardwood and tiis Southern Hardwood 
Subdivisions, Originally, under the Code tliese two groups were combined, 
but later -ander a Code amendment separate sub-divisions were set up. 
These sub-divisions were outlined generally on the basis of the forest 
range of tne specific v/oods anc. not tipon state lines. The costs and 
realization as submitted by the Southei-n Hardwood I'.nd Al3pa,lacMan Hard- 
vrood Subdivisions were subject to certain :~djustnents peculia,r to these 
t^TO groups. An item very definitely set forth i";i amount as a reduction 
of the realization v/ps for de,;:rulc and shriniaige , and no conclusive 
supporting datr v/as subm-itted for this item. In the Southern Hardvirood 
Subdivision realisation figure as presented on Table XXX, $4,53 is 
included for degr.-„de and shrinkage. For the Appalachian Ha,rdwood 
Subdivision the amovint of this item is stated as $4,35 per thousand. 

In connection with the realization item for Western Pino lumber 
it should be stated tlrnt the quoted amount was produced oy applying 
the formula based on the average outturn of tlie log as submitted by 
the Western Pine Division, There was no definite data as to v^hat the 
sav/mills actxr.l'y did receive for actual lumber produced for the costs 
deto-iled by them. 

The West Coast Division submitted informrition as to costs of 
production and realiz.at;-on for ooth large anl sma.ll mills producing 
Douglas fir sjid hemlock, and the S'.uae data for Sitk?, spruce. It will 
be noted tlmt as between tne large mills and the smo.ll mills producing 
Douglas fir a.no hemlock, the cost'^ of the sm.all mills vrere approximately 
only two-thirds of the costs of the lar^;e mills. It will also be noted 
that the reported re-.lization of the smll nilis was -52,35 per thousand 



9813 



-114- 

in excess of the cost tut tk-.t the realizrti on nf t?ie large mills was 
60 cents "oer thousand las;; tlian the cost to produce. 

The U. S. Tariff Coi-.imission, in developing their costs -of production 
of Douglas fir and hefnlock for 1929, presents a composite total cost of 
$23.96 per LI ft. t. ra. This cost, as well as the cost of $23.07 for ■ 
Western pine, is suhject to the sarue qualifications expressed above in 
connection \Yith the cost of $28.25 per M for Southern pine lumber. 



9813 



-115- 
r. LABOR 

1. Statistical Coveraf';e 



As mentioned in Chapter 1, the Census classificf.tion "Ltunter and 
Timter Products" is much more restricted tlin.n the industry covered 
ty the Code,* the former ueing defined as including: "logging camps; 
merchant saYmiills; combined sai'.inills rnc planing mills , including 
those engaged in the manv.facto.re ox "boxes; veneer mills; and cooperage 
stock mills." 

The Census classification "Planing Mill Products" embraces 
"independent" planing mills; th-^t is, planing mills not OT)crated in 
conjuLiction v'ith sav.mills* . • 

■The Census term "Wooden Boxes" includes estcablislmients engaged 
primarily in the rmufacture of vr:.o'''.en boxes (not including cigar 
boxes); crates for butter, fry.its, berries, and vegetables; box shocks; 
cases for efgs anO canned good:; carrier tra,ys; etc. 

These three Census classifications, "L'omber and Tim.bcr Products", 
"Planing Mill Products", and '.'Wooden Boxes, except cigar boxes'.', do 
not conform, even in their combined scope, v/ith the coverage of the 
Godal definition of. the industry, but together they represent the 
nearest a.pj3roxinmtion to tliat scope for which statistics are available. 
In this connection it- should be borne in mind that the Census statis- 
tics are, iu general, restricted to establishments reporting products 
valued at $5,000 or more annuD.lly, Tnis applies to tne data for 1933, 
but for earlier years a mill .which.. ss-wed 200,000 feet of lumber, 
1,000,000 laths, or 2,500 squares, of shingles v.-,as treated as an estab- 
lishment vifith -products valued at. g5,Q00. 

2 . . M ui.ibe-' and llYpe of 3r.Tolo,"ees ... 

a. ITumbcr of Employees, 

The .aggregate employivient in the three Census classifications 
of the industry just described sxiouiited to 539,772 wage earners in 1929. 
Of this number over 77 per cent was' represented by the Census classi- 
fication "Lunber.and Timber Products", which, in general, covers logging, 
sawmills, combined sawmills and planing mills, veneer and cooperage 
stock mills. Over 16 iDcr cent of this emiiloimient v?as represented by 
planing mills not operated in conjunction with savmills. The remainder, 
or less tlaax 7 per cent, was engaged in the manufacture of wooden boxes 
and j"'ac'-;ages. 

The logging and sav/mill branch of the industry (Census classi- 
fication "Lumber and T.imber Products"), rasalred third .-in 1929 among all 
American industries with respect to the n.anb'er of isalge earners employed, 
being exceeded by only the Foundry v.r'j MncMne Shop products and the 
Cotton Goods Industries, and followed by ti.r Iron .and Steel (Steel 
Works and Rolling liills) Industry. (*) 



(*) Census of I.Ln^nufa'ct-urers , Bureru of the Census (1929), Vol. II, p. 34 
9813 



123.5 


34, 


,834 


613, 


,253 


113.6 


107.2 


30, 


,797 


541, 


,332 


100.3 


100. C 


30, 


,554 


539, 


,772 


100.0 


60.5 


22, 


,864 


274, 


,004 


50.8 


39.3 


21, 


,753 


246, 


,508 


45.7 



-116- 

A-oproxiraately 162,000 T7age earners, or 39 -oer cent of the 1929 log- . 
ging and sawmill employment, were loggers, the remainder, or atout 61 per 
cent, teing engaged in the mills. 

The following tatle shows the numher of wage earners in the three 
Census classifica,tions of the industry'- for the odd years 1925 to 1933 in- 
clusive. Similar data for the even years are not available. 

Uumher of Wage Earners (Census Classifications ') 

Boxes 
Lurnher Wooden 

and Planing Except Total 

Timber Index Mill Index Cigar Wage Index 
Year Froducts ( 1929=100) Products (I929fl00) Boxes Earners ( 1929=100 ) 

1925 467,090 111.5 111,329 

1927 413,946 98.8 . 95,539 

1929 419,084 100.0 90,134 

1931 196,647 46.9 54,493. 

1933 189,367 45.2 35,388 

Source: Census of Kanufactures, Bureau of the Census - 1929 and 1933, 

It will be seen from the foregoing table that the number of wage 
earners in the three Census classifications declined from 613,253 in 1925 
to 539,772 in 1929. Under the influence of the business depression this 
employment fell sharply to 274,004 in 1931, a loss of approximately '50 per 
cent from the 1929 level. The year 1932 represented the bottom for the 
industrjr, both in production and emplojonent, but actual employment figures 
for that year are not available. However, the index of employment for saw- 
mills and millwork, prepared by the Biireau of Labor Statistics and shifted 
to a 1929 base, fell to 37.8 in 1932, as compared with 49.5 in 1931 and 44.3 
in 1933. On the basis of the 1932 index it is computed that employment in 
that year fell to 204,034 wage earners. In 1933 the employment level was 
about 5 per cent below the 1931 level and represented 45.7 per cent of the 
1929 employment. 

Technological unemployment has been less in this industry than in most 
other industries. There have been notable improvements in manufacturing 
methods, but these have taken place gradually over the past quarter of a 
century, with no sudden displacement of labor. (*) 

Prom Census statistics (**) it is compiited that the average 



(*) Verbal statement of Pranlc Read, forner Assista.it Deputy Administrator, 
N.R.A. , on the Lumber and Timber products Code, Februar;;^ 4, 1936, 

(**) Census of Manufactures, Bureau of the Census, 1933. 
9813 



-117- 

reportinc ertablisliment in the s-ivmillo, "Lii.i'ber and Timber Products", 
employed about 32 wa^^e earners in 1939, 39 in 1931, p.nd 50 in 1933; (*) the 
average "inde-iendent" planing mill (rnillv/or''.:) ectabliGlment employed 
between 18 and 19 vi/age earners in 192-7, nearly IG in 1931, arid' 15 in 
1933, while the average vrooden box or pacloage establicliment employed 
about 39 wage earners, in 1923, S-l- in 1931, and 37 in 1933. When it i-s 
realized that in some caches t^-o or ciore mills operated uiider common 
ownership are counted arj a single establisliment and that, in general, 
the Census statistics do not cover mills whose products are -volued at 
less tnan $5,0""" annur.ily, it is seen tha.t the average wdrking group of 
employees in the industry is ouite Rm;\ll, 

The follov;in^ table shov;s the average n^ombcr of wtige earners in 
establishnents of various sizes for the ve?r 19J9. ' 



In Establishments v/ith 
Products Valued at: 

$5,0 JO to $19,999 
20,000 to 49,999 
50,000 to 99,999 
100,000 to 24-9,999 
250,000 to 499,999 
500,000 to 999,999 
1,000,000 to 2,499,999 
2,500,000 to 4,999,999 
5,0)0,000 and over 



Avera-,e 'lumber of Average Nuuber of 
Wage Er'.rncrs in Sav- 'fege Earners in Mill- 
mill Establisliments a/ worh Establishments 'hj 



4.9 


2.5 


13.5 


6.1 


27.4 


11.7 


58.5 


25.0 


Xco • t_/ 


54.2 


216.6 


109.3 


411.2 


219.4 


841.8 


421.8 


2,179.7 


none 



Source: Computed' from Census ■ of Manuf- ctvxes , 1929. 
a/ Census classification "Lumber and Timber Products" 
b/ Census classific ■ tioh "Plani;ig '.'ills" 



b. Seasonality of 'Emviloi'T.ie:it 



The extent of seasonal fluctuations in- employment, in the, savmiill 
branch of the industry _is shown by the following indices of emploj-ment i 



(*) This increase was undoubted.ly due to the decline in the number of 
sino.li establislmients. 



9813 



-118- 

Index of Employment (1229=1:30 ) 
S'lvmillG 

1926 1927 1928 19:,9 l'?bO 19ol 19o2 1955 1934 19J5 



Jan, 


i:.4.7 


98. G 


90.3 


94,6 


35.3 


51.6 


36 . 3 


34.8 


49.7 


50.0 




Pet, 


104.5 


97.4 


90 . 3 


95.1 


82 .2 


5C.5 


35.8 


33,7 


50,7 


52.9 




Mar. 


104,9 


96.9 


92.4 


96.6 


82.9 


50.1 


35.5 


33,1 


52.8 


54.2 




Apr. 


109,6 


97.4 


95.9 


101.0 


82.0 


49.9 


35.6 


34,8 


55.5 


56.3 




May 


111,8 


99.9 


97.0 


103.2 


81.1 


50.0 


35.7 


37.1 


58.4 


55.0 




Jim, 


112,7 


IOl.4 


99.2 


105.1 


73.4 


49.6 


37.1 


43.1 


56,8 


50.0 




Jul, 


112.1 


100.1 


97.8 


105.1 


73,7 


47.3 


36.4 


49.1 


54,7 


55.0 




Aug, 


112,5 


101.0 


10'). 3 


106.3 


70.0 


46,3 


56.6 


53,7 


54.9 






Sep, 


110.2 


101.5 


101.1 


103.9 


60,4 


45.1 


37.8 


57,2 


55.2 






Oct, 


108.4 


99.9 


10-'.8 


ICO. 3 


64.9 


44.0 


39,2 


53,4 


54.9 






Nov, 


106.6 


98.1 


100.3 


97.0 


61.1 


42.4 


33,6 


55,1 


53.1 






Dec, 


104.2 


94.0 


07.5 


91.8 


56.3 


38.7 


37.0 


53.9 


51.1 






Aver- 
























age : 


108.5 


98.8 


97.1 


100.0 


75.7 


47.1 


37.0 


45.4- 


54.0 






Source: Bureau of 


Labor 


' S t=' ti 


sties 


Index, 


shift 


ed to 


1929 oase. 





Slnil.-^r data for millvorl; (Census classification "planing Mills") 
are presented in tlis folior/in;':: tnlile: 

Index of EiirTlo:./7;ient (l929al '.»■"') 
Millworl.: 

1926 1927 1928 1929 1950 1931 1932 1933 ,1934 1935 



Jan. 


124,9 


110,6 


99.0 


100.0 


82.9 


62.9 


49,0 


33.6 


37.7 


40.7 




Feb. 


125,1 


108,8 


99 '^<- 


10-. 5 


84.2 


64.3 


46 » 7 


34.4 


40.9 


42;9 




Mar, 


126.3 


108.0 


99 '-■ 


100.4 


81.7 


64.4 


45.6 


31.7 


42.6 


43.4 




Apr, 


123,5 


108.9 


102.4 


104.3 


81.5 


64.5 


43.4 


53.6 


44,6 


45.0 




May 


122.0 


103.8 


104.3 


105.1 


81.7 


65.4 


42,8 


36.2 


45.8 


46.1 




Jun, 


121.7 


109.9 


105.1 


105.1 


79.3 


63.2 


41,0 


39.8 


42.9 


47.5 




Jul. 


121.4 


109.0 


105.4 


104.9 


75.7 


51.6 


38,9 


44.0 


42.0 


50.6 




Aug. 


121.4 


109.0 


106.5 


104.5 


73.3 


60.8 


38,6 


45.2 


41.0 






Sep. 


119.9 


106.9 


104.5 


101.2 


68. 9 


56.8 


38.5 


45.3 


■v.o o 






Oct, 


119.4 


104,7 


101.6 


9 ^) , 3 


69.6 


54.8 


58.0 


43,9 


41.1 






Nov, 


117.7 


102.2 


102.5 


89.9 


68.1 


54.3 


57.5 


42,2 


41.1 






Dec, 


113.6 


103.7 


99.2 


84.8 


67.3 


52.8 


36,5 


41.1 


41.6 






Aver- 
























age: 


121.4 


107.5 


102.5 


100.0 


76.2 


60.5 


41.4 


39.2 


41.7 






So-orce: Bureau of 


Labor 


Statist 


icG Inc^ex, s' 


iiiftcd 


to 1929 bas 


c. 





G. Tyif^e of Employees 

It v:.'; seen iii Cliapitor I tliat , in f^eneral, employees in the industry 
may be divided into tv/o principal groups, najnely, log^^ing einployees 
and sawmill employees. Logger?., for tOie most ;:'art, must live in c--"jrrps 
which Can be moved readily f ro;i\ one logging center to another, for with 
modern methods it requires only a short time to fell -,^11 the comir.ercial 
trees on a considerable area. There are, therefore, very few permanent 

9813 



-119- 

living quarters for log£;erc, Sucli v;or''.:erc are, for the i.iost riart , 
■unmarried e,nd are more or less tro,nsicnt in most of the producing 
regions. An exception to this situati'on e;:iGts in those logging 
areas which are fairly contiguous with agricultural areas, as in the 
South and App'alachian regions, where logging lahor is frequently inter- 
changeable with that of agricultural lahor, with no clearcut division 
"betv/een them. In such cases log,i:ers frequently iiave more or less perm- 
anent residences on farms in the vicinity 'ncl are engaged part of the 
year in logging opers,tions, 

Savmill v/orhers fill into the c'ite;-;ory of factory workers. They 
are less transient, particularly^-" in the Tifostcrn areas, than the loggers. 

Planing mill workers mxy be enga,':ed in operations adjacent to the 
savmiill, or they may he employed in independent planing operations 
located near the centers of demrand and f;'.r from the logging and savmiill 
operations. Wliichever is the case v/iil determine whether the workers 
will have the advantage of tiie lov/er living costs of -the country or must 
incur the higher url^an costs, 

Questionnaire data compiled "by the Southern Pine Association, 
November 18, 1935, covering 85 large sawmills in 10 states in the Southern 
Pine area, gave the following riercenta'ges of negro to total labor employed 
in the month of September: 193£;, 52.5; 1935, 50.1; 1954, 52.2; and 1935, 
50.9. Similar data for sma,ll mills would probably show a larger per- 
centage of negroes due to a lesser degree of mcclia.nization and therefore 
of required skill. Dat-^. comi-^iled by the Southern Pine Association in 
connection with the above-mentioned study and cove?i?Jfij 18 small sawmills 
in seven Southern Pine states, shoT/ed the follov/ing percentages of negro 
to total labor for the m-;nth of Sentember: 1952, 55.3; 1955, 55.5; 
1934, 55.5; 1935,, 59.2. 

The logging and sarmill worlrrnen of the lloVth and West are genera,lly 
of a roving, independent nature, wliile t'ilose in the South are inclined 
to spend their lives in the same locality, changing from lumbering to 
agriculture and back agedn according to demandt. 

With reference to the sex of employees, a study made by the Bureau 
of Labor Statistics in 1929, covering 58,007 employees of 319 representa-; 
■ tive sawmills in 22 states and 6,968 employees of 51 logging camps in 10 
states, revealed the fact that only 18 of the sa^vmill employees and only 
29 of those in the logging cam.js v;ere females. (*) 

In 1930 there were 20,7'61 persons under' 18 years of age employed as 
lumbermen, raftsmen, v/oodchoppers , and ih saw and planing mills, 4,228 
of these being between the ages of 10 and 15 and the balance, or 15,535, 
being 16 and 17 yeo.rs of age. These statistics are set forth in detail 
in the following table: 



{*') Bulletin No, 497, Bureau of Labor St-tistics, page 1, 



9813 



-120- 
Children 10 to 17 yer-.rs, incl-asiive, of age 
gainfully occupied, -^.b Ixun'berrnen, n,ftsnen, and 
woodcl iop: erp; :\ncl in s -. w rvn-." - o l cn m,-;- laills in 1930 

Occupations Tot,! 10- 15 yrs. , i ncl. 16 ~17 yrs., incl . 

Tot-1 ■ 20,761 ' 4,228 16,5S3 

Lumbermen, riftsaen 

and woodchoppers: 5,025 1,047 3,973 

T9iu:)isterr anc lir.ndlers 237 57 240 

Other lun'roeri.ien, r-,ftG- 

men anc'. woodchopv^ers 4,72G 990 3,738 

Saw rnd Pl'.nia;;; Uilis a/ 15,736 3,181 13,555 



Source: Prepared by the Children's Bureau, Dc-oartment of La"bor, froi.i 
Census of Pov'ulation, 1330, Volune V. 



a/ Includes Wooden Box factories. 



During the ;ieriod 193.-J to 1935, inclusive, slcilled latur in 103 
cawmills in 11 st- tes in the Southern Fine area averaged atout 37 per 
cent of the total v/orlanen on the p-iyrolls of these mills, and common 
labor 63 per cent, (*) ' Similnr statistics for the Northern and Western 
portions of t.ie industry are not available, hut in, vie".' of the greater 
degree of .meclii\niKat:l.Qn of those; areas ,anc. the corresponding greater 
degree of skill required, the proportion of skilled. vrorlcnen in su(?h 
areas is doubtless larger. 

Some idea of the r^nge of occupations, in savmills may be gained 
from the follovdnt;, list of the principal occupations ;nublishcd by the 
U. S. Bureau of Li-,bor Statistics in connection v/ith its hour and v/age d?,ta; 
(*) 

Pondmen, log yardmen, head b,i,nd sawyers, head circular sawyers, 
doggers, setters, sa.w tailers on 'lead saws, garig sa.w3'"ers, resaw 
sav/yers, sm.all saw savryers, edgemen, edger tailers, transfermen, 
trimmer loaders, trimiuer operators, gang or resaw offbearers, graders, 
sorters, Ixand truckers, power truckers, liand stackers, -n Lining mill 
machine feeders, t.':'.lleymen, mil].\Yrights , laborers, and other env;3loj''ees, 

In logging the tj^oes P.nd nomenclature of rccu'^ations differ con- 
siderably in different parts of the country, and even between states in 
the same general area, Tliis difference is especially noticeable in 



(*) Analysis of questionnaire dat b.y the Southern Pine Association, 
ilcw Orleans, Lomsiana, November 18, 1955. 

(*) U. S. Sure ai uf Labor Statistics, Ti Tages and Koui's of L a . bor in the 
L-umber JA.: ustry in the United States ; 1932, Bulletin Ho. 586 

9813 



rrl21- 

comp?.ring the Northwest --^.nd t:ie South, cue largel;/ to the larger and 
tr.ller lumher in the former area and the greater de^-ree of meclianiza- 
tion in tli;;,t ■ area. 

The ari"ncipal occupations in tlic log, ir^' camps of North Carolina, 
listed by the U. S. Bureau of Labor St-- tistics, are as follovrs: 

31ac;]:smiths, sladder .0 alile pullers, clcan-ui") men, cooks, 
'cutters, fallers, filers, s":id-"er firemen, foremen-, assistant 
forBmen, fel"'-in£; crcnv foreuen, section foremen, teamster foremen, 
tr?.ck foremen, t^rab-jac': :uen, hookers, laborers, labor leaders, 
laborers and hookers', loader levernen, skidder levermen, loadermen, 
log s towers, rigji.ers, roacmen, ropers, sawyers, sldLdder yard 
sawyers, stuimping tr:e sav.'yer's, section lands, spikers, swampers, 
teamsters, ton^- hoo'::ers, to;'i loaders, trr.ctor operators, o.nd vrood 
cutters. 

By v.ay of co}itrast, the follb'.7in:j' list of ;orincipal occuoations 
in the l.og.'^ing cninps of Oregon, -lublished by the same source,, is of 
interest: 

Balcers, 'becmak.ers, blacksuiths , buckers, head buckers, bull 
cooks, log buncliers, caterpillar drivers, caterpillar greasers, 
chasers, choker' setters , climbers, cooks, crane operators, cruisers, 
dishv/ashers, donlcey engineers, loa^der engineers, fallers, filers, 
firemen, donlrey firemen, loader firemen, fire v/o,rdens, flunld.es, 
head flunltie"?, 'h^andymen, hi^'h climbers, hookers, hook tenders, 
knotters, laborers, linemen, loaders, he3,d loaders, second lo3.ders, 
machinists, machinists' helpers, mecli?.nics, -^-unpraen, camp repairmen, 
car repaii-men, he?,a car repp.iinen, caterpillar repainnen, don]:ey 
engine repairmen, crm". rc;oair„ien's helpers, cater--:iillar repairmen's 
helpers, riggers, head riggers, riggers' helpers , sawyers, scalers, 
swampers, termsters, tong setters, w?vtclTmen, \7elders, wh-istle punks, 
and v/ood buc]:s, . . 

3 , General Labor Conditions 

a. Hazards of Sniploynient 

Records of tlie National Sp.fety Cc^mcil indicate that the lunbering 
industry ranlcs among the most kazardous of industries, (*) The re-->ort 
of tlie Council for 19c3 shovrs lumbering as- tv/enty-ninth in frequency 
and tvrenty-seventh in severity of accidents amon^, thirty uir.jor industrial 
classifications, (*) 

The accident. frequency a;Ki severity rates for 1S30 given in the 
above-mentioned rei^ort are as' follows J .' . 



(*) Children's Bureau, Departvaent of Labor, nemor ndum of Jan^uary 17, 
193o, prepared for the Lumber -.ad Timber Products Study Unit, 

(*) Accidentr-.l Injury I^otes in f.e Woodv,'orl3.ng ,nd Li^nbering Industries, 
1933 - National Safety Co-oiicil, 



9813 



—1-32— 

Frequency Rate Severity Rate 

All Inclustries 14.56 1.59 

VJoodworking 18.26 1.56 

Lumbering 59.67 5.00 

The need for exclusion of minors from industries ps hazardous as 
this industry has for many years teen recognized. In 1932 the Advisory 
Committee on the Employment of J'inors in Hazardous Occupations, a technical 
committee of health, industrial, and insurance excerts, after a study of 
dangerous occupations and accident exTjeriencc, included in Its reioorts a 
recommendation that minors under 18 should be nrohibi'ted from employment 
in lumber and logsiing operations, in saw and planing mills, on the OTjera- 
tion of poT7er-driven woodworking machinery, and in the loading, unloading, 
piling or storing of heavy lumber. (*) 

In a study made by the U. S. Children's Bureau (**) some years ago 
covering accidents in a single -^ear to minors under 20 years of age in 
"I'isconsin, the Lumber and Furniture industries were found as a group e ven 
more dangerous to these young workers than the Iron and Steel industries, 
causing 137 injuries per 1,000 boys in semi-skilled occur>ations, and 35 
per 1,000 laborers. Boys in serai-skilled work in saw and planing mills 
had an injury rate of 153 per 1^000 and in other woodworking industries 
(excluding furniture) a rate of 204 per 1,000. For tlie laborers in these 
.saw and planning mills the rates were lower, being 47 and 28, res-oectively. 

In a later study of accidents to illegally employed minors in this 
same state (Wisconsin), madealso by the U. " S. Children's Bureau (***), 
woodworking machines rahl^ed first among machines causing accidents. 
Three-fourths of these accidents occurred i n t he manufacture of lumber and 
allied products, sa'-'s and planers being resnonsible for a very large 
proTDortion of the woodworking accidents. Those injured by T^oodworking 
machines included a large proportion r)erma.nently disabled. 

In spite of the recogni-red hazards in the industry, bovs 16 and 17 
years of age, as indicated by the Bureau of the Census figures previously 
given, were still permitted to wor^; utd to the time the Lumber and Timber 
Products Code ^a.s, aiDDroved, and the prohibition in that Code against the 
employment of those under 18, with a few specified exceiDtions, re-oresented 
a real advance in protecting minor workers from industrial injuries, (****) 



(*) Statement of the U. S. Children's Bureau, Department of Labor, 
January 17, 1936, prepared for the Lumber and Timber Products 
Studv Unit. 

(**) U. S. Children's Bureau, Industrial Accidents to EmT)loyed Hinors 

in ffisconsin. I'assachusetts. and iJew Jersey . Publication 152, v, 20 

(***) The Illegally Employed Kinor and the Compensation Act, Publication 
214, Table 11, p'. 108. 

(****) Statement of the U. S. Children's Bureau, De-oartment of Labor, 
January 17, 1936, prepared for the Lumber and Timber Products 
Study Unit, 



9813 



-123- 

t. General Lator Conditions on the West Coast 

1. High Labor Turnover 

One of the signs of a contented labor force is a low 
labor turnover. If men are hapry and contented rith their work they 
will usoallj'' stay T/ith it; if they are restless and discontented they 
will move on to another job. In the West Coast Lumber Industry the 
labor tiirnover has usually been very high, although like so nany other 
aspects of the situation', adequate figures on the subject are difficult 
to find. A few mills, however, have made careful turnover studies. 
Four Oregon mills report that durin.^: the three years 1919, 1920, and 1921 
the average number of separations was 703 per mill ver year, while the average 
working vforce per mill was 343, indicating a turnover of about 205 per 
cent. (*) Jive Washington mil^s during the same Deriod had an average 
yearly turnover of 266 -^er cent, (**) and there probably v:as little labor 
trouble in these mills during this TDeriod. Had figures been available 
for the years 1917 and 1918 they would undoubtedly show a much larger 
rate of turnover, ■ particularly for the six months preceding the shortening 
of the work day. It is generally admitted thpt the turnover during the 
period ran from 500 to 1,000 percccis pj5«- aBi'itun(**'*) in 1915 the Federal 
Industrial Relations Commission estimated that the annual turnover in the 
logging camps was about 500 per cent. (****) 

The causes of this turnover have been many and have rami- 
fied through all the rela.tions of workers and. owners in the industry. 
Some turnover is inevitable in any industry, due to sickness, accident, 
death, old age, promotions, removals, etc. Some of the turnover is ■oecu?* ' 
liar to this industry but inevitable in it. Ten find it too exacting to 
continue working indefinitely in some of the extreme weather of the West 
Coast Region and leave it to rest up or dry but. (*****) Rain, even when 
it reaches a precipitation of four or five inches -oer day, does not hinder 
operations in mill or camp until something washes away. High wind, how- 
ever, may stop logging, nnd snow sometimes interferes with it, esTJecially 
well up in the mountains. There is also a considerable amount of idle time 
due to breakdo\"ns or necessary repairs. All of these causes result in 

increased labor turnover. 

(*) Industrial Relations in the West Coast Jiumber Indus try, i.Bulle tin 
No,' 349, December, 1923. Bureau of Labor Statistics. 

(**), Four L Bulletin, April, 1922, p. 35. 

(***) Bureau of Labor Statistics, Industrial Relations in the West 

Coast Lumber Industry . Bulletin llo. 349, December, 1923, p. 38. 

(****) U. S. Commission on 'Industrial Relations: Final Report, p. 167 

(*****) Bureau of Labor Statistics, Industrial Relations in the West 
Coast Lumber Industry . Bulletin .!Io. 349, December, 1923. 



9813 



-124- 

2. Ga,us?s of Labor Unrest. 

Sporadic strikes and \inion activity in the logt,i'^-g and 1-umber 
camps of the Northwest from 1905 to 1933 (discussed later in this 
chapter) threw a penetratinii,' searchlight on the bad conditions 
existing in such camos. Professor V;'illi?jn 7. Ogbum of' the Univer- 
sity of ?/ashinii;ton wrote, in 1918, (*) that the chief causes of labor 
unrest in the industry were: (l) lon^ hour^^j (2) lev? wages; (3) un- 
sanitary camps; (4) lack of family life; (5) absence of commnity 
life; (S) unsatisfactory workins" relationships v;ith foremen; and he 
stated that those v;ere of iiirportance nearly in the reverse order to 
tliat in .which they are mentioned. These causes will be discussed in 
turn. Hours of labor and v/ages will be treated in greater detail lat- . 
er in the clapter. The space given to' this discussion is believed 
warranted by the fact tha.t the gz'eatost amount of labor unrest ha.s 
been oh the West Coast, and also by the fact that the States cf Ore- 
gon and Washington, on the basis of the 1931 census, accounted for 
one-fourth of the total wage earners in the "Lumber and Timber Pro- 
ducts" (Census classification) bi-anch of the industry, and in 1933 
these states accounted for a slightly lar:-.:cr slrnre of the industry's 
wage earners. " ■ 

Tan hours was the standard working day in the Lumber Industry 
almost from its inception, although in some operations longer or 
shorter days were worked. While there had been dissatisfaction with 
the.lO-Jiour day for many years, it did not assume important propor- 
tions until 1917. The great -strike of that summer was chiefly for 
:the S-hour day, and it was not -until the day was shortened to 8 
hours on March '1, 1918 fiiat it was possible to quiet the unrest at 
that time. (**) Since the 8-hour day first went into effect there 
have been .few deviations 'from that norm on the West Coast. In April, 
192i3, a survey .of the camps B.nd mills on the West Coast showed that 
of 749 operations only 15 were i-unning over 8 hours. (***) 

Wage rates have created labor unrest chiefly when wages liave 
been- decreased or when pi'ices iaave risen, or on acco'ont of the wage 
spread between adjoining camps. Sach of these conditions has been 
frequent enough to cause considerable dissatisfaction. In Fe^i'uary, 
1923, in the Centralia and Grays Harbor districts on the West' Coast, 
about 50 miles apart, the vvage spread for laborers was $1.25 per day. 
While this spread was probably above the average, there lias usually been 
considerable variation in wages from plant to plant. (*.***) 

(*) University of Washington Forest Club Annual, 1918, pp. 11-14, Causes 
and 5emcdids of the Labor Unrest in the Lumber Industry , by Wm. F. 
Ogburn. 

(**) Bureau of Labor Statistics; Indiistrial Relations Jji the West Coast 
Lumber Industry, Euiletin llo. 349, Decenbjr, 1935. 

(***) Four L Bulletin, May, 1923, p. 12. (Pacific Horthwest) 

(****) Four L Bulletin, ferch, 1923, "o. 13. 



9813 



-125" 

Practically nona of the camps on the Wect Coast is so arranged 
tliat the men can live at home and for most of them there is no alterna- 
tive to living in the camp 'btnilc hon.se and eating at the camp cool: house. 
The bad living conditions in the hunk houses furnished for loggers in 
the Pacific lTorth\7est prior to 1917 nre indicated in a mass of testi- 
mony on the subject ;^iven hufore the Industrial delations Commission. 

Professor Oghum reported tl'ist of the large mirnbur of camps he 
inspected in the llorthwest during the winter of 1917-1913, one-half 
had v70oden bunks, one-lialf Md bed "ov^s, one-third had bad toilets, 
and only rne-half had showers, while as a rul.. the camps had about 
one-lmlf the requisite axnount of 3.ir s-oace and one-third the window 
area required. The men nearly all furnished their own bedding. (*) 
In most of these camps the food was fairly substantial and plentiful, 
as was necessary to enable the men to endure the long hours and liard 
work, but this was not always the case, and in some camps, especially 
in hard winters when men were plentiful, the food was insufficient in 
quantity and of poor quality. (*'i) 

Some of the most careful stud.ents of labor unrest in the industry 
hold that the more fundamental causes lie below the surface even of 
the worker's though^, and tliat the chief of such causes liave been the 
lack of family and community life in the camp and the unsatisfactory -• 
relations between worfcnen and foremen. (?"*) There was practically no 
provision for orga,nized recreation at the camps except in the few 
places where the Y. M, C. A. has been established. 

In most cases men havo been chosen for positions as foremen on 
the basis of their knowledge of machinery or technique rather tlian on 
the basis of their ability to handle men. -Accordingly, it lias been 
common to find that the foreman had little understanding of, or any 
sympathy with, the feelings and prejudices of his men. (****) A 
particularly distasteful outgrowth of this situation has been wliat ' \ • 
the workers call "highballing", which usually consists in crowding 
the workers to as rapid a pace as possible,' This has been most common 
in connection with yarding in the logging camps, where the hook tendet 
has speeded up the work by e:cs.mple, and by giving signals to the en- 
gineer to go ahead before the men were entirely ready. Such a practice 
has greatly increased the liazard of a business dangerous at best, and 
protably has increased the accident rate, (*****) 



(*) University of Washington Forest Club Annual, 1918, pp. 11-14; 

Causes and Remedies of the labor Unrest in^the -Li^mber Industry , 
by Wm. F. Ogburn. 

(**) J, Rowan, The I. V,, Z. in the Lumber Industry ," pp. 9-10. 

{***) Carleton H. Parker, The I. ',7. VJ . , in "The Casxial Laborer and 

other 3ssays", p. 103 (ig^O) 

(****) Bureau of La.bor Statistics; Industrial Relations in the West 
Coast Lumber Industry . Bulletin Ho, 349, December, 1923. 

(*****) Ibid. 
9813 



-125- 
3. Improvement in Labor Conditions 

California was a pioneer in legislation designed to improve the 
conditions of the T/orkers on the VJes.t Coast. The first lator camp 
sanitation law for the state v/as passed in 1S13 and became effective 
on Ausust 10 of that year. (*) Its enforcement was placed with the 
State Board of Health hut no soocial funds v;ere provided to carry- 
on the work. This same legislation created the Commission of Immi- 
gration and Housing, -vhich, among other powers, was given the right 
to inspect labor camps, -~ 

The 1913 law set forth, in general terms, th-at the. hunk houses 
and other sleeping quarters and the grounds about the camps should be 
kept clean. It also provided, in general terms, that there should be 
sufficient air space in the sleeping quarters and that the beds or 
bunlcs should be made of sanitary raaterial, so constructed as to 9-fford 
reasonable comfort to the occxtoants. There were no requii-cments .for 
toilets or bathing facilities,, nor for the disi^osal of garbage or other 
refuse which rao-de many of the carons unfit for hninan habits-tion. In 
1915 this act v/as completely revised and contained in its provisions 
many of the features T/hich li3.d been established by rule and found to 
be practicable. The power to enforce this law was placed in the hands 
of a Commission of Imi'nigration and Housing, (**) 

The act lias since been -further amended until the jjresent law, 
though not ideal, assures reasoimble comfort to the occupants of 
these caraiDs, To aid in the establisliment ,of goo.d CAmps the Commis- 
sion publishes an advisory pamphlet on camp sanitation, giving all 
necessary information for their construction. This pamphlet has re- 
ceived international recognition. In addition, the Commission gives 
operators the benefit of the advice of its experts whenever called 
upon, and many logging and lumber camps have been built with their 
aid, (***) 

The amended Act of 1913 prohibits, the use of platform- bunks 
and discourages the use of the double-deck bunl:. It has eliminated 
the wooden bunl:s filled with loose- stray/, which generally became 
vermin infested. The screening of vdndov/s and other openings in the" 
kitchen and dining quarters has improved kitchen and dining services. 
Such practices and the proper- care of ga.rbage have relieved the camps 
of many flies and improved liying conditions of the workers. (***.*) 

{*) _ Kearney, R. 17,, Chief, Division of Housing and Sanitation, 

. , Department of Industrial delations, State of California, Calif- 

oniia Sets Standards for Lg.bor Camps ; National .Safety Council, 

IvLarch, 1930, 

(**) ' Ibid, 

(***)' Ibid. ' ■ . . ■ 

(****) Ibid 



9813 



-127- 

The major 1-um'ber companies, vdth few exceptions, are reported 
to have cooperated f-ally, and some of them liave gone beyond the re- 
qjiirements of the act in furnishing hotel service, including the 
making of beds with sheets, for which a reasonable charge is made. 
The operators of small millshave usually been harder to get in 
line. They frequently hire neighbors for some of the operations 
and contract other parts of the work. The wife of a worker operates 
the cookhouse, such as it is, and the housinn; is anything from a few 
cull boards thrown together, or tents, to automobiles converted into 
sleeping quarters. Tlie small mill operator 1ms frequently discledmed 
responsibility for the condition of the grounds, unscreened coolchousos, 
unsanitary toilets, etc. (*) 

While the foregoing, refers only to the Sta.te of California, 
it is a matter of common knowledge tlaat the improvement in living 
conditions of the workers in that state is reflected elsewhere in 
the West Coast area. While crowded b\-ailchouses, uaisanitary conditions, 
lack of drying rooms, and absence of showers are still found in some 
of the camps, the most flagi-^nt evils liave been eliminated. (**) 

c. General Labor Conditions in the South. 

Similar detailed data for the South are not available, but it 
may be stated that the causes of labor unrest in the West Coast sec- 
tion, Just discussed, do not, in general, apply to the South. This 
is due mainly to the fact, mentioned earlier in this chapter, that 
in the latter regions the loggintC areas are more or less contiguous 
with argiculiural areas. Logging labor is largely, therefore, inter- 
changeable with agricultural labor and loggers often have more or 
less permanent residences on farms in the vicinity, working only 
part of the year in logging opera,tions. For this reason the lack of 
family and community life, which lias been such a fertile source of 
labor troubles on the West Coast, has riot, in general, applied to the 
South. On the other hand, however, the South is confronted with the 
problem incident to the large nirnbers of negroes employed in the same 
camps and mills as the whites and often conroeting for the same Jobs. 
The negro workers are more or less resigned to their station, seek 
wliatever security they can gain from a low wa.ge scale, from the un- 
complaining perfonnance of disagreeable tasks, and from, occasional 
benevolent sentiments of the more influential elements of the white 
population. There is evidence, also, of poor housing conditions in 
some of the logging and lumber carajs, especia.lly in those of the 
smaller companies. 

The coiTiparatively low wages paid in the South have been rcndorod 
somewhat less of a hardship due to the milder climate and the fact 
that many of the workers have permanent homes or farms where they 



(*) Ibid. . ■ - 

(**) Todes, Charlotte, Labor and Lumber , International Publishers, 
Hew York (1931) 

9813 



can supply part of their food requirements and Y/hile on the joh are 
frequently furnished with coMpany-ov/nod cottages at low rentals. 

A survey made hy the Southern Pine As sr elation, covering 
103 mills in the Southern Pine area, revealed the fact tlmt of 
6,045 houses owned hy these mills, 552, or 9 per cent, wore occupied 
rent free in the first quart n- of 1934, 216 hy white tenants and 336 
hy negro tenants. (*) 

The same survey indicated tlvat of 11,313 lahorers ernployed 
hy 127 conpanies in Fohruary, 1934, S4 per cent were housed in 
company-ovned huildings. The avera^^e rents of these company- 
owned houses, accordinf; to this s'arvey, ranged from 50 to 60 cents 
per week for two-room cotts-ges, to $4.75 a weel: for certain six and 
seven-room cottages. 

4, Organizations and Disriutes 

Lahor organization activity in the industry lias heen largely 
confined to the West Coast, althotigh there Ims heen some such activity 
in the Southern States of Louisiana, Arkansas and Texas, and in the 
West Virginia Hardwood field. Organization in the latter area did 
not begin until the end of the Codal period (Ma.y, 1935). These areas 
will "be discussed separately. 

a. Wast Coast. 

The first union activity on the West Coast occured 
among the workers in the shingle mills, commonly called "shingle 
weavers", ahout 1890. These vrorkers were never verj'' numerous, 
the group in any mill being sroall. They were very mobile, the 
range of skill required was small, and most of the work could be 
done by any one of the group. In addition, the method of v/age payment 
— ^by the piece — and the dependence of all the crew upon the pace set 
by the shingle sawj^ers, drew them together. This group was well 
fitted, therefore, to take the lead in \inion activity. (**) 

About 1890 this group formed the West Coast Shingle 
Weavers' union, v/ith six locals in the State of Washington. In 
Jantiary, 1903, the variov.s shingle weavers' locals- united to form 
the International Shingle Weavers' Union of. America. This union was 
involved in many strikes during the first few years of its existence, 
most of these being of minor importance. The more im;,oortant were the 
general strike of 1906 at Ballard and the Gray's Harbor strike in 
1911-1912, all of which were located in the State of Washington. 



(*) Brief in belmlf of Southern Pine Industry submitted to the Nation- 
al Industrial Recovery Board by P. A. Bloom;r, Februa.ry 2, 1935. 

(**) Bureau of D?.bor Statistics; Industrial ^^..lations in the West Coast 
Lurnb.jr Industry, Bulletin ilo. 349, December, 1923. 



9813 



-129- 



The general- strike of 1906 "began at Ballard en April 1 when 
the union there went on strike, octensihly to oht^.in the union 
scale of wages which was teing paid elsewhere. Since this meant 
only a siTiall increase, it was generally vinderstood tmt the strike 
was for recognition of the -cuiion. This the owners refused. The 
strikers were siipported "by the International Union, while the 
mills were aided hj those in other parts of the state. On July 27 
the International Union called out all of its- members on the Uest 
Coast, tyins '^P a-hout 60 per ce.nt, of the- shingle production. About 
two weeks later the union called the - strike off and the men went 
tack to work wherever they could obtain Johs, the union being almost 
destroyed. (*) 

The Grays Harbor stri'ce in 1911-1912 was the next one of 
importance. An organization cairipaign had been started at Grays 
Harbor, but on October 10, 1911, before the coirrpletion of the cam- 
paign, two plants discharged their union employees, whereupon the 
union called a strike at both plants. Soon two other plants joined 
in the lockout. Considerable bitterness was aroused, especially i-n 
Hoquiam, where some disorder occurod, and the strike dragged out until 
it merged into the I. W. W. strike of March 14, 1312. Most of the 
original demands of the shingle weavers were granted with the settle- 
ment of the I. W. W. strike. (**) It should be mentioned here tha.t 
frequent attempts were made to withdraw the Sliingle Weavers' Union 
from the American Federation of Labor and affiliate it with the 
I. VJ. V/',,' but that these efforts were all -unsuccessful. (***) 

Many attempts were made before 1913 to orga.nize the logging 
and sa^vmill workers on the \Vest Coast, but few are worthy of men- 
tion. (****) In 1905 the .International Brotherhood of '.ToodmBn and 
Sawinill V/orkers were grarited a cha^rter by the American Federation of 
Labor and by 1906 this union had attained its greatest strength, with 
less than 1,250 members. The members had fallen, to iialf tr^a.t number 
by- 1911 and' the union was suspended by the Federation of Labor for 
failure to p3.y the per capita tax. (****<) After this suspension the 

(*) Ifeshington Stats Bureau of La.bor, Biennial Report, 1905-1906, 
pp. 194-196; Pacific Lumber Trade Journal, June, 1906, v. 9; 
July, 1906, p. 9, 33; August, 1906, p. 10; September, 1906, 
p. 9: Shingle ^Teavers Hevvs, Febrxia.ry 8^ 1913, p. 1 

(**) Aberdeen World, Oct. 25, 1911, p. 4; Oct. 27, pp. 1,4; Shingle 
VJeaver, Oct. 28, 1911, p. 1; Hov. 18, p. 1; Bee. 16, p. 1, Jan. 
27, 1912 p. 2, et. seq; March 9, 1912, p. 1. 

(***) Industrial Worker, January 23, 1913, p. 1; The Everett Massacre , by 
Walker C. Smith, Chicago, 1917, ^, 29; Shingle Weaver, Feb. 1, 1913, 
p. 10. 

(****) The Timberman, June, 1901, p. 5; July, 1903, p. 16, 

(*****) American Federation of Labor; Proceedi-iii;,-s of the Fortieth Annjial 

Convention, 1920, 13,33 et. seq.; 1911, ii, 87. 
9813 



-130- 

Anericor. ?edern,tion of Lr'oor extended the jui-isdiction of the Shiiirjle 
Uervers' Union to cover the entire Li.i .ber Industry, (*) The nri^e of 
the union T7as ch.-in;.;ed to "Interr.rtion.-l tlnioj-i of. Shinjle '^er.vers, 
Sawmill 7or]:ers nnd Uoodsmen" end. tl.e n''-;o oJ its Journp.l to the 
"Timber T7orI:er" . (**) .About Vir.voh., 19l9,...the luiion "ijr.in chmged iti; . 
nrrne to "Interno.tior.r'l Unio:?. of Tinbs.- T7orkers". (***) 

In J.'inuary, 1914, r, conventio/;a. -0.7 the unio:i voter to uonsiid .?.n 
3-h6ur day in the L\i;ibor Industry- ;--t the r.;.".}ie hourly rnte as for the 
10-hour dny, e:-ce :t th-^t the : lininu.j 'd."ily "r,:;e uas set at 0^.25, rrith 
tine and a half for overtine. (**•*=*) iho e:T^lo"'-ers , hoiTever, oyjosed 
the de-iands and launched an aggres;;ivo rtt-c!' on the imion. A strike 
nhich developed -oroved unsuccessful. Durin ; 1913 this union fought 55 
lockouts, lost in ner rly every case, rnd -as al;-iof5t coi.TOletcly destroyed. 
/ side*** \ 

Innedi-.telv folio- l'.; these o-isr^.trous stri^Tes and the failure of 
the Timber TJorhers Union to orr:;ani-:e the Lumber Industry, the Ai.ierican 
Federrtio:''. of Labor revo^:ed the jurisdiction of the union over the 
sawmill rnd cpjto vjorlters , thus li-utinii it P:-;ain to t?ie shingle 
weavers. (*«****) jhe shin-:^"le,. weayers' unio.i vo-s thereupon reorganized 
under its former nane,, "Internr.tion;! Shin;;-le '..'epvers' Union of 
Arjeri'ca" . 

Logginjc: and sai-jnill vrorliers ou/van to form locals rfter they had 
been excluded from the Jurisdiction of the International Ti?iber TTorkers' 
Union. Finally these locals neri;ed into a ner International Union of 
Tirnjer Uor]:ers, vhich did not include the shinz-^le vreavers, yjid in 1917 
were granted r charter by the American Federation of Labor. (*******) 

At this point it is ap'orojriate to consider the Intern'^.tional 
ITorkers of the "orla ;.-.nd. their part in the labor organization and dis- 
putes on the Uest Coast. To this end- it is ^/ell to recall the analysis 
of labor. t"'~o.es made earlier in tliis chapter, ilo .bers of the I.T7.T7. 
-(*) Shingle TTeaver, January 27, 1012,. "o. 10. 

(**) Shingle 'Tc-^ver, Februar^- 1, l')13, jj, 2; Febraarv 22., 1914, v. 2. 

(***)Timber-;Trorker, March 51, 1314, :>. 3. 

(****) Timber TTorker, January 31, 1914, p. 12.. Proceedings of Twelfth 
Annual Convention, Sesolution ilo. 104. 

t. 

(***** )Americpn Federation of Labor. 'Proceedings of Thirty-fifth Annual 
Convention, 1915, ■>. 38, 

(****=''*)Shina'le Ueaver, Aoril 4, 1916; Seattle Union Hecord, Februa.ry 12, 
1916, .p. 4. 

(******* )T7ashington State Federation of Labor, Proceedings of Sixteenth 
Annual Convention, 1917, p. 1J6; Aueric n. Federation of Labor, 
Proceedings of Fortieth ipinual Conve:ition, 1930, p. 35; Shingle 
Weaver, January 20 and 27, 1917, 



9813 



-131- 

have been iecraited rliio^t e:.:clasivel ' fro'T tho nij'^rptor;^ .^roa-os, vfho 
have had an importrnt irrt in shr rin ; the lolicias and t rctics of this 
frankl/ revolutiono.rv or^ani-rrtion. (*) 

Ainong the ^riiicioles oj? tho I.l.'.'', are the follo'dn,-: (l) That 
the interest3 of tho ei.roloyer and tlio enilo/ees hpve nothin':; in con.'ion; 
(2) that the wage system r.iust he re laced hv rn industrial societj'' 
managed b;' the -Torirers thei.-.selves; (u) that labor or':;anizations must 
be bp.sed on industrial rather than cr-^ft lines. (**) 

This ^io.cirl philosophy ^'as not -oQ-oulrir i^dth the ernjloyers rnd it 
T7as not al'7ays clear '-'hether their reaistrnce to I.T7.TJ, dej.iands was due 
to this philoso'ohy, its Ip.bor denajids, or both. TTith reference to the 
denrjid for industrial, rather than cr-'^ft, unions, it shov.ld be noted 
that the Ltrnber Industry, --jarticiilarly the lo£r.'inT br.mch, does not 
readily lend itself to orcrnization alon^; craft lines. The logr:ing 
canp erroloys a lar^^e niimber of unshilled and seni-skiMed "orkers rand 
only a fe" hi^;hl-'- skilled ;aen of nr.n-r different crafts. These include 
engineers, machinists, croenters, blacksniths rnd many other crp.fts, 
but there are usually not nore than t'-'O or three men of any ohe craft 
in a given camp or plant. In the cnros most of the nen live tOf;ether 
in the bunk houses nnd when not at rrork ,are very closely associated. 
The contact in the nills is iiot so close, but the irorl^ers iDecone r^ell 
acquainted. These fj'ctors h.'-.ve milita.teu. a,;ainst' the craft union and 
favored the industrial t;r3e. (***) 

The or.-'anizrtion ,«nd initial ;oro-iaganda of the liV.l.'. on the TTest 
Coast takes us back to 1905, vfhen a nuiibor of locals rrere formed, but 
its most important lumber strike did not start until !"arch, 1912, ;rhen 
members of a sa;-'raill crev at Hoquian, Washington, '--alked out pjid closed 
the mill. No demands nere made at the time, 'but it ^'as generallj'' under- 
stood that the strike -as for i)etter '-ratios. The mill ^-'as ^aj''ing $2- 
for a 10-hour day. ITithi;: tlie nonth the stri' e had si^road, many mills 
had closed, and some violence hod resulted. A citizens' comiiittee at 
Grays Harbor finally :)ro->osed thrt the strike be settled on the oasis of 
a minimum r/a^e of $2.25 per da;'"; thrt -Treference should be ';iven to 
American labor; that no members of the I."'. 'J. should be enmloyed; nnd 
that an otherwise open shop should be maintained. The mills accepted 
tnese proi^osals and ^although the strikers apoarently did not formally 
acceipt the proposals or call off the strij'e, all mills rrere running 
with full crews, about a month after tho initial stri]re. (****) 



The yearn follc'in-j 1912 \70re very unfavorable for the I.".rJ. , Tjith 
declinin:; membershim and strength, and it was severrl years before this 
(*) BTire-^u of L,'-.bor Strtistics; Industrirl Relations in the TTest Coast 

Liyab e r I ndu s t ry . .julletin Ilo. 349, Decerfoer, 1923, 

(**) Ibid. ' ■ ■ ' ■ 

(***) Ibid. ■ * ■ ' 

i**"*") Aberdeen T7orld, A )r. 3, 1912, pp. 1, 6; Aor. 5, 1912, mp. 1, 8; 
Apr. 8, 1912, p. 1; Apr. 17, 1 12, m. 1 

9813 



-132- 

loss Fas recovered. Attervots to locate and re:nedy the faults in the 
organization led to the ador)tion of the "can'o dele'^ato system", whereby 
a camp delegate vr.s 'olaced on each job, his duty being to receive dues, 
hold meetings,' look after the general- interests of the nen on the job 
and i-ee^ in touch with the nearest local. (*) This change in orgajiiza- 
tion ivas acconpanied by a considerable change in the attitude toward 
the job. The I.",T7, found tha.t its o\7n strength depended u-non binding 
the uenbers to their jobs- — a discovery '-'hich tended to break do-n the 
propaganda "or sabota.:';e v/hich was so evident in the files of its naoers 
fro": 1912 to 1917. (**) In the meantine, however, (1916) the I.U.!7. 
had becone involved in trouble at Hverett, State of TJs.shington, growing 
out of the shingle weavers strike .there, A free sioeech fight was con- 
ducted i-;hich culminated in bloodshed on both sides. (***) 

The strike in- the Lur.iber Industry in the llorthwest during the 
sumner of 1917 will be given special attention not only becaiise it 
represents ■ . by .■''ar the most extensive la^bor disturbance in the history 
of the industry, but nlso because of i.ts irrportant influence on future 
industrial problons. Extending to most of the Hest Coast, this 
strike brought to a head influences which had been gathering strength 
for years, and its settlement deeply affected subsequent industrial 
relations. Both the I.U.TJ. and the Aiaerica.n Federation of Labor felt 
that with the improved lumber raai'ket in the errly part of 191-7 the 
time had come for a deteriiiined stand for im>roved labor conditions. 
Demands drawn U3 at an I.U.I7. convention nay be sumnarized as follows: 
Better living conditions in the cam-ps, an 8-hour day, better wages, 
and union recognition. (****) 

The strike begon i-n April, 1917, '•gind. spread until , it is estimated, 
nearly 70,000 men throughout the Northwest -/ere idle, (*****) As the 
strike developed ell of the demands except that for an 8-hour day 
droprjed into the background and the struggle centered -on that question. 
The Federal Gove'rniiient was br-o-a,ght into the trouble through interference 
with the supply of lumber for the Array, rnd the Secretary of War and 
the Governor of I'pshington urged the employers to grant the 8-hour day, 
with time rnd a hc-^lf for overtime. The employers refused to yield, 
however, clriraing thrt -the 3-hour da}'- was economically impossible 
owing to the keen competition of other lunber regions "here cajn^os and 



(*) Industrial ¥-or]:er, ?eb. 1, I^IS, p, 3; Solidarity (l.''.". Organ) 

Jan, 3, 1914, p. 3; Kov. 21, 1914, p. 2 et sea; Nov. 28, 1914, p. 2. 

(**) Bureau of Lnbor Statistics; Industrial Relations in the ^est Coast 
Lumber Industry. Bulletin Ho, 349, December, 1923. 

(***)Colemrm, IT. F. , The l.V.XJ. and the La-; Lverett; Sunset magazine, 
July, 1917, pp, 35, -33-70; Smith, Uallrer C. , The Everett Ilassacre, 

(****)^est Copst Lumberman, April 1, 1917, p. 42, 

(***'^*) Bureau of Labor Statistics; Industrial RelatiOiis in the 'Test 
Coast Lumber Industry . .Bulletin No. .349, December, 1923. 



9313 



-133- . 

mills T^ere on a, lO-iioiii' "oasis. (*) "ith ths ■rosT...i--'tinn of o;oerD:tions 
on the -oart of the :i,ills m Se^tcn.irr, 1317,. the 3hin;';le Servers' and 
Tirnl>er TTorkers' Unions dro\':iec. oi;it ,of si ;ht, rnd the remainin.5 trouble 
^ps furnished b/ the I. ■..".7.':' stxi^re on the Job, or. as then terned, 
"conscious irithdrfivrl of cf "icionc-". (**) 

At this "ooint a re-or^seatative 01 the U. 3. '..'rr Deoart'ient held a 
conference of the leading; e-v.iloyers of tiie "Jest Corst, out of -Thich 
gren the Loyal Le^jion of Lo/: ;ers a.nd Lvaiberien, en organizatio.i of 
ernployers rnd ei.rolo-'-ees •'ith the ouipose of coo")erating \7j.th the 
Governnent for a ma.::inxi-m outfit of lu :ber pnd sui^pression of seditious 
activity. Coijinissioned officers vrere detailed to visit .tlie lumber 
caii^s and enroll the men in tlie Loyrl Legion. The or'janization was at 
once a success and installed a con^]ete system of collective dealing 
bet'.'een e;.iplover a.id e'loloyee. (***) 

There were nunerous CCToloyers on the Uest Coast ^-fho believed that 
it Tjas necessrr-' to (Vrrnt the S-hour day to nuiet the unrest, but a 
majority of then vere convinced that this v;-a.s an economic iirmossibility 
as lonj as other lu'nber regior.s i.:-ith 'Thich tlie"'' were coyneting had a 
longer day. A raee.ting of e.r-ilo.-'ers held in Portland on I'ebru.arj'' 27, 
191J attempted to ree.ch an agreene:it on this question, but without 
success. It was finally agreed,' therc'ore, to leo,ve the settlenent of 
the matter to a re-oresentative of the T7ar Deoartnent, Colonel Irice P. 
Disque, who announced that on Harch l,.iyi3 the Lu'iber Indu.^try in the 
ilorthwest would go on an 8-hour basis. I),;, ledia.tel 7 thereafter this 
action w'S unajiinously a^y^roved by the 4-L orgajiisation. Employers also 
accepted the conference nethod -jrovirled j-y the 4-L •".-^chinery, b.ut con- 
tinued to oiToose the closed shop, (****) The 4-L bec:".jie the- domina,nt 
organisation for e-iployer-em-'ilo-yee negoti'^tions, aj. though after the war 
its menbershiiD shrank fron ±30,000 in 191C> to 10,000 i-n 1922. (*****) 

A few local unionn of s-vni"! wor]:e:'s and log'-ers rei.iained, but 
the International Uaioii of Timb,er T7or!:er3, affiliated with the American 
Federation of Labor, disbanded In l'^22. The old 1.7.7. organization, 
■■'hich had been active before^ the ■-'a.r, also declined into obscurity. 

(*) Washington State Bureau of Labor, "''■iennial Re 'ort, 1917-1918, p. 
67 et seq. ; Uest Coast Liuiberraan, AUi:.,xist 15, 1917, j. 19; U* S. 
Congress, House of rie-oresentatives. Select Cou"ittee on IZxpendi- 
tures of the '..'a-r De'oartiient , SuoconMittee on Aviation Testimony, 
Vol. 2, pp. 1182-1192 (G6th Congress, 2d Session). 

(**) Bi.u-eru of Labor Statistics; Industrial delations in the 7est Coast 

L-'jjnb o r I nduB t ry . ]3ulletin No. C49, Dtceiiber, 19S3. 

(***)Perl.ia:a rnd Taft, Histro'^ of Labor in the IT. S. 189o-1932 . The 
Macl.iiliv^.11 C... (19;:5). 

(****) Ibid. 

T**'***")lbic'. ■ l.Ionthly Labor ileview,' Se-)t. 19o5, U. S. 3ureau of Labor 
Statistics. 



98i; 



-134- 

Durir.g the depre-:5sion the Loyal Legion suffered loss in nembership and 
influence in connon ^^ith regular r!,nd corrvonny unions, some companies and 
their iTorkers nithdra.i-'in;;; plto,;;ether, "hile others maintained an in- 
different attachment. (*) 

I7ith the --jassage of the irationel Industrial Recovery Act in 1933 
the 4-L's claimed collective bargaining control, hut the Arnericnji 
Federation of Labor became very active in an orj!5?.nization orop;rarn and 
is reported to have partially controlled 90 per cent of the workers by 
August 1, 1935. (**) 

A. P. of L. federal locals of loggers, sp'-rnill, plyr-iill and shingle 
workers spr".ng up throughout Washington o.nd Oregon. On A-oril 1, 1935 
these feder.-.l locals organized the Sawmill and Timber Worlrers' Union 
and became a i^art of the United Brotherhood Qf Cari^enters and Joiners 
of America. ^.***) 

Discontent with low earnings and reduced employnent had been 
growing among all lumber workers due in part to the fact that while 
the Code had increased their hourly wa,ge3, their hours had been so 
limited that there was no increase in weekly earnings. (****) 

The new Saivnill and Timber I'orkers' Union voted to go on strike on 
May 5, 1935 if at that tine they had 'not been successful in negotiations 
with the various limber operators. Their orojosed agreement providing 
for a 30-hour week, 75 cents an hour nininum wage, and ■union recognition 
was either ignored or rejected by all operators, who made no counter 
proposal. The strike was called and by the first of June had reached 
its loeak, with pra.ctically aJl camps and mills tied uo, involving 
32,000 lumber workers. Shi-',TOing and other affiliated industries were 
seriously affected. (*****) 

'The 4-L agreed uoon a scxle of wage increases a.mounting to 5 cents 
on the niniraun rates from 45 to 50 cents, 6 cents on wages iro;:i 55 to 
o2-l/2 cents, and 7 cents on rates from 6;3 to 72-1/2 centc. 

The partial success of the 4-L., together with the Sujrene Court 
decision oh the' HEA on Kay 27, 1935, influenced many members of the 
union to moderate their demands. An interesting side-ligh-t on the 
situation is a.fforded by the following excerpt from the 4-L Lumber 
Hews of June 15: -"The production of the mills and cainps now closed 
is not needed in the present condition of the national and foreign 
lumber markuts .... The mills no" do\7n could remadn closed for the 
rest of the year without affecting particularly the national lumber 
market, except to bring more -orosperity to the South and other regions. 

(*) U. S. Bureau of Labor Str.tistics, i.ionthly' Labor H'eview, Sept., 1935. 

(**) Department of Labor, Piles of the Dj.vision of Conciliation. 

(***)U.S. Bureau of Labor Statistics, Monthly Labor Revie-, Sept., 1935. 

(****)U. S. Department of Labor, Piles of the Division of Conciliation. 

(***** )U. S, Bureau of Labor Statistics, Monthly Labor Review, Sept. 1935, 

(******)lbid, 
9813 



-135- 

To';ard the Ipst of Jane the Federal Liinber I'edirtion Bor.rd, a:o;oointed 
by the Secretary of Labor, be-ran nerotiations betvreen the union and 
individual coiiVO-'^nies. A little lator a n-nj-iber of comanies be.'^an 
o-oerations on a 50-cent ninimi-jn rrte aiid 40-houi- basis but 'without 
'written agreenents , vrhile so-ne corroiivnies 3i;';ned a union apreerisnt pro- 
viding for this ivo^je scale and union recognition. By the middle of 
August practically all mills hrd reo-ienei on the basis of individuo.l 
agreements, some written and sorie verbal, but all granting increases 
in wages and li-nited recognition of the union. In general this recog- 
nition consisted of no discrimination against union i.ien out refusal 
to nm a closed shop..(*) 

Ooinions on the restilts of the stri]:e vary. The 4-L was vory 
emphatic in denouncing it ps \innece3sary , claiming that wage iiicreases 
had been obtained through peaceful negotiation. Union officials, 
however, maintained th^t the best -Dossible settlements had been made 
and thrt trade unionism, for the first ti;ie since the war, was again 
a dorainrint factor in the llorthwest Lumber Industry. (**) 

b. South 

During 1910 an attem-ot was made to organize the timber workers in 
Louisiana, Arkansa.s and Texrs into the Brotherhood of Timber Workers, 
an independent org.anization inspired by followers of the I.T7.T7. In 
1913 the Irotherhood was formrll-;,^ aff i'li.-'ted with the I.T7.W. Its 
headqurrters were in Alexandria, Louisiana. (***) 

In July, 1911, a convention of the compa.ctly organized Sawmill 
Operators' Association in this region ordered the shut-down of mills 
with 3,000 employees and gftve its e-;ecutive conmitt'ee powr,r over the 
closing of the 300 mills in Texas, Louisiana and Ar!;ansas. A war 
on the Brotherhood of Timber TTorkers and the I.!7,T7. w,as on, but the 
organizing canpa,ign ria^Le considerable headway. The chief obstacle was 
friction oetween i-^hites and colored, which the workers claimed was en- 
couraged b"y the employers. The iinion lerders took the position that , . 
since the em-oloyers obvioasl/ had not objected to the nixin-^ of races 
on the job,. the union had excellent precedent for inviting whites and 
colored to a. joint consideration of their coyyion job interest. 

The Brotherhood map-oed out the follo\:ing series of demands to be 
"oresented gradually to the lumber companies: A r:inimum wage of $2 for 
a 10-hour day; bi-monthly payment in lawful U. S. currency; freedom 
to trade in independent stores; reasonable rents; a revision of insur- 
ance, hospital and doctor fees; im-orovenent in the sanitary conditions 
of the luJTiner ca'HJS and towns; disarming and discharge of company 
guards; and the right of free speech and. free assemblage, (****) 



(*) Ibid 

(*) Department of Labor, ?iles of the Division of Concilia.tion. 

(**) Ibid. 

(***) Perlman and Taft, Historj'- of Labor in the United States, 1895-1932; 
The Macmillan Co., ITew York, 1935. 

(****)lbid. 
9313 



-136- 

The demand chosen to "be presr.ed iinnodi-^tely -.'as for e seni-raonthly 
pay day. Under the once-r-nonth "oa;'" doy it is reported thot the em- 
ployees i7ere frf^queatly forced to fr;)!-' for rdvrnces in corricny Scrip,., 
good at f"ce value only at conpany s'-tores ^hore , in some int^tnnces, 
prices '-'ere frou 15 to 40 -jer cent roove the outside prices. "Joninally 
the employees h"d the option of taJr.in-;; thoir scri'o to .the indeoendent 
stores, but at a discount which in some cases ran:';ed from 25 to 40 per 
cent. The companies refused the demand and p. strike follo'Ted. The 
strike v^as uneventful at first, but soon violence arose, resulting in 
the death of three union nen and one com'orjiy ^aan. The Coroner's .jury 
chargea officers of tlie conorny '/ith murder,, but the grand jury re- 
turned indictments for first de^'ree nurder agsint 58 union members, and 
did not indict the officers of the co-:.rocnr. Nine defendants nere 
brought to trial early in Octooer and a, verdict of not guilty "as re- 
turned. The murder charges against the other defendants ^lere dismissed. 
(*) 

Ten days after the verdict r strike involving 1,300 rrorkers began 
at Herryville, Louisiana, for the reinstatement of the en-oloyees of the 
American Lumber Co^rpany '-'ho had testified for the defense. Stpte tro'ops 
were sent but ijiiiediately nithdravm. The limber ■ comornies are reported 
to have encouraged p Good Citizen Lea,gue, npde u-o on non-union workers 
and business men in the West. The strike lasted seven months pnd, 
together irith the union, uas suppressed, according to the strikers, by 
the activity of vigilante committees. (**) 

c. T7est Virginia. 

About May, 1935, an orgpjiizer for t^ie jkierican federation of La.bor 
started a campaign to orgrnize the timbex' and sar,'.ull ^vorkers of the 
West Virginia hard'^ood field into locals of the Samiill Workers' .Union. 
(***) This orgo,ni'3er stated that by August, 1934, he had succeeded in 
organizing 5,000 'jorkers 'a.nd on Au.'-ast o caJled e. general strike \7hich 
affected 4,000 em":)loyees and 12 plnntn. The demands consisted of re- 
cognition of the Union, increased vages and si,;ned working contracts. , 

From the date the stri!:e rras called xmtil Hovember li>, 1934 it 
i^^as gradually settled on the basis of individual contracts -'ith en,ch 
□ill nhich generally contained a repetition of 7-A of the National 
Industrial Recovery Act and called for tb.e return of all strilcers 
without 23rejudice at three and one-half cents an hour increase, and 
signed agreements. There does not seen to have been an.}'' direct recog- 
nition of the union, since the individual contracts vere signed by a 
com;iittee representing e:roloyees rather than a corr.;ittee re-oresenting 
the union. However, the Director of Conciliation, Department of Labor, 
wrote the Secretary of one of the locals on October 13, 1934 that as 
bargai:aixa; • -',-m; "itn the union officers, this might be considered a.s 
recognition. Possibly the en iloyers did not understand their agreements 
to constitute recognition of the union, since in one mill the check-off 
system provided for in its ;i.,':roement never operated. In two of the 

(*) Ibid. 

(**) Ibid, 

(***) De'oartiient of Labor, Tiles of the Director o" Conciliation. 
9R1 3 



-137- 

agreements there was no iucropse in vnres, ''out those enployees living 
in company houses wero allo-'ea rent free. (*) 

After the liRA decision o;" tlie Su-'jre.it: Court oi iir.y 37, 1335, sons 
of the opers.tors endeavored to cancel their afrue-.ients "by f;oinj back 
to a 48-hotu" '.Teel: and cuttin.;; the •,-';u-;qs to the jrevious scale, hut 
these atte;.ipts appearted to he unsuccesoful . The Anerican Federation 
of Labor -granted the Brotherhood of Carpenters -^.nd Joiners Jurisdiction 
over the locals, effective Ajril 1, 1935. (**) 



(*) Ibid. 
(**) Ibid. 



9813 



-1"8- 

a» Siiwmill and L'ill^7ork GoraliinecL. 

The serious effect of 13113111633 depression on hourly wage rates in 
the Lumber Industry is seen in the follov/ing aver.age hourly rates, in 
cents, v;hich show the ra.pid downward spiraling of such rates since 1929« 
These data represent the conbined cora'outed rates for the census classi- 
fications "Lumber and Timber Products" and "Pl??Jiin£ llills", otherwise 
referred to as "SaATnills" and "Ilillwork", respectively, 

1929 1930 1 9 51 193 2 19 37. 19.^4 



Avero,ge Hourly 45.5 44.9 41,2 34.2 33.9 43,5 
Wage (cents) 



41,2 


34,2 


■.".: 


.. ^ 


90,4 


75,0 



Index (1929=100) 100,0 98.4 90.4 75.0 74.3 95.5 



Source: Corrouted bjr Code Industry Analysis Unit, Division of Research 
and Planning, 111111, on following bases: IT.I.C.B. tines .792 
from Jan^^ary, 1925, to December 1931; B.L. S. from January, 
1932, to 1934, combining "sa-'.Tmills" and "millwork" by using 
estimated total man-hours .'.s wei-vhts. 



It will be seen from the foregoing table that averr^e hourly xiagos 
declined from 45,5 cents in 1929, the yeoT preceding the depression, to 
33.9 cents in 1933, or to 74 per cent of the 1929 level. At first the 
decline was slight, but it increased iu severity during the years 1931 
and 1932. 

The codal yepx 1934 witnessed a very substantial recovery in wa.ges, 
raising the 1933 rate of 33.9 cents to 43.5 cents, thus representing a 
gain of nearly 29 per cent over the low oint of the depression. 

Ina.smuch as the weekly wage, rjiither than the hourly w.-^ge rate, de- 
termines the earnings of the worker, it will be of interest to examine 
the following average weel-d.y wages for the same industry classificj.tions! 



1929 1930 1931 1932 1933 1934 

Average Weekly 

Wage (dollars) 21.14 20.21 15.78 12,41 12.50 14,43 

Index (1929=100) 100,00 95,6 79.4 58,7 59,5 58.3 



Source: Computed by Research and Planning Division, IIRA, combining 

3oL.S. statistics for sawmills rnd nillwork by using estimated 
number employed as weights. 

9813 



-139- 

It will "be seen fron p co:Tpp.rison fo the t'-'O preceding ta'bles 
that average vieekly -wages declined rauch nore dr;\stically" than avera^je 
hourly wage rates, indicating the effect of reduced hours of enploy- 
ment. The 1933 \7eel-ly earnings of $1'";.60 represented less than 60 
per cent of the 1929 earnings, whereas the hourly wage did not fall 
beloT/ 74 per cent of the 1989 level, 

h. Sawmills and Millwork Coiapared 

The following table comaares average hourly wages in the sawmill 
(Census classification "Lumber ajid Timber Products") and millwork 
(Census classification "Planing Hills") brojiches of the industry for 
the years 1932-1934, the only years for which this coriparison is avail- 
able. 

Branch of Industry 



1932 


1933 


1934 


(Cents) 


(Cents) 


(Cents) 


33.0 


33,0 


43.5 


39.4 


37.2 


44.3 



Sawmills 
Milwork 

Source: U. S. Burea.u of Labor Statistics 



The foregoing table indicates that the differential between aver- 
age hourly wages in the so-called sawmill branch of the industry, and 
the' higher average hourly wages in the millwork or inde-oendent planing 
mill braJLch decreased step.dilj'' from 5.4 cents in 1932 to 4.2 cents in 
1933 ejid 0.8 cents in 1934. This situation may be due to the reported 
increased coiqoetition which independent plaaing or millwork plants ex- 
perienced from such plants operated in conjunction with sa.wmills. 

Average hourly wages for 1934 have not as yet been com^-Duted by 
the Bureau of Labor Statistics, but fig-ures for individual months, with 
the exemption of only the first three months, are well above the 1934 ., 
average. The 1935 hourly wages, by months, ranged from 42.3 cents in 
January to 47.2 cents in September for the sawmill branch, pjid from 
44.0 cents in March to 46.0 cents in Decerab -r for millwork. 

Because of the importance of averrge weekly wages, the following 
comparison of auch wages for sawmills and millwork may be helpful* 



9813 



-140- 





1929 

(dol.) 


1930 
(dol.l_ 


1931 
(dol.) 


1952 
(dol.) 


1933 
(dol,) 


1934 
(dol,), 


SavTTnills rj 


20.62 


19o63 


, 16.00 


11,77 


12,33 


14,30 


l.IillTTork t/ 


23,56 


22.59 


19,58 


15.08 


13,90 


15,21 


Sawnill Index 
(1929 = 100) 


100.00 


95.4 


77,5 


57,1 


59,8 


69.4 


liillwork Index 
(1929 = 100) 


100,00 


95,9 


83.1 


64.0 


59,0 


64.6 



Source:, U, S, Bureau of La"bor Statistics 

a/ • Census Classification "Lumber p,nd Timber Products'' 

b/ • ■ Census ^Classification "Planing Mills" 



Prom the foregoing table it appears that average neeld-y wages in 
the sawnill "branch of the industry declined from $20,62 in 1929 to $11,77 
in 193"', a money loss of 43 per cent, and that in millwork these rrages de- 
clined from $23,56 in 1929 to $15,08 in 1932, r money loss of 36 per cent. 
In the Ir.tter branch, however, the loss continued into 1933, so that the 
average ,f or thr.t year was nearly 41 per cent below the 1929 level. The 
codal year 1934 showed considerable improvement in the weeldy wages of 
both branches, the amounts of $14,30 for sawmills and $15.21 for millwork 
representing approximately 69 per cent njid 65 per cent, ' respectively, of 
the 1929 wages, 

c. Area Comparisons 

The striking divergence between wages in the South and TTest is indi- 
cated in the following corajarison of average hoxirly wage rates and weekly 
earnings in these areas: 



9813 



-141- 



Year 



AVT^KA^-E HCUKLY '"^A'"tE RAT"S AW" AYFMCr?. 
WEEKLY EAHi-IINGS , ir T^ffi LUi^OER 17D\]S1!1V{ (SA' 'MILLS) 
IN THE TOST Al\D S0UT7 a/ 
'■? 

Avevp-g-e ToTirly "Rrti^ of Averfge ^''eekly Hatio ".f 
Wa,?re Hates S'-uth t'^ Er-rnings South to 

West West 

South Per Cent West South Per Cent 



1923 

June. 



^est 



"50.552 



$0,270 



49 



1925 

Pehruary to June. 



1930 

Mpy t'' August. 



193; 



1933 

July - Average 

Decemher - AvetRre. 



,533 



1928 557 



.558 
.38=^ 

.366 
.530 



.27'^ 
.275 

.260 
.170 

.150 
.290 



51 








49 


S26.01 


$14.44 


56 


47 


25.17 


12.74 


51 


44' 


14.24 


7.11 


50 


41 


13.40 


6.80 


51 


55 


13.83 


8.44 


61 



1934 

Average fir?t ten 
months 



.548 



295 



17.76 



3.70 49 



Source: Research and Pl;inning l^ivision, ITRA, Pe-Qort entitled "Hours, 

.Wages and Enrol oyinent " * -orerjared for hearings on emt>loyment -nro- 
visions of C^des, January, 1935, -o. 58. 

a/ "West" includes Oregon and ^'fashingt^n. "South" includes AIp- 
. bama, Florida, Georgia, :assissir)'Ti, North Carolina, South 
Carolina, Virginia, Arkansas, Louisiana and Texas. Since the 
■orincipal t)roduct of the Southern States is nine, which comnetes 
chiefly with the Douglas fir of the ^^^est Corst, the Southern 
States have "been cnrn-pared \"ith the "''estern States where Douglas 
fir is produced Figures :f or Pre-code years are weighted averages 
of State averages airoQaring in the ^Viges and Hours Bulletins for 
the Lumher Industry "oublished by the Bureau of Labor Statistics. 
. Figures for 1933 and 1934 represent conditions in the Southern 
. Pine and West Coast (Douglas Fir) Divisions, as reported to the 
Code Auth'-'rity. 



This -oreceding table indicates that aver^ige hourly wage rates in the 
Southern states were a.T)TDroxiraately one-half of those in the West Coast 
States of Washington and Oregon for- the years 1923, 1925 and 1928,. the 
1928 averages 



9813 



-142- 

being $0,557 for the West nnd $0,275 for the South. It annears also that 
■beginning in 1930 the excess of the ^-estern average over tha.t of the South 
increased until in July, 1933, Just -nrior to the Cor'e, the latter was 
only 41 -Der cent of the former. (*) 

The effect of the Code a-oriears to be reflected in the fact that in 
December, 1933, the fourth month of oneration of the codal wage tdpo-. 
visions, the Western average vfas 53 cents as com'nared with less than 37 
cents in July, 1933, and the Southern average was 29 cents as comt)ared 
with only 15 cents in July. It is also seen that under the Code the 
Southern s.vera^^e hourly wage rate rer^resented a larger -DroTDortion of the 
Western avera,;Te than at any other period covererl by the table. 

These statistics show that until 1934 the ra,tio of average weekly 
earnings in the South to those in the West was greater than in the case 
of average hourly wage rates, due, doubtless, to the longer average work- 
week in the South. In 1928 these Southern earnings averaged $14.44 as 
compared wit.i $26.01 for the '''est — a ratio of 56 Per cent. Subseauent 
reductions brought these earnings down to $6.80 in the South rnd $13.40 
in the West In July, 1933, representing a ratio of 51 per ceilt. These 
pre-code earnings in the West were apprcximately 50 per cent of the 1928 
average and in the South were 47 per cent of the 1928 level. ' ' ■ 

The codal month of December, 19r'3, shoif'ed only a slight increaee in 
average weekly earnings in the '"est, as contrasted with an increase of 
nearly one-third in the South over the July, 1933, earnings. During the 
ten months of 1934 this situation was reversed, for the $17.76 weekly 
average for the West in that period represented a. substantial increase 
over that area's December, 1934, earnings, whereas the $8.70 average for 
the South was only slightly above the December level. 

It has often been assumed that it costs much less to live in the 
South than in any other section of the country, and considerable stress 
was laid on this point in pre-code hearings on the subject of territorial 
wage rate differentials. One approach has been to compare in the South 
and in the North the prices of a large quantity of goods needed by a 
family. The defect of this method is that the goods priced are not used 
in both regions, and to this extent the comparisons are artificial. More 
corn bread, for instance, is cons^umed in the South and more wheat bread 
in the West and East. More rice is used in the South and less coal. (**) 

Professor William F. Ogourn, of the University of Chicago, recently 
employed a different method of attack, using the percentage of the family 
income spent for food as an index of the plane of living, and on this 
basis reached conclusions which would throw some doubt on the existence 
of a large differential between living costs in the South and elsewhere. 



(*) The President's Reemployment Agreement went into effect in July, 1933. 

(**) Ogburn, William F. , University of Chicago, Does it co st less to l ive 
in the South? University of North Carolina Press, Social Forces, 
December (1935), pp. 211-214. 

(***)lbid, 
9813 



-143- 

Insuff icient data havp "opco^-ie ■■'v?o.l.---''-)le to enaolc definite conclusions 
en this -ooint to te -ofesented in the -orcpent report, but it is believed 
that such observations as those of Ti-ofer-sir Og^hurn indicate the need 
of further research on this subject nnd its importance as one factor in 
determining or justifyin^^ territorial wa£:e rate differentials. 

The following table com-nares av^ra.f^c earninsis "oer hour -oer em- 
X)loyee and average full-time earnings ner '-"eek -oer employee in logging 
camps and sawmills for three Southern states and three Northwestern 
states for the years 19'38 and 193,'^. The data for these years afford a 
basis also of com-paring nre-depression and bottom-of -depression earnings. 

Percontagc of Decline 
ig.-'S 1933 from 1928 



Logging Logging Logging 
Camps Saw- Crmps Saw- Camps Sawmills 
nills _ ■ m ills 

Average Earnings per 
Hour per Employee: 

3 Southern States a/ $0,322 SO. 292 '-^0.179 50.181 44.4 38.0 
3 N. Western Statesb/ .663 .566 .461 .393 30,5 29.3 

Average Full-time Earnings 

per Week per Employee:' • . . 

3 Southern States a/ 19.42 17.37 10.76 10.72 44.6 38.3 
3 N.VJestern Statesb/ 32.26 26.78 22.62 IB. 93 29.9 29.3 



Source: Bureau of Labor Statistics, Jiulletins Ko. 497 (1928) and No. 
586 (1932), "^''.Tes and Hours of L^^bor in the Lumber Industry 
in the United Statps". 

a/ Arkansrs, Louisianr*^ ?nd "'ississip'ii. 

b/ Oregon, T"ashington and Idr'ho. 



This table indicates that in 1928 average earnings per hour per 
eranloyec in logging carans and .sawmills in the Southern states of Ark- 
ansas, Louisiana and Mississippi were appro3:imately laalf of the Corres- 
ponding earnings in the thr^e Northwestern states of Oregon, 'Washington 
and Idaho. 

It also appe-irs that average hourly earnings in the Southern states 
suffered more during the business depression than in the Northwestern 
states, since in 1932 the differentials between the two were considerably 
greater. It will be noted that in the Southern states these 1932 earnings 
represented declines from the 1928 earnings of 44.4 per cent and 38.0 
per cent in the logging camps and sawmills, respectively, whereas in the 
Northwestern states these declines were 30.5 per C(pnt and 29.3 per oent, 
respectively. 

In average full-time earnings per week per employee the spread be- 
tween the two areas under consideration was not so great as in hourly 

9813 



-144- 

earnings, due to the longer hourp worked in the So-uth. It is interest- 
ing to note, hov'evpr, thf't the declines in 1932 from the 1928 level 
were almost identical with those for hourly earnings. 

d. Payrolls 

'^e long-time trend of -oayrolls in sa^^mills (Census classification 
"Lumber and Timber Products"). '">-s well as seasona.1 fluctuations in such 
payrolls, are shown in the following indices, which are based ur)on the 
year 1929 as IOC. 

Index of Payrolls ( 19'?9 = lOO) 













S-'wmills 












„i926 


-192?... 


1928 


1929 


1930 


ig.-^i 


1932 


1933 


_1934_ 


1935 


Jan. 


96.4 


92.5 


86.0 


88.3 


80.1 


40.9 


21.4 


16.7 


29.8 


32.3 


Feb. 


101.5 


94.3 


9". 6 


91.5 


78.7 


40. ft 


•-;1.0 


16.0 


32.8 


36.7 


Mar. 


102.1 


95.9 


93.4 


94.2 


83.7 


41.1 


20.8 


15.7 


35.5 


38.4 


Apr. 


105.4 


94. ^i 


96.3 


100.4 


83, f^ 


39.7 


21.2 


16.6 


38.6 


40.6 


^fay • 


109,0 


100.7 


99.5 


105.8 


82.8 


41.1 


21.5 


19.0 


''1.5 


34.5 


Jun. 


111.9 


101.5 


10T.2 


105.0 


79.9 


41.1 


20.9 


24. 1 


39.8 


35.8 ■ 


Jul. 


107.0 


97.3 


97. P 


106.2 


7.-.0 


37.0 


19.6 


28. 7 


25.8 


39.3 


Aug. 


110. 


100. 3 


99.9 


105.6 


64.7 


36.3 


19.3 


34.3 


37.9 




Set). 


109.9 


102.3 


101.6 


107.1 


62.9 


35.4 


20.5 


39.6 


38.2 




Oct. 


110.2 


102.1 


102.6 


104.5 


60.8 


32.8 


22.0 


39,9 


38.=! 




Nov.- 


107. 1 


99.^ 


100.6 


98.2 


54.7 


29.8 


''1.0 


37.4 


36.5 




Dec. 


102.5 


94.6 


96.6 


93.2 


49 . 7 


25.5 


18.7 


34.3 


34.3 




Aver- 






















age: 


106.1 


98.1 


96,9 


100.0 


71.0 


36.9 


20.7 


27.0 


36.6 





Source: Derived from Bureau of Labor Statistics unadjusted index (1926 
= 100) by adjusting to Census with ITRk method. 



It will be seen from the foregoing that r^ayrolls in the sawmill 
branch of the industry declined from 1926 through 1928, rose_ slightly 
in 1929, and thereafter droiD-ned shprioly until 1932 when, at the bottom 
of the degression, these nayrolls renresented r-n-oroximately 21 -oer cent 
of those in 1929, or a loss of 79 r,er cent. It will be observed also 
that after l.)32 there was a grPdua.1 increase in these ■nayrolls which 
continued inuo 1935. 

Trends in millwork or nlaning mill ■DP^yrolls, shown in the follow- 
ing table, are somewhat similar to those in the wawmill branch, exce^Dt 
that in millwork the decline ■«'hich began in 1926 continued without a 
break through the first half of 1933, so that the average T)ayrolls for 
1933, desi^ite some improvement during the latter half of thr t ye^r, 
were only 22 -oer cent of the 1929 level. 



9813 



-k45- 

In<ic>- of ppyrollF- (1929 = 1")0) 
"illv'crk 
192G 1937 192R 1929 1930 1921 193'-' 193? igs-^v 1935 



Jan. 122,0 107.1 92,2 95.? 77,1 53,1 ?4,? 17.7 22.5 26.2 
Feb. 126,5 107.2 9^\ 1 98.0 Rl.O 55. f; 31.2 17.4 24.7 28.8 



Mar. 


128,9 


108,0 


100.0 


104..'^ 


80.4 


56 , 5 


28.4 


15.1 


26.4 


29. 


,4 


A-or. 


124.7 


110.7 


304.2 


105.3 


81,0 


56.3 


27,3 


17,6 


28,1 


31, 


,6 


May 


125.3 


112.8 


107,1 


106 . 5 


83.1 


57.8 


27,1 


19,9 


28.8 


33, 


,? 


Jun. 


126.4 


113.4 


109.4 


106 , 1 


80.5 


55.6 


25,1 


23.1 


27,5 


35, 


.9 


Jul. 


120,7 


109.2 


105 . 8 


103.5 


71,4 


52,4 


23,3 


26.0 


26.4 


38, 


.7 


Aug. 


125.8 


113.4 


107,6 


106.5 


70.9 


50.8 


22 . ,3 


27.2 


26.4 






Se-D. 


121,8 


107.9 


104 . 8 


105,6 


66.0 


44.9 


22,3 


27,5 


24.8 






Oct. 


124,2 


107,6 


105.2 


lO-"'. 


65.3 


42,2 


22,4 


26.8 


27,5 






Nov. 


121.1 


102.'" 


102.8 


87.3 


61.? 


:^9,8 


22,2 


25,2 


27.3 






Dec. 


117.0 


101,3 


100.4 


83.0 


60.0 


39.1 


20. 1 


25,0 


28.0 






Aver- 
























age: 


123.7 


108,4 


103.1 


100,0 


73.2 


50.3 


25.5 


22.4 


26.5 







Source: Bureau of Labor Statistics Index shifted to 1929 base; '^A 
adjustment to 1933 Census. 



An indication of comnosite nayroll trends for both sav/mills and 
mill'j^ork is afforded by the following tible: 



Index of Payrolls (1929 = lOn) 
Saijnnills and Millworlc 
1926 1927 1928 1929 1930 1931 1952 193? 1934 1935 



Jan. 


102.0 


95.7 


87.3 


89 . 8 


79.5 


43.5 


2---.2 


16,9 


28.2 


51, 


,4 


Feb. 


106.9 


97,1 


90.7 


92.9 


79, 2 


44.0 


23,2 


16 , 3 


31.0 


55. 


,0 


■'ar. 


107.9 


98.5 


QA. ^ p 


96,4 


83,0 


4^'. . 


22,4 


15,5 


53.5 


36. 


,4 


A-or. 


109.6 


98,2 


93.0 


101.6 


83,2 


4? . ? 


22,5 


16.8 


36.3 


38, 


,6 


'.'lay 


112,5 


103,3 


101.1 


106,0 


8''. 9 


44. 7 


22,7 


19,2 


38.8 


34. 


,2 


Jun. 


115,0 


1^4.1 


102.2 


105.2 


80.0 


44.2 


21,8 


23,8 


37.1 


35. 


,8 


Jul. 


110.0 


100.3 


99,5 


105.6 


70.4 


41.0 


20,4 


28,1 


33 . 8 


39. 


,2 


Aug, 


113.4 


103.2 


101,5 


105.8 


66.0 


39,4 


19.9 


32.8 


35.4 






Set). 


11-^,5 


10?,. S 


102,3 


106.3 


63.5 


37,5 


20.9 


37.0 


35.3 






Oct. 


113.2 


103.3 


103.2 


103.5 


61.8 


34,8 


22,1 


?7.1 


36.'^- 






Nov, 


110.1 


100.4 


101.1 


95.8 


56,1 


32.0 


21.3 


34.8 


34.5 






Dec. 


105,6 


96.1 


97.4 


91.0 


51.5 


28,4 


19,0 


32.3 


32.9 






Aver- 
























age: 


110,0 


100.3 


93.3 


100,0 


71.4 


39,7 


21,7 


25.9 


34.4 







9813 



-146- 

Source; Bureau of Labor St?'tiBtics datp. shiftpc^ to 19*^.9 base by the 
Division of Research rnd Planning, I*^A. 



Estima' 'd. average weekly -nayrolls for sa-'rmills and millwork over 
the period 19^9 to 1954, ipclusiye, a^-e shown in the following table: 

Estimated Average ^''^eekly Payrolls 
(Thousrinds of Dollars) 



1929 



1930 



1931 



193' 



1933 



1934 



Sawmills 
Viillwork 



8,107 5,754 2,98". 1,675 2,17S 3,044 
2,239 1,638 1,127 571 ' 501 594 



Source: Commuted by Research rnd Planning Division, "TPJ\., ?.-n-nlying 

•oayroll index of Bureau of Labor Statistics, sh.ifted to 1929 
- bf se, against Census -oayroll statistics for 1929. 



6. Hours 

In 1932, which, in general, marked the bottom of the depression 
for the industry, the sawmill brancn averaged 36.4 hours ner week, and 
the fflillwork branch 34.9 hours, according to data of the Bureau of 
Labor Statistics. Unfortunately no official or other comnrehensive data 
covering hours actually worked throughout the country are available for 
earlier years. 

Average hours worked, -oer week in the sawmill branch are inresented 
by months for the years 1932 to 1935, inclusive: 



9813 







-147- 








AV7T^0.-n 


T-TQ-ps '■'OT'SD P7P. '"'^r;' 






-. 


SA'-:iLLS 






fiontli 


1932 


1933 


1934 


1935 


Jan-oa.ry 


33.6 


33.1 


31.8 •' 


33.4 


FelDruP-r:/ 


35.7 


33. A 


33.0 •■ 


34. 7 


March 


35. 6 


34.6 


34 . 8 • 


35.3 


Anril 


35.7 


36.2 


34.7 • 


36. <i: 


May 


37.2 


40.4 


34.3 


33.2 


June 


35.6 


43.0 


34.1 • 


37.3 


July 


35.4 


44. 1 


32.3 • 


36.8 


Augus t 


36.5 


43.1 ■ 


33.3 


39.3 


SeDtemlDer 


38.2 


37.1 


33.3 


40.0 


October 


39.3 


34.7' 


33.7 


41.1 


Koveci'ber 


38.6 


S4.- 


33.1 


38.9 


Decemoer 


34.5 


33.1 


32.9 


39.9 


Average 


36.4 


37.-: 


33.5 


1/ 



Source: CcTiTjiled from data of the Bureau of Lahor Statistics ty the 
Division of Research and Planning, iWA. 

!_/ Hot yet available. 



It will he seen fron the foregoing table that the average of 37.3 
hours worked in 1933 '-as slightly -bove the 1932 average, ovt that during 
the codal year 1934 the average fell to 33.5 or nearly three hours below 
the depression Ic^ of 1932. 

An average for the year 1935 has not been officially com-outed, but 
it is evi'"'ent from the monthly averages that hours worked in that year 
considerably exceeded those in 1934. The Code for the industry, i^rhich 
was termnated by the Suorerae Court decision of !fey 27, 1935, stipulated 
a maximum work week of 40 hours with certain exce'otions. It is ihterest- 
ing to note that in Jxme, 1935, the first month following termination of 
the Code, the average work week was about foiir hours in excess of that 
for the TDreceding month, and tha„t for the balance of the year average 
hours continued to increase. The effect of the Code on hours of em- 
■nloyment will be discussed later in this clia-oter. 



9813 





■- 


-1'18- 








AVERAfrE 


MILL'TOP-K 


'•'EFK 




Month 


193? 


1935 


19r'4 


1935 


Janiiary 


36.8- 


35.5 


32.7 


34. 1 


February 


36.7 


35.8 


34 . 4 


35.3 


March 


3".0 


31.5 


35.5 


35.8 


Anril 


36.4 


39 . 3 


34.8 


36.4 


May 


35.2 


40.? 


33.9 


37.4 


June 


3^. 8 


43.3 


34.2 


38.9 


July 


34.8 


4^.7 


33.2 


39.1 


Augus t 


33.7 


39.6 


34.3 


40.3 


Ser)teniber 


34.8 


34.7 


33.6 


41.5 


Octoher 


35.6 


34.2 


36.0 


43. 1 


Hovemher 


34.1 


3^.? 


34.9 


40.9 


DecemlDer 


34,4 


34.5 


35.6 


42.2 


Average 


34.9 


37. 3 


34.4 


1/ 



Source: Coimiled from data of the Bureau of Labor Statistics by the 
Division of Hesearch and Planning, IsTRA. 

!_/ Hot yet available. 



A comparison of Pverr.^e hours worker -oer ^"eel: in the Southern states, 
which -oroduce iDrii^ciDallj,'' loine, with average hours in the '"'est Coast 
states of ^I'ashington and Oregon, "rhose Douglas fir con-oetes with the 
Southern -oine, may be helpful. The basis for ?uch 3 corariarison is af- 
forded by the f olloirinf' table, i"hich covers the sawmill branch of the 
industry. 



9813 



-149- 



AVE^AOIi; EO^^.3 •"0''-'Er) ?-'?. "1EKIIT T^T LW07F IlIDUSTHY 
(SAVJ-qLIS) 11? T^ --^IST AHD SO^r^ 19P3-19Z4 a/ 



■Ratio of South 









t< 


"■est 


Ye^T 


Wept 


South 


(P' 


gr Cent) 


1928 


46.7 

45.1 
36.7 

36.6 
26.1, 


52.5 

49.0 
41.8 

45.3 
29.1 




112 


1930 

May to A-ugust 

1932, 


109 
114 


1933 

July Average 

Deeeraber Average 


125 
111 


1934 










Average first 

10 months 


32.4 


29.5 




93 



Source: "Re-nort entitled "Hours, Wages and Emr)loyment" , nre-n.^red for 

hearings on emolo.yiTient -orovisions of Codes, January, 1935, hy 
the Research and Planning Division, ITRA, t).58. 

a/ ""^est" includes Oregon and ""ashinrton. "South" includes 

Alabama, Florida, Geo-gia, ' iisrissinoi, North Carolina, South 
Carolina, Virginia, Arkansas, Louisiana, and Texas. Since the 
princit)al nroduct of the Southern states is ijine, which conroetes 
chiefly with the Douglas fir of the West Coast, the Southern 
states have been comoared ^-ith the "''estern states where Douglas 
fir is "oroduced. Figures for -ore-code years are weighted aver- 
ages of state averages a-orierring in TYage and Hour Bulletins for 
the Ltimber Industry, of the Bureau of Labor Statistics. Figures 
for 1953 and 1934 rcTDresent conditions in the Southern Pine and 
V'est Coast (Douglas Fir) Divisions, as rer)Orted to the Code 
Authority. 



The foregoing table shows that -average hour^ ^J'orked rte-r i^eek in the 
West declined from 46.7 ho-'ors in 1928 to 36.7 hours in 1932, the year 
which marked the det)ression Ic^ in r)i"oduction and errmloyment, r-hile in 
the South these hours declined from 52.5 hours to 41. S hours durir,g the 
same rieriod. It is note^vorthy that the decline in hours in each area 
during this period w^s the same, namely, 21.4 -oer cent. 

In July, 1933, Just "orior- to the a^'or'^val o:<^ the Code, the hours 
worked aver^'ged 36.6 in the West and 45..3 in the South, whereas for the 
codal month of December, 19C3, the averf-ge had dro-o-oed to 26.1 hours for 
the West fnd 29.1 hours for the Soutn, re-oresenting declines of nearly 
39 and 36 ver cent, resT)ectively, from the -Dre-code average. Seasonality 
ma.y have been a factor in this decline, but judging from the monthly 
averages given earlier in this re-ocrt it is not believed that seasonality 
was an imoortant factor. 

Probably the most striking feature of this table is the indication 

9813 



-150- 

that whereas in 193B aver-ve hours in the South were 12 ner cent p>)ove 
those in the ^"^est, and v^herens in July, 19"3,(*) just -nrior to the Code, 
this differential had increased tc 35 r)er cent, this situp.tion ^as re- 
versed during the first ten months of 193^;, under Code operation, when 
the average for the South dro-Q-'^eH to a levl 7 TPr cent below thf t for 
the West. 

Full-time hours in the industry h-'ve varied considerably between 
the South and the Northwest. The following com-oarison, based on da.ta,of 
the Bureau of Labor Statistics for three Southern states and three Forth- 
western states, indicates that full-time hours in the South ,h?.ve cons.ider- 
ably exceeded those in the Northwest. ' <''■'■ r, T 

AVERArrF NUI.BEP. OF FULL-TIlffi MOUP.S PF~ '"FEK PK^ EMPLO'jfEE- ■*..-.'■■*• 

1928 1932 



Logging Logging 

Camps Sawmills Cam-ps- Sawmills 
Three Southern States a/ 60.4 59,4 60.2 59.3 

Three Nortb-estern States b/ 48.7 48.2 49.0 48.1 

Source: Bureau of Labor Statistics* Bulletins No. ^97 (1928) and 586 

(1932), "'"ages and Fours of Labor in the L-'ambef Industry in the 
United States". 

a/ Arkansas, Louisiana, Mississi'rni. 

b/ Oregon, 'Washington and Idp,ho. 



7. Productivit y 

In 1929, the latest year for which com-olete Census returns are 
available, the eleven -orincipal Southern -oroducing states had 203,324 
wage earners in tne Census classificf tion "Lumber and Timer Products", 
or 48 per cent of the total wage earners in this classification. The 
three leading lumber ■oroducing states of the -oacific coast — California, 
Oregon, and 'Washington — had 115,224 wage earners, or only 28 ver cent 
of the total. Yet des-oite the fact that the Southern states employed 
76 per cent more wage earners than the Pacific Coast states, Droduction 
by the latter, on a 4B-hour single-shift week basis, aggregated 14,149, 
301,000 feet board rae-sure of lumber, ^s against 15,462,485,000 feet 
produced in the eleven Southern states on a 60-hour single-shift week 
basis. (**) 



(*) The President's Reemployment Agreement began to be effective in 
July, 1933. 

(**) Brief in behalf of the Southern Pine In'^iistry, submitted to the 
National Industrial Recovery Board by P. A. Bloomer, February 2, 
1935. 

9813 



-151- 

The production rier wgge errner jn the Sonthorn stnter; in 1929 wps 
76,048 feet, against 12'-i,798 feet ner w^^^e earner in tlie thme Pacific 
states. Tims, the average Pacific Coast w; ge earner, working 48 hours 
a week, -produced 61 ner cent more luinber than did the average Southern 
wage earner working 50 hours a week. Thin is due ma.inly to the larger 
yield per log find per acre of standing timber obtained on the Pacific 
Cop.st, to the absence of hardwoods in the Pacific Coast isroduction, and 
to the highly mechanized otjerations coirJlon to th- t region. (*) 

A study of the -nroductivity of labor in the Lumber Industry in the 
Pacific Coast states in 1929, made by the Bureau cf Labor Statistics( **) , 
revealed the fact that efficiency, as measured by man-hour nroductivity, 
depended more upon the extent of raechaniz' tion, nnd possibly wages paid, 
than upon such factors as size of nlant. In fact, it v:&s found that such 
efficiency decreased with the size of plant as measured by number of wage 
earners employed,' espeically for those mills which prodticed their own 
logs. It appeared tha.t productivity did not increase with the size of 
mill as measured by either number of wage earners employed, aggregate 
output, or even aggregate horsepower, although for those mills which 
bought their logs there was some increase in productivity with increase 
in size of mill as measured by total output. 

This study also revealed that for the Pacific Coast states those 
mills which paid the highest hourly wage sawed, on the average, about 
40 per cent more l^uniber per man-hour than did the low-wage mills, but 
only about 30 ner cent more per wnge earner. The average wage cost per 
thousand feet of lumber sawed was 'much lower in the case of the high- 
productivity mills than of the low-productivity mills. 

Referring again to this Pacific Coast study, it was found thr t the 
most reliable indicator cf efficiency in this industry is horsepower per 
w"ge ea^rner, the increase in productivity with increase in horsepower 
per wage earner being appreciable. It appeared also tha.t the wage cost 
per thousand feet sawed wa,s perhaps a little smaller in the case of those 
mills with much horsepower per wa-^e ertrner than in the case of those with 
little horsepower per wage ea.rner. 

Probably the most reliable available basis for a study of relative 
productivity of labor in the industry is afforded by a special tabulation 
made by the Bureau cf the Census for use in this report. This ts.bulation 
shows lumber production rier mfm-hour in the year 1929 in 372 selected es- 
tablishjuents in the Census classification "Lumber and Timber Products" 
industry; by districts and states. There establislments were selected 
from, and represent, rtbout one-fourth of those lumber producing estab- 
lishments w?iich reporte'''' individually products vfilued in 1929 at $100,000 
or more. They repre'^ent, therefore, the larger establishments. All of 



(*) Ibid. 



(**) U. S. Bureau of L' bor Statistics, Productivity of Labor, Monthly 
Labor Peview, October, 19.'^2. 



9313 



-15 3- 

them produced lijmber and most of then m?^nu.factured .-planing mill Torod\icts 
nlso. In calculating the smount ol' l-uniher' -Drodxiced -oer" man-hour, the.' 
nuraher of feet nf roUtTh lumber has been divided by .the total number of 
rie,n-hour5 worked in the eptablishrnentp covered by the table. Thug the 
dividend refers to roiigh lumber onl^-, whereas the divisor represents 
the labor enroloyed both in Toducing rou^-'h lumber and in remanufacturing 
a pprt 'of it. . ' 

The followiTig tnble "oresents these ■nroductivity data, summarized 
for the three grand divisions: North, South anc '^est: ... 



Kuraber of 
Wage Parners Lumber Produced 
Kuraber of (avera,£-e per ifen-hour 

Area Estaolislnrients for year) (?t.b«m. )' (Per Cent ) 

Total 



The North a/ 
The South b/ 
The i^est -c/ 



372 


79,093 


47 Avg. 


lOn.O Avg 


74 


11,675 


34 


■ 51.1 


130 


20,177 


23 


59.6 


168 


47,241 


62 


131.9 



a/ Ilaine, New >>moshire, Ve^^mont, j-iassachusetts, New York, N^w Jersey, 
• Pennsylvania, Michigan, Ohio, Indian^,, Illinois, Wisconsin, Minne- 
sota, South Dakota, Iowa, Missouri, and Kansas. 

b/ Maryland, West Virginia, Virginia, North Carolina, Kentucky, Tenn- 
essee, South Carolina, "eorgia, Florida, Alabama, Arkansas, Louis- 
iana, Mississir)-ni , Oklahoma, and Texas. 

_c/ Montana, Idaho, Colorado, New Mexico, Wfi.phington, Oregon, and 
California. 



The foregoing data reveal tliat the average man-hour production of 
the 372 :establiskments covered was 47 ft. b.ra. This average is not re- 
•nresentative of man-hour -oroduction in any one of the three great areas 
covered,' namely 24 feet in the North, 28 feet in the South, and 62 feet 
in the West. The man-hour production in the North and South was 49 and 
40 per cent, respectively, below the average for all- the establishments, 
xvhereas the man-hour production in the "'est was 32 per cent above the 
average. 

Limitiji..cn the cora-narison to the South and West, the main lumber pro- 
ducing areas, it is found that the average man-hour ■oroduction of the 
West re-orerented an increase of more than 121 -oer cent over the average 
man-hour i:)roduction of the South. 

The variations among the several areas and states in the amo-ont of 
lumber produced per man-hour a-^e due to a number of causes, the most 
important of which are the degree of meclia.nization and amount of horse- 
power available per worker, the size of logs sawed, the average timber 
stand per acre, the degree of soft'^ood production, and the size of the 

9813 



-153- 

nroduct. In all. o-f the?" rof'nr-cts ti'io i''o?t excelled. It i? interesting', 
for instance, to note th' t .tiies State of ■" shington, \«/hose -orod-uction Tser 
man-hour of 96 feet excelled that of any otaer state, had the gjreatest 
average stand ver ^icre of ■,in(''ustri''lly-0"'ned sai-' timlier, namely, 45,283 
feet.(*) As in the cape of the ,ot]\er factors Just mentioned, ho'vever, 
there is .no conmlRtc correlation bet'veen average tirriber stand and -Droduct- 
ivity -oe'r man-hour, owin^ to the; effect of other f-'^ctors. 

It is interesting to note in co.nnection yiitli the foregoing com- 
parison that the average nunber of wage earners loer establishment cov- 
ered was much gre.ater in the '"'ept than in the South ^nd Worth, the 
averages being as follo\Ars: ^''est, 2^1; "Nort?a, 1.58; and South, 155. This 
does not' indicate tliat the sara-oles in ouestion are. not. rer)repenta.tive, 
but rather indicates that the "verage '"estern establishment is larger 
than is found else^^here. 

8. Code Labor Prox'is ions and Th eir Interpr et-"' t i on 

The Code of Fair Competition for the Lumber and Timber Product? 
Industries, which ^^as aT)""irovecl by the President August 19, 193.", was 
adopted only after an active Tjeriod of code formulation during AB'hich 
strenuous efforts were raiide^by the industry to ha.rmonize its varied in- 
terests and at the same time satisfy reauirements of the National In- 
dustrial P.ecovery Administration, In view of the wide sco'':)e of the 
industries covered by tho code, from the stand-^Tcint of location, "oro- 
duc-s, markets, labor, etc., it is not surprising that the "oro-oosed code, 
as finally aDprov^.J, rfor'^rerted a corsi^'er'^'ble degree of compromise. 
This is certainly true of the labor -orovlFions of the code, which are 
covered in the followiiig discussi^ri. ' 

. a. General La,bgr Provisions . • . ■ 

The general labor provipions , f o.and in .Article V of the code con- 
tained the usual -nrcvi?' ons '-eQi"'-irnd by the National Industrial Recovery 
Act, nai.n.elyj atsaiauce of thorrgh'c of t>_e emTDioj'oes to org?.nize and 
bargain coll^^-j f' 'tl^ through representatives of their wn choosing; 
freedom from intTi.-'^erence of employers in these rerpects; the ■^ight of 
emuloyrnent free from reouirement to join a comt)any ■union or to refrain 
from joining, organizing or assisting a l-'bor ovganizaition of their own 
choosing; a ni the reQuii-ement that each emu 1 oy er -c&m-oly with the stand- 
ards of wa^s and hours and other conditions of em-oloyment ax)r)roved or 
urescribed by the President. 

An outs tan''"' ing provision in view -of the haza-rds of this industry 
was the urohibition of employment of any individua.l under 18 years of 
age, exce^it boys 13 years and over who might be employed in the 'Tooden 
Package Division and in non-hazardous occupations during school vacations 
or in case tl-.ere vere no wage earners of 18 years or over in their 
families. 

The Code contained no suecific -orovision covering hnndica-o-oed work- 
ers. However, this '"as taken care of by Fxecutive Drder 6606-F, of 



(*) Table IV, Stand -oer Acre on Saw Timber .A.reas. 
981S 



•154- 



February 17, 1934, which permitted handic^^pped workers to be em-Dloyed 
at light work at wages below the codal miniimim on condition that the 
employer obtain a certificate in each case from State authority desig- 
nated oy the U. S. Department of Labor, Employers hiring such persons 
were required to file monthly reports covering such employment. 

It was known to the Deputy Administrator's office (*) that 
handicapped workers were employed at less than the codal miniimim wage 
rates under authority of this Order, since evidence of this was presented 
from time to time in connection with specific cases that came before 
the compliance councils. No statistics are available, however, sh-wing 
the extent of such employment. 

There were no apprentice or learner provisions in the Code, Other 
than handicaTDTJed workers, who were taken care of by Executive Order 
6606-£' (discussed earlier in this cnapter), no one was permitted to 
be employed in the industry at less than the minimum wages set forth 
in Article VII. (**) 

Considering the wide scope of the industry covered by the Code, 
the interpretations of its labor provisions, made oy the Code Authority 
and its agencies, were very few in. number. Likewise very few, if any, 
of these interpretations ^ere opuosed by the NBA. (**) These interpre- 
tations will be discussed under the appropriate heads, according to 
the type of provision. 

b. Hour Provisions 

Article VI prescribed a 40-hour maximum work-week, subject to certain 
specified exceptions. These ej>ceptions included executives and suT^ervisorv 
personnel, traveling sales force, and camr) cooks for whom no hourly 
limitation was made; eraplovees such as watchmen, firemen, and repair 
crews, where the nature of their work required that the hourly maximum 
be exceeded, constituting not more than 10 per cent of the employees 
in any operation, in which CFses time and a half imist be paid for over- 
time, and tem-Dorary emplo-yment in cases of emergency. For none of these 
exceptions was there any limitation with respect to hours. 

To provide further flexibility it ^^as stimulated that the Admini- 
strative Agency of a Division or Subdivision might authorize employment 
in a seasonal operation for a maximum number of hours not exceeding 46 
in any week, with the exception of parts of an operation depending on 
climatic conditions, such as stream driving and sled hauling, in which 
a greater excess was authorized; provided that average employment in any 
seasonal o-peration in any calendar year did not exceed the standard 
schedule. 



(*) History of the Code of Fair Competition for the Lumber and Timber 
Products Industries, NEA, p. 307. 

(**) Ibid. 

(***) Ibid. p. 308. 

9813 



, -155- 



It '"as further provided that m.^nufacturei's of voolen packages for 
perishable fruits and vegetables raisght be authorized by the Administra- 
tive Agency of the V/ooden Package, Division to exceed the standard 
schedule for a period not to exceed four ■■-eeks for any one crop, ^hen 
required to furnish p?>.cksgeE' for. any perishable crop, provided that 
the average employment of any individual in any calendar year did not 
exceed the standard schedule. Here again was a provision for long- 
time averaging of hours v^hich '"as fr.aught vdth administrative difficulties, 

A striking feature of these codal hourly provisions was the failure 
to restrict daily wor,kin:g hours in any v-ay. In vie'" of the extent of 
seasonal operations in this industry, the above provision for permitting 
an excess of codal maximum ho\irs per 'veek in such operations was also 
noteworthy, especially since it permitted the averaging of weekly hours 
over an entire calendar year. Averaging over such an extended period 
was obviously very difficult to check on the part of the enforcement 
agencies. 

Article VI, '."hich prescribed maximam hours of labor in the industry, 
was interpreted, in general, (*) as not applying to an independent 
contractor o'sning his owa track and driving it himself. 

Article VI, SnbseCuion A (2) a, '"hich excepted certain personnel 
from the maximum h'lvsr provision, was interpreted by the Lumber Code 
Authority June cO; lto4.. (**) Accoraing to this interpretation, 
"Executive" included ei^fccuti'^a officers and their personal secretaries, 
traffic managers, sales manager's, auditors, legal advisors and other 
department heads,' -'.^hile "supervisorv" included all persons '"ho plan for, 
direct, or superivse the T-onc of otner employees. ..','Cooks" were inter- 
preted to irclude all employees ^ho have to do with preparing and 
serving of meals. 

•Article VI, .. ■> cir'.'cion A [2) b permitted ^regular emplovraent for 
watchmen, firemen, .-.r^j.-ir . cre'=';., etc., beyond the codal maximum where 
required by the ns -.^uro of their "^ork, for not more than 10 percent of • 
the employees in any oirp-ration, but required the payment of time and 
one half for overtime.- , 

This provision was interpreted by the National Control Committee 
on October 10, 1933 (***) as rather broad and as applying to employees 
such as watchmen, firemen and repair crews "rho, by the nature of their 
work could not conveniently comply 'i^ith the maximum hour limitation. 
A truck driver enijaged in long distance, h-^uling \-fes stated to fall 
'"ithin the terms of this exception. 

(*) Lumber Code Authority, June iO, 1934. Code Authority Bulletin, 
Volume II, No. 51, August 3, 1934, F. 1 

(**) Lumber Code Authority Bulletin, Vol. II, No. 51, August 3, 1934, 
p. 1, ' (Supercedes rule N.C.C. of August £1, 1933) 

(***) Lumber Code Authority Bulletin, Vol. 1, No. 128, p. 2, May 28, 1934. 

9613 



-156- 



It was interpreted also that teamsters might come vithin the terms 
of this exception if a declaration to that effect '-ere made ty the 
Division or Subdivision A.";ency under '"hose jurisdiction they came. It 
^"'as ruled also that employees '^hile rctually engaged in inventory 
taking could be classified under this exception "'here such '^'urk could 
not be done during regular hours. 

Article VI, Subsection A (S) c, 'f/hich excepted, from the maxiinam 
hours of the Code temporary employment in case of emergency, was inter- 
preted by the National Control Committee October 10, 1933, (*) by 
way of limiting "emergency" to such events as fire, flood, tornado, 
accidents to ecuinment and the like, and not to be construed as covering 
such matters as a large excess of orders or any other matters under the 
jurisdiction of the Code. 

t. '.'age Provisions 

The Code, in Article VII, specified tvo sets of basic minimum 
wage rates; i.e., minima for various divisions and subdivisions ranging 
from 23 cents to 45 cents per hour on territorial and population bases; 
and, '."here no such specific minima applied, a .%'eneral ::iinimam of 40 
cents per hour. 

For those receiving more than these codal minimum rates up to 
$30 per 'reek, it '.■■'as required that the existing vege differentials be 
maintained. 

It vas further specified that the minimum compensation for '"orkers 
employed on a piec^worK or contract basis must not be less than the 
codal minimum '"age for the number of hours employed. 

Several general interpretations were made of Article VII, which 
prescribed minimum '-ages. The Resident Committee, on May 25, 1934, 
and the National Contrul' Committee, on July.?, 1934 (**), specified that 
the time spent by an engineer in getting ready for the day's ""ork prior 
to starting time need not be deducted from the hours of regular employ- 
ment nor compensated for, provided that the employee be not required to 
be on the premises for a perijd "longer than that for ""hich he is 
compensated". 

The National Control Comi'aittee, on July 2, ,1934 (***), ruled that 
the use of company scrip '."here the employee '."as unvdlling to accept it 
'.•'as a violation of this Article, but that the Authority did not feel 
it could validly object tt) the payment of employees in company scrip, 
provided there '"as no state laF- prohibiting its use, and provided the 
employee was '-dlling to accept at. 



(*) Ibid, 

(**) Lumber Code Authol-ity Bulletin, Vol. II, Nu. 51, p, 1, Aug. 3, 1934. 

(***) Ibid, same page. 

9813 



-157- 



Article VII, Subsection A (l), 'iiich required that the minimam 
compensation for "'Orkers employed on a piece'."ork or contract basis 
be not less tnan the codal rainiinura wag-e , f oi' the number of hours 
employed, was interpreted oy the National Control Committee, June 7, 
1934 (*) to be a matter of averages rather than of the amount earned 
in any one day. Payment in such cases vas interpreted as a question 
of the total amount earned in the period from pay day to pay day. The 
average rate of the total amount paid for '"ork done from pay day to pay 
day could nut be less 'than the minim'am rate specified for the class of 
work performed. 

It was also interpreted (**) tnat any person subject to the 
jurisdiction of the Code who employed or dealt with contractors must 
not only provide in his 'contracts for code compliance but must take 
all reasonable steps necessary to assure such comioliance. 

Article VII, Section A (c), prescribed that the ej4.isting amounts 
bv which minimum wages in the higher paid classes, up to workers 
recpiving $30 per week, exceeded minimum x^ages in the lowest paid 
classes, must be maintained. This was interpreted ijy the National 
Control Committee on October 11, 1933 (***) as meaning that only two 
figures are necessary to deterniine the "existing amounts", these being 
the minimum wages under the Code, and the prevailing "minimum wages in 
the lowest paid classes" at the time the Code v/as approved by the 
President. The difference betvreen the t'"0 detetriined the amount by 
which wages in the hign^r nald classes in effect at the time the Code 
was approved must be increased in order to conform to the provisions 
of Article VII (a) 2, 

In the case of salaried employees, ac'cording to this interpretation, 
the weekly or monthly '"^age must be reduced t'o an hourly wage by dividing 
the total wage by the average number of hours previously worked. The 
increase per hour was then to be acde'd to the hourly '"age and the new 
weekly or monthly ^'age ascertained by rmiltiplying by the number of hours 
permitted under the Code. It was interpreted that the Code imposed no 
reouirements with respect to the maintenance of '"eekly or monthly 
earnings. 

It was also interpreted that in applying this section tne wages 

to be considered were the prevailing minimum wages paid in the 

particular mill, plant or factory in question, or that, on the other 
hand, the application might be broadly applied to operators '"ithin 

a Division, Subdivision or group. It was interpreted that the Code 

was not specific in this respe.ct and was subject to either of these 
interpretations by the agency of the Code Authority. 



(*) Ibid. pp. 1 and Z. ■ ■ . • . • 

(**) National* Control' Comniittefe 's interpretation oi December 22, 1933 

in Lumber Code Authority Bulletin, Vol, I, No, 1.-8, P, 2, May 29, 1934. 

(*♦*) Lumber Code Authority Bulletin, Vol, I, No, 126, p. 3, May 29, 1934, 

9813 



-158- 



It 'f'a.s farther intei'preted thet "fr^^istiriif; amounts" as used in this 
section referred to the differentials in cents per hour bet'Teen the 
lowest and the hi,!j'her psid clp.-sses rt the ti:ne of the approval of the 
Code, August IS, 1933. It Tdll be noted that such an interpr'eta-tion 
is quite different in aripliortion from the maintf-nance of differentials 
on s percentage basis. 

l/'ith reference to Article VII, (a) 3, T-hich prescribed that charges 
to employees for rent, boarc, medical attendance, and other services 
must be fair, it vps ruled (*) that until further regulations on this 
subject should be issued, epcn operation '.". s recuired to advise the 
appropriate Division agemcv of any added charges, and of any advances 
in .the charges imrosed on e.'.ioloyees for such services since the a-opro'val 
of the Code, together with su-DT3orting evidence. In the event that the 
Division agency was of the opinion that the advance was rot justified 
or tended to circumvent the Code in letter or m spirit, the operator vas 
to be recuired to amend such charges to comply '"ith the .codal reouirement 
that they be "fair" to ' employees, 

Vith reference to the question as to ?.'hether an employee could be 
required to live in a coraprnv-owned house, the Resident Committee ruled 
on May ?5, 1934 (National Control Committee, July 2, 1934) (**) that . 
the matter of bargaining as to whether or not an employee might be-'re- 
quired to live in such houses as e pre-requisite to his employment was 
not covered by the Code, but that if rent for these houses was- excessive, 
such charges constituted a violation of the Code. 

In response to the question as to whether deductions from wagfes 
might be made by employers for board and servicer; if such services were 
furnished by concessionaires, the' Resident Committee ruled June 19, 1934 
(National Control Committee, September 10, 1934) (***) th^t the Code 
Authority had no jurisdiction over concessionaires or' their methods or 
means of collecting their charges. 

Article VII (B) specified that minijiun wages could not be less than 
40 cents per hour unless in any Division or SrUbdivision the prevailing 
hourly rate for the same class of employees on July 15, 19?9 was less 
than 40 cents per hour, for which cases r- schedule of rates was set 
forth. This provision y-as interpreted by the National C ontror Committee 
October 10, 1933 (****) as merely stating the principle applied o^r the ' 
Administrator in determining the minimum rates of "-ages specifically ■■ 
set forth i-^ subsection D of the same Article, anc therefore not tq be 
applied in determining wages to "be paid by any person under the juris- 
diction of the Code. 



(*) National Control Committee, October 11, li:i33. Code Authority 
Bulletin Vol, I, No, l"b, F. 3. 

(**) Lumber Code Authority 'ullttin. Vol. II, No. 51, p. 2, Aug. 3, 1934. 

(***) Lumber Code Auth.-rit'^ loilletin, Vol. II, No. :7, p,l, Nov, 15, 1934, 

(****) Lumber Code Auth.^ritv Bulletin, Vol, I, No. 128, p,3. May 29, 1934, 

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-159- 

9 . Opergtion o f Code Lr-bor P r o vision s 

Child Labor Pr visiont; 

The need for the child labor restriction ' of the Code, mentioned 
previously in conuection with general laboi' provisions, was shovm earlier 
in this chapter. It was seen that in 1930 there were ^^0,761 persons 
under 18 years ot a^^e employed as lumbermen, raftsmen, v;ood choppers and 
in saw and planing mills, 4,528 of these being between the ages of 10 
and 15 and the balance between 16 and 17 years of age. The need for 
protecting such minors was eiiiphasized by the records of the National 
Safety Council, which indicate that the lumbering industry ranks among 
the most hazardous of industries. 

The codal provision prohibiting the employment of individuals under 
18 years of age with certain exceptions, was designed to meet the. need for 
the orotection of minors. Between July ?1, 1934 and May T7 , 1935 the 
Compliance Division received ?8 allegations of violation of this provision 
of the Code, representing onlv 1.6 percent of all allegations received 
of violation of all labor provisions. Thus it appears that this provision 
was verv generallyobserved, (*) 

b. Hourly Provisions 

The effect of the codal hourly restrictions on actual hours worked 
is a matter very cifficult to deterraine, owing to the numerous factors 
involved, -which are principally the following: (l) the failure to provide 
any codal restriction of daily working hours; (2) the exceptions to the 
codal maximum work week and the provisions in certain cases for averaging 
'•eekly hours over an entire calendar year; and (3) production control 
under the Code, whicELpro viced for allotment of production on a general 
basis of 30 hours per week, or 10 hoars belov.' the general codal maxim-am 
v;ork-week, ■ but permitted this allotment to be worked out on a quarterly 
basis, thus allowing mills to produce their entire allotment as rapidly 
as desired, subject only to the ''"eekly restrictions of the Code, The 
influence of this last factor in reducing hours of employment telow the 
level permitted by' the Code. would depend upon whether the individual 
operator found it advantageous to work out his entire quarterly allotment 
in a short time at full cooal hours, multiple shifts, or both, or on the 
other hand, whether he found it advantageous to ppread his quota more 
evenly over the entire ouarter. Just how this i^orked out in actual 
practice can not be accxiratelv determined at this time. 

The fact remains, however, thpt, according to statistics presented 
earlier in the chapter, average hours worked per week in the sawmill 
brpnch wer.. pbove 40 hours for the months of 1933 just prior to the 
effective aate of the Code, being 40.4 hours in May, 43,0 hoars in June, 
44,1 hours in July, 43,1 hours in August (the hour provision did not 
become effective until August 52'" , whereas for the Dplance of tne year 



(*) History of the Code of Fair Competition for the Lumber and Timber 
Products Industries, NEA. , pp. 506, 507. 

9813 



-160- 



these hours decrep.sed ?nd never Pgpin ri.pched the 40-h.yur level until 
after tne elimination of the Code in 1935, 

The records of the Liti'^rtion Division sho^vdng the number of 
cases of Code violatiim beinj-" pre-oared^ those in Court, and those 
closed, are of little or no help ps an ino.ication of the extent of 
compliance "'ith the hourlv r)rovisions of tiie Code, inasmuch as violations 
of such provisions v"ere lumped tOj^ether -'-ith other violations pn6 can 
not now be sei^regated. 

The follovinf'; analysis of violations of hourly provisions of the 
Code, found in the files of a Deputy Aoministrat ':)r, can not be checked 
by other data, but may be helciul principally as indicating; the 
relative volume of complaints in principal -producing areas of the in- 
dustry. It is possible that these statistics iierely relate to violations 
chari^ed, without any check as to the justification of such charges. 



Ajialysis of Violations of tfourlv Provisions 
■of the Code charged in Complaints 
July 1 to Decemoer ^;t, 1934 

l^uraber of Percentage 

Producing Are a Viola t ions Charged of Total 

53.5 
13.9 
6.4 
12.8 
13.4 

Total 9S0 100.0 



Southern Fine 


492 


Southern and ApDalachian 


IZS 


v.est Coast 


59 


V.estern Pine 


118 


All Others 


1?3 



Source: Code Administration Study, Preliminary Keport on Lumber and 

Timber '^x-oducts Inductr/, I.lnrch 30, 1935, p. 147. 



It will be seen from the foregoing table that more than half of 
the cora-claints concerned the Southern pine area, and only six percent 
related to the '..est Coast, /i-'estern Pine and the Southern and Appalachian 
areas ranked close together \''ith 13 and 14 percent, respectively, of 
the total complaints. • • 

c, ./age Provisions 

The industry 'a compliance ^-'ith the Code vpr.e rates '^as initiall'/ 
quite high. (*) In some Divlsijps and Subdivisions, such as Hardv-ood 



(*) History of the Cxi e of x'air C.;!apetition for the Luaber and Timber 
Products Industries, MIA., p. ^-94. . . ■ • 

9813 



-161- ■ 

Dimension, Northern Hardvooc, .oodwork Livisiun, , est Coast, Western 
Pine and other Viectern divisi''ns, volantpry cumpli-'nce rith these pro- 
visions held up fairly veil, while in the lerpe and influential 
divisions of the lumber manuf ecturin^^ branch in the South — such as 
the Southern Pine Division and the Southern Hr?rd"'Ood Subdivision — 
the degree of compliance declined, steadily in the face of continued 
lack of effective action in the field, of enf orceiaent. This is a 
matter of record in the corre^spondence iiles of the of x ice of tne 
Deputy Administrator in charge of the Code, 



As in the cp.se of violations of hourly provisions of the Code, the 
following analysis of violations of the rage provisions, found in 
the files of a Deputy Administrator, can not be checked by o*her data 
but may be helpful mainly as indicating the relative volume of complaints 
in principal producing areas. 

Analysis jT Violationa of Wage provisions 
of the Code charged in«Complaints 
July 1 to December 29,. 1^34 

Perdentage 
of Total 

39.1 
33.7 

7.4 

3.4 

16.4 

Total 1,527 ' 100.0 





Number of 


Producing Areas 


violations 


Southern Pine 


£97 


Southern and A-ppalachian 


514 


Wer-t Coast 


113 


Western Fine 


52 


All Others 


251 



Source: Code Administration Study, -reliminary Report on Lumber and 
Timber Products Industry, /arch 30, 1935, p. 147. 



The foregoing t«ble indicates that the Southern Fine and Southern 
and Appalachian regions together accounted for nearlr 73 percent of the 
violations of wage -Drovxsions charged, in complaints, y-hereas the west 
Coast and Western ?ine regions accounted in the aggregate i or only 
11 percent. 

The Code Authority's attitude toi-ard these wage provisions was set 
forth in the follorin^ testimony by David T. Mason, Executive Officer 
of that body, before the Senate Finance Committee on Anril 16, 1935: 

"Lumber Code minimara wage rates* for most ol Western United 
States are higher than those set in most other codes .... Prior 
to the approval of the, Code, minimum ''ages in the South in our 
industries averaged slightly below 12 cents per hour. The Lumber 
Code rhen presented to NiiA by industry representatives on July 
10, 1933, placed Southern minimum vr^c ^ates at TO cents per hour. 
General Johnson stated th.-'t ?0 cfntr- "-as ^'hollv unacceptable. 

9813 



-162- 



The industry then revised t;j c''~l/'' cents and so stated at the 
public hearing beginning? July 26,. 1933., In the ipjst-heoring 
conferences,, under pressure x'rora NBA, the- Southern miniraun vas 
raised to 23 cents, or m^jre than 100 per cent, above- the pre- 
viously prev-i'' irf: average j.iirji lum . .. . Since the p-nproval of 
the Code many .com-olaints have corae in that the Code is ODpressive 
and destructive of small enterprises in the South, because, as 
is asserted, the ..lininxuia, vage rate is too high. 



"Lack of effective enforcement of. the raininrara "^age rate in 
the South is the niust important, cause contributing to the nresent 
crisis of the Lumber Code." 

Vi'ith reference to the allegation referred tu aoove, that tne Code 
was oppressive and destructive to small' enterprises' i"n.; the South, it 
should be noted that the sprae testiiaony stated that the ii'ederal Trade 
Com.nission made an irvestigation of the situatiuh ir the South and on 
ivlay 7, 1934 reported in effect, that the o-^errtion of the Code ':'as not 
discriminatory against small enterprises. 

This testimony also indicated that the Coda renresented an effort 
to restore 1929 minimum haarly '^'age rates, and that this standard '"as 
followed-, excepting in certain parts of the country where such' 1929 rates 
v^rere below 30 cents per hour, in rhich cases the Code rates rere estab- 
lished at a level higher than in 1929, It wps claimed that the result 
for the whole industry was an average mini^oura '-^ge rate higher than at 
any time since 1920. 

In estimating the effect of the Code on hourly '-age rates and 
weekly earnings in the industry, the following data, which were pre- 
sented in a more detailed table earlier in the c/.a'oter, may be helpful: 

Average Hourly wage Bates and Average Weekly 
Earnings in the Lumber Industry (3p"'':.iills) 
in the west and South- 



Average 
Hour ly Vage Hat e s 



Average 
Ueekly i]arnings 



Period 




Y^est 


b/ 
South 


\-» est 


b/ 

South 


1933 

July Average 
December Average 




$0,366 
.530 


$0,150 
.290 


$13.40 
13.83 


$6.80 
8.44 


1934 , , . 

Average first 10 : 


ionths 


.548 


.295 


17.76 


8.70 



Source: Research and Flanning Tdvician, llT\k, ne,0'.-rt entitled "Hours, 
V.'ages and ■Em-Dlo.''ment", prepared for hearings on employment 
provisions of codes, Januar/, 193;':, p. 58. 



9813 



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a/ Includes Orec:;on and WnshinjErton, 



b/ Includes Alabama, I'^loridr,^ Geoi'gia, wlississippi, North Carolina, 
South G arolina, Virginia, Arkansas, Louiriana and Texas, 



The preceding table indicates that average hourly wage rates during 
the first ten months of 1934, all under the Code, were $0,548 in the 
Vifest and $0,295 in the South. These rates reprecented increases over 
July, 1933, just prior to the Code, of apDroximately 16 cents in the 
'Vest and 15 cents in the South, and in terms of percentage ^ere nearly 
50 percent and 97 Dercent, respectively, above the Tsre-code level. 

The fore:?;oing statistics also show that the average weekly earnings 
in July, 1933, were $13.4) in the West and $6.bO in the South, and that 
for the first ten months of 1934 these earnings increased to $17,76 
and $8.70, respectively. In terras of money these gains were $4.36 
and $1,90 for the¥&stand South, respectively, but in terras of percentage 
the increases were more nearly equal, being approximately 33 per cent 
for the Wect and 28 per cent for the South. 

The fact that during the codal period under discussion average 
weekly earnings increased to a lesser degree than average hourly wage 
rates was due to the decreased working week in 1934. 



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G. PRODUCTION COUTROL 

In previous sections some of the problems of timber supply liquida- 
tion have been discussed, and as a bnsic coiiclusion it wps stated that 
both the public and the forest industries have an interest in seeing that 
ample supplies of forest products are dontiriually available at reasonable 
prices and that stability of emplo;,mient through irdustry prosperity is 
maintained. The removal of nil possible obstacles to that result is the 
obligation of both the industry and the public. 

Although any prediction of future forest product requirements is 
largely speculative, sufficient facts are available to clearly indicate 
that a timber famine is im.probable if conditions and trends, reasonably 
comparable to those of the past ten years, are continued. This' does not • 
mean that reasonable care should not be taken of the National forest and 
commercial forest areas, in the interest of both the industry and the 
public, nor that shortage of certain species, if not complete exhaustion, 
are not likely to occur. It does mean, however, that the forest problem 
in the United States as a whole is not one of timber shortage but rather 
one of proper protection and management of the forest areas, including 
adjustment of production of forest products betv;een and v;ithin the various 
regions so as to secure the best results from existing forest growing stock. 

In the begining the most available timiber was converted into lumber, 
which meant low production cost. These costs increased as the industry 
continued its logging operations in continuously widening circles and had 
to go farther ahd farther back in rougher country to m.eet the timber. 
As the areas of virgin timber began to fall in availability new forest 
areas were opened up farther away from the market, thus increasing the 
cost of delivery which in some cases became as great as the total of all 
other costs. 

Thus the industry was faced with two alternatives, either to get a 
higher price for the products or to reduce cost through more efficient 
methods of manufacture. And both courses were resorted to. The quality 
of the product was improved nnd logging and milling methods were revised 
to produce at a lower cost. In spite of these efforts, the increasding 
cost of holding timber due to interest, ta.ces, and other carrying charges, 
necessitated such a high price for the products that many substitutes were 
able to successfully compete with lumber, and made possible the exploitation 
of young, immature timber which had been left uncut, or had grown up after 
previous cuttings over the sam.e areas. 

Up to about 1921-19?3 Inomber prices were generally increasing thus 
compensating in part for the higher production costs. About this time, 
however, the competition of other materials became acute, with the result 
that lumber prices could no longer be maintained. Furthermore, stumpage 
prices began to decline for the first time in history. Thus many units 
of the industry, faced with steadily mounting carrying charges found them- 
selves forced to a policy of liquidating tneir areas of standing tim.ber 
almost without consideration of either the ability of the market to absorb 
the manufactured products or of its cost. Up to the time that the Lumber 
Code became effective the industry in ^;cenernl, through pressure of various 



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economic forces, was virtually coimDelled to adar)t its^-lf to this -Droce- 
dure. 

There were many deviations from the T,l)ove- cited, long trend. For 
examiDle, whenever a satisfactory rrice TDOsition was reached new manufac- 
turing facilities would enter the nroductinn field and existing ones 
would "be increased in cacacity. Overoroduction would th^n inevitably ■ 
follow, with a resultant nrice drop, again forcing the high cost opera- 
tions to ciose down and stay down until curtailed Toroduction and in- 
creased prices permitted them to again operate their clants. 

All of these factors have ijlayed a Toart in removing incentives to 
large concentrations of ownership and toward the hreaking utd of large 
tracts into a multitude of smaller ownershin interests with decreased 
feeling of resTDOnsibility for eliminating excess mill ca-oacity and over- 
production. 

The era -orior to 1923 was also one of lessening of virgin timher 
sunply in the main, -oroducing region of Southern -oine, which made it 
economically xiossihle for the West Coast operations throiogh exranding 
use of the Panama Canal, to enter the Eastern market and unload some of 
the products of the tremendous mill ca-oacity which they had developed. 
By 1929 they had wrested the suDremaCy of -oroduction from Southern pine, 
tut the pressure exerted hy their invasion had forced T5rices down from 
the former level and, it was claimed, "below the cost of iDroduction. 
With the continued decline of x>rice and surplus of unsold stocks of 
lumber, accentuated by the deiDression, the demand for -croduction control 
and coincident price control became insistent. 

This can be attributed to two na.jor conditions: (l) the ownership 
of large tracts of virgin- tinber in the hands- of -oeoDle who were either 
unable to carry it, or to whom it wa.s nroving a burdensome -Droblera, 
and who in innumerable cases were manufacturing the timber into a loroduct 
which the market did not demand, and conseauently were sacrificing their 
investment without corres-oonding accrual of benefits. This was nrevar- 
lent over Large areas and involved millions of acres of timber; (2) the 
loremature cutting and destruction annually, • of millions of acres of yotaig 
ttuber vhAch was not large enough id produce good lumber, having been 
held through the period of the least volume growth and was being manu- 
factured instead of being allowed tb reach maturity. 

Both of these conditions raised the need for effective relief for 
the holders of the timber who in the past had been forced to cut to 
realize cash far accumulating interest and taxes, and to obtain a live- 
lihood from their holdings. In view of the need of the holders of this 
, .timber to cut and -oroduce, and in order that the -nressure of liquidation 
may. npt in the future cause the' distress attendant on the overoroduction 
of the past, with the corresnonding decline in price, some sort of nro- 
duction control would seem necessary. In view of the multitude and 
diversity of ownershi-o interests, and tyoes of ODerations engaged in 
the production of lumber and the difficulties of maintaining an ade- 
quately balanced su-p-oly it can be seen that it is a very difficult prob- 
lem to effectually protect our forests from wasteful and .premature cut- 
ting and destruction and provide for conservation of our National Resource, 



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The subject of control of -Droduction has teen decreased ty the 
industry for many years but the nrohlem did not attain sizeable BroiDor- 
tions \intil 1924, at which time the West Coast -oroducing rea-ion with its 
tremendous "sUTDnly of virgin timber and its extensive mill car)acity, 
shipping throU(?;h the ranama Canal, began to dominate the eastern market, 
and the lack of earninjers of this industry, as com-oared with others, be- 
came recognized and was larf-'oly attributed to overuroduf tion. In Novem- 
ber, 1925, a movement to consolidate a. •considerable nunberof mill and 
timber owning comtDanies was s-nonsored by a member of West Coast onera- 
tors renresentinu? an estimated 30 ver cent of the -oroduction of Douglas 
fir, backed by BaVer, Fentress 8r ComiDany, The Commercial Trust and 
Savings Bank of Chicago, and Dillon, Reed & Cbmnany, of Hew York, By 
the time the details of this merger became public, a number of other 
mergers were being proposed and discussed, but ao a result of careful 
investigation it was found that profits in the industry were decreasing 
to such an extent that there would be no Drobability of servicing and 
retiring the securities necessary to finance any merger, and the plajis 
were dropped. This subject was again brought up in 1931, with the same 
result. 

About this time the Oil and Coal industries, ind'^'oendent of each 
other, and of the Lumber Industry, were seeking TDroduction contrail of 
some sort both in the States and nationally and it may be that what 
they weie doing had at least a suggestive effect UDon the Lumber Indus- 
try. At any rate conversations in regard to control began, and continued, 
until early in 192f\, Then came into being The Committee of Fifteen, 
the membershiis consisting of outstanding lujTiber-men from the West, South, 
and Lake States, to formulate plans for -orpduction control. Among the 
plans evolved was one for a Director General, as in organized baseball 
or in the Moving Picture Industry, The resTilt of work of this Comnittee 
was intangible but at least made the industry more conscious of the 
problems before them clamoring for solution. 

In the period immediately following, many other plans were discussed 
and worked on, one of • which was the attempt by the National Lumber Manu- 
facturers Association in 1928 to affiliate with the Coal and Oil indus- 
tries to obtain legislation for. the control of production as a natural 
resource, which overture was rejected by the Coal and Oil Industries.- 
Other major plans were The Holding Company Flan in 1928; The Hardwood 
Conservation Flan in 192R; The West Coast Advisory Plan in November, 
1929; The Compton Plan in 1930; Southern Pine Curtailment Plan in 1931; 
and the Fir Stabilization Flan in 1932. That the Government recognized 
the problem is shown' in the U. S, Tiriber Conservation Board report in 
1930e (the "Copeland" report generally referred to as Senate Document 
No. 12,) and by the fact that steps were taken to relieve the situation 
by the starting of the Federal acquisition of timber lands in 1931. 
Mention should be made of the Wisconsin Stabilization Agreement pporaiil- 
gated in 1931, for the control of production, under State sanction. 

All available material clearly shows- that many operators, probably 
a majority of those ' involved, approved the above-cited plans, but that 
always a few large oi'terators "who never cooperated" either objected or 
failed to assist and caused the abandonment of these plans. 



9813 



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In March, 1932, agitation 'be+'an among a number of industries, 
including the Lumber Industry, fbr i*elief from the anti-trust acti In 
the Lumber Industry apioarently the motivating force was the desire to 
control production. The idea seemed to many lumbermen to be so fair, 
so easy to put into effect, and so beneficial to the t)ublic, as well 
as to private lumber interests, that tney began to fe=3l certain that 
it would settle most of their -crobleins find that the entire industry had 
concentrated on, and apTjroved it. During this period at least two types 
of control were considered, one, a Commission to be appointed by the 
President; and the other a Joint committee composed of five members each 
of the House of Representatives, and of the Senate. Legislation was 
proposed along these lines but never passed. 

A complete description of each of these proposals has been prepared 
by former Deputy Administrator A. C. Dixon, and is attached as Appendix 
III of this report. 

The need and demand for production control was further intensified 
by the continued reduction of per capita consumption of lu-nber which, 
as shown in previous sections of this report, declined steadily from 
525 feet in 1906, to 90 feet in 1934. 

The opportunity to make effective the plans and hopes of the 
industry for production control came in 1933, under the NSA, when in- 
dustry was invited to present their plans for cooperation between in- 
dustry and Government under Codes, and as one. of the features of the 
Lumber Code, Article VIII, entitled "Production Control"' w'as approved 
in Code No. 9, on August 19, 1933. 

The Code in part provided as follows: 

_ "This is an undertaking in industrial self-government 
under such, public sanctions as are necessary to carry 
out in the lumber and timber products industries the 
purposes of the National Industrial Recovery Act, It 
is the declared purpose of the lumber and timber prod- 
ucts industries and the adherents of this Code to re- 
duce unemployment in the industries reported, improve 
standards of labor, maintain a reasonable balance be- 
tween production and consumption, restore prices to 
levels which will avoid further depletion and destruc- 
tion of capital assets, and to conserve forest resources 
and bring about sustained yield from the forests. 

The applicant organizations shall, with the approval of 
the President, establish and empower a suitable agency 
., named "Lumber Code Authority, Incoi*porated" hereinafter 
referred to as the authority to administer this Code in 
conformity with the provisions of the National Industrial 
Recovery Act under the authority of the President. 

The Authority shall issue and enforce such rules, regular 
tions, and interpretations, and impose upon persons subject 
to the jurisdiction of this Code such restrictions as may 



9813 



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V "be necessary to ef-fectiiate the TDuroos'es and enfor-'pe the 
., provisions . of . this Code. •■[■'^-./-c; . • .•.•:''"'^; 

The Authority may delegate to said a^rencies all necessary 
power and authority for the administration of this Code 
within the. Divisions and Subdivisions, including; the 
adoption of Divisions and Subdivisions code -orov.isions 
within the. scope, of the power granted under this Code and 
not inconsistent with it; but the Authority shall reserve 
the power and duty to enforce the provisions of this Code. 

The Authority shall make such reports as the Administrator 
may require, .xieriodically or as- often as he may direct. 

Any decision, rule, regulation, order or finding made or 
course of action followed pursuant to the provisions of 
this -Code, may he cancelled or modified by the Administrar- 
to.r whenever he shall determine such action necessary to 
effectuate the -Drovisions. of Title I of the National 
Industrial Recovery Act. . 

Any interested TDarty , shall iiav-e the right of comt)laint 
to the Authority and of -crompt -hearing and decision 
thereon, under such rules -pnd^ regulations as it shall 
prescribe, in respect of any decision, rule., re^^lation, 
order, or finding made; by ^ the Authority. 

It also -prcvided for a maximum work day of eight hours and 
week of 40 hours with certain cxoections for all sections, whereas, 
it had been shown by testimony at -oublic hearing that usual hours were 
60 in the South and 48 in the West. •' ■ : ' 

Minimum wages were established which in some sections were four 
times those previously paid. -- i 

Production control -was -orovided for with certain specif ic- rules, as 
were minimum prices. The major point which it is desired to emphasize 
is that of the complete delegation, of power to the Code Authority, (and 
their right to redelegate this power to their agencies) of interpreting 
the Code, making of rules and regulations, and enforcing .them, with the 
reservation to NRA only, as contained in Article IT, to: require reports, 
and in Article XII (b) to cancel or modify actions of the Authority. 

Following this delegation of. power the Administration did not set 
up any machinery by which it could- be automatically apprized as to how 
the details of the production control plan were working. "'When asked 
for certain data by the Administra,tion pertaining to timber ownership 
the industry held that it could not give out facts which had been col- 
lected from members with a pledge that they wotild be held confidential. 
The failure to register in any one place full data on the issues which 
arose and the way in which they were handled, created uncertainty on 
the part of the NEA Administration as to how the- plan was jurorking out 
in practice. ; , . ... 



9813 



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Judgment regarding the functioning of administrative machinery 
must te iDased mainly on indirect evidence except for the few cases sub- 
sequently recited. There are no data availaljle which would show in a 
comprehensive way, on a quantitive 1)3318, how production control af- 
fected the business of the individual operator. 

It has teen impossible to accurately determine the volume, or 
character of complaints against production control, or the manner in 
which decisions were rea.ched by local authorities exce-ot for the few 
cases which reached the N.RA Administration on appeal , and which are 
covered in detail later on in this chapter. 

There can be no question as to the magnitude of the prohlems in- 
volved in this undertaking hy the Lumber Code Authority of control of 
production. 

In view of the hroad field covered, with approximately 20,000 
operators, a producing lumber capacity approximately four times produc- 
tion, a proportionately large inventory, and species or inter-divisional 
competition. 

Any attempt to control whether hy industry or Government was "bound 
to result in some friction and inequities. 

As previously stated no provision was made for keeping the Adminis- 
tration informed as to the Details of actions of the Code Authority on 
this subject and not much is known as to what happened except' for the 
few cases following which were appealed to the Administration or called 
to their attention. In view of the problems involved the number of 
known cases are surprisingly few and it is not the intent to place undue 
stress on them, rather merely to report them as evidence of the troubles 
resulting from the kind of system the MA and industry created. 

There is no doubt that the difficulties surroiinding the establish- 
ment of production control on such a far-flung industry were realized, 
as in all the meetings and conversations prior to this date the subject 
had been sufficiently discussed. So the rules as set forth in Article 
VIII were the result of much planning, and not an immature concept, when 
the industry proceeded to put them into effect. 

The position of the Authority was promptly defined as outlined in 
Article I , as that of industry self-government, and it was early ruled 
by the Code Authority that the method of appeal from any action of the 
Code Authority should be as set forth in Article XVII, progressively to 
'"he Subdivision, Division, Authority, and then to the Administrator. 
In the early days of the Code all complaints and appeals reaching the 
Administration were forwarded to the Code Authority to answer and handle, 
but later were acknowledged by the Deputy Administrator, advising appel- 
lants to take their problems direct to their governing body. It can 
readily be seen, with the purpose of the Code Authority to (as they so 
often term it) "wash their dirty linens in private" and with the assent 
of the Deputy Administrator to this procedure, coupled with the expense 
and lengthy controversy of carrying a protest through to the Administra,- 
tor, why so few formal complaints ever came before the NRA officially. 



9813 



-170- 

The foregoing 'background is necessary to the discussion of Article 
VIII of the Code entitled "Production Control." 

The Assistant Administrator Dudley Gates in renorting on the Code, 
stated: 

"On the assuTn-otion that interindustry coin-Detitive 
equilibrium will "be maintained, and increase in volume 
of sales permitting an increase of about 50 vev cent over 
recent rates of -oroduction would "be necessary to restore 
employment to as many rersons as were occunied. with lumber 
and timber products industries during 1920. About 65 ner 
cent of the total lumber production is absorbed by the con- 
struction industry, therefore, sustained improvement in the 
l\imber industry cannot be expected apart from revival of 
building construction." 

This revival of business activities did not materialize, thus making the 
problems of production control even more acute. 

"There are now some 20,000 sawmills in the United States 
of which more than 15,000 are small enterprises whose mills 
are valued at less than $5,000 each. The Code as recom- 
mended contemplates their continued operation and guarantees 
free access to the market to new enterprises subject to the 
same limitations as are applicable to those already in the 
market." 

The provisions for the granting of allotment to any person upon request 
and evidence of ability to operate, and the high levels of prices estab- 
lished held out a promise of lara-e profits resulting in the establishment 
of some 95 new large mills each with annual capacity- of five million feet 
or over and a great number of small mills variously estimated as high as 
five thousand in Southern Pine territory alone » , , 

In order to prevent flooding the markets through this potential 
production the Authority was forced to cut down the quota to each opersr- 
tor for each succeeding Quarter during the expiration of the Code. As 
an example, the Hardwood Division, which reported a great increase in 
new mills was able to allocate but 1,100 hours per mill for the entire 
year, 1934. 

Assistant Administrator Dudley Gates, who conducted the public hear- 
ing on this Code, reported to the Adrainistratoi- as the x-easons for the 
inclusion of this Article: (l) "Logging and sawriiii. activities have con- 
tinued at a low level for so protracted a period of time, and capacity 
is so greatly in excess of even the enlarged operations of recent months, 
that control of proiuction is imperative if renewed a,nd .accentuated 
deToralizP.bion of 'the industry are to be avcidnc^'' and (2) "the excess 
volirae of 1-ojnber produced without regard to demand ib responsible for the 
demoralized price and selling below cost." 

The principal arguments' developed at, the hearing against production 
control were that the plan was difficult of equitable administration, 
that- its execution would inevitably fall into the hands of large operators, 

9813 



-171- 

and also that without control over the erection of new mill caT:acity it 
would iDe .extremely difficult to make such control effective. However, 
despite the latter argument, Article VIII, provided that each -oerson 
known to "be in operation was entitled to an allotment for -oroduction, 
and that any person desiring to operate, uPon evidence of ability to so 
do, should te eligible to join the ranks of producers. 

It will be observed that the Lumber Code is specific in its numer- 
ous production control mandates as included in Article VIII, which for 
the purposes of this report is quoted in part as follows: 

" The Authority shall determine, and from time to time revise, 
not less frequently than each three months, estimates of 
expected consumption including exports, of lumber and timber 
products of each Division and Subdivision; and based thereon 
it is empowered to establish, and from time to, time revise, 
production quotas for any Division or Subdivision of the 
Lumber and Timber Products Industries . . Allotments within 
each Division an d Subd ivision, for the persons therein, shall 
be made, sub.ject to the supervision of the Authority, by the 
agencies designated by it . Said quotas as tetween such Divi~ 
sions, or Subdivisions shall be in proportion to the shipments 
of the products of each during a reprGraiitlWve cocant- past 
period to be determined by the Authority. 

Each person in operation shall be entitled to an allotment. 
Each person known to any Division or Subdivision agency to be 
in operation shall be registered by such agency immediately 
and shall be assigned an allotment. The agency shall also 
immediately give public notice reasonably adapted to reach 
all persons operating or desiring to operate, stating the 
date on which the allotments will be determined; and any per- 
son desiring to operate who shall give the agency Trritten 
notice of such desire ten days before the allotment date, 
supported by accr^ptible evidence of ability to operate, shall 
be registered by the agency and assigned an allotment. Any 
person so registered shall be deemed an "eligible person" 
for the purpose of this Article, 

The allotment for each eligible person shall be determined 
from time to time for a specified period not exceeding three 
(3) months and, except as anywhere permitted under the provi- 
sions of Section (d) hereof, shall be as follows: 

The basis for determinatio.n of Division and Subdivision quotas 
and of individual allotments and any revisions thereof, all 
quotas, all allotments, and all appeals therefrom and all 
decisions on appeals shall be published. 

Allotments from two or more Divisions or Subdivisions to the 
same person shall be separate and distinct and shall not be 
interchangeable. Allotments shall not be cumulative except 
as authorized in specific cases under Section (d) I of this 
Article, or in cases of seasonal operations of a Division of 
Subdivision under Section (d) (s) of this Article, and shall 



9813 



-173- 

- not be transferable eTtCP-ot as between operations under the 
same. ownershiiD within the same Division or Subdivision. 

Whenever in the case of any eligible -oerson it shall be 
necessary in order to accent and execute orders for report, 
to have an addition to his re^lar allotment, provision for 
such necessary excess shall be made by the Division or Sub- 
division agency, provided that any excess above his allotment 
shall be deducted from his subsequent allotment or allotments. 

The Authority shall issue interpretations and shall promulgate 
rules and regulations necessary for the enforcement of this 
Article, to prevent evasion and sec\ire eauitable application 
thereof, and assign quotas to each Division and Subdivision 
which shall become effective on the dates specified by the 
Authority. Each Division and Subdivision shall assign allot- 
ments to all eligible persons effective on the dates specified 
by the Authority." 

As quoted above, it was specifically provided that the Code Authori- 
ties should determine expected consumption and, based thereon, establish 
quotas, liio application of this provision immediately resulted in trouble. 
If strict interpretation 'of this rule had been applied and production 
allotted on the basis of expe.-!ted demand, the allowable production would 
have been so small that instead of creating employment, which was one of 
the main purposes of the Administration, the closing down of many mills 
and laying off of a great many men would have resulted. 

The Code Authority cho':?2 to take a very optimistic view of conditions 
and increased the Nation';'! c^cola for the fourth quarter of 1933, to 26 
per cent above the estimates Timber Conservation Board for that period, 
and to 18 per cent above such estimates for the first quarter of 1934. 
The members of the industry produced roughly up to the limits allowed 
and, as increased demand did not materiali-ze, a sharp increase in stocks 
resulted. This increase in already top-heavy stocks created an additional 
burden on the operators and exerted tremendous pressun on the price 
situation. 

It must be borne in mind, however, that other forces contribute to 
increased production. The profits expected from the new minimum prices 
had much to do with the production of lumber by many o-nerators who 
would not have been enticed, by production control alone, to add to 
their already excessive visible supply bf sawmill products. 

Article VIII (b) provided that allotments should not be transferable 
except as between operations under the same ownership within the same 
Division or Subdivision. It was ruled by the Code Authority that this 
made raanda'-,cry the transfer to any person qualifying. This right of 
transier, of course, could only accrue, to a large operator, owner of 
several plants, and the result was to permit one plant of several, to 
operate much longer hours than could the under sale ownership plants. 
This condition caused much bitterness, particularly in the Hardwood 
Divisions, with their multiplicity of small units, and quite^ a number of 
complaints in the other lumber divisions. The Artirle was finally 
forced before the Administration for amendment, with the IfflA Advisors 

9813 



-173- 

maintaining that transfers of allotvient redoMdcd to the benefit of the 
large operators only and shoiold not he allov/ed voider any circ-uraotances, 
and the Code Authority incistin/^ tliat there v/ere certain conditions 
\7here it should l)e |rc3:"«-?''-'tcd, ' The suhject vns finally cornprcmised by 
Amendment llo. 53 \-fhich was approved by Administrative Order 9-139, 
providing for the transfer of allotirients if the Authority should find 
that non-transfer would cause undue iiardship, and under certain limi- 
tations, and that notice of such action with a find.ing of facts should 
be immediately forwarded to the Administration. Certain Divisions con- 
tinued to transfer allotments and no reports vere forthcoming to the 
Administrator. After a nxmber nf months of delay and repeated requests 
the Divisions begf?n to send in reports as follovfs; 

"Tho Division upon a finding of facts h-'.s traiisferred allotments 
as follows :" 

No details as to .ivmers and amounts, or explanation of the reasons 
for these transfers were given. The failixre to furnish the Adminis- 
tration with the required inf orma,tion, and the failure ct the Deputy 
Administrator to force the issue, prevented any control or supervision 
of the actions of the Code Authorities. 

The inequity of allowing transfers of production quotas to mills 
under the scjne ovmership, permittin-'j them to concentrate production 
and work full time, and the difficulty experienced b;'- the owners of 
only single mills who had geared np their production to tvo shifts 
and v/ere forced, by the r-mount of taeir allocation, to reduce their 
operations to less than an economical single shift v.'as shoi."/n in the 
case of the appeal of a Ircaber com-p-ny in Ar'^ansas, (*) This company, 
in its appeal cited the c-.se of -nother com;'Dany which had transferred 
to its operating mill the --roJuction quota of ^ nill v;hich had not run 
since 1929, thus enabling them to operate t'.vo shifts in the one mill, 
whereas, the a-opellant was allotted only sufficient production quota 
to run a single sliift. riowever, t'neir petition to operate longer hours 
was denied. 

The Division of Heoearch and Planning, IIPA., had for some time boen 
attempting to investigate the operation of this ;'-iroduction control pro- 
cedure and had made specific requests for informa.tion thro"ugh the 
Deputies' offices, but certain efforts to obtain definitn information 
from the Code Authority in re;::ard to the methods in establishing quotas 
of production used by the divisions- and the applici.tion thereof, met 
with refusal. However, the limited study wMch wa.s made of this sub- 
ject, from published bulletins, leaves some doubt whether eq"ua-l -appli- 
ca.tions of the provisions of the Code w.'-s accorded to all operators. 
Hot many -irotests were appa.rent in the first four months of operation 
of the Code, but from January 1834 on, there v/as evidence of greater 
diss o.tisf act ion. 

In the West Coast Division the very large c-p'^.city of the mills 
and the metnod of quota allocation c-used gre^t dissension and claims 
of preferential treatment until adjusted. At first the allotments were 
ma,de on the basis of proportioning .the Divisional quota rjnong all 
operators according to the crlculated or rated capacity of their pl-^nts, 

based on reported past perf orin.ances of their tl iree be st yea.r s, 

(*) Tschud^Lumber Company, Weona, Ar^r'.nsas. public Hearing 
^813 j-iiiy 3, 1S34. 



Because of the Division' f vrt C'.p'^.city 30 greatly exceeding the 
quota allotted it, and the ^Treponderauce of large mills whose past 
record gave them the moct of the quotra, some of the small operators 
received a.s little as 11 hours per v.eek operating; time, v/hereas, the 
large plants were Vble to opero.te "t least a part of their equipment 
to the maximum of 40 hour? rallovred hy the Code. 

There was further objectio.i hir the sm.all mills on the £;round tliat , 
as provided by the Code, all Imown operators received an allotment p,nd 
were operating for the full time allowed even though they h:.\d formerly 
operated very intermittently, devotin.,": the balance of their time to 
other business, and th-^t this was not fair to those whose only business 
was iTjmbering. 

The objections v/ere partially net by a compromise which consisted 
in adding to all those receiving less than 30 hours of operating time 
each week, sufficient hours to equal this minimum, and deducting pro- 
portion.ately from those above the 3D hour level to equalize. 

There were other protests from the West Coa,st Division regarding 
provicion for export allotments. The beginning, of this controversy 
dates bacic to the formulation of the Code, Ludley Gates, in reporting 
on the hearing to the Administrator, stated: 

"Certain West Coast operators lorged that exports 
should be exem:nt from production control. The 
West Coast district ship over half of all 1-umber 
". exported,} Tliese exports constituled about 16 ^er 
*■ ■■ - cent of the entire production of the Wost Coast 
district in 19^9, and -bout 18 per cent in 1932. 
At least 40 ii-er cent of all '.".'est Coast inills share 
in this business," 

Again at the public hearing of January 9, 1934, persons vitally 
interested in exinort shipnents appealed for relief from all control 
of production for export and a controversy as to whether or nc^ the 
control of production should a,;iply to mills, manufacturing 1-umber for 
export was carried on during practically the entire year of 1934, It 
also appeared that in the applica.tion of the formula i^rovided in the 
Code, the West Coast Division, in order to arrive at the o^uota for 
mills v:hich were shipping for ej^^ort and for those which were L-hipping 
for export and domestic consvjm-ition, and for those ship;ung for domestic 
consumption only, took the total production quota allowed them by the 
Code Authority for domestic business, added thereto the exj^ected export, 
consumption, and divided this total pro rata, a.mong all mills in their 
Division irrespective of whether they hae ever shipped for export or 
ever intonc-ed to.(*) They claimed that to allow an export shipping 
mill unlimited production for e^rport and also allow them a domestic 
quota comraensura.te with their capacity would result in their operating 
longer hours than adjacent mills which did not compete for export 
business. 



(*) Mandatory under the Code 
9815 



-175- 

It was claimed ty one of the apoell'ints (*) that the application 
of this ^irinciple resulted iu th-t compaiiy beinc forced to turn C.ovm 
larf^e orders for Inmbcr to be exjr.ortet'.. 

The increase i;' the cost of i.ianuf ,cture of lumber under the Code, 
due both to the cstablisiir:ent of minimum w\zes and maximum hours and 
the establishment of control of production ¥;hich increased cost by 
cutting down volume, led to the ado;"'tion of cost protection prices v/hich 
protect'ed the producer a-.ainst a loss v.'hile selling, in the domestic 
narliet. These minimum prices did not generally apply in the highly 
competitive export field v;here nrices were c^nerc^.lly lovrer. The tendency 
vras therefore exhibited to e3::port a' smaller amount of lumber than had 
been shipped during pre-code days. To stimulate export sales, vmich 
v;ould benefit the producer by lowerinti his cost per unit and benefit 
labor through' incre'ased employment, the Authority proposed in Amendment 
No. 54 a variety of devices which might be adopted by the division or 
subdivision agency to stim.ulate eiqsorts. These devices, in essence, 
called for a reduction in quota to mills who' v/ould list themselves as 
export mills ydth the compensatory feature th'^.t such m.ills m.ight be 
en -.bled to produce more lumber ior ezqDort than, they vrould have if their 
quotas had. not been reduced. 

Certain of the Adviso^ Boards felt th t the proposal to est'^.blish, 
at the discretion of the administrative agency, one of several optional 
methods increasing exports, v/as contrary to IIIIA policy. The Lumber 
Code Authority tooh the position th^ t due to the diverse nature of 
conditions faced by the varioiis divisions and subdivisions, a certain 
option in raethodi of treatm.ent was necess'-rj^. Failure to agree on this 
question was responsible for non-approval of this amendnent. 

There is evidence that in the West Coast Livision an allotment to 
one of the largest companies (**) was increased, not only as to their 
base for allotment, which was increased- nearly 100 per cent, from 
55,666,660 to 105,302,300 board feet, but also additional time was 
accorded them on their plea that the brid.ges which served the timber 
to be cut were in such condition that they vrould have to be repla.ced 
in a short time and therefore the timber must be cut -^.t once or the 
expense of prodiiction vrould be greatly increasedi. This additional 
quota was ordered to be deducted from allotments to be granted the 
company after October 1, 1935, but the uode expired by limitation not 
later than June 16, 1935. 

The Ch'.innan of the Committee ^llo^'dng this increased allotment 
was an officer of the company. Protests were made to the Divisional 
Code Authority, and a committee which vias appointed by them recommended 
as follov/s: 

"Without going into the merits of the case we find 
th"t the '57est Coa.st Committee on Control of Pro- 
duction erred in granting the Crossett Western Company 
additional p.llocation which wa.s to be returned, after 



(*) Coos Bay Lumber Com.T3",ny 

(**) Crossett l^Vestern Lumber Company 
9813 



the ei'Cjnir-^tion ol the Indus tri",l Zlecovci-y Act, 
J-ane IG, 1935, .Wo recor.imend to the West Co-^-st 
Lumhermen ' s AssociT,ti-on Tr-ostees th'^.t they c^Jicel 
the ''j'jJ.ition'\l '\lloc-'.tions -^.s sriven to the Crossett 
T.f e s t e r n C oiTt;o -^.ny . " 

The I'ollovifin^, motion vn,s '^^dopterl hy the Bo".rd of Directors of 
the West Co-^,st Pivision: 

"Th-^.t ■^ll s'Teci-^.l l-um'oer .■^lloc-.tions nov civen 
manui'^.cturers w'.iich CMinot "be deducted during the 
first ',nd second qu'-.rters of 1935 "be rescinded -.nd 
th-^.t no further speci'^.l lumher "illoc^tion he grr.nted 
th",t v/ould recjuire dedxictions \fter June 15, 1935." 

This p.ction v;t,s overruled "by the Piesident Comraittee of the Lumber 
Code Authority in Yif-^.shington, which, it '^^'pep.rs , h".d p-^.ssed upon n,nd 
confirmee the '^,ction of the Division 1 Control Committee immedi-^.tely 
after tlicir -action. 

As p. result of the ra'^.ny difficulties encountered in the •^^wiinis- 
tration of -oroduction control hy the industry, the West Coast Division, 
shortly after tne Schechter tecisian in I; .y, 1935, vrent on record -^s 
being opoosed to industry h ndling control under any new lef^islation, 
but stated th t they were still convinced th-t it was for the good of 
the indvistry and they vrould suhmit to Government a^' mini strati on only 
of this feature. 

The Red Ceda/r Shingle Division c-jne in for a i-;reat ntuTiher of pro- 
tests by the various oper-tors re;, rdingthe "fasis of allotment in their 
Division. Discrimin-tion -,nd unjust allotment were claimed, A check 
of the correspondence ■ concerain,;. this Divi'iion tends to show that the 
production control j-irovisions yrere not adequately '^.ncl equitably adminis- 
tered, '^nu that cert'dn operators vrere allotted production quotas much 
larger thar others of lihe capacity, A preliminary check of allocation 
in this Division was made ''oy the Division of Research and Planning from 
the published bulletins, and the following questions were r-.ised: "Why 
were tncre such discrepancies in -^dlotments to mills of the s-^iae size 
between the third and fourth quarters of 1934? Why v/ere some mills 
granted up to 200 per cent more alloc-.tio;: for the fo-jrth f^iarter of 
1934, than ixi previous qu".rters? "^Piiy were such large exce"otions and 
additions granted to cert- in mills for list production in p'-.st periods?" 

A check of the public-tions of the- .lorthern Pine Division tro-ught 
out tha question -"s to why a proc'ucer should anr' did receive a fuota in one 
quailisrgrf^aterr tn-.n p-^st experience records had sho¥/n him to produce 
in '.n t;i.cj.re yea.r. 

There vrere •, n"umoer of conrpl'lnts .bout the '."implication of the 
provisions of productioii control in the ■..'estern Pine Division ¥/here 
the provisions covering seasonal operations had to be av.jplicd. It w-s 
provided, in general, th\t if the operatirig records of a mill showed 
inability due to seasonal conditions, to oper-^.te less th-.n nine months 
in a year, it should receive "-oprov".l to work 4S hours per week, but 
if more th-.n nine months of oper■^tion v/as shown the'i only 40 hours per 

9813 



-177- 

vreek would "be approved. 

In one case v/aicn \;ac inves tijjatec' , where the operator furnichcd 
ills records sliov/ini';; O'oeratin^; time oi lesc- tiian nine months for a 
n-uiTiber of years, the -oetitioji for additionr.l time was denied on the 
f^roraids that the nill could '.inwe worhed lo.i^;er hut dif not hecause it 
was unprof it ihle for the'n to o vo, Hov/ever, it ^rs. developed that 
another mill located on tne v.v ^e L-^-I.e v.'.?s receiviiv; t^'.e 48~hour allot- 
ment • 

In ^:eneral, investi/r.tion oi i;:,ll toa subject rmtter in regard to 
-oroduction control shows ti:iat -r-cbically every 7/ivision was represented 
in the complaints. ^ 

As previously stated, the machinery set uo hy the Code Authority 
for appeals provided that they riust he m.ade in tn-;; first instance in 
writing or toy personal a-.r-iearance to the Suodivision '1 arency, then to 
the Divisional aj^'ency, then to the :"ationc^l Code A'Atliority, and finally 
to the National he c every AC /".ini strati on. 

No exa.ct record is availaole a.s to tae mijicer of coiirplaints or 
appeals thrt were .nade to the Suhdivisiona,l ' or I'ivisior.al a;;cncies 
nor as to the ntu.iber of rules, re^~alations , or interpretations made toy 
them in interpreting nud appl^^i-.y the production control provisions of 
the Code, but in checl-in;,' the records of the Code Authority reference 
is fouAid to the fact that on the question of production control the 
administrative a;"encier> of the Divisions issued 153 rules, regulations, 
and iviteriDretrtions , and received C^o ap'reals. The Lumtoer Code Author- 
ity received 39 appeals, and for the period from An<mst, 1935 to March, 
1934, issued 15 major rules and interoretations on this subject, Un- 
douhtedly there were some operators who v/ould not or did not, after 
discussion v/ith t.;e Autiiority, consider it v;orth v/hile to put' their plea 
into writing, or f.:o to the expense of carr^'ivi/; tlirou,';h their rppeal will 
never be loio^mi. There were only foior appeals, under Article XVII, 
officially hrou,'jht hefore the NRA a{;ainst production quotas. The pre- 
viously mentioned case (CroSsett 'Testern Coim.any) rras the onlj'' a"'^':>eal 
from a lumber division. The otner were f;'ora the f-ihricatin^- divir^ions. 
A veneer "comp.^ny (*) n.ppealed f-^om tne p^'O'hiction quota set for it on 
the froimds th- fc tne oj^mntit;.' a'.lqv;ed was i.^s'afiicient to enable them 
to take care of the orders tliey ia?,.;' on h'l.nd. It \7as ueveloped that 
tneir trade was entirely thao of cuttinp stocL: to order for other com- 
paiiies. It Was held by the Code Authority that it was unfair to nllow 
this company to ta.he more th^n its slaare of the avili^blc businesr; and 
to operate loniper hours tii£i..i its competitors, as those comr'etitors would 
:_ ladly tahe cere of -the surplus orders of the rv .rJlant and thus spread 
emiDloyment anc" allow all plants to cerate. 

In the Sp'rin;!. of 1935^ .a com-\a::,y(**) was cited for consistent 
viole.tion of its production oi^ota and ar'ieared before the xHlA in an un- 
official attenpt to settle its differeir es with the Code Authority, 

(*) Lr.peer ''.'ood.. products Con-:i.ny 

(**) iLaxwell Brotaers, Cnica^o, Illinois 



981C 



-178- 



Tiio corn;-".-..y cl inicd tli t prior to th . Coilc it h^d dor.^ "-iroxira-.twly 
wif;ht 23^.-' cent of th,. tot'.l "bujjir.^sc of t'a^ V^;iccr livir-ior. tuidcr rrlrich 
it \/-.3 cl -.Eirificd ;-.d thvt ,r.y l^rrcr -jnoixit would c mxsv, ^■.•. o'^: r ".ti'.'.j;; 
Iocs to 'Jiiich it './ould :".ot '.i^^rc, to be sutjcct^d. By tiiis time the Ad- 
mi. listr \tio:: -.diTiitted the j^J'^ti 'ble illc":" lity of p:'oduction cortrol 
features of the Code, rnd ^'ould r.ot cor.sert to proseciitc the conijo-,r.y» 
Ther. the Code Authority -.djusted the productior. quot", of thin- comp'iiy 
to the '.moiiiit den-.:-.ded by it. 

A compr..y v/hich oper.ted -. box f.ctory (*) "orodeici::/^ boxes for its 
ovr.i \ise, "Oioe'^led or. J :iu-.ry 10, 1934, fron the prodtiction quot-^, 
-,ccordcd it, cl ■ imin;';^- th .t it -.--.s not sufficiert to t -he ere of its 
reouiremce.ts 'r.d th-.t if r.ot llo'Tcd to "v-oduce rufficier.t boxes for 
its ovfj. use, it vould be compelled to buy ir the op^"r. n-.rket the b-.l^r.cc 
required v/hilc its ovr.-i pl^r.t stood ii'le for p~rt of tii^ tiiue. It vr.s 
held th-,t there v; ,s v.": excessive c-.p^city i.e the i.v^ustry "nd th'\t it 
\7ould be irif-ir to ^llou l-,bor ir this pi -at to -Tor'r full time Thilc 
l-bo:- in otner pl-nts i7orI:ed p .rt tine. The victitior ■■..'-? denied, 

Le ",vir.. the field of specific c ses ':.\c. objections, the -ttempt? 
by the Code Authority to correct the m-.l-^.djiistments of the Code should 
be shovrn. The fQllov/in{;; -^.mcndmcnts to Article VIII vc :x 7oroposcd -.nd 
it is v;o-'thy of note ^,s shovrn by the number of propop-.ls th-.t sincere 
efforts vere m-,dc to -dijust the pr -.ctic^.ble worhin,';, of the provisions, 

LCAJjnendment 0,1 1, 

>IRA Amendmc.it #8 

A pprovcd: Ijr^l'.lS, i934 

Si^i^ed by: HU(^n S. Joh-ison, Administrator 

This ".mendmcnt provided th-.t in the -pplic-.tion of Article VIII 
(c) (2) shipments mi^ht be used iri jil-.ce of production. The u.sc of 
shipments r-.thcr th-,n prodtiction -,s ■, b^sc for dctcrnininL^; production 
quot~.s vr.s to be discrction^.ry vdth the division vnd subdivision ^ encics. 
The Lumber Code Authority in ;a-cscntin;^ this -mendment s-.id th-.t it 
believed th-.t ccrtnin c-.ses shovred the use of shirmcjjts -.s •", l".sc mi^ht 
be more fnir, bec-.usc in cert's/in c-,scs the u'~e of p'^.st production -,^ '^. 
b-,sc mi;:ht :;ive imduc vrcifht to the fi-.TH who during: the p-".st yc-^.rs jiro- 
duced -t full c-.p-.city rc.::,-.rdlcss of m-.rkct conditions. 

1./ Tr-.nscript of he-.rin^:.;, J-nu-'V;^ 22, 1934, pp, 1242-1245, Vol.11 on 
Amend . #8 

(*) Du]ront de i-Tcmours. Public I-Tc^.rinG of J-,nu'-.ry 9, 1934 



9813 



-179- 

The companj'- claimed that prior to the Code it had done approximately 
eight per cent of the total businesn of the Veneer Division under r/hich 
it was classified ^uid that any lessor omoiint uo-uld cause an operating 
loss to which it v;ould not agree to he suhjected, B;/- this time the 
Administration admitted the prohahlc illeijality of production control , 
features of the Code, .and v/ould not consent to prosecute the company, 
Tlien the Code Atithority adjusted, the production quota of this company 
to the amount demanded "by it, 

A company which operated a box factory (*), producing; "boxes for 
its own use, a-ppealed on January!- 10, 1934, from the production quota 
accorded it, claiming that it was not sufficient to take care of its ; 
req.u.irenents and that if not allowed to produce sufficient "boxes for 
it§ own use, it would "be compelled to "buy in the open market the 
"balance required ^.'hile its omi plant stood idle for part of the time. 
It was held that there was an excessive capacity in the industr;,-- and 
that it would "be unfair to allow labor in this plant to work fu.ll time 
while labor in other plants vrorked part time. The petition was denied. 

Leaving the field of specific cases juid objections, the attemints 
by the Code Axithority to correct the maladjustments of the Code should 
be shown. The following amendonents to Article "VIII vrere propo-^ed 
and it is worthy of note as. shown by the number of proposals that 
sincere efforts v/ere made to adjust the practicable working of the 
provisions, 

LCA Amendment #11 1/ ' • 

ITBA Amendiient #8 . - . - 

Approved: April 13, 1934 

Signed by: Hugh S, Jolmson, Administrator 

Tlais ninendment provided that in the application of Article VIII 
(c) (2) shipments might be used in place of production. The use of 
shipments rather than production as a base for determining production 
quotas was to be discretionary with the division and subdivision agen- 
cies. The LuT'iber Code Authority in presenting this amendment said 
the.t it believed that certain cases showed the use of shipments as a 
base might be more fair, because in certain cas-es the use of past produc- 
tion as a base might give imdue weight to the firm who during the past few 
years produced at full caTiacity regardless of market conditions. 



(*) Dupont de ilemours. Pu.blic Hearing of January"" 9, 1934, 

1/ Transcript of hearing, Janua^y 3£, 1934, pp, 1242-1245, Vol, II 
on Ai:iend. #8. 



3813 



-130- 



LCA Amc:-.dmc-t #1 2 ij 
Hot --D-orovcd, 



Tliir -mcr.dmc-.-.t li-/. to rlo ■.Itli tlic 'tr-./.rfcr of llotnc-tr. It 
v/~^ '.'it'x'.i"vr.-. "by the LumTDcr Coc.c Atithoiity -::A i-cj-obmlttcd .r AncncV 
mc:it #53. 

ij T---v.-.?c-i-it of :ic-ri::_, J -u-.ry 22, 13-34, p:o. 1245-1255. 

LCA Ai-nc-cl;-ac..t #15 l/ 

bRA Amcr-c!jnc: :t #8 

Approved: Arpril 13, 1934 

Sio--cd ty: K-Uti.li S. Jok'-'joii, Ac'jiur.iGtr-.tor 

Tills --jncndricnt provides tr.-.t Qiiot'.r of imiiortr or productior- es- 
tablished by the M-.:io;;-r_y Bivisior. wv:. - llotncr.t'- thereof t o cli.-_iblc 
pcreor.s, rn-y "bo rodo for -, prriod .-,rc -tcr th^r. throe nor.ths , in .y be 
"b-.scd or. shipments, -.r-d sh-,11 not preclude vny person f rom m int - inin^ 
-n inventory cqu-.l in foot',,";c to his "oreviou^ ye-r''.- shipmc'-.ts. 

The provision for re;:-al~.tio;-. of shipiic:ts of im;iDorts r -.ther th-n 
reculntioei of s -'.vir.;;;, is 'fw. to thn f.ct th-.t v/hil.e r.o m hO;;;;-ny is 
;,ro'.-n. in t]iis coniitry, some prrsonr dax^ctt th" lo^'s :.\C. ciit them them- 
selves, v'hilc ot!ierr im:iort --xl m ho^^-ny l-onber. To c stehlish off cctivc 
control, it v/ns therefor^ r.ecess-ry to piece th'- limit -.tion on imports* 
The provisior. for th: scttinr ixo of quotes for . nuriod of ;rc^tcr th~n 
three mor.ths is occ-,sioned by the n-thod of productio.- of m-hoj^'ny 
timber. The timber, exit in tropical 1-nds, is floeted to the ocenn 
durine flood time, Th: tropical operators usiaally do not have cnoijigh. 
money to finance their operations for a year's time, i.e., the time 
between flood periods, and it is the habit of the American importers 
to enter into contracts with the tropical operators a year in advance 
of delivery. In order to make such contracts, the Mahogany Subdivision 
felt it necessary tliat production quotas be given for a period of a.p- 
proximately one year. Another unusual feature of this industry is the 
fact that unusually lar^re inventories are necessary. This is occasioned 
by the fact that many sizes and thicknesses of mahogany lumber must be 
carried in stock. In order tiuxt nev/ members of the industry who did 
not liff.ve large inventories should not be liandicapped , the provision v/as 
written in providing for an inventory a.t least equ£-.l to the volune of 
shijoraents for the preceding year. 

It is not possible to say how this -erovision worked in practice, 
A year's time v;as scarcely a sufficient test. It sho\ild be mentioned, 
however, tliat -ornduction control was being evaded by many importers who 
v/ere bringing stocks in this country v/ith irajDunity, and the mahogany 
Subdivision was, during the last few months of code activity, consider- 
ing various methods by vmich such importation cotild be stopped. 2/ 

ly Transcript of hearing, Jamiary 22, 1934, pp. 1253-1229, Vol.11 
on Araend, #8, Code Record Section 

2j Files 3f Ass't Dcp. Adm. J. C. Wickliffe on Mahogany Division. 

9813 



LGA Amendment #16 l/ 

NR A Amendment # 6 

Approved; April 1'6 , 1534 

Signed by: Hugh S. Johnson, A'dminictrator 

This amendment empowered the Executive Committee of the Philippine 
Mahogany Suhdivision, v/ith the apvroval of the Lumber Code Authority, 
to estahlich maxim.um import allotments on Philippine Mahogany. The 
amendment provides thlt only eligible persons, those v.-ho had registered 
with the subdivision agency the name of the Philippine mill from which 
exiports were to be made, might import Philippine mahogany lumber. The 
quQ-^-as assigned were not based upon past performances of the importer 
but rcre based upon the productive capacity of the mills from v/hich 
they into:-:ded to import their products. Thus this particular scheme 
of limitation of importation was not subject to the criticism so often 
made against control of production under the Lumber Code, i.e., that 
it tended to freeze the industry's distribution as of the date pro- 
duction control, for the Philippine mahogany scheme permitted a change 
in the relative size of import quotas assigned to the various distribu- 
tors by the simple aevice of a distribu.tjr gaining for himself the 
right to sell the prodiicts of another Philippine mill. 

The limitation of imports of Phili-opine mahogany vjas necessary 
to prevent that wood from gaining L^ro'Uiid. at the expense of other 
hardwoods which were subject to production control. The provision 
also had the advantage of preventing an over supply of rruihogany coming 
into this country v/ith the demoralization of price v/hich v/ould be its 
consequence, 

1/ Transcript of hearing, J-^.nuary 22, 1934, pp. 1147-1159, Vol, II on 
Amend. #8, Code Record Section, 

LCA AME1MD!:EMTS #17, IS, 19 and ,? 1 Ij' 

WRA Amendment #8 

A proved: Ajiiril 13, 1934 

Signed by: Hugh S. Johnson, Administrator 

These amendments provided that in the Northern Hq.rdwood Subdisision, 
the Northeastern Hardwood Subdivision, the Northern H^nJlock: Division, 
and the ixforthc-astern Softwood Division, quotas of production and allot- 
ments thereof to eligible persons might, in the discretion of the adminis- 
trative agency and v/ith the approval of the Lumber Code Authority, be 
for periods of greater than three months, 

Amendm.ent #17 also amended Article VIII (a) to permit the sotting 
up of production quotas for longer tmm the three months period provided 
in the orijf.-inal code. 

Those a'-.endjiients v/ere designed to take care of a difficulty arising 
in the above-named divisions and subdivisions du.e to the fact that many 
of the operators were engaged in seasonal operations. The locations of 
these divisions and subdivisions is in the northern part of this country 
where it has long been the -oracticc to foil timber from early fall until 
heavy snow comes and then to transport tue timber to the mill on sleds. 
The operations arc usually some distance back in the woods. It is there- 

9813 



-182- 

fore necessary to set up rx log.^ing camp and f-urnish supplies and equip- 
mcnt for the season, TiU' mal:in[.; of such arrangemonts v/as of course 
difficult as lon^; as it was impossible to loiow vfhat quota v/ould "be 
assigned to a given firm for the v;hole year. 

As a result of these aitr-ndments , quotas were thereafter assigned 
over such a period as vrould permit the seasonal operator to knov/ what 
ho would 'bo allov;ed to cut durinf;; the winter season, and to enable 
him to plan for his canii:^ an'l o^ierations without the necessity of 
making further chan.'^es, 

1/ Transcript of h-aring, January 22, 1934, pp. 1194-1207, Vol.11 
on Amend, #8, Code Record Section. 

LCA Amend:nent #55 l/ 
Not approved. 

This amendmrnt co:\cernin£ regulations for export allotments was 
withdravm by the Lumber Code Authority and amendment #54 was submitted 
in its place, 

1/ Files of Assistant Deputy Administrator H. H, Heloney, on 
Amendmont #35. 

LCA A-nendmont #50 1/ 
1-Io't approved. 

This amr-ndmr^nt Vifa? d'^ signed to i;^ivr the Code Authority power to- 

withhold production allotments from persons vmo violated Article IV 

of the code, either through failujre to mak" reports or to "oay code 

foes. • ■ 

At the hearing a representative of 411 small southern savmills 
protested strongly against this proposal, stating that these small 
mills werr- unabl- to furnish th'- r--ports asked for by the Lumber Code 
Authority and its atiencies. The ainendment was not approved, partly 
because of the feeling that it was not altogether fair to the small 
operator, and partly because, at tha.t time, the Administration began 
approving amendments to codes providing for supposedly compulsory 
collection of code fees, 

1/ Transport of hearing, Iferch 27, 1934, pp., 33-92, files of Assistant 
Deputy Adjninistrator H. M, Moloney, on Amendment ,#50, 

LCA A mendment j^l l/ 
Not approved. 

This a^i-ndment proposed to give power to the Lumber Code Authority 
in cases where a portion of the lumber uiidcr the jurisdiction of any 
division or subdivision was im:iTorted, to fix prodiiction quotas nn the 
basis of imports. This amendment was strongly endorsed by the North- 
eastern Lumber Manufacturers Association v/hich stated tliat the effect 
of production control in their territory with the consequent decline 
in domestic production, was merely to raise the amount of lumber which 
was imported. The representatives of the Association argued that the 

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measurc wruld n^t be unfair t-^ ir.TO^rters f'r it iT'iilr! nly ^ut them -n 
the same "basis as d'niestic pr-^ducer?. 

T'" '^pTD'siti'^n t this amendmrnt ''/ns sh^-vn at the public hearing 
but the Legal Divisi-'n refused t a>-nr-vc it -"nd ^n August 21, tuc Lum- 
ber C'^de Authority reouestrC thpt n" further acti'n be taken --n it f-^r 
the present. 3/ 

!_/ Transcrint f he-^Ting, torch '7, 19:54, vr,. 93-llG 

2/ Piles '1.' Assistant Deputy Adrainistrnt "r 11. :'!. icl'-ney Ti Amendment 
#51. 

LCA Am endm ent -;'-52._ lj_ 

N TLA A mendment '-11 

Appr-ved: June 5, 1934 

Signed by: HugJi S. J-hns-^n, Adninistrat'T 

This amendment Pr-^vides that the Lumber C'de Auth-^rity may, after 
having been renuesteri by a divisi-n r subdivision agency by vte ~f 2/7 
^f it~ I'.mbers, auth-rize the allotment "f pr'^ducti'-n therein '-n « basis 
''.f h"urs of ^perati'^n. 

The idtP f this aiaendment is s'und. In certain divisi-ns and sub- 
divisi'^ns, either due t" the fact that n'^ str~ng trade associations were 
built up, -.T due t'" the nature 'f the '^pera ti''ns, there were n'-'t avail- 
able records '"~f pa.st performance sufficiently accurate to enable the 
allocati'n 'f pr-^ducti'^n -^n p;'st performance. This was particularly true 
in divisions where there were a predominant number -"f small operators. 
Als'~' in certain cases the result ■"f applicati'n -f the f^'rraulae originally 
,C'"ntained in Article VII J would be t-" give certain persons such a small 
QU^ta that it was har'ly w-rth while runniiig. "^he advantage ^f alloca- 
tion 'n an allowable number ''f h urs or sis is th; t it treats everyone 
alike and will, generally, give s^ifficient number of h-^urs -^f '^perati~n 
t" gi^e 1 .b r fairly decent ei.Tnl- j/ment. 

1./ Transcript "f hearing, March 27, 19r.;4,p-o. 116-126, V-1. IT n amend- 
ment vll, C'~'de ?.ecord Secti -n. 

LCA Amendment --"'53 1/ 

NRA A mendment v23 

Approved: Oct"ber 5, 1934 

Signed hy: G-. A. Lynch, Administrative Officer 

A;tticle VIII (g) of th( c de permittee tne transfer f allotments 
"between o-nera,ti'~ns under thr- same ownership within t/ie same divisi'^n "r 
subdivision," Qualified o^ly by the provisi-^ns of Secti"n C which rpQuired 
"a.ccepta.ble evidence of ability to o-rjeratc. " This provision for tlie 
tra.nsfer of allotment auotas was taken advantage 'f by (l) purchasing 
of mills which "'o-L-t]_^ probably never run ao:ain s^ tha.t their allotment 
Quotas might be transferred, (2) tra.nsfer "f allotment ouotas fr^m mills 
which had n available timber resources and (c) by transfer "f ? llotmcnt 
t- an area where the minimum wage was lower. 

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In r^I•dpr t' f.vid thepc difficulties, the amendment -oroT^scd liy the 
Lumber C''de Authority stated in essence (l) that n'^ transfer sh-uld he 
allowed fr~m n mill T"hich load n't been ^Doratec'' in g"~ri faith f-r six 
months after its acauisiti '^n, if such acnuisition was after the effec- 
tive date -^f the c^de; (?) m transfer could be made fr'~m '^ne mill t'^ 
another unless the sTiecies ■or^duced were ordinarily the s.^.me; ('^O n^ 
transfers c^uld be allowed t-^ any mill, the greater part 'f wh'^se oroducts 
could, under the -orovisions of Article I" (d) "f the cr.de be s^lr! at 
less than minimum cost -orotecti^n -orices, and (4) n^ transfer sh-uld be 
allowed unless it arj-orieared tliat such transfer w^uld make for greater 
efficiency &nd ecn^my of onerati^n. 

The Consumers' Advisory Beared recommended disaTo-or'^val of this amend- 
ment because it felt the ability t^^ transfer alli^tments between t^^-^ mills 
under the same management gave an unfair advantage t'^ the large o-oerat'^r 
over the sraf-11 individual mill owner. 

The desirability -^f some method ^^f check o£ transfers of all'-'tments, 
however, causfd favorable action n this amendment by the Administration. 

1/ Transcript -f hearing, March 27, 1934, pp. 1S6-144, V-1. II -n 
Amendment #23, Code Record Section. 

LCA Amendment #54 ij 

Not approved. (Previ-uslv referrod t in this report per- 

taining t"" E:cp'Ort C'ntr'l.) 

The increase in the C"st of manufacture 'f lu.nber under the C^de, 
due both to the establishment ^f minimum wages and maximum h^urs and 
the establishment 'f control ^f ■nr-'ducti'n which increased cost by cut- 
ting down vol-ume, led t^ the ado-nti-n ^f c^st pr'""tection prices which 
protected the producer against a loss while selling in the domestic 
market. These minimum prices did not generally apnly in the highly com- 
petitive expert field where prices' were generally l^wer. The tendency 
was therefo^re exhibited to expert a smaller amount of lumber than liad 
been shinped during ■ore-co'de- days. To' stimulate sales, which would 
benefit the producer by lo^^ering his co-st per unit and benefit labor 
through increased employment, the Authority prop-sed in Amendment -'^54 
a variety of devices which might be adopted by the division "t sub'^'ivi- 
sion agency t^ stimulate experts. These devices, in essence, called for 
a reduction in auota to mills wh' would list themselves as export mills 
with the compensatory featiire that such mills might be enabled t'O' produce 
more lumber for export than they would have if their au~tas had n't been 
so reduced. 

Certain "f the Advisory '.^^^<r^z felt that tae pro-o^sal t - establish, 
at the discreti-n of the administrotive ae-tncy, ne of several o-ntional 
methds increasing exports, was cntr^ry t' I'TRA "policy. The Lumber Code 
Authority took the position that due to the diverse nature of c nditions 
faced by the vari'us divisions and subdivisi ns, a certain o-ntion in 
method of treatment was necessary. Failure to agree "n this ouesti'n 
wa^ responsible f^r non-approval of this amendment. 



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1/ Trnnscri^t of hePrin.g, March ?.l , 19^4, n->. 144-15:^. Files of As- 
sistant De-nuty Administr' tor K. M. i.'eloney on Amendment #54. 

L CA Amendment #55 \J 
Not ■■n-nrcved. 

This amendment, ■ declaring' th-.t the -nroductive c?>-nacity of the in- 
dustry was far larj^er tha.n ^^'arranted by current needs, -Droriosed that, 
until the Administrator found thr t additional c'--DPcity was necessary, 
no new mills be created and no existing -nroductive facilities he en- 
larged. The Authority pronoF.ed this -iraendraent for the following rea- 
sons: 

1. That whereas in IQ"?'?, 69 -^er cent of the ■oroc'uctive ca-pacity 
of the indiustry was being utilized, in the first ouarter of 
1933, this use of -nroductive caTDacity hnd shrunk to 19 -oer cent. 

2. Control of -Droduction ^-'hich rnf-de m.'=!nd.atory the frranting of an 
allotment to every mill canable of -oroduction had resulted in 
the STDringing -or, of several thousand new mills, particularly 
in the South. These mills were gr-^nted nuotas with a conse- 
oiient reduction in the size of the ouot-'' s given to already ex- 
isting mills. This -nrocess beinf continued, woul-^ result in 
slicing thinner f.nd thinner the amount of business which cculd 
be given to -any mill during ft given -oeriod with the result that 
costs would be highly increased and competitive -nroducts would 
take the place of lumber -nroducts. 

The amendment -nroposed that mills might be transf erri- c! from one 
site to another when their timber was cut out and also proposer! that the 
administrative agency might, in exceptional cases, authorize the build- 
ing of new productive machinery when such buildin?; was necessary to cut 
mature timber which might otherwise be lost. 

The adoption of this amendment was strenuousl:"- apposed from many 
Quarters. The Administration felt that it not onl:/ granted too much 
discretion to the administrative a.^encies, but that, it was unconstitu- 
tional as constituting a deprivation of -nrcperty -'ithout due -nrocess of 
law. 

1/ Transcript of hearin/-, March 37, 19-34, ryr). 15o-P70. Files of As- 
sistant Deputy II. M. '.ieloney on Amendment #55. 

For a considerable number of year? about ?.-!5 per cent of the red 
cedar shingles consumed in the ^'nited States had been imported from 
Canada. In 19.32 the rate of exchange tnen existing caused the -nropor- 
tion of Canadian imports to rise to 35 per cent; and the 25 per cent 
ratio was again exceeded during the early part of the Coc^e period. 

In the administration of production control the Code Authority had 
to meet the problem of restricting domestic production of a product '^here 
a portion of the supply was imported. 

Although the workers in t/ie Canadian shingle industry "'as endeavoring 

9813 



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to advance wajes and the industry to advance trices in line with ad- 
vances in the United States -under the Code, it •"as agreed \)Y re-oresent- 
atives of the industry on "both sides of the border tliat it would be im- 
nessible to control production and prices for any length of time unless 
there was developed some control over the ouantity of Can^^dian iirmorts. 
Section 3 (e) of Title I of the N^ational Industrial Recovery Act ruth- 
orized the President, in case competitive goods were ' imported into the 
United States in substantial quanitites, or in inore-^sing ratio to 
domestic production, in such manner as to endanger the maintenance of a 
Code, to authorize an investigation to be made by the United States 
Tariff Commission, and, following the completion of such investi|?ation, 
to limit the Quantity of such goods "hich might be imported into the 
United States, or otherwise determine the conditions undpr which entry 
would be permitted. 

In response to the President's direction, the Tariff Cominission 
made an investigation of the red cedar shingle -oroblen ^nd recommended 
that the Quantity of shingles ^-'hich could be imported be restricted to 
25 per cent of domestic consumption, either through cooperation with 
the Canadian Government or by Executive Order. The problem was settled 
by the Canadian and American raan-ufaccturers, aided by the. DeTiartments of 
State of the two countries, co'nin,<^ to a. voluntary agreement on a P.5 -ner 
cent limitation, go that it was not necessa:i"y for the American Govern- 
ment actually to exercise the authority riven it un'''er the National In- 
dustrial Recovery Act. As a means of ap--ilying necessary control, the 
Canadian producers had first formed an organize ttca foy tKit pu2rp'v'<$e-». 

In 1935 the production program for the Red Cedar Shingle Industry 
was upset by a strike which lasted from May to September, Under there 
circumstances, it would have been impossible to supply the markets in 
the United States on the basis of the auotas'set up under the Lumber 
Code. In order to permit increased importation of Crnadian shingles, 
both in absolute Quantities a'nd in proportion to total consumption, the 
entire red cedar shingle auota i^-as increased. As American Droducers 
were unable to meet their auotas, this in effect increased the percent- 
age allotted to Canada. 

It was expected that the administrative machinery ?et up under the 
Code for the Red Cedar Shingle Industry would disap-oear at the end of 
the Code period but it has not. The American producers have retained 
their organizations and apparently have some gentleman's agreement '"ith 
Canadian producers, with the tacit support of the United States Depart- 
ment of State. To determine exactly how matters have worked out since 
the Code period ended, field cont' cts would be necessary which have not 
yet been possible. 

Altho-ugh mahogany is not produced in this country, imports of this 
wood T"ere restricted- vnArr "the" Code, Some firms that had imported mahog- 
any irregularly, and had not imported in the three years prior to the 
codes which was the basis of determination of ouota, did not receive 
Quotas and could not make imports. 

The by-laws of the various associations, which became administrative 



9813 



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agencies londer the Code, ^rerc ;imended so tlipt p11 mernlDP'"? of the industry 
could gain easy entr^.ri.ce to.PSBOciP tion mern'oerphi-n, nnd -to establish 
eouality in voting -ooiver. 1?hree snecific erce^itions are noted in such 
by-la-'.^'s. The first is that of the Northern Pine Division, whose "by-laws 
provided that voting -"fi- to be on the basis of one vote for each one 
million feet of -oroductive caxiacity or frtSiCtion thereof, '^ith no one mem- 
ber receiving more th^m 15 votes. A -nrelirainary check of the production 
ouotas established for this division durin,^ the year 19.'^4, showed that 
some producers received Pllotraents for one puarter tl>"t were larger tha.n 
their records had shown, them able to -nroduce in an entire year. 

The Mahogany Subdivision by-lfiws carried a nrovision that voting 
should be on the bnsis of one vote for each SlO*^ dues naid. No in-oorter 
was limited t.o the amo-ont of dues that he could rjay, ^^nd conseouently not 
limited to the number of votes he could receive. l\o check ha,s been 
nossible on the allocations of this .Division, due to the difficulties 
mentioned above. 

The Phili-D'oine Mahogany Subdivision by-laws contained a, clause Ber- 
mitting votes on the basis of "each 100,000 feet of allotment." Due to 
the fact that there wa,s a com-nlainrnt who appealed to the Administration 
the Division of Research and Planning was enabled to obtain the allot- 
ment records and found that six -Drcducers received a.llotraent=: eouivalent 
to 51 Tier cent of the total for the Division. These six -oroducers, ac- 
cording to the by-laws controlled all future ouotas and could keeio them- 
selves in power as long as they wished or until amendment of the by-laws. 
In the case mentioned, arrangements were made to sa.tisfj'' the aiToellant. 

It might be well to note that one of the results of -oroduction con- 
trol as administered under the Code ■■'as the encouragement of selective 
sawing — bringing out of the forest only the best nart of the tree. 
With restrictions only on the nuantity of sawn lumber produced the aim 
of the maniif acturer must be, of cor.rse, to get the highest return from 
this Guota. The production control -orovisions limited sawn lumber and 
not logging, and therefo^^-e increased waste in the forest by encouraging 
the "omctice of leaving on the ground to decay all but the best logs 
from the trees. 

The National Industrial Ppcovery Borr''' recognized certain conditions 
as inevitable in any attemrjt at control of -nroduction, I'^nd in a i-iublica- 
tion dated April 33, 1935, entitled "Administrative Policy," st-^ted in 
part a,s follows: 

"A control of -Droduction is inevitable under -^ny 
industrial system. A long ex-oerience has led us 
to leave thpt ■oroblem to the onen market. In a 
few industries in which competition h?s -n-^oved 
unus"ua.lly disorderly, it ma.y be necessary to in- 
tervene to bring production into line with demand; 
but such intervention should avoid 'restriction of 
output' and should aim at the kind of eouation be- 
tween production and consumijtion a? the market is 
suT5-oosed to effect. The strategy of nolicy must find 
ex-nression in a multitude of decisions. But its 

9815 



-188- 

end is single — an economy, not of scnrcity but of 
nlenty. In other ""ords, raeans and- end? mvist not be 
confused. Means should "be flexible, reouiring the 
use of a miscellany of devices and nrocedures. Ob- 
jectives should be stable. The goal is the estab- 
lishment of conditions under which in p. free and 
open market comT)etition may determine a fair r)rice." 

Production control will remain a -nroblem of this industry, and 
methods to solve it will continue to bp off erpd r s long as the presently 
existing tremendous -ootential capacity to produce goes hand-in-liand with 
a much restricted consumer demand for lumber and timber oroducts. 



9813 



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CliAPTER IV 

FHOBLEI.IS OF PISTRIBUTIOIT 

The successfiil marketing of foi-est productc is as imisortant as the 
■unquestioned need for aggressive and farsighted action in maintaining 
the grorrth and protection of timber stands. This axiom is well sub- 
stantiated "by the fact "that had the per capita lumber consimption from 
1899 to 1909 continued, the 1929 gross consumption i/ould have been almost 

twice what it was fsr while consumption of all other major building 

material was greatly increased, gross lumber consumption actually de- 
creased or barely held its own, (*) 

The intimate relationship of the growth and distribution of forest 
products to (a) land use, (b) employment, (c) government investments, is 
a challenge to the industry and to the consuming public to put forth 
every effort to retain, to recapture, and to expand the market for for- 
est products. 

Patently, the attainment of these objectives is a problem of indus- 
trial efiiciency centering chiefly a.round (a) productiori, (b) price, 
(c) channels of distribution, (d) trazisportation, (e) increased satis- 
faction in the use of the products, (f) competitive practices and 
(g) integration of industry. 

Not the least of these intimate factors is that having to do with 
the inorovement of the products which may be accomplished in various 
ways, some of which are: 

1, By controlling moisture content througli better seasoning 

2, By exercising greater care in selection and grading, . and 

3, By mak;ing decay-resistant lumber generally available. 

Sight should not be lost of the fact that low production cost, pjid not 
so incidentally. either a nigher degree of satisfaction to the consumer, 
calls for radical chsjiges in industry organization and in practices re 
forest holdings, 

' Fnile there are of course various disadvanta^ges controlling the 
cost of lumber (lumber is the principal fo'rest product and presents the 
most difficult marketing piroblem) , possibly the most dominant is the 
heavy transportation charge. Lessened transportation costs vdll depend 
on at least three conditions: (l) freight rate a,djustment, (2) decreased 
cross-hauling, (3) putting those forest ared,s clo'sest to consuiaers into 
maximum production, and (4) fabrication of lumber at the source rather 
than at the point of consumption, 

Few people realized how intimately and extensively wood, as wood, 
enters into our every day requirements. Fewer still r.re av/are of the 
fact that an ever increasing qu'iiitity of vrood is used in mailing articles 
in which the identity of the wood is not obvious. There are, for example, 
thanks to laboratory and chemical treatment, products such as paper, 
. Jayon, cellophane, artificial leather, paper dishes, drinlcing cups, roof- 
r^l "A National Plan for American Forestry." A reT)Ort of tlie Forest 

Service (1933) p. 1365. 
9813 



-190- 

ing felt, and even, conduit pipes, all nade from wood. Then there are 
wood e:ctracts, dye stuffs, essential oils and naval stores, each one 
creating a demand and its consonant problem in distribution. 

In the past, lumber and the other' major forest products have "sold 
themselves," Quite the 'contrary is true now, for those commodities 
must be pushed against the increasingly keen competition of other mater- 
ials. There is important needi therefore, for strong promotional effort 
not only to maintain established outlets but to generate latent wants, 
all of \7hich calls for distributor cooperation in a well coordinated 
sales policy to the end that the consumer ma;A obtain material of the 
type and quality desired to meet his particular requirements. 

Taming to the more specific discussion of distribution problems 
as such it is to be noted that there are as many and as wide variations 
of marketing methods as there are sections and regions of the co-untry. 
This may veil be accounted for by the fact that the industrjr took its 
beginning largely from agriculture with its early market of new farms 
-caused out of the ever receding wilderness and the methods which grew 
up during this period have been carried on through the transition period 
to the present. Any attempt to define specifically methods- of distribu- 
tion would be entirely erroneous except for the section or region 
specifically under discu'ssion, therefore, this portion of the subject 
will only be touched on in a broad way, 

Tlie entire distribution mechanism is governed by specific demand 
factors. While these factors are legion, if individual purchasers are 
considered, there are actually but fe\7 variant factors if purchasers are 
reduced to major consumer groups. The Construction Industry comprises 
by fa.r the most important of these groups,: followed by the Wooden Con- 
tainer Industry, and majiy other lesser industries - all discussed in 
some detail in subsequent pages. 

In order that the reader maj" have some sort of a yardstick by which 
to measure the Lumber Industry's field of distribution and thus more in- 
telligently comprehend its demand factors and distribution problems, the 
following observations and data are presented. 

As already stated, although lumber is but one of the many products 
of the forest, it is by far the most important, since the saw timber area 
consists of approximately five-sixths of the total commercial area, With 
the shifting of the industry, as each new area was tapped, production 
and origin of shipment naturally shifted and correlatively influenced the 
distribution problem. 

In the beginning, timber and other forest -products v;ere located under 
favorable conditions adjacent to their markets, making for low production 
and distribution costs. But as these supplies of virgin timber were de- 
pleted, new areas were opened up farther and farther from the market, 
thus increasing transportation costs which were passed on to the constuner 
in increased prices. The inevitable result was lessened demand, 

G-oiigback a step further into the field of Traduction, it is evident 
that these recurring shifts and consequent resvilts generated a dilemma 
on the horns of which the industry was and still is securely caught. To 

9813 



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raal--:e a profit it has always had to cither increase prices and face a 
diminishing demand, occasioned in part ty consumer demand for substitutes, 
or roduce cost in an effort to Maintain and expand markets. 

Bearing in mind that the principal soft-jood producing regions are 
Southern pine in the Southeastern section of the United States: the 
Douglas Fir region comp lined of most of the States of Washington and 
Oregon; end the yestem Pine region comprised of the inter-mountain 
states, it can be readily seen with the principal consuming markets on 
the Kortheastem Seaboard, in the ccntrr?J. \7est arid in California, that 
there woiild be a very considerable cross-haul of lumber and timber prod- 
ucts to effect the distribution of the manufactured pi-oducts to the con- 
suming areas» This raovomont of lumber and timber, is very completely 
sho\m in Table XLTI; Appendix II, of tLiis report vmich deals only with 
the softwoods, but as scftwpods inal:e up from 85 to 90 per cent of the 
total ajinual cons'JUiJpt ion of lumber rnd timber products, this data is in- 
dicative of the whole field. 

Certain suimaar;'- fngii-es from tliis complete table are presented in 
tabulation on tiic follo,7xi?g p. ■■::■■ 

Fnerever the manufacture of lumber has been a major undertaking 
the first mills were usually situated along waterwa^/'s and the logs were 
rafted to them but as the timber axlja.ccnt to the water was depleted, the 
mills moved inland end resorted to rail and other transportation agencies 
to reach the consoling areas. About the only rafting now done of logs 
is along the Pacific Coar^t fron the northwest to mills in that area and 
in California, '■ 

THien most of the production of liimbsr was confined to the northeast- 
em states, a large amciuit of it moved thro-ogh the variovis canals. In 
1872 a tcta,l of 1,467,865 tons of forest products moved into the Pludson 
River from the Erie and Ohamplain Canals, From this peak year, cana,l 
tonnage declined to 232-325 tons in 1907, (*) 

Lalce and all-rail shipments of liunbi. r from Saginaw River points in 
1885 amo-jntrjd to about 149,0GJj000 ft, by rail and slightly over 
559,000,000 ft, by water^ Rail shipments increa^sed steadily until in 
1897 they amounted to 379,000,000 ft, as against slightly over 
89,000,000 fta by water r. Water shipments of Itunbrr into Chicago reached 
their peak in IScT-'^ araoun-uing to 1,850, 000, 000 feet, but have dropped to 
175,000,000 by 1914, In 1371, 61 per cent of the lumber reaching Chicago 
came by ','atcr whereas in 1913. such j^ovcment wa-s less than 9 per cent, 

AS the areas of production shifted to the South, coa.stwise movement 
from, the South Atlcaitic ports 'oj sailing ajid steam vessels became of in- 
creasing ir.poi-trc'ce.-, The annus,! report of the New York Chtimber of 
Commerce for 18yi>-91 contains a table shewing that 1.301,3585762 ft, of 
lumber -ere received at the port of iTew York in 1390. Of this amctnt, 
304,823,000 ft, verc dolrvered by rail an.d 99:;5::4.762 ft, by water. In 



(*) Canal data Lai.yn from "Rjp'-rt ,-;:^ rransportation by waiter in the 
United State:;." by the U, S. Co:.: rdssioner of Corporations, July 
19, 1909, Part, 2, 



9813 



•193- 






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9813 



-193- 

1907, 447,229,565 ft. of Southern Pine were received at ITev; York ty water 
aJid of this anount 224,433,208 were discharged from sailing vessels, the 
remainder from steam vessels. 

Prior to 1900, and to an evci"~decreasing extent following the turn 
of the century, a considerable anount of the water-borne lumber which 
entered the North Atlantic ports from Baltimore north was shipped by rail 
to interior points as far west as Cleveland, Much of the lumber which 
was back-hauled was remanufactured in plants located in the llorth Atlan- 
tic ports* However, as manufacturing facilities were increased at the 
mills, and as the network of railroads spread out throughout the South 
and West this movement of lumber inland from the Atlantic Seaboard ports- 
has very materially decreased. 

In the early 1920' s the movement of Pacific Coast woods to the At- 
lantic Seaboard ports'began to gain impetus. In 1920, 205,000 short 
tons of lumber passed through the Panama Canal; in 1922 this had in- 
creased to 1,122,000,000 short tons. 

Tliis w3.ter-bome movement from the Pacific to the Atlantic of 
low-grade lumber at low freight rates was a blow to the producers of 
Southern Pine, Although wages in the nills on the West Coast were two 
or more times higher than they were in the southern mills, the effici- 
ency of labor, the class of timber, and the facilities for manufactui>- 
ing lumber on the West Coast were such that it could be shipped 6,000 
miles by water and yet compete in price with lumber of other areas 
shipped by rail from 300 to 1,500 miles to the metropolitan centers. 
Farther, it could be back-ha.uled by rail 400 or 500 miles from the At- 
lantic Coast and still compete with Southern Pine, shipped to such 
points as Youngstown and Cleveland, Ohio, 

Within the last few years there has been a movement by truck 
from the mill to the consumer. This trend was to be expected in re- 
mote districts; it has, however, been highly developed, particiilarly 
along the Eastern Seaboard, and much lumber is now hauled from Virginia 
and the Carolinas into such cities as Washington, Baltimore and 
Philadelphia, In many instances the lumber hauled by truck is sold 
direct by the mill to a contractor or a builder, and delivery is often 
made over night. 

This method of transportation has materially added to the burden . 
of and increased the competition of the retailer in certain areas. 
It has further served to break down general price levels, A contractor 
btiying direct from a mill at a cheaper price thaii a retailer exerts 
pressiire on the retail yard to meet the competition of the mill, and 
this pressure is, in turn, exerted by the retailer on his sources of 
supply, ^ 

Although there are no figures available to confirm definite changes 
in the method of distribution under the Code it is believed that much of 
the growth of truck transportation was due to the Code. Certainly it 
cannot be denied that many purchasers of lumber exerted themselves to 
the full in an endeavor to brealc down not only the Code prices set up 
by the manufacturers but also to evade, if possible, the modal mark-up 
of the retailers. It is also an undisputed fact that some shippers and 

9813 



wholesalers of lumter coo-nerated rrith this class of purchasers. Diiring 
the Code period, the majority of retail 'Itunher dealers not wishing' to 
increase their low stocks were most desirous'of h-uying in small q-uantities, 
less than carload lotso This reason, together with the fact that low 
stocks were replenished more rapidly hy track deliveries than "by rail 
shipments Often led to truck transportation. The great increase in num- 
ber of good roads and in the efficiency of trucks has al6o contributed 
to this method of distribution. ;' 

With the expansion of the west, particularly upon the completian of 
the transcontinental railroad, came considerable increase in farms. 
During this period' there' were approximately 60,000 farms established an- 
nually^ each taking m'any thousands of' feet of liiunber. This building 
reached its high point in 1906 and 1907, when 46 ,'000,000, 000 board feet 
annually were consumed, inciting wild stumpage speculation. With the 
continuation of agricultural expansion and its concurrent increased de- 
mand for lumb.er, the val'u.e o-f stumpage- "rose" steadily to about 1927, 
This- speculation and acquisition in the West, of large timber holdings, 
is the key to many of the problems T/hich appeared during the years of 
the depression. 

With the declining demand and the resultant decline in value of 
stumpage, timber holding' became a liability due to the tetx" problem For 
example, a study in northern Michigan shoves that on 16 representative 
timber tracks, average annual taxes per acre increased from 14 cents 
in 1906 to 96 cents between 1926 and 1930, Is'with ail other products, 
when stumpage values were no longer increasing, the tendency was to 
liquidate holdings. This in turn brought keener competition and a de- . 
sire, to Convert standing timber into cash. New mills were constructed 
at a rapid rate, Prom, 1921 to 1929' the number of establishments produc- 
ing more than $5,000 annually grew from 14,961 to 19,142 — this in 
spite of the fact that the volume of lumber consumed was steadily de- 
clining. The' pressiirs to liquidate timber became even greater during 
the depression years, although practically 'all holders of timber land 
realized that there was already large over-production. 

Until about I9'2;3 the generally increasing lumber prices were 
accepted by the public,- then the competition of substitute m'aterials be- 
came acute, with the result that profitable lumber prices could no 
longer be maintained under the current regime. Literally forced to the 
wall by the two battering rams of nounting costs and relentl.ess competi- 
tion, the industry in- desperation resorted to, lower cost formulas and im- 
proved methods of grading and seasoning to make its products more attrac- 
tive to the consumer. What little advantage was gained in this manner, 
however,- was frequently offset by new concerns entering the production 
field, particularly in the' older areas, where a second growth, though 
immature, was put .on the market, and by old concerns setting up an al- 
ready sufficient capacity. Overproduction would inevitably follow' with 
a resultant drop in prices, thus forcing the high-cost operators to close 
do\7n until curtailed production and increased prices again permitted them 
to compete, ■ 

As already stated, although lumber is bat one of the many produc ' , 
of the forest, it is by far the most important. Some graphic idea of 
the general demand faqtor of at -least the major forest products may be 

981S 



-195r 

gained from the followine table of forest products and the per cent of 
demand in terras of the total amount used annually from 1925 to 1929: 



POEEST PRODUCTS PER CEIIT OF TOIAl 
USED AHIWALLY 

Lumber 50,8 

Puelv/ood 27,6 

Heued tiqs 4,4 

Pence posts 4,3 

Pulpwood 4,1 

Mine timber (round) If 6 

Veneer logs If 6 

Cooperage (slack) " 1»1 

Logs and bolts in maniifacture 1«1 

Cooperage (light) 1»0 

Shingles ' 0.9 
Miscellaneous (poles, piling, e^qjort, logs, 

distillation and extract wood, excelsior, 

etc,) 1.5 

Source: Bureau of the Census, 1925-1929. 

Through its years of developnent and vicissitude, the industry has 
had to cope with a sluffing away of same and the growth of new demand 
factors. Just what future demands may be is pure conjecture. The con- 
viction is growing, however, that our forests will be requii-ed to fur- 
nish material for many derived products such as cellulose, lignin and 
acetate of lime, rather than chiefly logs, lumber and cordwood as in 
the past. Whatever the demand, though, the pioneers' attitude of des- 
truction is being replaced with an attitude of care and conservation. 

It is quite evident that the brevity of this chapter does not per- 
mit even a passing discussion of the lesser maniford uses and the ger- 
mane factors entering into their individual collective distribution. 
It will suffice to devote consideration merely to those major demand 
factors or consumer groups, which have dominated and still control the 
consumption of the Lumber Industry's chief products. 

The consumption of Itunber may be roughly divided into five general 
demand divisions. They are: 

1, Lumber used for construction purposes 

2, Wooden containers 

3, Industrial use- 

4, Railroads, including ties and other structural 
lumber for railroad jjunioses 

5, Tlie export market - 



9813 



-195- ■' 

It is difficiilt to obtain data as to the proportion of the total 
cons-umption going into each class enimerated ahove. The Department of 
Commerce, however, in conjtmction with the United States Forest Service, 
made such a "livision, and found that in 1928 approximately 63 per cent 
of the total lumber used was for construction purposes, including the 
lumber that uad been fabricated into construction parts, such as doors, 
sash, etc, 'Jhis included all railroad lumber except that used for car 
construction, irhich 'was placed in the industrial classification. Ap- 
proximately 15 per cent v.-ent to the UTooden Container Industry in 1928; 
and about 14,5 per dent to the lesser industrial uses; vrith 6,5 per 
cent to exiDorts«(*) " 

In 1933 the Construction Industry took about 65 per cent, the ' 
Wooden Container Industry 16,4 per cent, other industrial users .12,5 . 
per cent, and 5,1 per cent was exported. It is thus seen that the 
Lumber Industry is'prretty definitely wedded to the Construction Indus- 
try, for better or for worse, Correlatively, large centers of popula- 
tion furnished the idost enticing consuxaing areas, 

The total lumber consumed in the 'early part 'of the 20th Century 
exceeded even that u'sed during the building boom period of the late 
20' s. This, to some' extent, was duo to the enormous amount of rail- 
road building at the turn of the century-, together with new towns and- 
farms opened up along their right-of-way. 

According to the National Lumber Manufacturers Association, produc- 
tion in 1906 and 1907 surpassed 45,000,000,000 feet. The nearest ap- 
proach to this figure was in 1923 and 1925, when slightly in excess of 
41,000,000,000 feet of production was reported. Lumber, though used 
for fewer purposes during this period to 1907, was used in greater 
quantities than at any time feince, ' Tlie railroads for example then used • 
enormous quantities for ties and trestles; some of the latter have since 
been replaced with concrete and steel and perfected methods of treat- 
ment have reduced decay and replacement. The planlc sidewalks, and these 
took a lot of lumber, were common, and green lumber houses sprang up 
like mushrooms. 

The United States Census reports for the decade 1920 to 1930 
showed construction of 4,500,000 buildings with a dollar value of such 
construction amounting into tremendous dollar investment as seen from 
the following table: 

YEAR VALUE .■BUILDIiro COHSTRUCTIOIT 

1920 $4,133,000,000 

1921 3,786,000,000 

1922 5,302,000,000 

1923 5,829,000,000 

1924 6,421,000,000 

1925 . 8,036,000,000 

1926 8,163,000,000 

1927 7,975,000,000 

1928 8,237,000,000 

1929 7,234,000,000 

-^^ 1930 5,062,000,000 j'^*) 

(*) See Table XXXI, Appendix to this Report 

(**) See "The Construction Industry and NM Construction Codes," Division 

9813 °^ Review, NRA, March, 19S6. 



50.5 


79,5 


45.2 


77.9 


65.1 


88.0 


71.5 


101.4 


79,0 


98.2 


■ 98.8 


104.3 


100,0 


100,0 


89.0 


92.3 


100.5 


102.4 


89.0 


97.2 


62.0 


69.2 


39.5 


50.9 


17.3 


37.4 


16.4 


43.7 


20.7 


40.6 



-197- 

Tlie use of iTJUiter follows the general trend in construction as shovm 
by the follOT;7ing index comparisons of building volume rith total volume 
of lumber shipped: 

Year Construction Lu-nber ShiToned 

1920 

1921 

1922 

1923 

1924 

1925 . 

1926 

1927 

1928 

1929 

1930 

1931 

1932 

1933 

1934 

Wliile it is apparent that the volume of lumber used during the 
boom years of the late 20's as shomi in Appendix II, of this report, 
Table XXXIII did not parallel the total increase in construction, 
there has been less disparity than is generally thought. The compari- 
son shous that for every $1,000 '•'orth of construction, there was 4,520 
feet of lumber used in 1920, 2,796 feet in 1925, the lowest point being 
in 1927, when 2,470 feet were used. There was an increase in 1929 to 
2,861 feet, with the highest point in the 15 years rea.ched in 1933, ^-^ith 
5,768 feet. This may have been due in part to the large number of 
C.C.C, camps built in that year as compared to total construction, but 
this has not been accurately determined. In 1934 some 4,523 feet of 
lumber were used for each $1,000 of construction. 

In 1928 a total of 25,822,230,000 board feet of domestic lumber 
went into construction, as compared with 10,162,661,000 board feet in 
1933, or a drop of more than 50 per cent for the period. Softwood ac- 
counted for about 91 per cent of the total softwood and hardwood con- 
sumed by the Constraction Industry in 1923, and for about 87 per cent 
in 1933, It is seen, therefore, thctt softwood consumption has lost 
somev/hat to hardwood consumption, althou^gh the cause is not definitely 
discernible. 

Of the total lumber consumed by the Construction Industry in 
1928, by far the largest amoujat, or more than 31 per cent of the soft- 
vrood was taken by ITew York State. Illinois ranked ne::t, taJ-^ing nearly 
one-third as much as Kew York, followed by California, Pennsylvanigi, 
Michigan, and Ohio, in the order named. Considerably lesser amouiits 
were t?ken by the remaining States. New York likewise took the largest 
proportion of the hardwood prodiiction in 1928, or about 31 per cent, 
followed by Illinois, California, Pennsylvania, Llichigan, and Ohio, in 
order. 

In 1933, five years later. New York still outranked all other States 
9813 



-198- 

in its total consimption of "both soft\70od and hard^vood, "but the percent- 
age difference 'bet\7een itn tnl:e and that of Cslifornia, the next ranlcing 
consiraer, vas slight, llev York took 23 per cent of the total softrood 
production, v/hereas California took 21 per cent, llev; York, 23 per cent 
of hard\7ood production, and Co.lifornia, 21 per cent, Illinois, which 
held second place in toth softwood snA. hardwood in 1928, dropped to 
fifth place in 1933, Pennsylvania moved up from fourth to third place, 
Ohio fron sixth to fourth place, and Lichigan dropped to sixth place. 

Comparisons of State consumption are even more significant when 
studied, in relation to the total amounts consumed in the two ^'■ears, 

COIiTSUl'.iPTIOH OF LUMBER BY THE CPU STRUCT I Oil INDUSTRY 

(LI. Feet B. 1,1.) 

WOOD ai:d state 1928 1933 

Softwood: 

Total ■ 21,634,717 8,859,570 

New York 6,838,518 2,075,568 

Illinois 2,434,555 244,445 

California 1,340,271 ■ 1,884,784 

Pennsylvania 1,298,516 483,392 

Michigan 1,191,424 163,732 

Ohio 1,183,419 291,277 



Hardwood: 
Total 
New York 
Illinois 
California 



2,r87,513 1,293,0,91 

691,451 302,596 

246,161 35,637 

-^ ..-^ 135,516 274,782 

Penns3'lvania 131,295 70,473 

Michigan ■ 120,466 23,870 

119,557 42,455 



Ohio 

It is noted from the foregoing table that while New York consump- 
tionin 1928 was 31 per cunt of the total, as against California's 5 
per cent in 1933, New York took "but 23 per cent and California increased 
her tai:e of 21 per cent of the total. Not onls?- that, California in- 
creased its softwood consumption in 1933 over 1928 ahoxit 46 iier cent, 
and its hardwood consumption doubled, Tli.e consumption for all other 
States in 1933 was considerably below the consumption of 1928. 

Undoubtedly the greatest amount of labor used for railroads is 
that used for ties. Here was the most important influence on the de- 
cline of the total," No figures are available for the early part of 
the countrj' when railroad building was at its height, but fig'j.res show 
that there was a drop from 135,000,000 ties in 1923 to 46,000,000 ties 
in 1932. 

The prime reason for the drop vras of course, decreased railroad • 
building btit in, addition, the introduction of a treatment which in 
some cases trebled the life of the tie, influenced a reduction in the 
use of new ties, 

9813 



-199- 

As stated, the next largest consu-ner of lirnlDer after the Constmc- 
tion Industry is the Wooden Packaf;e Industry, vhich talies about 16 
percent of the total production. There has been much complaint in the 
industry regarding numerous displacements of '-'ooden containers by fibre 
and iiaper bo::es. Undoubtedly thii:, is tome to a considerable extent but 
there is no statisticrJ means of measuring this, due to lack of infor- 
mation on the Paper Container Industiy at this tine. The onlj'- \7ay id to 
compare the index of industrial production vith the total amount used 
for \70oden containers. Table XXXI of this report indicates that in 1928 
about 5,474,000,000 feet of lumber -jere used for this purpose. The 
Federal Heserve Board Index on Industrial Production with 1929 equal to 
100, stood at 93 for 1928, and in 1953 only 2,949,000,000 feet of lumber 
were used for containers. The index of industrial production stood at 
64 - e^ droi^ of 31 percent in industrial production as compared to a drop 
of more than 50 percent in wooden containers. 

Certain sections of the industry-, notably California, and Oregon, 
show somewhat less decline in wooden containers due to the fact that the 
fruit packing industry in the llorthwest and the fru.it and vegetable pack- 
ing industry in CsJ-ifornia are still large users of \700den containers. 
In the East, the practice of using large veneer conta,iners rather than 
the sa.wed wooden box containers so prevalent in the Vfest, reduced the 
amount of lumber used for that purjDOse. 

Over 75 percent of the l\ijnber tal:en by the IJooden Container Indus- 
try is softv-ood. In 1929 Washington ranked first in the .amount con- 
sumed, talcing about 12 percent of the total, followed by Oregon, liichigan, 
Pennsylvania, Liassachusetts, and Ohio, in the order named, each consuin- 
ing more than 200,000,000 board feet annually. Pennsylvania tal:es the 
most ha/rdwood for container, followed by California and Ohio in the order 
named. Considerabl;'' lesser amounts were talcen by the other States. In 
1933 California took by far the largest amount of softwood for contain- 
ers, followed bj' Oregon, althpugh it ranked seventeenth in ir!28, Washing- 
ton (first in 1928), Llichigan, Pennsj'-lvania, Lascachusetts and New York 
in the order named. 

Tiie Construction Industry ai'.d the Wooden Container Industry'- to- 
gether took approximately SO percent of the 1928 lum.ber consumption, 
leaving about 14 percent for other industrial uses and 6 percent to be 
exported. Pra.ctically tho sam.e relationship prevailed in 1933. 

In 1928 the tota.l lumber used for industrirJ. purposes was 
4,945,000,000 feet. This dropped in 1933 to 1 , 90?", 000 , 000 feet— a de- 
cline of slightlj"- more than 60 percent as compared to the decline of 31 
percent in industrial production of all other industries. It appears 
from the above that the decline in the use of wooden products was great- 
er than the general decline in consoxiption of other industrial products. 

Wliile over the longer period there had been some increase in the 
use of lumber for industrial purposes, other than has already been dis- 
cussed, due to the increased use of wooden automobile parts, this consump- 
tion began to decline during depression years \Tith the 'xdv^nt of the steel body, 
Further, some displacement has been made by metai furniture and metal 
parts, which were formerly made of wood. While the Automobile Industry 

9813 



-200- 

is still using ei considerable share of the l/tunber production, its rapid 
substitution of inetal for '.70od has now placed consumption of vrood at 
appro xinately the level contained "by the carriage and huggy industry'. 
IJhile there are clains of a reversion to v/ooden pa,rts for nany things, 
this nay he due in a large measure to special development in the indus- 
try itself; and the trend nay be further increased by the price level 
of lumber as compared v/ith the price level of metal products. 

It is vTorthy of note that whereas the great preponderance of 
lumber consumed by both the Construction Industry- and the Wooden Con- 
tainer Industrj"- was softwood, more hardwood than softwood is talien by 
other industrial users. 

Although iiichigan ranked first in 1928 in its consumption of lum- 
ber for industrial uses other than for construction purposes and for 
wooden containers, and North Carolina was second, in 1933 llorth Carolina 
ranked first, and Uichigan second. California, though prominent in its 
conswAption of wood for construction purposes and for containers, ranlced 
eleventh in its consumption of wood for other industrial uses in 1928, 
and even lower in 1933. 



table: 



The major hardwood consuming industries are shown in the following 



LlAJOa PJURPffOOD C0IISFi.:I1:G IimuSTRILS 



imUSTHY 



Furniture 

Boxes and Crates 

Building and Construction 

Raili'oad Construction 

Railroad Car Construction 

Flooring 

Vehicles 

Caskets and Coffins 

Sash, Fram.es, Doors, Blinds, and 

General Kill Work 
Handles 
Miscellaneous 
Unaccounted for 



IvI. FT. 



PERCEIIT OF 





TOTAL COlIsmiPTIOH 


628,000 


21.38 


516,000 


17.57 


492,000 


16.75 


328,000 


11.17 


38,000 


1.29 


222,000 


7.56 


191,000 


6.50 


46,000 


1.57 


44,000 


1.50 . 


32,000 


1.09 


234,000 


7.97 


166,000 


5.65 



Source: 



national Lumber Manufacturers' Association, Docket No. 5, 
1933. 



9813 



-201- 

It '.Till "be noted that the Furniture Industry taJ:es the largest 
share of hardv/ood shipments. The Box and Crate Industry ranks second 
nith der.and areas scattered over the entire eastern section of the coun- 
try. This latter industry uses the lov-t'^rade product of the logs and 
as a rule the less expensive ^70ods, such as gum, tupelo, and cottonnood. 
It is an industry that in the past decade has had to face intense and 
ground gaining competition from substitutes such as fibres and paper 
containers. The saving in ti-azi sport at ion cost through the utilization 
of a lighter weight container has been ajn. economic competitive factor 
that the manufacturer of the Tvooden box has had to meet. 

As early as 1626, the Colonists sent some lumber to Holland and 
from there it nas reshipped to England. It is also worthy of note that 
for many 3^ears the timbers of the finest ships in the British Navy came 
from 1-Tew England. Nor should it be forgotten that lumber, logs, masts, 
planl:s, stairs, tar, pitch, turpentine, and other forest products en- 
tered largely into that first nursery of foreign comnerce. Trade with 
the Uest Indies; growing out of these Island transactions was the fa- 
mous "three-cornered trade," in which New England and the Carolinas 
shipped forest and agricultural products to the West Indies; the Uest 
Indies shipped sugar and molasses to Europe; and Europe shipped manu- 
factures to Hew England, so closing the circuit. 

After the Revolution, great emphasis was given to the exclusion 
of the foreign trade of this country to the Orient. As a result ship- 
ments increased a pace, including lumber and forest ;products. By 1821, 
according to Department of Commerce data recorded exports of sawmill 
products and naval stores, gums and resin (wood manufacturers not re- 
corded) amounted to $1,828,000,000 — 43.5 percent of total exports for 
that year, and in 1S13, just prior to the Uorld War these exports in- 
cluding wood manufactxirers, amounted to $134,190,000, or 5.5 percent 
of total exioorts. 

The table on the follovring page shows lumber ex^Torts for the 
years 1S29 and 1932-1934. 

The above mentioned table does not include total shipments, be- 
cause comparable figures are obtainable only for the items shown. They 
constitute, however, the major portion of the footage shipment of the 
industry. While, again, there are no footage and value fi;gures direct- 
ly comparable which completely encompass the Lumber Industry, it is 
perhaps worthy of note here that the total value of exports in 1929 
constituted about three and one-half percent of the total exports of 
the United States. If this percentage is set off against eight and 
nine percent, the amount of exported manufactured goods of this coun- 
trj"- in relation to total production, the relatively collective unim- 
portance of lumber exports is evident. 

Aside from the fact that e:q5orts of both softwood and hardwood lum- 
ber dropped off rapidly from 1929 to 1935, the preceding table is sig- 
nificant as showing that small hardwood dimension stock increased over 
the same period. The 1934 shipments represent an increase of about 74 
percent over 1929 shipments. 



981J 



Kind 
SOFWOODS^ 



1929 



-202- 
LU MBER EXPORTS 
(M. Bd. Ft.) 
1932 



Firot rnonthr. of 
1933 1934 1935 



Douglas Fir 


1,450,115 


495,708 


574 , 504 


591,402 


398,140 


■Mo. Pine 


810,782 


331,265 


341,924 


383,985 


280,780 


Wes. Pine 


41.482 


14,353 


17,358 


28,409 


24,948 


Hedvood 


62,280 


8,219 


14,185 


18,611 


11,544 


Cypress 


11,087 


2,847 


3,764 


4,611 


3,436 


Other 


239 , 520 


45,699 


30,505 


28 , 741 


22,871 


lall Dimension 












Stock 


5,337 


65 








TOTAL 


2,620,603 


898,156 


982,240 


1,055,759 


741,719 

1 


HARDWOODS* 


y' 










Ash 


38,781 


27 , 849 


35,995 


44,381 


26,660 


G-iim 


53,904 


28,776 


36,996 


33,000 


25,860 


Oak 


231,024 


132,347 


155 , 549 


130 , 124 


115,571 


Popular 


40 , 383 


16,265 


21,979 


23,903 


20,629 


Other 


87,626 


23 , 763 


28,677 


34,060 


25,799 


nail Dimension 












Stock 


5,407 


4,984 


6,600 


9,415 


6,355 


TOTAL 


457,125 


233,984 


285,796 


274,883 


220 , 874 


JTAL - SOFT AND 












HARDWOODS 


3,077,728 


1,132,140 


1,268,036 


1,330,642 


962,593 , 



SOURCE: Foreign Commerce and Navigation of the United States - 1929-1932- 
1933-1934. 

* Includes boards, planks, scantlings and sawed timber. 



The hardwood dimension segment of the Lumber Industry, though relatively 
small, felt the depression effect to but a minor degree in the volume of 
the export business. This fact would seem to point to a fast grov/ing 
tendency of consumers of this industry's product to purchase requirements 
as far as possible in the form of semi-fabricated material at the source 
of supply. This trend presages an evolution of the lumber industry and 
one that will doubtless be found to be of value in its competitive battle 
with substitutes. 



9813 



Products competing with lumber and' timber productc are numerous 
and varied. Nearly all building materials compete directly, and either 
have displaced or are displacing lumber to a large extent in the con- 
struction field. 

Displacement of lumber by structural steel, cement, stone, and fire 
clay products (brick, terra cotta tile,) and other shifts in commodities 
consumed, may be separated into three classifications: (a) Shifts due to 
changes in relative volumes of different types of building construction, 
(b) temporary shifts due to price competition, (c) permanent commodities' 
substitution. The first factor measures long-term but only partially 
permanent shifts in displacements; the last factor of primary importance 
measures the permanent changes in potentialities for consumption of com- 
peting commodities. 

The following table Shoes the percentage of displacement of lumber 
by steel, cement, brick and stone for the period 1919 to 1932: 



PERCENTAGE CONSIB/iPTION OF MAJOR BUILDING- MATERIALS 



Year 


Lumber 


Steel 


Cement 


Brick 


Stone 


Total 


1919 


59.7 


10.8 


11.8 


15.7 


2.0 


100.0 


1920 


52.6 


13.6 


14.9 


16.4 


2.5 


100.0 


1921 


56.4 


5.9 


17.2 


17.3 


3.2 


100.0 


1922 


50.8 


11.8 


15.6 


18.4 


3.4 


100.0 


1923 


50.6 


11.9 


15.3 


19.2 


3,0 


100.0 


1924 


48.7 


12.2 


15.8 


18.9 


3.4 


100.0 


1925 


49.1 


12.2 


16.3 


19.1 


3.3 


100.0 


1926 


47.2 


13.5 


16. 8-; 


18.9 


3.6 


100.0 


1927 


45.4 


13.8 


18.0 


19.0 


3.8 


100.0 


1928 


48.3 


14.2 


16.8 


17.2 


3.5 


100.0 


1929 


44.1 


17.2 


17.3 


17.4 


4.0 


100.0 


1930 


40.4 


17.1 


20.6 


17.1 


4.8 


100.0 


1931 


44.0 


14.6 


21.2 


14.3 


5.9 


100.0 


1932 


46.0 


11.8 


21.4 


12.1 


8.7 


100.0 



Source: Mr. Victor Ferlo, Division of Research and Planning, NRA, 

Table I, of unpublished report of February 20, 1934, - entitled 
"Displacement of Lumber in I'uilding Construction." 

Brick includes common, face, and vitrified brick, terra cotta, 
hollow building tile, and fire brick. 

Stone includes buidling stone, rubble, and riprap. 



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According to the preceding table, Itmiber supplied by far the 
largest percentage of major ■buii-ding materials for the entire period 
1919 to 1933.- ' Although somewhat' irregular there was, however, a con- 
sistent downward trend in this percentage to 1930 when the trend turned 
upward and became sharp in 1932. This spurt was due to price competi- 
tion, for there was a decline in lumber prices in 1931. Quite the re- 
verse is generally true for the other four commodities tabulated. 

Steel, with exceptions in 1920 and 1921, increased in use lontil 
1931, when it dropped off rapidly. The percentage consumption of brick 
increased slowly to its high in 1923, where it held steadily until 1927, 
thereafter dropping rapidly as a result of displacements by cement or 
stone, until by 1931 its percentage was less than in 1919. Cement and 
stone steadily increased in use until in 1932 when cement had about 
doubled its proportionate consumption, and stone had more than quad- 
rupled its consumption. It is evident, therefore, that although they 
have a long way to go to supplant lumber, cement and stone are slowly 
but surely whittling away lumber's predominant place as a'major building 
material. 

The following table showing percentage distribution of major build- 
ing materials, by class of building, is particularly significant, clear- 
ly indicating the large losses lumber has made to its four competitors 
in all three types of construction. 



PERCENTAGE DISTRIBUTION OF' MAJOR BUILDING MATERIALS 
BY CLASS OF BUILDING 



Year 


Lumber 


Steel 


Cement 


Brick 


Stone 


Total 


Residential: 














1919 


92 • 


■ 


6 


2 





100 


1931 


68 





9 


■ 22 


1 


100 


Industrial : 














1919 


25 


27 ■ 


11 


36 


1 


100 


1931 


.19 


42 


15 


22 


2 


100 


Public: 














1919 


40 


10 


28 


14 


8 


100 


1931 


29 


16 ' 


39 


2 


14 


100 



Source: Mr. Victor Ferlo, Division of Research and Planning, NRA, Table 
I, of unpublished report of February 20, 1934, entitled "Dis- 
pl:icement of Lxunber in Building Construction." 



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The foregoing tables and broad generalities should not entice the 
reader into assuming that the l-umber industry is, as a result of its 
market loss to vigorous competition, about to relinquish its preponderant 
dominance of construction materials. The age-old use of wood, its com- 
paratively easy fabrication into a multiplicity of products, and its 
relative cheapness, to say nothing of intangibles which have always 
given it a particular allure, will probably keep it well to the fore- 
front of major industries. 

The intrusion of other materials in fields of wood use is an 
inevitable expression of the modern age and the eagerness of consumers 
for new and improved products and services. It is quite obvious, there- 
fore, that there Is a Vital need for more scientific and technical re- 
search in wood and its products to the end that the increasing encroach- 
ment of extra industry products may be countered successfully. 

The competitive surge within the Lumber Industry of the present 
date had its beginning in Colonial days, when lumbering was pursued 
in a primitive way in all new communities in connection with the clear- 
ing of fields and the founding of settlements. As settlements grew, 
demand increased. Because of inadequate means of transportation in 
those days, the increasing demand had to be supplied largely from the 
neighborhood. Thus there developed the hundreds of little lumbering 
centers with their varying regional distribution problems and embryonic 
competitive practices.- 

. As consumer demands increased through the years, competition be- 
ffame keen, even vicious, in its malpractice and blindness. Up the 
spiral of increasing prices the industry chased the consumer's dollar, 
only to find that- such myopia actively lessened consumption and thus 
forced prices to fall almost as rapidly as tney rose, more often than 
not to a demoralizing plunge belov; cost. 

Many competitive causes have contributed to the impoverished and 
distracted condition of the Lumber Industry today, prime among which 
are: (a) Regional and species com.petition, (b) extra-industry competi- 
tion, (c) intra-industry competition, (d) competition from exports, 
(e) and distributor competition. Obviously all of these contributing 
causes, discussed below, are flanked with their own disturbing satellites 
such as production costs, transportation costs, prices, etc. 

Broadly speaking there are three principal regional areas producing 
softwood that are in competition for the consuming markets of this in- 
dustry. The first is -the Southern Fine Region which includes all of 
the Southeastern States, also Arkansas and Texas. The second is the 
Western Fine Region embracing 'practically all of .the mountrun States and 
third, the West Coast Re^^ion. This V/est Coast Region produces principally 
Douglas fir and this wood comes directly into competition with Western 
pine in all of the western and mountain. States and enters into direct 
competition with Southern pine in all of the central western area on a 
rail transportation basis. The Douglas fir from the West Coast Region 
also enters into com.petition with Southern pine on the East Coast through 
the medium of water transportation, but Western pine, being required to 
transport by rail, cannot extend its area of competition all the way to 
the Eastern Seaboard. It has generally been considered in the industry 
that the meeting point of competition for these three species was the 
9813 



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middle western consuming area centering around Chicago, Illinois, and 
the states immediately contiguous thereto. 

Naturally, transportation costs enter largely into the delinea- 
tion of the markets available to these species and especially "betv/een 
'Douglas fir from the West Coast and Southern pine the control of the 
softwood market has fluctuated depending upon advantage that first one 
or the other region might secure in transportation rates. 

In the middle western area all three of these softwood species 
enjoy equal opportunities, and this is the major price "battleground. 
In the North Atlantic and the Middle Atlantic States where there is also 
a very considerable consuming population, Douglas fir, through its water 
transportation rates, has been in a position to largely take away the 
major portion of the softv/ood market. A very' considerable part of the 
softwood delivered by water at the principal ports of the Eastern Sea- 
board is not consumed in that area. Just what volume this backhaul of 
Douglas fir amounts to is a matter for conjecture as there are no de- 
pendable statistics available, but it is presumed to be very consider- 
able portion of the lumber products being landed at the Eastern Sea- 
board ports from the West Coast ports. 

In the West Coast and the major part of the inter-mountain area 
competition is entirely between Douglas fir and Western pine. In 
California, which is the largest West Coast market, there has been a 
continual shift back and forth between Douglas fir and YiTestern pine. 
Moving out of the inter-mountain area, competition between softwood 
species is confined to Western pine and Douglas fir in the two mid- 
western states of North and South Dakota and in the Lake State of' 
Minnesota. 

Southern pine is the most used softwood species in the Lake States, 
the 'jouthern group of mid-western States, the Southwestern States and 
in t":.e Southeastern States, with Douglas fir and Western pine alter- 
nati:;.£ for second and third places. This is natural for here Southern 
pill:-' ;ids the co^lpetitive advantage because of the shorter haul from 
prod"i:;cing to consuming centers. 

The production of the Northeastern Softwood Division, consisting 
principally of hemlock, spruce and white pine, is largely consumed with- 
in the -New England States, New York, Pennsylvania, New Jersey and West 
Virginia; they are all competitive within that area with the softwoods 
from the other main softwood producing divisions. Aside from use in 
general construction the products of this division are used in large 
quantities in the manufacture of sash, doors, blinds, aid general mill- 
work, boxes, baskets and crates. 

The products of the Northern Fine Division consist of white pine, 
Norway pine and miscellaneous softwoods produced in the State of 
Minnesota. The distribution of these woods for general construction 
purposes is confined to a more or less limited territory adjacent to 
Minnesota. One of the principal outlets of pine in this territory is 



9813 



-207- 

to man-ufacturerS'Of.sash, dc^rs, "blinds, and general millwork. 

The spruce, white pine and hemlock shipped from the Northeastern 
and Northern Divisions arc all competitive with W(?storn pine, the 
West Coast woodn-and Southern pine, and when used in general con- 
struction work their territory ends where freight rates and othor 
factors permit the products of the three major divicions to meet 
them on a competitive "basis. 

The geographical arc"ac, of ccrapetition f or hardwood lumber are 
to a certain extent dictated by rail freight rates which rach pro- 
ducing division has to pay, Becau.se of this, certain divisions 
furnished th'? majority <tf stock in certain areas. For examole, the 
Northeastern Division furnished the North Atlantic area with 58.58 
per. cent of that area's total hardwood consunrption in 1929. 

The New England States are farthest removed frnm other hardwood 
producing arear,. It is therefore to be expected that this area wruld 
draw most of its hardwood from the Northeastern Division. The 
Southern and Ap-oalachian Division competes for second Dlace in us« 
in the North Atlantic arra. This may be because of the fact that 
while on the whole freight rates from the A-ooaiachian Division are 
less than .from the Sriuthern Division, this advantage is somewhat 
offset by, .Southern hardwood being priced somewhat lower than 
Appalachian hardwood. 

The mi l^Atlantic,;arca', comprised- of : New Ygirk, New Jprsey, Penn- 
sylvania, D;jlaware, Majryla^nd and^ the. District ■ of- Col''jnbia, affords 
a better. competitive o-oportunity to Southern and Appalachian hardwood 
than does the North Atlantic area. The large volume of lumber sup- 
plied the middle Atlantic aroa by the Northeastern Division, which 
almost eq'iiallcd that supplic?d by Apioalachian, is occasioned by th<? 
fact that Pennsylvania and New Yqrk, particularly the former, rare ■ 
large hardwood producing States.. . ; - ,•.,:..;■..., . : ,-.fi'' . ■ 

The Southern Hardwood Division supplies the larger part of the 
hardwood rpquirements of tho Southeastern area, with the Appalachian , 
Di-vision +urnishing almost the balance. It is the second largetst area 
of consurn-ption for hardwood. This is because of the heavy conversion 
of lumber into fabricated products or finished parts within the?f» 
states- of .production. ;There is a larg'> manufacture of flooring, fur- 
niture .and automobile parts in these States. This activity is fin 
evidence of the tendency toward fabrication at the source of supply 
of the raw materials, and of .progressing integration of maniifacturc 
in the industry. 

The Lake Statos arra, comprising Ohio, Indiana, Illinois, 
Michigan, Wisconsin and Minnesota, is the largest hardwood consuming 
arp.a. in tile country because of. thn many woodworking plants located in 
that area. Michigan is th(^ largest consuming state, with Illinois, 
Indiana and Ohio alternating for second place. The Northern Divieion 
supplies the larger -oart of thr Lake States' c^nsuniotion, with the 
Southern Ha.rdwood Division, bocause of price, furnishing the next 
larger part. The Midwestern Area, comprised of the States of Missouri, 



9313 



-203- , 

Kansas, lova-, Nebraska, •■ South Dakota- and North Dakota, . draws the 
greater tiart of its hardwood requirements from the Southern Division 
"because- of its chea-oer-TDrice, .... 

While- the inter-mountain area, comprised , of the States of 
Montana, Idaho, Wyoming;, Colorado, Utah, Nevada, Arizona and. New Mexico, 
drew 75 -oer cent .of . dts; total consum-otion in 1929 from the Southern 
Division, in 1932 it drev hut 52 per cent from that Division; while 
the Northern Division shipment into the area went up from 5 per cent 
in 1929 to 29 per cent in 1932. This might be accounted for by a 
compet-itive price effort of the Northern Division to market its pro- 
duction although, of course, it might be the result of a preference 
for a> particular type of wood. In 1933 and 1934 the Southern Division 
shipped a trifle over 57 per cen-t of the hardwood consumption of this 
area. The Northern Division dropped back to a little over 8 per cent, 
and the Western Division went up to slightly over 33 per cent, a 
material increase over its percentages, of 1929 and- 1932. This large 
increase might- have been due to the effect of Code prices, ?is such 
prices may have, encouraged the hardwood consumers in that area to 
purchase more stock produced within the territory.. However, this 
area is a small conjjimer of hardwood. 

Th^ Pacific Coast area is pne in which the ccnsum-ntion of hard- 
wood appears to- be growing. This. is, doubtless because, of the increase 
in fabrication taking place in the Pacific Coast States.., While 
Washington and Oregon draw the majorit.y of their hardwood from the 
Western Division, California secures the larger part of its_. require- 
ments -from the Southern Div-ision.- In 1929 California, was decidedly 
the heaviest cons'omer,. the shipments into it being more than twice as 
much .as into Washington and- Oregon. 

California c-onsumes more redwood than any other State; it is 
shippedin .lesser qua-ntities to Illinois, Indiana, Michigan, Minnesota, 
New York, Ohio, Pennsylvania, Wisconsin., . In fact some redwood goes to 
all States, except those in the deep South and the States in which the 
direotl-y competitive wood, c-yoress,- is produced. Redwood, is chiefly 
used- in planing mill products, woodwork, tanks, silos, caskets and 
coffins. 

Cypress is widely distributed throughout the South, the East and 
the--€entral States, and is shipped in fair quantities to practically 
every State east- of the Rocky Mountains.- It was for many years largely 
used i'n the production of doors, frames and sash, but within the last 
two decades has lost much of its consumption to Western pine and 
Douglas fir. 

No figures a'r.e .available to show the destination of the imports 
of lumber or of forest products into the United States; however, the 
areas a-re well- known in which the species are used and it is a reasonable 
assunipticn that the majority of the imports are consumed in the areas 
which 'they enter. - ■ . 

In^-fehe year 1929, -86,9,94 -E ft. of fir, spruce or Western hemlock 
logs -w.ere imported, all of which came from Canada. In 1929, 37,936 M ft. 
of lumber ',^ere imported from Soviet Russia, and while the species is 

9813 



-209- 
not known it can be concluded that the majority, if not all, of it, was 
spruce. In 1932 the imports of fir, snruce, or Western hemlock logs, 
dro-oped from just under 87,000 M ft. to 58,933 M ft., all of vrhich 
came from Canada. 

The imports of softwood luraher also dropped materially in 1932. 
In this year 126,819 M ft. of softwood, species not specified, were 
imported, of which 125,704 M ft. came from Canada. In addition to 
the unspecified softwood, there vrere 50,185 M ft. of . fir, all, of which 
came from Canada. • • 

Hemlock lumlDer ira-oorted in 1932 was negligible, amounting to only 
3,153 M ft. ,' all' from Canada. The imioortation of s-nruce lumber in 
1932 totaled 125,698 M ft.,* of which 90,580 M- ft. came from Canada, 
31,410 M ft. frura Russia, and the remainder in small quantities from 
Germany and other Euro-pean countries. The total imports of pine 
lumber in 1932 amounted to 45,928 M ft., of which 43,085 M ft. came 
from Canada, and slightly over 2,000 ft. from Mexico, the majority 
of the remainder, 587 M ft, coming from the British West Indies. 

In 1933, 86,579 M ft. of fir, snrxice and Western hemlock logs 
were imiDorted, all of which came from Canada. The volume of un- 
spacified softwood lumber amounted to only 4,199 M ft., all from 
Canada. Th-^ vcltune of , fir ,liai:iber imported in this year also dronned, 
the total bHng 22^729 M ft,, most of it from Canada. The irat)orts 
of hemlock amounted to only 2,473 M ft.,' all of which came from- 
Canada. , Th i imports, of spruce increased, the total iranorts amounting 
to 176,000 M ft. The imnorts of pine' lumber in 1933 increased in 
excess of 100 per cent, 104,066 M ft; being imxiorted, of which 
102,626 M ft. came from,. Canada, 1,400 M ft. from Mexico, and 26 M ft. 
from Trinidad and lobago. . ' 

Thi? importation of spruce', fir, or Western hemlock logs decreased 
materially in 1934. In that year there were only 17,340 .M ft. imr)ortcd, 
of which 17,338 M ft. came from Canada; the other 2 M ft. came from 
Kwantung. The imports of unspecified soltwood lumber in the year 1934 
amounted to 5,237 M ft., all of which came from Canada. ImiDorts of fir 
lumber amounted to 4,085 M ft., of which 4,076 M ft. came from Canada. 
Import'; cf hemlock were only 821 M ft. , all of which came from Canada. 
The ianorts of spruce ^amounted to 142,260 M ft., of which 124,088 M ft. 
came f.-om Canada and 13,023 M ft. from Russia, the remainder coming 
from other European countries. The imr)ortation of uine declined to 
^1,194 M ft. of which 86,959 M ft. came from Canada. 

Advance data, suliject to revision, of tho Bureau of Foreign and 
Domestic Commerce of the Department of Commerce, show that in the first 
eight months cf 1935 there were im-norted 66,560 M ft. of fir, spruce, 
and 'Western hemlock logs, all of which came from Canada. In this same 
■Dcriod 13,865 M ft. of unspecified softwoods werr in.oortcd, also from 
Canada. The imoorts of fir lumber in the first nine months amounted 
to 53,255 M ft. from Canada; imports of hemlock 6,312 M ft., all from 
Canada; imp'-'rts of " spruce 133,655 M ft. of which' 11,905 M ft. came 
from Canada and 15,855 M ft. from Russia. The imports of pino amounted 
to 70,184 L ft. of which 66-, 332 II ft. came from Canada. 



9813 



-210- 

The total imr)orts of soft'^ood liunber declined steadily from 1929 
throiigli 1934. In the latter year tl-e smallest amount was im-oorted 
for any year since 19.39, the total footage being ?!43,597 M ft. of which 
approximately 233,000 fl ft. rerr s-nruce and -oine. 

The figures for the first nine months of 1935 show an increase 
over the total of the year 1934 and a marked increase in the quantity 
of fir imDorted — about 53,000 M ft. in the first nine months, as 
against 4,000 M ft. in the entire year 1934. It is of interest that 
of this 53,000 M ft. only 841 M ft. were ira-norted during the first 
four months of the year. Atj^oroximately 2,400 M ft. entered the 
United States in May, the June, July, August and September imports 
increasing respectively to ap-nroximately the following: 9,800 M ft., 
16,500 M ft., 11,700 M ft., and 11,700 M ft. for September'. 

This marked increase from June on can nrobably be attributed to 
two factors: (l) The strike on the West Coast which tied up many 
coastal mills, and (2) the fact thrit Canadian shi-o-oers may have avoided 
sales in the United States during the Code period due to the feeling 
that a quota such as was established for red cedar shingle shipments 
might also be established for lumber and that this feeling was abated 
after the decision in the Schechter cpse. 

It is further known that during the summer of 1935 some 16 cargoes 
moved from British Columbia at freight of from $8.50 to $9.00, whereas 
the Inter-coastal Conference, rate at tliat time was $12 per M ft. 

The imports of spruce and pine lumber present a different picture 
from tliat of the West Coast woods, l^hile fir and hemlock were de- 
clining in volume dioring 1932 to 1933 and 1934 the imports of spruce 
increased from approximately 125,000 M ft. in 1932 to 176,000 M ft. 
in 1933 and decreased to 142,000 M ft. in 1934. Imports of pine in 
1932 amounted to just under 46,000 M ft., increasing to slightly over 
104,000 M ft. in 1933 and decreasing to just under 87,000 M .ft. in 1934. 

The figures for the first nine months of 1935 indicate tliat the 
imports in 1935 will equal and probably somewhat exceed those of 1934, 
but will not exceed the 1934 figures .to the extent tliat the importations 
of fir and hemlock in 1935 exceeded those of 1934. 

The species of softwood lumber that are native to ITortheastern 
states are approximately the same as those found in the adjacent areas 
in Canada; therefore the imported. spruce and pine is highly competitive 
in the Northeastern territory with the native woods produced in that 
territory, the competition becoming still more accentuated as the domestic 
Northeastern and imported woods enter those areas into which Southern 
Pine and the West Coast, woods are being shipped. 

While it is a fact that same of this imported softwood l"umber 
moved out of the New England and New York area, it can safely be con- 
cluded that the competition of the southern wood •.confines the use of 
the majority of the imported softwood to that area. Approximately the 
same conclusions are applicable to the Lake states and the importations 
of lumber which enter through the Dakotas, Duluth, Superior and 
Michigan customs districts. 

9813 



-211- 

The effect of these imports on domestic nrices and domestic 
■Droduction cannot te definitely established. It is known, however, 
that irai3orts of fir and hemlock materially increased in the first 
nine months of 1935 over the year 1934, altho\agh there was a combined 
duty and tax of !t4.00 ner M feet in favor of the American wood. 

Competition within the L-umher Industry itself is and always 
has been rife, and as in many other industries has tended in its 
avaricious and headlong way to destroy the very value it would enhance. 
'Wasteful felling of trees, merely to secure a more profuse and easier 
cut for competitive markets, regional disputes, .species propaganda, 
transportation problems, stumpage speculation, price fixing, produc- 
tion .control, over-capacity, apathy toward, changing consumer demand, 
trade association antagonisms and other "competitiye, factors have all 
helped in the past to ensnare the industry in a net, from which the 
Code attempted to free it and with a. modicum of success. 

Although some of the foregoing competitive practices resorted to 
by the Lumber Industry in an effort to hold old business and gain new 
markets have been alluded to and have been discussed in other sections 
of this report, it is deemed advisable to bring them together here to 
focus attention solely on their bearing unon.ccm-petition. These named 
may not be a conrslete catalog of the -practices and conditions making up 
the complete .competitive fiel-d within the industry itself but are 
sufficient 'fo,r the purpose indicated. 

?erha.ps the most im-portant ,c.omT)etitive prqblem of the industry 
prior to the Code was that h9.ving to do with the actual sale of the 
products. There was little cooxieration between general sales plans 
and no clearly defined function for the various types of distributors. 
Small dealers were fast going into bankruptcy. In 1933 sales by saw- 
mills were only t'"0 and eight-tenths times inventory, whereas in 1926 
they had been four times inventory. Collections were slow, the elapsed 
time between invoice and collection in 1933 being 117 days against 75 
days in 1936. Earnings for assets employed were the third highest of 
all industries in 1920, with 89 per cent of asf^ets employed in that year 
earning a profit; whereas in 1932 the industry earned a profit on only 
eight per cent of its assets. 

Just where, the creaking machine needed the most grease no one 
knew. .3efore the Code the industry was not fu]ly orcanized, with only 
a framework of warring trade organizations engaged principally in looking 
after their own legislative requirements and in gathering statistics of 
the industry. The process of code f orraulatiooi and code operation served 
to integrate the industry and to encourage a more democratic approach to 
its distril ition problems. Under the Code the industry attempted to 
define the ".iiannels of distribution. Just wha.t was done and the re- 
sults thertTrom are discussed in other sections ci this report. 

It has already been pointed out that changes in consumer demand 
are to be recognized and met, net combatted, if competitive markets 
are to be retained, much less expanded. One might well go a step 
further and urge that aggressiveness be the order of the day and not 
merely a laissez-faire attitude taken, even though it cannot be denied 
that for certain forest products recent consumption trends, aggravated 

9813 



-212- 

by the depression, have been discouraging to producers. Periiaps the 
way to greater heights for the industry is through closer cooperation 
among its '."^idely-scattered and generally inarticulate membership, 
wise synchronization of the technological improvement with employment 
needs, increased research, and more unified and less capricious 
distribution methods, to the end that the industry raa,y be an entity 
in combatting the onrushing tide of extra industry competition. 

There are three major distribution channels in the Lumber Industry, 
namely, the wholesaler, the commission salesman, and the retailer. 
In addition, sales are made by sa'Tinills direct to manufacturers and 
to retailers through their own sales department, directly for export, 
and in other miscellaneous ways. The object of this section is to: 
(a) Define and describe these nmjor agencies; (b) to delineate their 
competitive activities; (c) to review pre-code efforts and their 
results; and (d) to discuss code efforts at regulation and the results 
of such efforts. 

The Lumber and Timber Products Code defined the wholesaler as: 

"A person actively and continuously engaged in 
buying, assembling, or rehandling lumber and timber 
products from manufacturers or other wholesalers in 
quantity lots and selling it principally to wholesalers, 
retailers and recognized wholesale trade, who maintains 
a sales organization for this piJTpose, assumes credit 
risks and such other obligations as are incident to the 
transportation and distribution of lumber and timber 
products. Wholesale Assembling and Distributing Yards 
as de-fined in Divisional Rules and Regulations shall also 
be classed as wholesalers." 

In addition to the functions performed by t he wholesaler as 
described, certain wholesalers likewise financed mills and retail 
yards. A wholesaler's organization will naturally vary with the type 
and scope of his activities. Some maintain b'dying representatives 
or agents in the producing areas when headquarters are located else- 
where. 

The variation in the type of wholesale activity is partially 
due to the development in the distribution channels of the Lumber In- 
dustry. In its earlier years there were relatively few wholesalers 
and these were in a strong financial position and handled a large 
volume of lumber. The customary operating practice of that day vfas 
for the wholesaler to buy very large stocks of lumber on contract 
and not infrequently to contract the entire cut of a number of mills 
for the year. Many times the arrangement provided for certain 
financial assistance and often for instruction and advice. In that 
day nearly every wholesaler had one or more yards either in the con- 
suming area or at the mills, or both. 

As time progressed and industrial conditions changed, there 
came into being a relatively larger number of wholesalers, and buying 
practices changed to the point where today the wholesaler is in the 
main- a financial broker and salesman p-urchasing units as small as a 

9813 



-213- , , 

car at a time and carrying a relatively snail ntock, if any at all. 

Wholesalers of Irm'^Jier are located in all parts of the country, 
the bulk, ho-.-rever, bein^ east of thr-; Mi osissiptji River. The principal 
wholesale trade association; the national American Vtoclesale Lumber 
Association, with headouarterr, in Jre^r York,' had a rnerr.bership of 573 in 
1928 and approxii::ately 300 in ±934 and 1955, Hhile there are no 
available statistics, the association est^dates tliat in 1933 there 
were approximately 1,300 wholesalers who were not members of that 
association. 

Because of distance from lar,!;© ccnsiming areas and consequent 
lack of constant contact with the buyers, the Douglas fir manufac- 
turers and the Western pine manufactiirers U3e the wholesale channel 
of distribution to a relatively larger extent than do other d.. vicicns 
of the Lumber Industry which are located nearer to the points of 
ultimate consumption. This condition is, of course, being changed to 
some extent through the establif.hmenx;, by these romoteTiy located manu- 
facturers in the Douglas fir section, of wnnierale distributing yards 
on the Atlantic seaboardo Shipments of Do-ijilas fir oy wpter through 
the Panama Canal to the Atlantic seaboard 'las had a continuous growth 
in volume and in this both the wbol^spler and the intercoastal whole- 
sale distributing yards ha,ve played a large part. 

This develn-omont in distribution has given birth to the probiera 
of "transiting" of sr.^cksj co::ruzance of wh,ich T^as taken by the Code 
and outlawed.^ A wholesaler would undertake', to dispose of certain 
cargoes of lumber after they had be'en put m transit from the West . 
Coast. If unsuccessful inchis effort either in whole ot in. part, 
the only alternative was to "carry these unsold stocks uyon arrival 
on trucks or cars, or incur the expense of yarcling if , the wholesaler 
had a yard. Storage in' cars w-'.s used, at pDipts where car; service 
charges were less than yarding chai'ges, ? nd this naturally, tied up 
railroad equipment. The pressure to mo/e ';hese Lihs.oii stocks in order 
to avoid carrying charges conscituted a prersure on mrtrket prices that 
was unjustified by the volume of these unsold stocks as related to 
total consumption. 

There also arose the practice of consigning stocks to the retail 
yards to be paid for when sold. This also was outlawed under the 
Code as it was held that it was unfair to the small producer who was 
unable to cope with this type of comi^etition. 

The outlets of the wholesaler are the retailer, the industrial 
buyer, the railroads, government (state and municipal) purchasers, 
and to some extent the contractors. The first four were generally 
recognized in the Lumber Industry prior to the Code as legitimate 
customers of the wholesale group, TJiere has always been some question 
as to whether the contractoi- was the legitimate customer of the whole- 
saler or of the retailer and a.round this point developed the difficulty 
in the Code period of dsfining what constituted \7holesale trade, as 
well as the effect of the wholesaler upon the Code and of the Code 
upon the wholesaler. 



9813 



There are no available statistics as to the actiial qioantity 

of the industry's producticn that is mrrlcoted through the wholesaler, 
tut according to the lfe.tional American Wliolesale Lumber Association it 
has been for years estimated that this movement can conservatively be 
placed at 60 per cent. 

In the earlier days of the industry, and even yet to a very 
considerable extent, the wholesaler of lumber who would buy mill stocks 
or large quantities of lumber and yard and classify such material and 
then sell, had a very important place in the industry. He is still an 
important factor but does not dominate the movement of lumber from 
manufacturer to retailer as in the past. 

The commission salesman is a very valuable sales outlet for 
many lumber man-ufacturers. They are probably more valuable when they 
represent one or more companies producing different products, for they 
provide a sa,les outlet for those companies at much less cost than a 
wholesaler or a sales organization financed by the company or companies 
themselves. On the other ha.nd, the commission salesman who acts as a 
buyer's agent and uses his knowledge of a. producer's stock to beat 
down the price is a competitive factor that is very detrimental to the 
industry at large. 

Numerous cooperative activities on the part of lumber manufacturers, 
like organized collection bureaus, the interchange of mill prices and 
the publication of association price lists and discount sheets, have 
in the past tended to check competitive fluctuations in the wholesale 
markets. The same is true of various informal local agreements and 
other attempts to maintain imiform prices. The effect of such forms 
of cooperation among lumber producers has been exceedingly variable 
both in different regions and at different times. It has depended upon 
the number and financi,al strength of the plants concerned, the qijality 
and volume of their output, pressure of timber land investments to 
increase mill capacity to mainta.in continuous production, the manufac- 
turing conditions to be met, like the necessity for prompt shipment of 
some species and grades of lumber, and the condition of the market. 
Cooperation has usually been more effective when the demand for lumber 
is strong and prices are rising, -and has largely been ineffective when • 
opposite conditions prevail. This was exactly the condition prevalent 
for some time prior to the Code. 

To just what extent dishonest and deceptive grade manipulations 
or substitutions, the raising of invoices, and similar nefarious prac- 
tices prevailed in the wholesale merchandising of lumber and timber 
products is undetermined. Perhaps of the total volume of Ixomber sold 
daily, a relatively small proportion is subject to such practices, 
although it is generally admitted that a great volume of lumber passes 
through a process called the "ethical" blending of grades. Such 
practices obviously not only cheat the customer but tend to disrupt 
the market locally by establishing a fictitiously low price for the 
grade which has been manipulated. 



9813 



There have been many concerted efforts- in the -c/it by associaticnfs 
of lumber retailers separately or in- cpr.^-cjyotion riith mar'Ufacturers 
to cc-iitrol the comoetition of wholesalers oy a ''clasaif ication" of 
the trade. Thess clacsssif icalviois were par.Liallj'' effective, though 
subject to many local excc-^nti ons and variations.. Just -orior to t];.e 
Code, hcvever, while the dictaoes of "tx'ode ethics" as between whole- 
salei and letailcr were yliil reco^uizrjd to sr\ae extent, the trend 
was sway from restrictions upon competition. 

This attitude of at least a negative regulrtory rr^echanism of 
the wholesaler is exemplified in many .v/aya„ Tr,.ke for instance the 
retaliation of whclosalers- a{:ainst retailer? wno bou.-;>-b dirfcct from 
millp. Wholesalers, as an offsf^t of this iattor-da.7 Tirrictice of 
retail dealers, became proficient in looking after tlie noeds of the 
contractor, whose purchases, incidentally', had 'becorae. greater tl'ian 
those of the master carpenter. The bitterest kind of competition 
between the v/hplesaier-o and retailers ensued, Ihe.Liimber Industry 
its&if, represented at beat bv loosely feaerated associations, was in 
no -Dosition to framo either local or national regulations, much less 
to carry out punitive measures,. ... 

In general, but v/ithout limitation, the abcve-cited attem-pts at 
regulation of 'who'lesale ijractices brings this, type 'f eff "rt in the 
Lumber Industry d -wn t' the time , "f C de cnferences, G'de effTts at 
regu.lati'-ns and their results ar-e discussed immediately after the 
following discucs.'- "n '"f -ore-c^de eif"'rts a.t regulati' n m the retail 
trade. In additir-ri' t" "^Lher s, urces, C'^do licarings and .the c"c'al 
history of the induu try contained illuminating infrrmation on this 
subject. . . ■ ' . 

The retail lamber dealer wa.s defined under the Retail Lumber 
Code as: 

"A Tjers'^n who maintains -an adecuate a.ni -Darmanent 
plant or plants which are prop^e-rly eq-.iiriood f'r sc^rvice to 
the public, -"ith rffice, -with-^sp'^rage yard rr warehouse, kppt 
open daring business h-^ars, witlj .s^,:!'. handling facilities and 
sales service an are commensurate wi Lh ..the -nature f the busi- 
ness.; and who carries a s^'ufficient stock of lumber and build- 
ing ma.terials (for the purpor,,. -f reiling at re't-ail in small 
or large quantities and not f^r hit '^■rn c-ns-j-miotion) to supply 
the general req-oa.rsmenos of the comr.miityJ.'. 

In the early days the retn-iler'^ p'iition w'^'.s much more definitely 
fixed and in a very much br'^ader f ie7.d tha.n at ohe present time. Up 
until recent yea.ry the retailer- supplied pi-actically all of the lujnber 
requirements of those located in his trade prae. or vicinity, and the 
user of lumber in practically any q-'ja.ntity dealt v;ith the reta.iltr as 
the only sr^urce of his lumber supply. As com'pstition increased 
between mills and mill selling .agencj es or reprr-?fcn*'.atives, this repre- 
sentative position '^f tne retailer in. m-.st crjr'.riities was destroy^^d 
and, generally, he is now the supplier of lumber in only small quantities. 



9813 



-216- 

A contracts, a builder, f^r an individual owner contemplating 
the erection cf even nne structure that may use as little as one 
carlrad of lumber (ap-oroximately 20,000 feet) wuld be solicited to 
buy this lumber from other than the local retail lumber dealers. As 
quantities needed would increase, the prospective Durchaser w^uld 
have other channels open t-"' him through which his wants could be 
supplied. 

The manufacturers of lumber and other distributive agencies 
recognize, however, that the retailer of lumber has a very imnortant 
part in the industry. Practically every C'-mmunity, however small, 
has had s^me type '"f retail l^umber suDply offered t'^ it even though 
this lumber supt)ly might have been carried simply as a side-line to 
other merchandising activities. 

There are approximately 23,500 retail lumber dealers in the 
United States. They liandle a great many materials '^ther than lumber; 
however, the latter represents abo\it 72 per cent ^f their total 
business. 

In the retail lumber business consideration must be given to 
the different kinds of retailer and retail establishments, primarily 
from the standt>oint '"f the machinery of the control of such unit. It 
was recognized that a very considerable majority ''f these retail 
dealers were owned, cntrolled and operated as independent economic 
units. It was also realized that there were a considerable number of 
retail yards, especially in certain sections '"f the country, which 
are known as "line yards." These yards, ranging from tw- in number 
upward, are operated under one management with buying and selling 
methods, credit p^'licies, and 'ther elements being controlled by a 
common head and generally uniform in practice in each of the con- 
stituent yards. Some of these "line yards" groups are purely re- 
tailer organizations with activity based primarily ut)on the buying 
and the selling of the nroducts t-^ loroduce a -orofit for the owners. 
Other groups of "line yards" were established by manufacturers whose 
principal motive was the setting up of retail outlets for the products 
of their own sawmill and manufacturing tilants. Other "line yard" groups, 
smaller in number, were reputed to be largely controlled by wholesalers 
of lumber, and again in practically every instance the actuating motive 
was to supply distribution centers and outlets for certain if not all 
of the products controlled by the particular wholesaler. 

In the field of retail distribution the co-^perative groups have 
also grown up within the past few years. Lumber, as one ^f the 
products needed by many of the individual members of these cooperatives, 
became one of the products handled, and in the section of the United 
States where the C'operative movement lias gained the m'^st ground, it 
was not uncommon to find lumber yards connected with the other activities 
of the cooperatives, which, of course, primarily consisted of the mar- 
keting of products of the members and the purchasing of those articles 
of commerce most commonly used by them. 



9813 



-217- 

These various types of retail distritutir-n units naturally came 
into competition with one another. It can readily be seen that the 
small independent lumber yard located in a rural or urban community, 
being compelled to purchase its material as a single unit, would 
find itself at a disadvantage in selling when it came in competiti'^n 
with a "line yard" unit where the lumber for that unit had been pur- 
chased as a part of the quantity needed for the supplying of several 
similar and allied yards. Again competition would be faced from th-^se 
yards controlled by the man\ifacturers who would not need to calculate, 
in his final costs, at least one intermediary step. The comoetiti^n 
of the cooperative organizations with the retailers would not, of 
course, be particularly effective unless the cooperative organization 
was of sufficiently broad coverage to include a considerable portion 
of the rural users of lumber. 

In considering retailers thought must be given to the differences 
between the retail lumber yard in the urban communities and the 
retail l-umberyard in rxiral communities. Kot only does the first 
class of lumber yards have high rents, high wages and high inventories 
to Contend with, but they must also be in a Tj-^sition to extend con- 
siderable credit and te make deliveries 'ver an extensive field. On 
the 'ther hand, lumber yards I'cated in rural communities have rents 
and wage scales considerably lower than the urban yards, and generally 
speaking they are not required to deliver their merchandise and 
naturally are not required t-^ carry particularly large st-^cks. In 
many cf the rural yards their business has developed in later years 
to practically a cash and carry basis. 

The channels of distribution discussed above relate particularly 
to the softwoods and, to a limited extent, t-^ some f^f the more commonly 
used hardwoods, but the production, sale and use of the principal hard- 
woods differ s^ materially from the softwoods that a specialized service 
of distribution grew up for this narticular species. 

Important in the business of the retailer of lumber were the 
various and constantly growing number and character of products com- 
peting with lumber. The retailer has been compelled to carry competing 
products and many other substitution products. His stocking of these 
items was made as easy as "possible, as naturally the raaniifacturers or 
distributors of any products competing with lumber were anxio-us to 
have these competitive' articles as widely distributed as possible. 

The retail trade is" r-ughly divided into two classes. The first, 
commonly called "retail sales" or "wagon trade" constitutes the small 
transactions incident t"" the current demands of the- community for 
small job work and repairing. Such sales are, by and large, made under 
far less competition than the large sales of the second class.- Efforts 
at their regulation, theref-re, have been less important and correla- 
tively less attendant with any action in that direction. 

The second broad class of retail trade is that commonly called 
"estimate," "bill sales," ^r "contract business." These are the larger 
sales such as house sales," special contracts, etc., which are made 
usually upon competitive quotations or at fixed discounts to contractors 
and carpenters who are in the habit of. dealing exclusively with '^ne 

9813 



-218- ■ • • 

c^ncerrt. It is ^tvirus that this definitirn inherently contains 
regulatory measures resnecting, quotatirns and disc'unts.. 

Under the Retail Lumber Code it was hoped: that a bottom could be 
placed under retail prices by the devel'^pment ""f industry cost data 
and the determination ^-f the s-"-called ra^de.rf these csts in each of 
the 32 divisions of the retail trade. 

In the early aTDt)llcati'^n r,f this Drinciple it was pi^inted out 
by the retail dealers that certain c^sts of handling lumber were rela- 
tively the same. 'This group of costs were.- generally classified as 
yard and delivery expenses, and the the'Ty was tha.t it cost the 
retail lumbor dealer just' as much per th'^usand feet to unload, yard 
and deliver a grade and size lumber that c"ftt .^20 .'oer thousand feet 
as it did a grade and 'size , of • lumber casting much more. 

The Administration accented the view of the retail dealers and 
sought t' establish a com-nosite ra"dal mark-up consisting ^f a flat 
price for yard and delivery c "sts varying essentially only in accordance 
with the different minimum wage rates specified in the Code, and the 
additional c^sts were then to be expressed in a percentage of mark-up 
on cost of the lumber plus freight. This added a further complication 
to the development of a minimum ^t floor selling price for lumber at 
retail. 

The majority of -the retail dealers reacted favorably to the general 
application of the Code provisions establishing or seeking to establish 
minimum retail prices, but there was considerable uncertainty by the 
dealer as to exactly what he '■oouid quote, which was increased by diffi- 
culties experienced by the Code Authority f-^r the Ltmiber and Timber 
Products Industries in their attempt to regulate and to establish the 
prices at which the retail dealers could purchase their supplies. 

There was the objection by strictly cash yards tliat ' they should 
not be compelled- to include in their selling- price a percentahe cal- 
culated upon the cost of dealers who were required to maintain ex- 
pensive bookkeeping and credit departments. !l?hese matters were again 
apparently satisfactorily adjusted by negotiations between NEA and the 
CrAe Authority for the retail dealers. 

As the result of these yar,ious adjustments it was necessary to 
again estab;ish a modal mark-up and to specify the application of 
its various factors in such manner as would work as few inequities as 
possible. I'^his basis was established by -order of the Administrator 
carrjdng forti^ard to March 1, 1935, It^was recognized in the industry 
that the establishment of the' modal mark-up- did increase many of the 
prices and did materially stabilize the retail prices of lumber. 

There seems to be no doulpt that, selling direct to consumers by 
the mills and by the- wholesalers increased during the codal period, 
which was undoubtedly brought about by the discount of eight per cent 
to the wholesaler as specified in the Code and by the modal mark-up 
which left such a large spread between the wholesale or mill price and 
the retail price that the mill and wholesaler co-uld well afford to com- 
pete for retail business, particularly with the limited demand. The 

9813 



-219- 

baSing point system and delivered prices had the effect of increasing 
truck transportaticn as distributors attempted t^ regain lost groTond 
and even to 'secure a' larger margin <^f -nrofit. 

Unfcrtunately there are n"' comprehensive statistics, either 
reliable or otherwise, available as to the quantities' of luiiber 
handled by wholesalers or retailers. According t'^ a report of the 
Denartment of Agriculture the increasing number of wholesalers in 
the middle west during the first decade of the 20th century caused a 
ohrinkage of from 50 to 60 per'cent in the average volume of lumber 
laandled by each wholesaler. It is further nointed '^ut that the same 
over-expansion occurred in lumber retailing. "3y 1900 Nebraska had 
a retail yard for every 1,485 pe'^ple; Iowa a yard f^r 1,600 people; 
and Illinois, outside of Chicago, a yard for 1,720 people. From 1900 
to 1915 the number of yards in these three states increased on the 
average nearly 26 net cent although their population increased hut 
7 per cent. " 

In view of the fact that the -oer capita consuinption of lumber 
reached its zenith in 1906 at 525 feet, and steadily decreased until 
1529 when it amo\inted to only 275 feet, and plumhed the depths to the 
low of 95 feet in 1932, increasing to 110 feet in 1934, it is readily 
understandable that with the increase in the number of units in the 
industry the competitive situation in the various distribution . 
channels increased tremendously. Although there was a comparatively 
large volume of lumber consumed from the year 1925 through 1929, the 
price trend in the majority of iteins was- downward; and while profits 
retreated in both the wholesale and retail branches of the industry, 
employees of many companies hroke away and established either retail 
yards, wholesale businesses, or went into commission selling, and all 
of them to-k away s^me of the business of their former employers and 
matorially increased the competition in the various distribution 
channels. This trend was growing steadily in the early part of the 
century and continued to increase until probably 1930, when the . 
economic pressure of the depression caused many who had been engaged 
in lumber distribution to seek other vocations. 

The large manufacturers of lumber have shown a decided tendency 
over quite a long period of years to sell their products direct through 
their own sales organization to retailers, railroads 'and industrials, 
and other large consumers of lumber, and, while it has been estimated 
that wholesalers handle approximately 60 per cent of the lumber pro-? 
duced, this figure cannot be substantiated for all producing areas. 
Direct selling by the large mills t'"' the retailers has forced many 
wholesalers to seek other .outlets, and. they have been selling increasing 
quantities of lumber to contractors, b'th large and small, and the 
small contractor, particularly, has been considered by the retailer and 
many others engaged in the- industry. as the sales outlet of the retailer 
alone. " . 

Although' there has oeen this tendency of tfie large manufacturers 
to sell their products thr'"' ugh. their '^wn sales organizations, the 
part played by the retailers, .wholesalers and commission salesmen of 
lumber in the distribution of , lumber is a vitally iraporta.nt_ one for the 
industry, and the sales volume of the industry is dependent to a major 

9813 



--Ssu- 



extent on these outlets, for without the close contact with the consu-iier 
that they nfford, the latter would seek and TJurchasc, to an even greater 
extent thaa he does today, substitutes for lumber products. Decreased 
volume of consuraiDtion and sale- of lumber i^-ould increase the per thousand 
feet costs and -Drices, and thus oyrrmid the competitive disadvanta.«^e. 
V/hile many retfilcrs handle substitutes and materials that are comneti- 
tive Ti^ith lumber, the wholesaler' and commission man almost invariably 
handles lumber or timber products alone, and his existence is based 
u-con his abi'' ity tcdisDOse of these products. 

The tremendous increase in the facilities of the telegraph and 
telephone coapanies, as well as 'the distribution of mail through the 
most remote areas, has brought the lumber manufacturers into much' 
closer 'touch with the retail yards as well as with the ultimate con- 
sumer of lumber and has permitted the purchaser to communicate direct 
with the seller without havinf; to go through the medium' of the ^riiole- 
saler. All of these changes in the economic life of the nation have 
enormously increased the conipttition between the various distributors 
of forest products. 

One of the earliest problems that the Lumber Code Authorit:/ had 
to solve wr. s that of the position of the ^^holesaler in connection with 
this Code. With few exceptions the general terins in the jurisdictional 
clause describing each division under the Code did not include whole- 
salers or distributors. The exceptions w?iich included wholesalers and 
distributors -were : The Hard^food Division;' the wholesale Distributors 
rivision (. of Iviillwork) ; the Sa-^ed "•:ox, Shock, 3rate and 'Tray subdivision 
of the 'Vooden Package Division; the Oak ilooring Division; and the 
Veneer. Division. ' 

Viith the^ exception of the definition of the wholesaler previously 
quoted which occurred in Section 1 (c) of Schedule 3, ahd' reference in 
Section 2 of Schedule 3 as follo?fS, there is no further reference to 
wholesplers: . , ■■ 

"Section ?. \;holesalers.- The Lumber wholesaler is 
an economic lactor in the distribution of lumber and it is 
recognised that he is entitled to compensation for nis dis- 
tribution services. 

"(-■) Each division and each subdivision through its 
designated agency shall establish for its members and file 
with the Authority a schedule of maxiimim discotmts to ."hole- 
salers for distribution services'. Trade discounts when ap- 
proved by the Authority shall remain in effect until changes 
are approved by it, 

"(b).. As ,;a condition of the grant pf '--holesale discounts, 
. the ii*iolesaler shall not rebate or allow any part of trade 
discount to any customer, or cell or offer to sell any item 
01 lumber or timber products under the minimum or ices es- 
t.ablished .as -provided in -this code, except to another whole- 
saler or manufacturer; and he shall conform to all provisions ' 
of this code, .as they apply, to him in the sale and distribu- 
tion of .each, species. • », . • 

9613 



-221- 

Ancl under Section 5 are inc?L\ided certo,in dir.coimtE and terms of 
sale to I'TOvem transactions v;ith Trliolesalars. 

Except for these references to the wholesaler the Code contains no 
provision for inclusion of jurisdiction over wholesalers except for the 
few divisions previously mentioned v^hich inclvidcd distrilautors under 
their jurisdiction. 

Shortly after the adoption of the Lumher and Timher Products Code 
is was conceded that the wholesalers were not hound "by the rules and 
regulations established thereimder. 

The Retail Limber Code, when written, contained a section which 
encompassed- jurisdiction of all carload business, but when it was 
sought to put this into effect such a s.torn of protest arose from con- 
sumers and lumbermen alike that this article was stayed, and during the 
life of that Code altho^jgh considerable discussion was had on this sub- 
ject, the stay was never lifted and, accordingly, jurisdiction over all 
mill sales of carload shipments of lunber remained under the Lumber 
and Timber Products Code. 

Hie definition of v.'holesale Irade and j-iarisdiction over wholesalers 
continued to be a problem to the industry throughout the life of the Code. 

For a groat many years prior to the Code various coromittees and 
individuals within the 'industry had been working on plans for a defini- 
tion of wholesale trade. After the signing of the Code all activities 
were combined and on April 3, 1934 the Code Authority, at a public 
hearing, submitted certain propossls bearing on this question as Amend- 
ment No. 68. A complete record of this proposal as submitted and the 
objections thereto is cont?.ined in the Transcript of Hearings in the 
NBA files, the text of which is too lengthly to discuss specifically in 
this chapter. It is sirfficient to remark that they included complete 
definitions and jirrisdictional delineations for the entire Lumber In- 
dustry, and vrould have effected a rigid sj/^stem of distribution fion the 
producer through the wholesaler to the retailer and then to the cons"'jmer, 
and woiild have eliminated any possibility of cutting imnecessary distri- 
bution costs. In fact they would have added materially to the price of 
lumber to the consumer. 

numerous details of this plan were questioned or objected to by 
the National Recover^'- Administration, but the principal objection was 
to the establishment of the rigid distribution system, which would have 
meant the elimina.tion of wholesalers who liad for many years past sold 
direct to consumers and contractors. 

As a result of a plea to the National Recovery Administration in 
July, 1934, by the Lximber Code Authority that conditions in regard to 
the distribution of lumber had become so involved that action must be 
tal<:en on the distribution problem, the National Recovery Administration 
drew uo a compromise solution with the provision that this would be ap- 
proved only if the wholesalers would agree to accept the plan and corae 
under the Lumber and Timber Products Industries Code as a wholesale 



9813 



-222- 

division. 'The national American Fnolesale Lumber Dealers Association, 
acting for 'the v/holecalers, refused to accept this conpromise and the 
attempt to settle the vzholssale question o-gain failed. 

Havinr; failed to obtain aporoval of this plan, on July 18, 1934 
the Code Axithority svibmitted aRendraents 75, 76, and 77, '-"rtiich proposed 
the establishment of a rrholesale division in the Lumber and Timber Pro- 
ducts Industries Code to raalce effective and bind the trholesalers to 
the cost protection features of Article IX. Amondinent 77 proposed a 
new definition of wholesale trade which was tmsatisfactor;?- to many 
wholesaler protestants at the public hearing. 

On April 3, 1935 the Code Authority submitted Aracndnent 78, again 
proposing a distribution nlan which, with few minor e::ceptions was 
the same as that proposed in Ainendment 58. 

The Code Authority fin^-lly submitted Amendment 85, which again 
outlined wholesale trade practically the same as the other submissions. 
As in the other cases cited above the objections raised by the National 
Hecovery Acljiiinistration and protestants co^jld not be reconciled and the 
amendments were not approved. 

Hatters thus stood, until the elimination of the Codes, with the 
wholesalers selling more and more in competition with the mills and 
with the retailers through the device of cutting prices Arhile acting as 
a shield for rianufacturers who were violating the Code. This -undoubted- 
ly played a large part in breaJcing down Code prices and the Code, 



9813 



-223- 

; CHAPTER V 
I'UTURE STUDIES 

The TDurpose of this chapter is threefold;: First, to set out the more 
important sources of serial statistical data; second, to desctihe briefly 
and evaluate each soui-ce according to its research value; and third, to 
point out additional serial data that' would contrihute greatly to a better 
understanding of the industry and its rianifold -iroblens. This bibliography 
is not exhuistive because of the limited time alloted for its coir/oletion 
and must not be considered as other than -i preliminary gij.ide for fut-ore 
research, 

A. DESCRIPTION OP SOURCES OP SERIAL STATISTICAL DATA TOR TIIP LUl'.IBER AMD 
' TIMBER PRODUCTS IIJDUSTRY 

Serial statistical data for the Ltunber Industry can be classified 
into eleven major groups which include: standing timber, number of mills, 
production, shipments and stocks, labor, distribution, transportation, 
costs, and finance, ta^-ces, prices, and grades. Series of data pertinent 
to each will be discussed in the above order and will be treated in as 
chronological a man.ier as the material will permit. 

In general, the available data covering many of the subjects sxe 
meager. In other instances an apparent abundance of information is only 
superficial as either the' coveraf^-ce is poor or the same basic sources have 
been used by several sta,tistic-gathering agencies, each of whom revise 
the data according to his particular ideas or to siiit speciaJ. purposes 
for which the information is to be used. 

In the preceding cha.pters there has been explained the widespread 
geographical location of this industry with its multiplicity of small 
linits. Because of the lack of adequate booldceeping records in these small 
units most of the statistics of this industry are based on the reports 
from the large -units which are of course rela.tively few in number. TThile 
these units represent a large proportion of the total production, estimates 
based on an imknown shifting quantity, (the number of small mills operat- 
ing and their production) must be made to obtain a total for the industry; 
or this small mill production disregarded. Either method makes the figures 
of doubtful value. 

All second",ry. sources" have been eliminated in the references cited 
in this description and the accompanying charts, precept in such cases as 
additional information has been added or a new form of presentation had 
been used, 

1, Standin p- Tirabor 

'Statistical data concerning standing timber cannot be ta''::en currently 
and is not currently available, only one series having been 'found, 
The Forest Service, .of the U. S. Department of Agricuilture, 

The Forest Service had "published a:anual data since 1920, covering 
average log and stumpage prices for each of the more -orominent species 
9813 



-22-3- 

and for each State, as well as suranary tables. The basis of these 
statistics is actual stiunpage and I0.-5 sales from all parts of the 
United State s as reported to the Forest Service. 

The log prices are on a delivered basis which includes all costs 
of transporting the log from the forest to the mill. In some in- 
stances, chiefly with the more rare species such as American Walnut, 
the cost figures cited are not true cost of the log alone. As a 
result comparability of prices does not necessarily exist between 
different localities utilizing the same specie. 

2. Number of Hills 

Prior to 1904 the Decennial Census of the United States report- 
ed the number of mills covered in its canvass. Annually since 19C4 
the Bureau of the Census and the Forest Service have published num- 
ber of mills data in conjunction with volume of lumber production. 

Ttie data gathered by the two sources are comparable, as in 
formation gathered in the Decennial Census has been made use of in the 
anriual report. However, complete coverage was not obtained in the 
annual report as questionnaires were mailed only to kno'^n operating 
mills. 

Complete coverage has not been attained in either compilation, 
as statistics are quoted for only those mills doing an annual bus- 
iness of $5,000 or nver per year in the annual re-oorts and $500 or 
over per year in the Decennial retjorts. These two sources give ex- 
cellent figures for actual operating units but not for units which 
can operate but are not in operation. 

Each trade association has more or less complete figures as to 
the number cf mills in its particular region. The coverage is good 
when viewed from the volume of production represented by these mills, 
but coverage is much less when considering all units actually oper- 
ating. 

3. Production 

The Decennial Census of the United States also has compiled 
production figures for each year in which the Census was taken. No 
annual data exists for the intervening years bet".'een census years 
•until 1904, when a special census was taken. Since 1904 annual 
production reports have been issued by the Forest Se-vice and the 
Bureau of the Census. 

In 1904, and from 1906, the Bureau of the Census conducted the 
studies, assisted by the Forest Service. From 1913 to 1918, and 
in 1920, the Forest Service was responsible and since then the Bureau , 
of the Census has gathered the material with the Forest Service co- 
operating. 

Since 1921 the odd year repo-ts have included not only pro- 
duction data on lumber, lath and shingles, but also general labor 

9813 



-325- 

data. In the even years under the title of "Lurater, Lath and 
Shingles," only production is reBorted. All" annual -lumbor productidn. data 
are reriorted by State and species. 

These production figures do not represent 100 per cent. As 
no date are included for mills productinr'^ less than 50,000 ft. b.m. 
of lumber per year, no factual data exist as to what portion of 
production is represented by these very small mills. It is es- 
timated to be between 5 and 10 per cent in mOst years. 

From 1904 to 1920 except for the decennial year the Forest 
Service compiled "total estimated cut" based on reported cut. From 
1920 to 1931 the Federal Reserve Board continued the estimates. 

Lumber manufacturing associations began during the second de- 
cade to compile monthly production data gathered from members of 
the association. As the membership included the Ip.rger mills of the 
country, a substantial portion of production could be accurately ac- 
counted for. 

In 1915, the National Lumber Manufacturers'' Association began 
publishing a weekly lumber barometer based on dnta collected from 
several of tho largest associations. Its sources of information have 
increased greatly, and for the past several years have served as a 
good indicator of general conditions in the lumber industry. Com- 
parability is not possible in these figures, as identical mills are 
not used for continuous periods of time. 

From November 1922, to September, 1923, the National Lumber 
Bulletin, published by the National Lumoer Manufacturers' Association, 
carried a m^onthly series on production which annual total represent- 
ed approximately 40 per cent of the production reported by the Census. 
The number of mills covered by the data varied -from 489 to 705. This 
succeeded a "Monthly Bulletin" of the Association published from 1912 
to 1918, containing monthly reports by states and regions for 10 to 
13 reporting trade associations. 

The Survey of Current Business has published a series of month- 
ly statistics since 1923, based on reports submitted directly from 
trade associations whose members produce the more important soft- 
wood and hardwood species. Only in the case of redwood does re- 
ported production near the 100 per cent raarh. Even then reported 
production varies from 40 to 90 per cent of capacity. (*) Total 
hardwood and softwocd data in the Survey of Current Business are 
now furnished by the National Lumber Manufacturers' Association and 
are estimated National totals. 

Seasonality and variation in the number of mills reporting each 
month greatly influence the utility of the above two series as shown 



(*) Survey of Current Business, 1932 supplement, footnotes. 



9813. 



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ty the monthly fluctuations. 

4. Shipments and Stocks 

In the National Lumber Bulletin, the National Lumber Trade 
Barometer, and the Survey of Current Business, previously mentioned, 
efforts have been made to publish assembled shipments and .stock data 
of the trade associations. The first named published only produc- 
tion and shipment information, v/hile the last two have carried stock 
and new and unfilled orders in addtition. The first two sources 
combined shipment' figures from all associations and o ^ them as 
total, while the Survey of Current Business auotes the figures on 
regional lines alone. 

The information given by these three sources is only partial 
and merely indicates trends' on shi-oments and stock. It is question- 
able as to how accurate the represented monthly trends are, becp.use 
of wide variations in the number of mills reioorting each month and 
the lesser variations in the representativeness of those mills which 
are included in the reports. 

After the year 1900, the Y/ar Department began gathering tonnage 
figures of water-borne, commerce which includes all freight leaving 
or arriving at all ports in the country. These statistics also 
includes all coramerco carried on in the inland waterway systems. 

The value of War Department tonnage data is not great, as 
all reshipment' which takes place is not segregated from original ship- 
ments. For exemple, a partial cargo of lumber leaving a Southern 
port billed for a Northern city is also included as an outboiind 
shipment at any port in between where the ship may put into port for 
the discharge of other ca.rgo. Thus the statistics reported by this 
cource are somewhat exaggerated. 

The United States Shipping Board has r)ublished a series on in- 
tercoastal distribution by "ater since 1928. The importance of this 
series is diminished by the fact that all lumber products such as 
pulpwood, cordwood, baskets, boxes, furniture, etc., are assembled 
under a "lumber and logs" classification. 

The quarterly reports of the Lumber Survey Committee (*) quoted 
stock figures in addition to production. The stock figures are based 
on association data. No evaluation can be placed on the accuracy of 
the estimates, as there is no comparable information against which 
they may be checked. 

Beginning with 1923 the Bureau of the Census has reported stocks 



(*) Appointed in 1931 by the Timber Conservation Board now report- 
ing to Department of Commerce. 



9813. 



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on hand at the beginning and end' of the odd ye.-.r. These date are 
comparable to -orodtiction data '"ron the same source and for this 
reason have considerable value. 

5, Labor 

Series of laoor datp. did not ap'-iear until after 1910, when 
the Bureau of Laboi Statistics be^jan -Dubiishin^; index nonbers of era- 
ployraeat and payrolls. Polloiving 1520, the series of euipluy^ient and 
payroll data was published by the Monthly Labor aeviev;. Soth have 
been monthly series and serve only as* trends, rs the in-fomation -does 
not cover identical mills and the numbe^ of mills re-oorting varies 
considerably. 

The Bureau of Labor Statistics has also compiled rather ex- 
tensive wage and hour data for selected years since 1920, covering 
sawmill workers in more than twent;' states. The dat"- have been 
based on full time hovirs and average hours. Earnings, however, are 
given as to the hourly rate and the actual weekly earnings of several 
classes of workorsc. 

The Bureau of the Census in its Biennial Ee^'orts of "Principal Liimber 
Industries" -nubiicption gives very mer.ger Inbo^^ information for those 
esta.blishinents producing less tha,n 200,000 Tt. b,n. per year, con- 
sisting of averr\ge nujiber of wage earners i^et- year, and total wages 
paid. While this elii^iinates a large numoer of eStaPlishments, its 
effect upon niimber of exioloyees is not so g-^eatj as employment in the ^ 
very small establishments is seaso?;al and the same workers are prob- 
ably employed in other industries s.s well, , -Thereas the principal 
erjployment, is in the large .plants 9,nd'is 'that reported by census. 

6. Distribution and ConsunTitiGn 

Prior to 19C0 the available distri j.tution data was thr.t' cafr^ied by 
Foreign Ccmmerce and Navigation, relative to ei-morts and imports of 
lumber. This source is "•ondoubtedly one of the most accurate as the 
question of duties are involved. 

The Pacific Lumber Inspection Bureau began gathering ca.rgo 
figures from the States of Vfeshington rnd Oregon, arcTond 1910. They 
quote monthly cargo movements botn 't/p donestic ?,nd foreign markets 
by points of origin and points of destination. Due to the fact that 
most of the exporters in this territory make use of tie services of 
this Bureau, its statistics are looked uucn as being authoritative. 

In 19C8 and 1933, the Forest Service in "Luinber Used in Man- 
ufacture" gave quantities of lumber used in the manufacturing in- 
dustries of the United States by SToecies, by State of consumiDtion, 
and for the even years beginning with 1926, the Forest Service has 
gathered valuable statistics of all lumber shi-rjments according to 
States of origin and destination. This series" indicates not only the 
interstate nature of lujnber shiriments but also the shift in consump- 
tive markets. 



9813. 



-228- 

The three large' trade associations, Southern Pine, V/estern 
Pine, and the West Coast Lumbermen, and smaller associations, have 
published distribution data as to origin and destination. Although 
the infornation they dissiminate does not represent 100 per cent 
distribution from their territories, it does indicate the large markets 
of consumption and the direction of movement of their respective species. 

The Lumber Survey Committee appointed in 1931, by the Timber 
Conservation Board has a quarterly series of estimated total con- 
sumption by major lumber uses which is based upon Forest Service, 
Census, and Trade Association data. Its contribution to statistical 
data relative to distribution data lies in the attempts to.'shov? 100 
per cent lumber consumption a.nd the distribution thereof, 

7. Transportation. 



Transportation statistics (rates) appeared in the "Timbernan" 
shortly after 1900. This trade magazine quotes water rates on lumber 
from Pacific Coast ports to both foreign and domestic ports of desti- 
nation. 

Another source of Pacific Coast water rates appears in the 
publication of the Pacific Lumbe- Inspection Bureau, 

The trade association, chiefly Southern Pine, Western Pine, and 
West Coast Lumbermen's, have gathered voluminous rate data concern- 
ing rates important to their respective memberships. 

A fourth source of rate data are the publications of the Inter- 
state Commerce Commission. Although this body sets and regulates all 
rates it is more of a repository for rate data than a primary source 
as its manner of operation is to hold hearings at which trade asso- 
ciations and others submit the information which it finally sanctions 
as the acceptable rates. Its great value lies in the fact that i^te. 
data are gathered at this one fountain of infornation, 

8. Costs and Finance 

Published statistical data regarding costs and finance are 
very meager. The Bureau of Internal Revenue in its annual "Statistics 
of Income" docs give some information relative to total assests, lia- 
bilities, and costs for reporting corporations. While this covers a 
considerable portion of the industry no data are available for many 
thousands of small units which are unincorporated. Internal Revenue 
data are of a most general nature and are entirely inadequate for de- 
tailed stud.}'-. 

During the period from 1918 to 1931 the Southern Pine Associa- 
tion, the North Carolina Pine Association, the V/est Coast Lumbermen's 
Association, and the Hardwood Manufacturers' Institute published month- 
ly per thousand feet b.ra, costs of a small number of their members. 
These costs were shown in detail for each mill and as an average cost 
for all mills. 



9813 



-229- 

Although the cost samples pre smrll, some de-Tee of compar- 
atility is attainable "between different sections of the country. 
In order to aid connarison, stiTapage costs ^.ere either left out or 
a unifor'H price aoplied to all individual nill reports. 

9. Taxes 

The only serial statistical data concernin,? taxes appears in 
the Internal ReX'enue puolication "Statistics of Income", These date 
hack to the early part of tlie 1920' s and re^er only to corporc^tions. 

In spite of the fact that corporations have trcraendous timher hold- 
ings there is a considerable portion of the industry uirepresented 
in this series. The cheif objection to the above data is that the . 
amount of taxes paid is given in one lump sum which canbe segregated 
neither as to the particular levies under '^vhich the taxes were paid 
nor to the geographical distribution of the tax cost. 

10. Prices 

The principal published source of price data is trade publi- 
cations. The sources cited in the chart of "Sources of Serial 
Statistical Data" are not exhaustive of the industry but have been 
selected as repreienting both an extended period of time and dif- 
ferent sections of the cotmtry. 

The Bureau of Labor Statistics has also been publishing a 
price indes for soiae time, but the items have been cnr-nged from 
time to time, so that the prices are of doubtful value. 

In the Census of Lianufactures have been Dublished yearly 
since 1906, an avei^age realized price of f.o.b. mill (per thousand 
feet b.m. ) for each of the nore prominent species of hardwoods and 
softwoods. These "orices should not in any way be confu§Q8. nith tiae 
trade publication drta, as Census prices made no distinction be- 
tween grades or sizes. Its information is indicative of only the 
average per thousand feet b.,rao realization to mills. Also, private 
st-atistical agencies have published information. Among these are 
the Davis Statistical Service and the Southern Pine Liimber Ex- 
change. The forr.er published monthly dn.ta from 19C4 to 1931 on 
Southern pine prices ar.d West Coast Lumoei prices from 191B to 1931. 
Since then the latter has assumed these duties for Southern Pine. 

The basis of this data is individual mill sales re-oorts of 
amount, grade, size, specie rind price from v/hich average prices 
are compiled. 

This type of data is valuable on^y in so f8,r as it concerns a 
certain number of mills. There is no way of checking how representa- 
tive of the entire industry such data may be» 

11. G-rades 

Very little serial statistical data regarding volume grades 
produced can be found. The Southern Pine Association did, for a 

9813, 



-230- 

few years in the 192o's, quote quantities of each grr.de sold in its 
monthly sp.les renorts. No recent published infornation can be found 
of Southern Pine Association authorship. 

Late in the -1920 's the Western Pine Manufacturers Association 
began publishing grade statistics conniled from sales reports of 
their raembershix). These data sho'v the quantity of various sizes and 
grades sold and also the destinations of such sa.les, IJo information 
is available as to whether this is still in existence, 

■ The information appears to be very good for the Western Pine, 
but other series covering all major species ':vould be of great value. 

12. General 

In some cases, lumber statistics are inadeauats, in others they 
are incomplete, and still others lacking in bases for camparability. 
There are better data available on some subjects than others. Pro- 
duction statistics are very good, although ;in abundance of Drice 
sources indicate that this subject is well cover&d. Such is not the 
case, a,s grades and sizes are changed so freauently in the quota- 
tions of "orice that it is very hard and in most cases iirroossible to 
find a series of comparable Tjrices covering a span of several years. 
Objection to present data is also based on their representativeness. 

The labor ds.ta cover only a few classes of la.bor in some 
cases chan-^e the bases of the data so that coraDarability is im- 
possible. 

In tne case of shipments the coverage is small and the data 
can be compared only with production data in which identical mills 
have reported both iDroduction and shi"'oments. 

The only distribution d-^ta wnich are complete are information 
relative to imports and erports. Onjy in recent years have data 
been corciJ-jd pertinent to distribution from points of production to 
points ci CO '.sumptionc The more recent data have been gathered only 
for every ether year and a,s yet a considerable portion is estimated. 

Transportation drita are reported partly in tonnage and partly 
in thousand feet b.m. The two are hard to reconcile, as species, 
grade, and size must be considered before a conversion figure can 
be detr^rrj-iiijd for changing both to the same basis, llo data are 
availa.rJe It,? the determination of an accurate figure cf conversion. 

All o^-ner statistical data are of a very sketchy nature. 



9813 



-231- 
B. TIMBER OTfKEESHTp STATISTICS (BUREAU OF INTSEITAL EEVEITUE DATA) 

In preparing tho chapter on Capital ani Credit in the Prelininary 
Report on the Eccnomic Pro^blems of the Inimher and Timher Troducts Indus- 
try, it was necessary for us to use tasic data relating to a consider- 
ahle group of corporations generally classed as "forest products cor- 
porations," when in fact the principal "business of such corporations- 
was other than sawmill and planing mill opera.tions. This necessity 
grew out of our ina'bility to officially establish the' proper contacts 
with the Buroau of Internal Revenue to enahle us to secure and "broaJc 
down tho information from their files and also "because the Bureau of 
Internal Rovenue did not extend the scope of its statistical analyses 
to Include several of the factors which we considered necessary to a 
complete and axhaustive study of these particular factors of the Lum"ber 
and Timher Products Industries. 

The "othor wood products" corporations are classified as manufac- 
turers of carriages, wagons, furniture, "baskets, etc. We are concerned 
with none of these except "baskets, and so this group of "dther wood' 
products" corporations, consisting of more than 50 per cent of the total 
num"ber of corporations classified "by the Bureau of Internal Revenue, it 
is "believed should "be excluded from any study that has as its o"bject 
the presentation of data in connection with sawmills, planing mills, and 
other wood fa'bricating plants integrated with sawmills. 

The act lal data in the files of the Bureau of Internal Revenue re- 
lating to. samills is quite extensive and appears entirely edequate if 
it were poss_ble to secure the necessary "breakdown into the segmonts 
actually pertaining to the type of manufacture which we wish to in- 
vestigate. This material is not only concerned with the financial 
status of these corporations, "but also consists of a very complete col- 
lectio.i of information in connection with. the investment of the industry 
in standing tira'ber. You will recall that our information as to standing 
timber ownership at the present time is neither relatively complete nor 
th«r-0Ui;hly relia"blB. 

It should "be "home in mind in planning for such a study of informal 
tion in tho files of thfl Bureau of Internal Revenue that such informa- 
tion from the financial standpoint is availa"ble only as to corporations 
definitely classifying themselves as "being in the sawmill "business, 
&ueh corporations for 1952 num'bered less than 3,300. In this connection 
it is well to renif;ni>,er that standing tim"ber areas owned ty corporations 
■whose principal "business is not sawmilling would not "be cla.ssified in 
this group, and it s'nould "be our purpose to quite thoroughly develop 
thi3 particular t^^^pe of information and to assera"ble it with the gro-up 
already segregated. What has "been said a"bove as to ownership of tim"ber 
lands also applies to the ownership and operation of sawmills. TS^e also 
must consider that the specialized da.ta in the files i^f the Bureau of 
Internal Revenue rsla'^ing to standing tim"ber is not confined to corpora>- 
tions and tliat from t"nis data we can secure leads to information relating 
to sawmills operated "oy other than coi^orations. 

As the purpose of this investigation should "be to develop informa- 
tion concern" ;ig sawm:llls and standing tira"ber, efforts should "be concen- 
trated at tht "begiiining on an investigation of those corporations 

9813 



-232-. • ■ 

definitely so classified and extend from that field our investigation 

into thase otner orgr'ni^^stions thpt form .-•"-' riart of this ■ industry," 

We are particulprlv interested in the clpsi:if ication of "cppital 
assets", especially -the division bet'^'een plant pnd equipment and standing 
.timber. Concerning the latter ^re particularly wish to secure informa" 
,,tion concerning annual charges for taxes and interest as definitely 
related to this asset, 

' A very considerable quantity of this financial information has 
already been developed by the Buieau of Internal Revenue and is avail- 
able for analysis and re-analysis. The information concerning the 
standing timber ownership has not been classified except roui:hly into 
.geographical areas. 

The re-analvsis and the re-classification of the financial data 
would be a project not particularly difficult, nor ^^ould it be very 
costly-. However, the ni'oper, classification after careful analysis 
of the data relative to the -ownership of standin.-:: timber vould be a 
,pi:oject of considerable scope, and would be quite costly. 

You will also remember that this Division has prepared a list of 
,the names and- ad'df esses of 1,200 of the largest sawmill operators in 
the country, which we had expected to use in the first planri-ed- inves- 
tigation of the Bureau of Internal Revenue statistics. This list 
could ..be subjected to a special study and classification of data in- 
cTudii^ -both the financial and the standing timber phases, •■ As such 
a study -"-'ould involve a complete re-classification, eyen. of • the finan- 
cial data, the project vould be, one of considerable/ size and it is 
believed would cost a considerable sura of laoney to properly conclude it* 

' . The information is available for all past years -up to and including 
1933 (.1934 is now being classified,) It is suggested that any one of 
these .above suggested project::, should be very carefully outlined and 
that no one of them should be undertaken unless it was reasonable 
certain that dat' received in. later years, at least through the year 1936 
should be similarly assembled and classified. 

Such data is believed to be invaluable to Government and industry 

if gathered for a particular period. If such study could include years 

prior to,' during, and after the depression, the value would be almost 
incalculable, 

c, teai'tsfortatlof and cross-hauling 

Very little has been done .in this study with the subject of trans- 
portation and crosg-hauling. The Cii-apter on "Distribution" has indirectly 
and briefly touched upon the vo.lume aspect but only in so far as volume 
was related. , to specie movement and . consuming centers of the more prominent 
specifes. Limited time and' personnel, as v/ell as insufficient data, 
prohibited an adequate stady of this important subject, .As a study for 
future consideration the following will briefly outline the major aspects 
of the "uestipn and -indicate broad lines upon which investigation may be 
carried. The question' of data necessary for a cafeful examination of the 
subject' will also be analyzed in the later paragraphs. 



-233- 

It is p-DPFTent from a cursory expminationof available datp that a 
mnjor portion of lumber is consu'.ied a CTeat distance from the point of 
production. Considerin;: the bulkiness of the merchandise in relation 
to its value, it necessarily ioIIofs thnt even by use ol the cheapest 
form of trfinsportation, considerable expense is incurred in bridging 
such distances. 

Two broad uses exist from lumter, namely, construction and fabri- 
cation. Little, if ;i.nythin;r ever can be ;--ccompliEhed to-vard decreasing 
distances between consumption rnd production centers of that lumber used 
in and for construction purposes. 

The lumber fabricating industries, vhich consume a considerable 
portion of lumber, were located, ft their inception, close to the 
source of their stocks. As the center of production shifted from the 
North-eastern and Lake regions to trie South and far "West, distances over 
which lumher must be shipped hrs increased tremendously. Fabricating 
plants were not moved nearer to prociuction centers to any great extent 
as large suras had been invested; the major portion of which would be 
lost in moving the frctory. One notable exception in the migration of 
a consuming industry is that of tne Furniture Industry. It has been 
gradually moving from Michigan to ITorth Carolina, which state produces 
large quantities of softwoods, is much nearer hardwood forests, has 
cheaper labor and overhead costs and borders on the ocean with its 
cheaper means of trpnsportation. 

Transportation and cross-hauling has "been suggested as a topic 
for future study in order to throw light upon tne increased costs of 
lumher due to the situation outlined above. 

The study of lumber transportation resolves itself into two major 
aspects, namely, volume and cost. Certain investigations should he 
made relating to both, among v,hich are: (a) the rmount of traffic in 
lumber between states, (b) amount of traffic in lumber within states, 
(c) competition between types of carriers £.nd the- effects of such 
competition, pnd (d) the causes and effects of cross-hauling upon 
price. Cost and volume of transportation are so closely inter-related 
that great difficulty is encountered and imich care must be taken in 
distinguishing between the efiects of each upon the economic life of 
the lumber industry, Sather comprenensive data are necessary for an 
adequate study of this nature. Some information is available in usable 
form while some of the available data will have to be reworked. 

Data essential for an adequate study will include statistics 
relative to the following: production, and production facilities in the 
various states; volume of lumber carried by r^il, water and trucks, 
volume of lumber shipped from states to strtes "s well rs quantity 
distributed within states; location and types of lumber used by various 
fabricating industries; rate data from all important centers of pro- 
duction of the more prominent species to the many consuming markets; 
the extent and quantities of reshipped lumber; and the volume of imports 
along with general information as to their ultimate destination, A 
great deal of the required data cp.n be oota.ined from existing sources. 
However, some will undoubtedly require reworking end supi:lementing, 

981S 



-234- 

The chief sources from which the above data may be obtained are: 
B-areau of the Census, Forest Service, Interstate Commerce CoramiEsion, 
jiureau of l\eilvB.y Economics, United States Shipijin,'^ Board, and the 7/ar 
Department, 

The -^reau of the Census co;apilcs annual production statistics by 
states and species within states. This information is reliable and has 
the best coverage for state !?v,.d species statistics in existence, 

Forest Service has two sets of data T'hich would prove to be of 
great value in a st\idy of transportation. One entitled "Lumber Used 
In Manufacture" has been published for the years 19?8 and 1935, These 
publicationa show the species and quantity of lumber used in fabricating 
industries by industry and state. The other series is published under 
the title of "Lumber -Distribution and Cohsum-otion, " Althou^-h it is 
available for every other even year beginn?,nj? with 1924, data for 
several of the years have not beeii published but can be obtained from 
the work sheets at Forest Service, These data give shipments from states 
to states and within each state sep;regated according to hardwoods and 
softwoods. 

The Interstate Commerce, Com iisf:ion reports volume of rail ship- 
ments over all Class I railroads in the United States under the title 
of "Freight, Commodity Statistics" which is available for such years. 
The data since January 1, 1926 have included many more classifications 
of freight and are therefore of greater utility. 

All data are reported by railroads and by general railroad districts, 
which is a serious disadvantage to the study of transportation, Compara- 
bilit?/ cannot be obtained betve'en data from previously cited sources nor 
is it likely that a state breakdov^n can be obtained without a great deal 
of work and expense, A second disadvantage exists in the fact tha^t 
volume of transportation by rail is reported in tonnage rather than 
thousand feet b, ra. 

The Interstate Commerce Commission can also provide necessary all 
rate data relating to' railroad freight. 

The United States Shipping Boara reports intercoast movements of 
lumber by water under the title of "United States Vteter-Borne Intercoastal 
Traffic," which is available for several years to date. This source also 
quotes all volume in tonnage and has an additional disadvantage in that 
lumber and all wood products are included -under a "logs and lumber" 
classification. Before an adequate evaluation of this source can be made 
the quantity of wood products other than lumber, appearing under this 
title, will have to be determined. 

The ''<ar Department reports annually water-Dorne commerce statistics 
entitled, "Commercial Statistics, Water-Borne Commerce of the United 
States," v;hich is available both for fiscal and calendar years. It will 
not be of great value in its present form but basic data are in the hands 
of Army Engineers which could be compiled to show origin and destination 
of all water-borne comTnerce in the United States, Lack of i"unds have 
prohibited the publication of data in this form as yet, 

9813 



-235- 



lumber transportation in this re'S ^^^^^^^^^ quite a lactor in 
Also, datp f^r ?'ater ratfc; m-i i ' -,,^,., + _ i ' ,, . 

The need for addition?! dat- oth-r th-n th,^.. .,, . ^ ■ 
preceding paragraphs will undoubtedi;"no h^ e ^Sff: ^Ms tf . 
which can arise after the study is ur.der wf,7. " ''™'^"^ "^^ *-"^ t^'^e ^<i 

D. METHODOLOGY 

Timbef ProJ^ctrirdustri''"o '°/^f^^-,*- --"^ems of the Lumber and 

.anner in ^hi^h Jf o^^SeH^^ rSe ode'^tf^r^bl^ ^""'^ ^^ ^^ ^^^ 
not for each particular p^rt of the ir^i^.f*-. ^f problems are analyzed 
into types on%he basis L h. origin Tni'^ fl f "'^'"^ '''' ^'^'"^^'^^ 
industry as a whole except th-^t hprX'^.:^ i i "^ "■" ^^PPl^^d to the 

considered as rep^esentiS *^-*J^^^^^°^d dumber and softwood lumber are 

Of the industrrth::tr?o'd: :i h%h:^ ^b^ricltin: j^'r'7- ■''''' ^^^^^ 

products, but Which under the Lu:nbL^d Tim'^f Produ t Td" ""'^ °''"^ 
ered part of the indu=;trv «nH fv,<,+ 4. - ■" "°^^ Products Code was conoid- 

-hich are product' o^ the ^odf r',"""' Tlu"" '" "' "''^ ^'^^^^^ ^^^^^cts 

disregarded to ^^^ 1^ ^t^^Zr^^^^l^T' l^ '^'^ 

except standing timber have n.t been analyzed. ^" --blems, of all 



been tre:Lf L^r'i:i: ^o^l^'^''T'^l ''^'^^ -^ ^--^ ^-^^ ^-e 
the problem^ of the ..1^^! f . ^^ contributed and were the genesis of 

problems of "^.roduction o"v t t'^-'°?^"' ""^'"^"^ '" ^^^^^"^ ^^^^ the 
production only tue Luraoer Industry has been treated. 

far af:o::ible intf^rgHns'^^^a:; to T^t^ ''I'i^^^ ^^°^^-^ - 

one region and another ^h'^v^: lit 11 f h' f ^^f ^^^-^/^tween 
particular region have h^tr^Zl I T r \:^ . ^^'^^^'^ problems of a 

attempt has hSn madrchienv to divi ^'\ ^^ "^T"" '"'""^'^^ P^°P- - 
and these in turn TLf S^ to diviae between hardwood and softwood, 

with a mer reference thfrnin^'r^''"'''""' '' '^^^'^'^°^^ ^^' -"--^-. 
the problems. ^'"^ aivisions and their contribution to 

its most'^outst^.'dl^ ''"''' '-f '^''^^''-^^ -^^^ ^^^^ *^«-ted at best onl.. in 
should be made S^fh'aT; ^ "T^ '^'^''^'^ ^^"^^^^^ - "-^^^i -^ 

and timbe^^^^ductrof^S^S:: ete^' Jhe^^reT h^^'d .°^ ^^^ ^^^^^^ 
part of a statP «ir,^= "" ^■^^^- should be a state, or 

?he industry nd ItTlZT""" "It'' ''^" contribute to the operation of 

Should be tL t d : tS:' s: !r f :^n thf'^^'^ '^^'%^^- '^^ ^^^^^^-^ 

to and all inclusive oJ.m -H tne way irom forest management 
within that area. '''''"'^'■' '"' ^^maunfactured forest products 

obstaSerto'^SpLL'^n'^^dT" P^^'^-^--^^^-^ --Id ^e made as to 

expansion . nd tne cause of any retrogression, particularly 

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-336- 

along the lines outlined in a research project proposed by the Harvard 
Tl'ureau of Business Research snd the Harvard forest entitled "The Present 
Situation and Future of Timber-producin!?; Regions as related to the 
Utilization of Non-virgin Timber," This project was proposed for the Nei- 
England territory only. Hovever, such a project might be designed and 
developed, ivith only sli.^'ht changes., to apply to each one of the regions 
as shown in Section "A" of Chapter II, or i"here required for particular 
states within those regions. 

After such studies riave been completed it would then be 'possible to 
make a more thorough analysis of the entire Luralser and Timber Products 
Industry, 

Attention sh^-uld also be directed to a publication available in the 
files of NRA entitled "Scope And Status of Research In Forest Economics" 
(available through the cour'tesy of the Social Science Research Council) 



9813 



-237- 
APPEliDIX I 
EITORTS OF TIE L'UIIBZR IITDUETHY AT PRODUCTION COHTROL 
PRIOR TO I'. R. A. 



A report prepared "by A. C. Dix.on, 'based on personal 

knowledge and an examination of the files of the 

National Lumter ManufL-cturers Association 



You have as]:ed me to malre a stn.dy of the prodiiction control efforts 
of the liamlier industry prior to the period of code administration. In 
doing this, I have thought that on account of the time limitations I should 
confine the study to the major divisions of the sav-milling "branch of the 
industr;'' on the theory that the action taken "by these m.ajor divisions 
would fiu-nish a satisfactory seiaplo, and "because I know that most of what 
the smaller groups had done r/as "bj"- vay of following the programs of the 
larger ones. 

I have not paid any attention to t"ne fa"bricating divisions although 
I know that some of them operated imdcr the so«?called Stenenson Plan and 
that perhaps some of the others attempted to practice types of production 
control. 

In going through the material availa"ble, I was impressed hy the fact 
that all of the efforts to control production which attained any siza"ble 
proportions occurred su"bsequont to 1924. Prior to that time, it is trae, 
there were conversations and perhaps some correspondence relative to the 
future possi"bility of the need for control, "but nothing was done which 
could "be called a serious effort. 

In searching for the reasons ps to ".7hy the efforts were made during 
the period mentioned, I ran across the follov/ing facts which seem to me 
) to "be worthy of note and as having a pro"ba"ble "bearing on the chronology 
of the efforts that were made. 

1. Transfer to The V^ect of Production Supremacy. 

Th.e United States Census of Manufacturers shows that up to and in- 
cluding 1869, the northeastern states were the largest producers of 
lum"ber, and that in the next census period, in 1879 and the following 
in 1889, the laJ^ce states predominated in production, and that t"hereafter 
and uaitil 1919, the southern str^tes were in the lead, while late in the 
twenties the western states forged ahead and at the time of the census 
taking in 1929 and subsequent thereto, the western states have produced 
more l-'ain"ber each year than any other area, 

2. Influence Of The Panama Canal. 

Tlae Pacific L!ii:i"ber Inspection B'tU'eau for a generation has inspected 
and kept a record of all foreign and domestic cargo shipments from the 
Pacific Coast and has "become a worldwide authority not only as to its 

9813 



-238- 

statistical record. Its records show, prior to 1914, practically no ship- 
ments to the Atlantic Coast, the total aiaoiinting to less than fourteen 
iiiillion feet, which would only amount to three 1 arge car.^oes measured Id;'- 
the size of cargoes today. In 1914 these Atlantic Coast shipments jumped 
to thirty-four million feet; in 1915 to eighty-six million feet; during 
the war period the shipments were nominal but in 1921 they reached the tots-1 
of two hundred and eleven million feet; in 1922 six hundred and sixty- five 
million feet; the next year nine hundred and t;7ent3''-five million feet; in 
1924 one thousand and sixty-five million feet; in 1925 two thousand million 
feet; in 1926 suhstEintially the sane, and each j^ear from 1925 to 1929, in- 
clusive, nineteen hundred million feet or more. Ti70 thousand million feet 
is the equivalent of 80,000 carloads, or sufficient to huild well in excess 
of 100,000 five and six room residences. I "believe these figures indicate 
that during the period referred to there was a tremendous pressure put on 
the Atlantic seahoard raorkets hy the influx of Uest Coast lumher, and while 
guaging this pressure, it night "be well to remei.iter that luinher delivered by 
water to the Atlantic Coast ports was very often transferred to tr\\cl:s or 
the railroads and hatGLed hundreds of miles inland. 

3. Loss Of Earnings. 

Possibly as an effect on what is recited above, and certainly a con- 
tributing cause to the desire forproduction control, was the steady decline 
in earnings during the period' beginning immediately after the war. Statistics 
of income furnished by the Bureau of Internal Revenue give net profit or 
deficit of all companies reporting, and the showing covering saw-nills, con- 
sidering the nearest million dollo.rs, is as follows: 

1919 - 137 profit 

1920 - 179 profit 

1921 - 38 deficit (this was a year of temporary 

de-oression in the construction industrj'', 

1922 - 110 profit 

1923 - 191 profit 

This T/as the high point from which the yirofits dropped until in 1927 
they show only as six million dollars, while in 1930, 1931, and 1932 the 
deficits show respectively as seventy-three million, one hundred nineteen 
million and one hundred and twenty-four million dollars, the amount in 1935 
being equal to 32.24;o of the gross income of the industry. 

I have noted with interest from the records, aided by my personal re- 
collection of vriiat happened, that the uiiiversal desire for some tYpe of 
production control developed at approximately the time when profits began 
to disajppear. In 1925, 1926 and 1927, without having the benefit of a 
com-oosite statement of the industry for any given year until the year was 
well past, the operators generally knew tha.t the industry as a whole was 
either losing money or making only a nominal amount, \7hile at the same time 
industry in other lines was reported to be paying vast amounts in profit 
taxes o.nd to be in a prosperous condition. Eie, question was frequently put 
as to what was going to happen to the lumber industr:7 when other industries 
started to lose money, in view of the fact that when other industries were 
making money the lumber industry was moking none. 



9813 



-239- 
4. Other Industry Activities Along Production Control Lines. 

Aliout this same tirae the oil and coal indxistries, independent of 
each other so far as I knor/, and indejiendent of any action on the part 
of the lixiifoer industry, v/ere seeking production control in one v/ay or 
another, "both in the respective states and nationally, and it may be that 
what they uere doing had at least a suggestive effect upon the lumlDcr in- 
d\xstry. 

5, Hailroe-d Suilciing In the 'iTest. 

Beginning soon after the war, there was a period of intense activity 
in railroad "building in the far TTest, and the Southern Pacific, G-reat 
Northern, Northern Pacific, Union Pacific, Chicago, Milwaukee and St, 
Paul, as well as the TTestern Pacific, huilt many hundreds of miles of main 
lines, in some cases opening up vast areas of virgin tinher either directly 
trihutaiT to the main lines or easily made so hy short tranches, and on 
these now main lines and "branches there were erected a n^jmher of new mills, 
some very large and, of course, adding to what was already considered a 
condition of overproduction, 

5. Tax Intreases. 

Tliere was a notahle increase in taxes paid "by tinher owners as well 
as taxes generally in the western states hetween 1920 and 1930. This was 
an era of road-huilding, "building of new school houses and other p\i'blic 
"buildings, and. more or less riotous state and municipal spending. In 
some heavily timbered counties, the total load increased while the timber 
availa"ble for taxation decreased, with the resultant multiplication of 
the tax load and neither could the other assessed valuation carry the 
"balance. Some of the co-ujities have had to go into a state of hanlo'iTptcy, 

Some of the a"bove nuiTi"bered paragraphs may "be considered as causes, 
some as effects, ajid some as merel:''' coincidences, "but I think all are 
worthy of consideration as having some sort of a hearing on the various 
efforts later made "by the industry to "balance supply and demand. In 
gathering material for what is to follow, I have had an opportunity to 
look over considera"ble material in the files of the National Ltimher 
Manufacturers Association "bulletins, news letters, releases, etc., "but 
mostly in the nature of private corresnondence "between persons in the in- 
dustry, relating to the various movements that were under waj'" at different 
times, and giving, in many cases, their confidential views and "beliefs 
which the;'- did not e:cpect to have broadcasted either to the industry or 
to the public. Consequently, I have refrained in the main from using the 
names of individu£.ls, but feel quite sure that if any checking is desired 
by some responsible person in authority, that it can be done. 

It has been my intention to list the varioixs production control 
efforts in chronological ord.er. I have done so as nearl"^'- as I can but 
could not be entirely accurate for the reason tha.t the movements overlapped 
in a nuLiber of cases, in fact, in, most cases, and one. was not out of the 
way before another began. In the mo.in, I have put them, in the order indi- 
canted by the first definite '^/orthw'iile mention in the correspond.ence and 
data I have looked over, 

9813 



. -24C- 
I. Y/EST COAST IliilRGI-ER. 

In ITovein'ber 1925, tliere had "been enof.gh thought and discussion on 
the proposal to merge sone large ITest Coast tiinter properties co that a 
man prominent .in the industry v/as aslted by "¥est Coast people and haiilrers" 
to act as a leader in the raoveiaent, and late in that month a prominent 
firm of timber "bond specialists and bpnicers in Chicago rrote a letter to 
an officiaJL m the industry stating that they, v/ith o ne of the leading ITew 
York bond houses and one of the largest benics in Chicago, had been tTjlng 
to wor]: out o. merger among fir operators in the West. The letter states 
that tro conditions existed at that time which had never existed before 
and which r/ere favorable; first, "the government attitude toward mergers", 
second, that "money was available beyond anj^ sums previously thought pos- 
sible." ITith these conditions which they mentioned, they cilso coiipled the 
idea of the "depressed conditions and, therefore, psychological position 
of the fir operators", and reached the conclusion that "there is at least 
a chance to merge some of the greatest operr tors in the Pacific Coast, " 

This group (Baker, Pentress and Company, Comuercial Trust and Savings 
Banlc of Chicago, and Dillon Eeed and Company of 3ew York) spent some 
months of time and a great deal of money, and the lumbermen interested 
a-lso spent Liuch time and money, in working out the possibilities of the 
scheme. They secured the ten-year record of produ.ction, cost, sales, e^nd 
net returns of a large number of companies, on the Pacific Coast, estimated 
to have arov-nd 30^ or more of the capacity of the Douglas Fir producers, 
to see whether or not when projected into the future, the operations of 
these concerns by reason of what they had shown they could do in the past, 
and giving consideration to ei^^ipected economies and benefits to come from 
the merger, could from the conversion or "net avails" service the various 
classes of seco.rities which it was felt necessary to issue. The g^-neral 
plan f this and 'Other proposed mergers to be mentioned later, contemplated 
the issuance of three classes of securities. Pirst, the operators would 
be paid in cs-sh for their current assets, e,nd first mortgage bonds wotild 
be sold to t'lie public to orovide this cash and provide working capital. 
Secondly, preferred stocl: would be issued to co^mpensate the operators for 
transfer of title of their '-'orking fp-cilities, such as sa'' Ills, logging 
railros.ds, ships, docks, etc,, and tliirdly, common stock would be issued 
to the operators for their timber. There were, of cotxrse, variations 
in these plans as the banlcers' group aiid" the industry group worked together 
and raajiy different tentative schemes were drawn up on paper, some ninoograph- 
ed and some printed, but running a.ll through the discussions, conferences 
and planning, was the central thought that vTha-tever basis the merger wa,s 
formed, on, .the prospective income must in any event be sufficient to retire 
the obj.iga-tions. 

The first publicity as to this merger was given under a Chicago data 
line as early as February 6, 1926, and the indications are that this was 
the first publicity that was given. About this same time, the National 
City Baiilc of Hew York came into the picture and it was thought by some of 
the v/estern operators that a br-tter deal coiild be made with them than 
could be riade with the first group n(?ntioned, and accordingly committees 
were appointed to meet v/ith representatives of this bark and tentative 
plans were developed approximately along the lines referred to above. 



9813 



-243- 

Bu-rin/;; the time the Coitv.ittee of Fifteen r/as in existence, the 
thoi)^:ht was? e.-pressed (pro'ba'bly. not ori.^inptin-;: with the Couiinittee, brt 
furthered h;, them) thrt t]ie lnd'\tsti-: dioiJc have r^ c" irector-;':eneral, fnd 
freqi'.ent corinj-.riKons v/erc ^^^.e to b" '■-imgII mic Jv.v.'.;^e Lc;ndis; t'Jie movie 
incustr;, rnt T/ill H&ys; mC the ii.-u.b"er Institute fiiL &enerf:l Ar.drev/s. 

I oi'.ecjtion if it i': corve't to r.i:y that no benei'icij'l re- tilt n . 
accrv.eJ, i I'O- 1 the woj'K: oi' tiiis co:.i,,iittce. I thirilt it cr-n be said tha,t 
there v/ere no tangible recorded re'iailts in eviJ.ence and nothin;^ thrt 
CGUlc DC -..t on cit]"Ler pide of the ie'. >"er in firrLiref;, bat the movement 
did rern.lt, esMeciall thioujh the. cv'llin,'; to3;ether of lr;r,;;c .groups of 
serioUGly i::terented operators, in r- :;prer-.o. of Liiovdedge as to the con- 
dition of the incustry end unist jiave coiivoellcc. utn^, persons to taice a 
more rep.lir'tic view of the sit.mtiori them they otherv.'ir,e roiild have trhen. 

The ;yrobabilities are tlict tiie comjaittee revcr formally disb£.nded, 
their pi-o.)os?.l tu chen;:;e the 'fotionrl Lumber lMairaff.ctr.rers Associrtion 
to :'.r. i.iGtit.i.te was never cairiec. o", .t, there w.ao no director- -general 
secure^., anc in time the ..lember::. of the regional 'croujs tvmed their 
attentio'.: to variour: nthev pla,n3 .and fjchemes cesi^jned to adjust production 
to aem?v,d, "SiTnile the nieetin;.;^ of the lar,':er ^jToups above referred to 
\vere bBin:^ held, and as ,;ien went home from thev^e meetings carr^'in,^ the 
hiesza,";^ to their or/n associations ai;d regions in some sections efforts 
were .;n.e to ;■ ether strtistics r-.i-iL lind ot.t more about facta with 
regard to the industry, ana rt one time later in 1928 the Southern Pire 
Associr.tion htd as rianj a.s eighteen men in the ficD.d a.ttempting to 
secure data on the productiori of the 3m.all millr vmich did not re.'^'dril;' 
report to the ar;sociaticn. At the same ti.ne tiie North Caroline Pine 
people r/ere doing oome of the snme v-ork. It is difficult to relate the.e 
re;;ion,:.l i,.ctivities to an:; particular movement uut I thinlc ineii cat ions 
are rer voncJoly clear thet at least some of the scouting amd .investi- 
gatin,, v'orl: that was done in 1928 and early 1929 was the result of tJie 
thinlci'v, oi some of those vho a.tteneed the meetings of the Corai'.ittee of 
Fifteen. 

III. A?ThI3TID ALLIAIICL UIT^I COAL AI"J OIL. 

In 1923 there crme to tr^e attenoion of the IT.^tionaJ. L^'ynbcr I.iani"- 
facti.rers Association the fact that t;.ere was a movement on the -^art 
of coal rnd oil interests tc secure Ict^islation desi.gned to have a 
be.?,ring on the production of those nat^'.rpl resources. There v.'as consi- 
derable correspondence back rnd forth between mem.bers of the indur^try 
and with associations executivesj and the industry became interested 
eno\.-gh so that on December 6, 1928 the Hational Liunber i,Iariufacturcr3 
Associatio.: _;assed a, resolu.tiqn calling attention to the fact th^- 1 t..ere 
were ".inilrr rnd a^.iitional reasons why, if oil and coal had le^'i-jlation 
providin-;, for "control' -ng orod-uction under ]jroper safeguards" of 
oil rnc. coal, or both, the legislation should also oermit controlled 
production of l"iii.,ber, When the a.ctivitien of the liriibermen came 'to the 
attention of the oil peo;ile erpeciellj, the:.,- let it be laiown that they 
dic. not wrjit the lumber-t?.il fttf chec-. to their kite, jnd whether or :iot 
the efforts of the liTinoen-nen were quieted cx'-ra 'o:, res'jnn of this objec- 
tionj ■c];e frets are th'-t the throu -lit was not airsucd to the point that 
legislation V7as had in beji.?lf of lu^-fcor, 

9813 



TL3 oriei recit."'! liere of thi:; thQW.;ht ia not coinjenm^rate '"ith 
the fi.ioiuat of corresponO.cnce anc. confei-riiz:; en.jejec'. in' ay the liunljer 
iiid-'.st::'y ^■.^^ri^:':; th/ t ti:..o , '.,'Ut f.ere vere- ';»o .:;;t.cifl lumber or^'anizations 
brou a-c ii.to lieii'.^ to fui'ther tl .i:3 v..,r_)0!ie rud relF.l'vely r. snell rnowit 
of yxiblicity ves I'lad. 

]'OTS: At t;.iis joint, i'n or; er '^/O civoi'. i rec._i.-eiit repotitioa, it urj'' "be 
veil CO 'jtr.te tl at in all of t:u 'ij.roit:: oi I'le inc.Mstrv '.vhich are re- 
corCec. ;.,eie und ^.Iven Kiu'iicient . rominenct:; to T:.r4e a nurnbereu ;:Jsra;:raJi 
or cha:;ter, there v/jr; j.r.'it.I. le 'al «..isoussion on the oprt of attorney's 
of ui ;1;. strnr.in/,: in the pro:i; fsf^ion coi.cerj; in ■ tie le/j-ality of the v,:.rious 
ideas rnd ^ilrr.s |jromoted by the inuustry. ihese attorneys ^"ere jjrincipal- 
ly c;tij] o„'X.d re^jularly "by the lri,r:;'er operators in the ino.ustry, "isvially 
from vo or three to o, n.olf (.■-OL;er or iio^'e oi thera lire p,;" r.if^ned to 
jointly HGiid, t:.e ^jrourcuio;. control ideas r s they crme alon,;?; and to 
advise their clients as tc the 1 e ;rlity of the prn:)osal under cons. .".erati« 
on. At tiuG'^ some of t^iere /^roi, .t; went entirely r.ccross the continent 
for the .1 rpose of laectirin vitl! thcii: lu'incip'^.ls or to meet attorneys 
vho CO' 1,. not travel to .leet t e::i. hrny written opinions are in existeiv- 
ce s to the conCl-usiorn- ai'inved at t-nd, s." aiipht be ez^ecte^ , in a. 
nomber of inbt^nces no Uiipniinous conclusion was reached. It is probably 
that Icter on in this renort it v/ill . e necessary to refer to thase 
le;;rl co-ferences or discu33io.:G but for the salreof brevity such reference 
will mC elihiinated as rraich r!5 neeias expeo.ient and the jeneral sta.tement 
v/ill tand that the i:.d^^Gtry ano its Lieiifoers tooh great care to cliech on 
the le.^clity of every production control plant to vmich they ;-ave 
serio"".s consideration. 



981S 



-245- 

IV. DIRECTOR OF PJlCDTICTirN. 

During this period .GOTn^on'-^ , I do not 'enow who, evolved the idea that 
the industry, should have a "director of production" to act in tehalf of all 
firms who would si^n a contract with him, and various tentative forms of 
contracts were proposed. One provided that the duties of the director 
should te (l) "to survey stoc'-s, production, sales, demand, etc., of dif- 
ferent companies in relation to demand and production as a whole"; (2) 
"to determine production necessary to maintain reasonable inventories and 
"balance tetween supply and demand"; (3) "to instruct th'^ manufacturing; 
department accordingly." This form provided for a monthly salary for the 
director and, for the operator, promised that all the departments of his 
business would comply with instructions from the director. 

About the same time various sales agency plans weire written up and 
circulated and, if carried into effect, theoretically would have had some 
control of production inasmuch as the operator boixnd himself to sell his 
entire output through .the sales agency and to abide by the contract for a 
minimum of on? y^ar, a.nl th^r-^aft^r to .eiv.^ at I'^ar^t six months of inten- 
tion to canc'^l. 

It was evidently the t?i0ught of, some that if enough operators would 
sign this contract with the central agency that they obviously could not 
over-produce because the agency would not sell or offer to sell more than 
it could market at a reasonable price and the operator could not sell at 
all. 

V. TH3 HOLDING COivIPAKY IDEA; 

In April 1928 there was some corre?pondence relative to i:he sugges- 
tion of a leader who was a ra'=mber of the Committee of Fifteen, also a 
member of' one of the special committees selected to negotiate with the 
banking groups relative to the West Ccast merger, as to the possibilities 
of a holding company modeled somewhat along the lines of public utility 
holding companies, with the idea that this might take the place of the 
merger, that it would involve less preliminary "or"'^ in the way of ascer- 
tainment of va-luGS and marketing of securities, and that the holding 
company with lesser capital ^ould, under the proper setup, control sales 
and fix policies as to production and distribution. This movement did 
not get under very considerable headway, probably because of the legal 
opinion of the lawyers who were advising this particular man and others 
with whom he conferred. Possibly the holding company idea could hardly 
be considered as a definite movement toward production control but I am 
citing it as showing that the members, of the industry were reaching out 
for every possible straw. • . 

VI. HARDWOOD CONS^RVATIOi\I PLAN. 

This program was apparently started in February 1928. The plan 
was only developed and put into effect after careful work on the part 
of the legal advisers and after a conference by members of the Industry 



9813 



-246- 

with Assistant United States Attorney General Donovan. In setting 
forth the :olan use \7as iirde of statenents nade by President Hoover con- 
cernin,-'i the need for economic inquiry ana. fs,cts,..and vrha.t he said '7as 
quoted in '^rrt in circulrrs and letters "hich vere sent out. 

The plan contemplated a division of the hardwood nianufacturin.?; area 
into ten geographical districts, 'to each of which were to be asai,;;ned 
twelve field men whose princioal '-or!' would be to gather production rnd 
stock data. Each week there was a barometer issued for each district 
and the statistics taken from these barone'ters were coiTpiled and used 
in a iia.ster barometer showing production, orders rnd shi orients for the 
entire industry. The theory as announced by menbers of the industry 
was that operators,- Icnowing the exact facts as to vital statistics of 
the industrv, could and would produce for a 'orobable deraand rather than 
by g-uessor runor, and instances rrere cited of ronors relative, to 
surplus or scarcity of stock in variov.s areps and relative to possible 
new denaj.ids or falling off in denand, which rujriors ha.d been acted upon 
by nembers of the industry with disastrous results. 

I find no record .-jiving the figures 03 to hoi-^ this plan worked 
out but no doubt some statistics could be gathered from officials of 
the Hardwood lianufacturers Institute, which .has recently gone through 
a reorganization and will be in better sk'.'oe later on than it is no^ 
to furnish any information desired. Ho'"'ever, in some corres'oondence in 
March 1930 relative to another matter then xinder consideration, the 
president of one of the Irrgest concerns in the country, manufacturing 
both softwood and hardwood, said "organization of districts in hard- 
wood and meetings worked well un.til production droir^ed belov? de?io.nd 
and price came uo a little; then the operaJ;ors lost interest." In 
this sane letter th-e statement was made that "Oak Plooring hs.d a 
better method of. reporting sales than any other c?.nd in one yea.r, with 
demand 25^3 less than in the previous two years, they sold their pro- 
duction ata profit. 

"In December a number of manufacturers reached the conclusion the^''- 
could not stand the strain on account of a selfish dis-:)Osition of 
others and quit coopera.ting. The industry then became demoralized." 
Prom this I think it vdll be seen the hardwood conservation pirn faded 
out of the pciture during the yerr 1930 and that is according to iiy 
personal recollection of what occurred at the time. 

VII. BEST COAST ADVISORY PLiill. 

On November 25, 1929, Colonel U. B. Greeley, former Chief 
Forester of the United States, and at that time secretary- manager of 
the TTest Coast Luiiberraan' s Association, wrote to the United States 
Attorney General setting forth the reasons for this )lan fmd what 
it was hoped to accomplish throu^'-ch the olc?.n. Colonel Greelsy referred, 
first, to the demoralized condition of the.- industry; second, gave 
some of the reasons for its over-develo :)ment, such as the abundance 
of available timber, heavy carrying charges on the properties and 
overly optimistic attitude on the -lart of the industry on the trend 
of national consumption. He then referred to a combined re-nort of a 
considerable grou of large and small mills, covering the previoun ten 

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years esDecially. Thic reioort showed a loss in six of the ten years and 
only a very slight gain in the other four years. Colonel Greeley also 
referred to -Dublic losses, such as loss in employment and lowered loayrolls 
due to the demoralized condition of the industry. He s-ooke of the timber 
waste and the necessity on the -oart of the emnloyers to use only the creaii 
of the forests and leave to burn and waste all timber not of the best. 
He called attention to tne fact that .60'^/ of the remainine: softwood was in 
the northwest ref^ion and that, therefore, the TDublic interest had to be 
considered and the su.^gestion was that this interest would be best served 
by bringing about a condition of reasonable balance between surnoly and 
demand. 

Colonel Greeley said in conclusion that "what w.>. desire is to stabil- 
ize the process J^nd avoid the erctr-me fluctuations in both -oroductions and 
Tjrices which have lead to demoralized conditions". The rlan itself was 
entitled "A Plan for Advisory Statistical and Merchandising Service to 
West Coast Lumber Manufacturers" and was -catterned after the Stevenson 
Plan. Without going into detail the reader will, I think, set sufficient 
information as to the working of the -clan from this statement from the 
pamiDhlet, a copy of which was sent to the Attorney General: "The kej' to 
the advisory plan is the limitation of sales by each comnany over a reason- 
able period to its percentage of the adjusted ca.-oacity of the industry. 
Such a plan could not be carried out, however, without kee-oing iDroduction 
and stocks in sound balance with sales." 

The letter referred to was presented in noerson and subseauently several 
efforts were made to secure a rerily which was not forthcoming until January 
9, 1930, when the Attorney General's office wrote refusing either to ari- 
•orove or disapprove the lolan or advise as to changes in the -olan which 
might be made to remove the auestion of its legality. In his letter he 
said that if the plan should be nut into oneration, "It seems not unlikely 
that the Department of Justice would find it necessary to test its legality 
in the courts." 

In view of the altitude of the Attorney General, the West Coast Asso- 
ciation decided in February 1930 not to give further consideration to the 
plan at that time. Comments were ma,de by those of the industry who had 
Tbeen in close touch with the negotiations with the Attorney General's 
office to the effect that "it was. evident the Attoroiey General's office 
felt the previous Attorney General had made too many -oromises and too many 
gestures in the direction of laxity of enforcement of anti-trust laws." 

VIII.IKITED STATES TIlVffiEH COKSERVATION BOABI). 

Some time in 1928 a suggestion was made to the directors of the 
national Lumber Manufacturers Association that there be organized an of- 
ficial government committee or groun or board with special reference to 
the lumber industry. At least some of those in association work and 
active in the industry at this time felt that there was merit in the 
idea of an official organization of this sort for the reason, first, 
that such a group would have the facilities for ascertainment of 
facts, and secondly, that the fa.cts when Dut before the industry 
and public would have more weight and influence than if put out by 
private industry. Furthermore, that suggestions and advise from a 

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-248- 

board of thin character could ;orobably be acce.ited by those Yzho wero so 
minded without the industry beinij chD,rg'3d ^ith collusion or ponsoiracy 
to violate any sto.tute, and that if .the, board found that ainon.5 the 
difficulties of the industry w^n that of overijrodnction, they could so 
state and set forth, the remedy in a .much more ..authoritative nny than 
could any other or.'jenisation. 

In April 1930 the directors of the lunoer rssociation v.j.jrovoA. 
the plan and in May of the same yep,r it was formally presented to 
President Ploover. In rppointinc the nembers of the board in llovenb'er 
1930, the President stated, amonc. other things, that, the purpose of, the 
board was "to develop, constructive methods for dealintj ■-'ith this 
problem", the problem being "consequences of overoroductioa in the 
forest industries.",. 

At first there were various r'^actions to the findin;,-s and cuL^i^es- 
tions of the bo9.rd v/hich, after it'.:; organization .and as soon as the 
data could b,e assembled,, issued statenents indicatin,;^., the necessity for 
a drastic reduc'tion in inventories. Some jiembers of the industrv' and. . 
some .groups, felt .thr?.t the suggested reductions v.ere too great,, while 
a?oparently most of the industry . felt that the dj.ta assembled was, the 
best that could be secured ahd that the. suggestion? s.hould be followed.: 
Finall.y, I think it can be s,';i,id that the industry almost unanimously 
accepted the finaingsof the board and to a very. con.s,idera,ble extent 
complied; with its suggestions.,' and it, is a well-.laiow;ri fact that the 
industry inventory. i7as cut, very ,ma.terial'ly a.nd apoi^oxinately, from 
tiiae to tine, in line .rdth the siiggestions of jthe board. , : ' . ,.. 

The Lur,iber Survey Committee, of the. Timber Conservation. Board, which 
.is the statistical: and i"ac,t-findinf];-.ipajrt of the. .organization, , as 
originally aJoointed on July 9, 1931, is still serving and the member- 
ship consists, of the following: Thomas S. Holden, vice-president of 
the, P. V. Dodge CoriDoration, Kew .York Cityj' H. '.7.. Sta.rk, economist 
of , Chicago; . Calvin Fentress, chairman of . the Board of 3^aker and 
Fentress and, Comoany, CMcag.o; Phillips A. • HajT.70,r.d , Chi e;r, . Pores t 
Products Division of the Department of Co.m;ierc.e; • aJio.- Wilson Compton, 
secretary-manager of .the National Lumber ."lanufaeturers AssociFtion, 
Washington , D. C. 

It has been their practice to issue a quarterly report, the first 
page of which was a release for the press, usually settingvf orth e::pept- 
ed consumption for the current quarter with a record 01' reduction or 
additions to inventories for the ye^r to date, or in the case of first 
quarter , reports , for, the -oast year. This release would indicate ;thG , • - ■, 
relation of demand to sup'^ly px.,d, what correction, • if any, was, needed tc 
bring these two .factors , into balance-, ajid qtiit.e often carried some 
suggestions as to . trade rjromotion and. research needed, and called atten- 
tion to new constructio-i ^rejects or new t3r.-)es of construction in 
accordance with wliat appeared to be- the .curreiit o^.Toortunities for the 
lumber industry. : ■ 

The , body of the .rcoort, addressed to the . Secretar'- of Com-ierce, 
i^sually gives .first the recommendations and conclusions in a more 
extended form than shcTn in the release, and then goes on to give a 



detailed aiiolysi-.i of consunptinn o-id stoclrs by regions and species. 

It is the common )rac^ioo of t-ie re::;ionr'.l assocititions to extract 
fro;n the report the pertinent naterial arolicrble to their res )ective 
proble ;■!'-, and to circnJ.'rize their ■ lenbersl'.ip sui'^fjesting the r.dvisabil- 
ity of complifoice TTith the recoiT-iendrtionG of the Board, the secretaries 
of the assocxr:,tion'3 toMnj." t'.ii? om ^ortunit.'- to lake their otto narket 
consents. Thus the recoriMend- tions, conclusions, su--;jestions, and 
detailed infornatic-: pronulg^'ted b' the board quicldy passed through 
the various association offices <'md to the individual operator T^hon 
it is ho^ed 'jill see thR necessit-'- for doin^ his Ti.art tO'Trru adjusting; 
oroduction to de.ipjid. 

While thir laovenent in its entirely porhaos sho\ild not be desi;gnat- 
ed as an industr;'' novenent because of its bein^ s censored by the 
^overn^iient, still so f-^.r as is '■aio-rn the iiidustry, throu^^h the 
executives and directors of the Ii'ational Lurfoer llanufacturers Associa- 
tion, did V70rl: up the )lan, h."d a very great deal to do ^ith gathering 
statistics and '■'aterial for the use of the board and had a. great 
influence on the industry in settin.'; forth, the merits of the idea pjid 
urging acceptance of the sv^pgestions. 

The Lumber Code Authority, in fixing the no.tions.1 quotas of soft- 
wood and hardrrood, used as a basis the fig-ures provided by the Tinber 
Conservation Joard in their qua.rterly reports. For various reaoons, 
(such as at tines the necessity for providing employnent) the Luraber 
Code Authorit-' did not rigidly adiiere to the 3oa,rd's estimates but in 
all cases used then as a b.-ise fron; v/hich to start. There nere times 
Tjhen subsequent to the issuance of the re 5ort and before a quota rras 
arrived at, changes in condition- nrde it seen to the Code Authority 
advisable to depa,rt to sone erctent froii the Dor.rd's estimptes. 

IX. BEST COAST i^ISIEICI -iLSTI:" -S. 

Throughout the material available there are more or less frequent 
r,eferences to efforts rirde on the T7est Cor.st in 1929 to loirer produc- 
tion a,nd a series of district meetings th- t vera held at important 
producing points, such as Fortlajia, Seattle, Gray's Ha.rbor, Uillamotte 
Va.lley and others, and to n ^Irn '"hich v:as advocated rrherebv operators 
with tvTO mills rijnning t'70 shifts e'^ch '-^OTild discontinue one shift, 
thus reducin ; their individual oroduction ^,5^, 'fhile single-shift mills 
would run five days per week, cutti^ig their -production lo-2/Z',:. Refer- 
ence is m-'de to the dissatisfaction of Inhor at the single-shift mills 
hpving onl"' five days of 'lork oer neelz vhile -oerhaj^s just across tiie 
riv«r or on' an adjoining operation on the Sound or Harbor mem rrcre 
ivorking si:: da"ys per week. The correspondence shows that some coeraitors, 
in fact probs,blv r majority, conolied "ith this plan for adjustme:it 
of production but thrt a fen large operators "who never co-operated" 
would not lend pny hel-o to the idea, which mut the iss-iJ.e up to the others 
as to whether they wanted to '■'"hold the -Ojurella" over the others. I 
know from personal contact of these meeti}-. -s, havin-: attended ^anj'" of 
them, that there were no minutes he-it and r r/ detr.il rel-tive to the 
meetings and the results wiould have to bo ;;ec'.ired from corres -'oudence 
files or recollectior. of the martici-oaiats. 



9813 



-25C- 

The attempt to secure voluntpry coo'oeration looking toward the 
adjustment of production continued off and on, and while other ideas 
and plans v/ere 'beini; ivorked on, until xiq vere '7ell into the depression, 
and then i^roduction a„nd other factors connected v/ith the operation 
of the industry iTere regula.ted hy the necessities of the individuals 
more thrn by anythinf; else until the code period. 

X. THE COlIPTdl^ PLAir 

Early in 1930 the attention of the industry was called to proposals 
na.de hy Dr, Wilson Compton settin;^ ."orth "A course of a.ction for the 
lumher industry in the orderly control of lumber production cjid supply", 
and advr-nce copies of the vrritten proposal were circulated arnon^,- a few 
members of the industry prior to its deliver?/- by Dr. Compton at a 
meeting of the board of directors of the National Lumber Manufacturers 
Association in Chicago on April 24, 1930. The promise was set forth 
in the statement that what is needed are (l) wider no.r]:ets and uses 
for lumber and (2) better control of supply, and a proposal was nade 
involving the ascertainment of facts relative to production and "ex- 
pected production" and indicating methods which might be used for the 
secui'ing of facts and for making use of these facts. As to the latter, 
it was suggested that there be (l) 'regular monthly meetings in each 
imoortant lumber manufacturing locality or wholesale center; (2) the 
formation of logicpl regional groups for the collective consideration 
of "production quotas'-'. 

The suggestion involved the dividing of the United States into 
several geographical sections, originally intended to be five in number, 
and the selection of eight to twelve meeting points in each district 
or locality, with a chairman selected in each locality, with arrange- 
ments being nade for regular meetings which would be arranged for and 
handled as- to all details by local people with representatives of the 
national association in attendance, not to lea.d in the program but to" 
give those present the benefit of economic analysis that had been nade 
of vihat was goi -ig on in the countr"'- at Irrge, end. to bring in reports 
of the exoerience or the lack of it at other meetings of like character. 

This ad'.ress of Dr. Com"itoJTi also made direct mention of the 
method of securing orderly control of "oroduction through the employment 
of a director of production, t-hich idea has heretofore been discussed. 

Subsequent to the meeting of Hay 24, t"-o Iprge committees were 
appointed by the National Limber manufacturers Association directors, 
one to "suggest plans for securing orderly control of lumber produc- 
tion and distribution" and the other to "consider ways and means for 
broader cooperation with retailers * * *." About this time, because 
of the interest that seemed to be taken in Dr. Compton' s plan, a 
strong legal committee was appointed, consisting of the lawyers em- 
ployed by several of the largest firms in tiie industry. Just prior 
to the meeting of April 24 referred to a.bove, one of the Del I.ionte 
meetings was held on At)ril 15 and an effort was made to bring up 
Dr. Compton' s nlan and discuss it at thrt .leetlng in lieu of any other 
progress, but matters did not wor]: out tlvat wa;''. 

The special committees aoowinted in A-ovil met iu Chicago on June 11 
9813 



and 12, 1930, r-mtL consiclera'ble effort ^7as ^Tut forth in order to c^t the 
men '-fho T7ere considered to be le-^ders in the industr?' ,to attend the 
neetinf;. One of the larg-est -Toducers nhose -oreserice r.t the neeting 
^as considered essential, indicated his '•'illiivjness to attend it on any 
date Trhich '-^as o-ion on his calendar, but he said beforehajid that he 
thouf'^ht the olan v'oulu not vorlc, thn.t I'/heh lunber, by reason of control 
of oroduction or rn/ other rea.son.^vas u) in -orice, there '■■oiO.d be an 
increase in the auraber of*, rails; '-hon it "ent Co-^m the ne^r riills vould 
becoLie inactive a^^iin pnd tha.t this -^roceos ''ould be re-oeated fro:i 
time to tine. This i^rn had every reason to lish thpt sone 'oleja could be 
found \7hich, '7hen put into O'leration, "ould ir.rprove the situation, but 
seeiied to hp,ve a hopeless attitude and as a natter of fact, that sort 
of attitude -oervri.ded the industr:.'' at thrt tine r-jid still does, as could 
be shown by a nui.iber of rea:is of corres ^oidence. 

Another lar,=;e oper.c tor .aid one who had been a l.e,- der in vo.rious 
industry novenonts, said at the conclusion of a lenrjthy letter, "It 
is goinc to be necessa,ry for us to find some le,-;ol vs:r to secure 
control of ■Droduction and sales policies." This is only a so,raple of 
any number of extracts nhich could be taken fro-.i letters written by' 
industry menbers and this' azid siinilca' quotations are. only drop-^ed into 
this narrative to sho\7 that the industry hrd its nind continually on 
this iiroblem. 

The resolution adopted ;'t tl;e special connittee neetini^s on June 11 
and 12 vrere equivalent almost to a comi^lete endorsement of Dr. Conoton's 
plan and provided for, first, a, system of reports md surveys related 
to supply and demand, luioer consu'-iption ar-d volume of production 
necessary for supx)ly and de-'-iand to balance. Second, regular monthly 
meetings at "perhaiDS forty to fifty designated convenient -ooints * *" , 
and further approved the ap'^ointnent of a SDecirl connittee to 'Torh out 
the nechancis, So^iie other resolutions vrere passed relative to sales 
agencies, and then a resolution that the president of the association 
should ap-Qoint a special comnittee to be authorized to secure counsel 
to make an intensive study of "the possibilities of reduction in the 
number of producing; units * * * being a nerger through holding con- 
panes * * * in order to permit necessary eco'aonies in production, con- 
servation, etc." This connittee "as authorized to report at a sub- 
sequent meeting. There ;7ac. 3cne considerable publicity given to this 
movement in neirsnapers of general circul-ition and more space given by 
trade papers. The Chicago Journal of Con-^erce of June 3, 1930, carried 
an article headed "Lumber Group To Disc\iss Supply and Demand Relations"; 
"The Development rrithin this industry of means of encouraging closer 
adjustment of the supply of luiaoer to the denadd rrill be discussed hy 
a snecial comi-ilttee of directors of the National Lumber llanufa.ctiirers 
Association to be held June 11 and 12, etc." 

To sho'-- the fear in the ninds of sone as to anj^thing that night 

have the color of a violation of the anti-trust act, sone of the lea,d- 

ing and most active men in the industry took e::ception to even this 

much publicity and one lerdoir th:^3rte:i.ed to -nthdraT? from any a^ssocia- 
tion activities. 

A 23lan for the • 'atherin; of st^'tistics and the holding of meetings 
9813 



-252- 



TTc.s finp.lly approved and the work started. Lieetings were held at least 
at rarjay points throiifhout the coimtry and re^nJ.arlj'- at many of the man- 
ufacturing; centers, Protably no one .v-.s entirely satisfied with the 
results and "business ^•^nerplly, immediately subsequent to this period, 
Mrs fretting into a worse condition rith the lumber industry probably 
declining faster thnji -Imost pxiy other. I do not kno\7 whether it can be 
said thr^t the working of the machinery of t]-ie Com-oton Plan sto'oped at 
any certain date or whether a better staterent would be that in these 
vnricus meetings many other subjects of interest were discussed b3'- the 
assembled luinbermen, and the statistics gatherec". '.-pre such a,s were made 
use of by the National Lumber Manufacturers Association in its regular 
statistical ^rogrr'in md service, faid tii-xt orobablv this plan gradually 
merged into natters having to do with the Timber Conservatioh Board 
statistical v^ork and recorinendations ^uid merged into the regular as- 
sociation activities, 

XI. TK£ HARDWOOD 5PF0RT, 

During the spring and earlj' siimner of 1S30, according to correspondence 
passing at that tiyne, the hardwood people were more depressed tha,t at any 
other time, had overly large inventor;-, and the statement was ma.de that 
it wca'd tr>e a forty-five day shut down to balance stocks. In May ajnd 
before the Corapton Plan got under ^'ay, the hrrdwood industry w-s holding 
a series of meetings in an effort to ascertain the facts and mal^ie the 
operators see that the;;- should limit their production, Tliere is little 
information available here at', to tne number of these meetings or the 
period of time covered, but it is indicated that they later merged into 
the type of meeting provided for in the Compton Plan. 

Again showing the continuity of thought on this subject, the follow- 
ing quotation is from an article by 3, C. Forbes in the We'j York Herald 
Examiner, of July 26, 1920, in which he writes relative to conditions in 
the West where he was then travelling, saying with regard to the lumber 
industry; "The bane of this industry is gross overproduction * * *•" 

XII, FEDERAL ACQ,UISITI01I, 

During the s-omrner of 1931 and Dnrhapd earlier, there bo grai to be 
discussion of a suggestion that the Federal governm.ent re-acquire the 
"excess overload, of irivr'tely owned timber reserves," The suggested plan 
was formally incorpor-ted in a, "memorandum on proposals for improvement 
of the lumber industry r-ituation'' written by Dr. Compton during 1931 
a.nd circulated among -iembers of the industry. Letters back and forth be- 
tween operators and timber owners on this sr.bject were quite plentiful and 
the tim.ber referred to was freeuently designated as "distress" timber, 
"menace" tii.iber, etc. The indi-.strj'' generally'" seemed, to accept the idea. 
One member • -rites that tl"e r.cuuisiticn program would be a "wonderfully 
good thing for the industry," The objectors were exce-dingly few in 
n^dmber ajid only two or three persons recorded an,y definite objection, and 
it is evident that they did not ojiderstaJid the program E,nd it is known 
that some of them have since changed their views. 

The president of the National Lumber M.ani;.f octurers Association at 
that tine, in a letter to one of tne directors, said on October 9, 1931, 



9813 



-253- 

"I have yet to discuss this Id^a with any operator, or anyone actively 
intereeted in the industry, who did not approve it." The thou,p;ht as 
proposed in Dr, Corraton's menioranduTn, referred especially to virgin 
timber in the Northwest, since that is \/hei-e the largest remaining stand 
of such timber exists, A very large southern operator, in Septenher 1931, 
writing relative to the matter of production, said, "The problem * * * 
""is with the West", and goes on to say that v/e will have to correct the 
bliinder made there in ;gotting "too much tinber and too many facilities 
in private industry", ajid points out that the West will have to correct 
that situation, that "it is little the rest of as cajn do." 

Some years 'orior to this period, there had been authorized, through 
an act of Congress, tiie formation of the National Forest Reservation 
Commission consisting of three Cabinet officers, two Senators and two 
Representatives who, corhing with the Chief Forester of the United States, 
could establish P\irchpse Units and re-accuire forest lands or lands 
saitable for forest pro~jagation. 

Not by reason of legal requirements, but as a matter of policy, until 
recently the Reservation Connission has confined its activities to the 
eastern part of the cc'>intr^- and very largely to the purchase of cut-over 
lands. The corar-dssion has spent or has authoriTed the exipenditure to 
date of something in excess of $50,000,000 and further appropriation and 
expenditures are exoected. Recently the commission has indicated a 
change in policy and h.as authorized some piurchases in tl:e far West and 
authorized the investigation of other possible p\irchase areas. 

In 1933 the so-calTed Co'Teland Report, Senate Document No, 12, 
consisting of well over 1000 pages and covering a great many, if not all 
phases of the lumber industry, was issued and one of the outstanding 
recommendations was that this matter of acquisition be carried on because 
of the inability of private oimers to carry this "menace" or "distress" 
timber, and riointing out the evils accruing from forced liquidation. 

Article X of the Lumber Code made provision for the appointment by 
the Secretary of Agriculture of a joint committee, representing the 
government and the industry, to study conservation measurers and problems. 
This committee met in October 1933, again in January 1954, spending a 
number of dc\ys at its task, and issued a printed report wherein it 
recommended as one of the things to be done, the acquisition and control 
by the government of that portion of the timber of the country which 
cannot be c^.rrisd by private industry with satisdactory results to the 
industry or to the public interests involved. The correspondence shows 
that the acquisition program was discussed with President Hoover and also 
with the President Roosevelt, The Copeland Report and .also the report 
of the conference appointed by Secretary Wallace above referred to, were 
both approved hy the Secretar3'- of Agriculture, and it is generally under- 
stood that President Roosevelt has ap?rovi=d both in principle. 

In a recent letter (September, 1955) from President Roosevelt to 
Governor Martin of the State of Oregon, the following paragraxjhs occurred: 
"It now seems evident that passage to private CTnership of so much of the 
most acceptable productive forest land in Oregon had aggravated rather 
than simplified the problem of permanent forest management. It will be 
necessary, as you suggest, to restore to public ownership a great deal 
of forest land that unwisely was allowed to pass into private control, 

9813 



•■ -254- 

ajid to creats conditions under which private onnership of forest resources 
may. be constructive rather than destructive, Arrnngeiftents to that end 
which clearly would dontrihute to the permanent ouhlic interest and could 
not he capitalized to private advantage deserve sympathetic gonsideration, 

"Legislation to create an organic hasis of the Federal forest program 
continues to command my interest, but so many vital matters, have claimed 
the attention of the Coragress during the present session that I have 
hesitated to iirge consideration of .the forestr;;" legislation (for sustained 
yield management). It is my hope that it can receive attention early in 
the ney.t session." ■ 

Conferences- between representatives of the industrir and of the De- 
partment of Agriculture indicate that the legislation referred to will 
probably contemplate the providing of a bond issue to finance timber 
purchases, or the isGua,nce of bonds in direct payment for such purposes 
in a sufficient amount to t.al;'e out of private ownership enough surplus 
timber so th-^t the press .i.re for hurried liquidation will be removed and 
the industry-,- with government cooperation, can then "oroceed to the 
marketing of the forest products of the country in an orderly and fairly 
well regulated manner and, where loossible,' th3,t operations will be on 
a "sustained yielf " basis, tha.t is, as to any given -onit of timber of any 
size, production will only be carried oq at a rate equivalent to natural 
replacement by growth, the theory being that the government, when it has 
added to its present holdings the so-called "distress" timber will resell 
it to those vmo operate, on a sustained yield basis only so fast as the 
market demands the product, thus tending to stability in the industry 
and permanency of payrolls and comnunities established for forestry and 
lumber producing operations. 

It is contemplated by industry and Administration people who have 
discussed this subject at great length that the program, if carried out, 
would, in addition to the obvious benefits to the industry and the public 
at. large, be a 'orofitable undertaking for the government and that what- 
ever sums are provided should and can be returned to the government with 
interest, administrative charges and orofit. 

The question miglit be asked as to why the government should purchase 
more timber \7hen it alrea,dy has such a large percentage of the virgin 
timber in the most heavily timbered states, and, if this o\7nership in 
Oregon and W.^.shington, for inst;ince, (ajiounting to ap iroximately 45^ \ 
of all standing softwood timber), does not ^rivide s-officient stabilization, 
how any addition to this amount wou2.d provide increased stability. At 
least a partial answer would lie in the explanation __that generally speak- 
ing, privately owned timber is the most accessible, having been selected 
very largely because it was accessible, being nea.r deep wati=r, or navigable 
streams or railroads, while the timber belonging to the Porest Service and 
the Interior Department is further back and not so available to the market. 
On a flat map one body of timber might appear to be as accessible as another, 
while on a contour , map the facts are more clearly brought out, rnd it will 
be observed that in many casps large bodies of timber c^n be aprjroached 
only from one direction nnd, by reason of the typography and accessibility 
to transportation, there exist many key tracts which, if acquired by the 
government, would control very considerable cxens which the government 
would not have to p-orchase. It is true that no one had advocated any 
attempt at entire control and it is realized that there will be bodies 



-255- 

of tinber scattered throughout the producing area that are not large 
enough or in other rasp'cts suitahle to he included in sustained 
yield units. Also there will he some large operators especially 
who will not desire to dispose of any of their holdings and it is thought 
that these people, one of whom controls in excess of 5;b of the softwood 
production of the United States, would as a matter of self-interest, act 
in harmony with the government in attempting to regulate the amount of 
timber furnished the mills to the approximate exoccted consumption. The 
small mills woiild he to some extent uncontrollable, but the volijme of 
their production as shown by all the records, is relatively small and by 
reason of small voliame and also because the small scattered operations 
do not produce the high grade of na.terijil, their influence on the m.arkets, 
if not inconsequential, would be relatively unimportant. 

Estimates made by the government and private inter-^sts over the last 

five or six years indicate that in the ten forest regions into which the 

Forest Service has diviscd the timber holdings of the government, which 
regions comprise all of the timber areas of the United States, probably 

$?50, 000,000 to $500,000,000 would be required to complete a satisfactory 

acquisition progr.am, and a period of from five to seven years would be 

needed to properly select the tracts and complete the nurchases. 

There is evidence to indicate that the acquisition idea originated 
with the industry, consequently it is listed as an industry activity 
directed toward production control and, if it can be placed in this 
category, it remains, I believe, the only active v.ovement now in force 
looking toward anything like a permanent solution of this oroblem, 

XIII. Wisconsin STIBILIZATICU AGREEliLElW. 

The first notice 'that I have found of this agreement was dated 
August 1931 and the pirn was put into effect in that year -^nd generally 
considered by the participants to have been successful. The ITisconsin 
State Journal, in a news item, referred to "Lumbermen's plan to Maintain 
Jobs," The correspondence and arguments in behalf of the plan which were 
put out in rdmeographed form show that the industry in Wisconsin, not- 
withstanding a falling off in business in 1950, continued to produce at 
nearly a normal rate for 'the salce of keeping employment as high as 
possible with the hope that by doing this they could shorten the depression. 
In 1931 conditions were worse and a s-urvey as of July 1st of that year 
showed two years' supply of lumber at the then rate of demand, which 
demand was considered to be approximately one-third of normal. The em- 
ployers then gave consideration to the general situation as it affected 
them and their employees, A report of the State Tax Commission issued 
about this time showed the sawmills in Wisconsin earned Zfo of their 
Capitalization in 1928, with a bmall return in 1929, but lost in 1930 
more than the earnings of the previous years. 

Considering the rate- of production and consumption at this time the 
employers feared complete stagna„tion \7ith severe depletion of capital 
assets and possibly almost total unemploj'-ment in the industry, Ihiring 
this period considera^tion was given by the Wisconsin operators to what 
was being done by other industries, such as coal and oil, and possibly 
to interstate and state pacts of one type or another, the possibility of 

9813 



-256- 

of relir-f from st-'te and Federel c.Tti-trust la-'s, (thfj Wiaconsin anti- 
trust la^T beiiif; more severe than the Peder-l lavr) and ctatenents were 
mad-e that the pu'dlic as well •-■.g private interests '"praanded that 'something 
be dene. There vip.s a series of consultations and conferences -vith the 
State gpvernor's industry advisers and tie reports indicated a sympathetic 
attid.ute on the o^rt of state officials. 

The plan cr a.^-reenient vrhen fina.ll:'' viritten provided, (1) the 
signing hy the opera,tors of an agreenent to produce during the "oeriod 
prior to July 1, 1932, .at ca.ch' of t/ie Tiills.^SJa of the average production 
fpr the years 192?, 1928 and 1929, and not produce ■•iiore or less than this 
figure except for god reasons. The thought behini". this arrangement t/as that 
demand at the time -;7as appro::iinately 30^'f- of normal for the three years 
used, that "by producing not ^lare than 3Bfs there would te at least no in- 
crease in inventories, and. it 'jv'^s desired tha,t the- opera^tors produce at 
least 28Jj for the sal:e of erToloyiient, 

(2) A committee of seven -lanufa.cturers T^as to be chosen by the 
signers of the agreement and this com-nittee '/ould have' t'le rir:nt tb sa.y 
whether any individual operator "lad sho\7n good reason why he should be 
allowed to vary fron the agreed uoon "oercent'-ge of 'orodaction. 

(3) The conmittee of seven w -s^ tc collect statistics relative to 
production said if increase in demand developed cculd. increase- the per- 
cnetage above 28,t-, or could, end, the agreement. 

(4) In order tc protr-'ct the oj.biic's interest and keep within 
reasonable limits frcm the pablic viewpoint, there was to be a puhlic 
policy committee of five not connected with the industr^r. This comnittee 
v/as appointed hy tie governor and consisted of one ba.nl'er, the dean of the 
Agriculture College of the University of Wisconsin, a University;- exoncmist, 
a man formerly presid.ent of the Eetr.il Lunbemen's Association (ass-aned 

to protect the customers' inter-^sts), :nd one State official, the secretary 
of the State Industrial Accid.ent Com;nissicn. 'The public policy committee 
iras to meet -.vi-th the com:iittee of sev^n -^nd the State Department of 
Agriculture ajid Markets to offcer and receive suggestions and to counsel 
with this department, and had the -oower to declare the agreement at an end 
ajid to withdraw state support whenever the committee thotight public interest 
Was not being promoted. 

(5) The powers of the committee of seven were qualified by a pro- 
vision that this com;uttee could not increase or decrease the oercentage 
of industry.' -production or end the agreement without the consent of the 
Public Policy Coiiraittee. 

The record shows that tixe legal a.dvie(„-rs of the state officials said 
that the plan was not illegal, that it was reasonable, there was no 
penalty provided, that it was canstantly under the insp'='ction of the State 
Department of Agriculture and Liarkets, jind that the, dean of the College 
of Agricalture would, protect the fa.rmers' interests, nnd that others on 
the committees would -arotect all public and private interest^, and that 
because the Wisconsin and },iichiga,n prodacers together were responsible 
for less than 5)b of tlie nation's oroducti^n, they c^uld not be charged 
with heing a monopoly. The Michigan iroducers did not sign the Wisconsin 
agreement but worked a.long a less publici'/ed line of their own which con- 

9813 



-257- 



templat"d production on a slightly higher basis, probably 32^ of the 
average of the three years chosen. The Michigan operators, however, 
while not signing this same agreement, did furnish their statistics to 
the comnittee of seven and in return were furnished statistics showing 
the results attained. The plan v/as enough in favor with the public and 
the legislators so that there was proposed a new chapter to the statutes 
of Wisconsin, being Chscjter 109, with suggested headings, such as 
"Stabilization of Employment;" "Equitable Distribution of Employment", 
etc. Public statements were made as to the stabilization plan and its 
effect and apparently all considerations were carefully weighed but the 
proposed legislation v;?.s not enacted into law, losing by one vote. The 
st-ntute T'ould have exempted industries in the state from the state anti- 
trust lavs under certain fj'j.arded conditions. 

Such reports ps are available, which consist of correspondence be^ 
tween members of the industry, and membprs of the industry and associa- 
tion executives, indicated that the result of the first year's operation 
was up to expectations, that is, the production in Wisconsin was 
ap-iroxiraately r,s anticipated, between 2dfo and 29fo of the average used, 
while in Michigan it was slightly higher but not enough to disturb the 
situation. Losses were not entirely checked but were lessened in amount 
^nd it was upon the basis of the showing of this first year that the 
proposed legislation was introduced. The plan and the record of its 
working were sent to other districts s,nd studied in other production 
areas and in other statns, ajid wa.s then generally considered to be the 
most advanced and successfully operated plan yet proposed. The plan was 
in operation up until the discussion of ISA and the possibility of codes 
began, but there is no record available here as to Just how and when the 
transfer was made from the stabilization plan to the code plan, 

XIV, INTERSTATE COMPACTS. 

During the period between and including 1331 to 1933, there was a 
great deal of study by lawyers selected for that purpose and by members 
of the industry of sta.te anti-trust laws and of state and i nterstate 
com.pacts, and in this discussion study, which was not, however, confined 
to the lumber industry, the lixmbermen had a considerable pa.rt at about 
that time. In other indvistries, state legislators pa.ssed bills attempting 
to control production but I find no record of any of this legislation 
directly affecting the lumber industry or made use of by the .industry 
or made usg of by the industry although some members thereof felt at 
times that something ha.d to be found which could be made ase of, 

XV, SOUTHERN PINE CURTAILMENT PLAN, 

Correspondence da.ted in Se'oteriber 1931 between members of the in- 
dustry in the South, refers to a committee of five with an outstanding 
operator as chairman, having met in New Orleans on Tuesday previous to 
calling a meeting of lu'iber executives for September 18 ^nd 19, The 
letter carries the statement that it is proioosed that "manufacturers 
produce at least 10^ less lumber than they ship in any three i^.onths' 
period in order to overcome surplus stocks," The letter further states 
that the v:riter feels this reduction is not drastic enough and from 
statements made deploring any "attempt at government control", it is 

9813 



"■rim- 

pro'bs.'ble that the effort -xncL "tne p:;5etinr,3 referred to ra:f have 'been con- 
nected uith the -desire, of the Gouthern Fine Assncin.tion to copperate 
with the pla,n of the Tii^.ber of the Co iservi.tion Boai'd. !Jp until ahout 
this time the Southern Pine Association hnd heen e.-xeedingly «caref\il to 
avoid any connection vrith an^r noverient designed to control or affect 
production and the e::ecative officers of the associa.tion frequently • 
stated their attitude in this regr?rd. 

At leo,st one of the reasons for this attidude is found in the 
charter of the Southern Pine Association from the State of Missouri, 
one paragraph of.nhich roads "hut none of said piirposes shall he deemed 
or cohstrued to hold any ■ sug;;]:estion th:_',t control of the amo-ont of pro- 
duction of lumber he in any '.7ay affected or attempted," A letter of 
July 51, 1931, fro"] an as£;ociation executive to a nenher of the industry 
states in cQniiection r/ith' the expressed desire to assist the Timher Con- 
servation i3oard in its efforts that "it happens tha.t- the Southern Pine 
Association ha^s called a numher cf dist]::ic.t. neetings ?,mong the small 
mills to discuss the situation which confronts them. From reports we 
have received, these smaller operators are a.hout to h-^coi.ie more active, 
and it is felt that they sho-ijild he acquainted vrith all facts concerning 
the present condition of the industry," 

Essential features of the idea tna^t v;as heing carried out hy the 
Southern Pine Association at tha.t time had to do very largely, if not 
entirely, with control of inventories and it is entirely orohahle that 
the work that was done was- not onl;/ in line with previously conceived 
ideas of the Southern Pine Association people, hut fitted in very sell 
with the plan of the Tinher Conservation Board, The Southern Pine 
territory, for the piixpose of gathering statistics, was divided hy 
state lines into seven districts. The operators were individually 
asked to make an estimate of the amount of stock that each shall carry 
on the hasis of a supposed normaJ. dema.nd, such .a.s existed in 1928, the 
demand heing the sales of the individ'^oal o-oerator, .?jid then to ascertain 
what percentage rela.tionship e-isted hetween the normal stock and the 
demand or sales of 1928 and to project this percente.^'Te into- the current 
period, attempting to keep the stoclcs a,t,the same percentage of current 
sales as they were to the sales of 1928. For illustration, the total 
knovTn stocks as estimated hy the operators in 12S O'Terations for 1928 
were S83 viiHion foetj the total sales or demand for this same period 
was 3,307 mj.ilion fe=t, the hudgeted normal stocks heing, therefore, 
20.66^0 of tne demajad. The demand in 1931, of course, was verj'' much less 
than in 1928, amounting to only 1,785 million feet, and the desire was 
to hring the inventories down to 20. 66;c> of that amount, .The plan 
apparently worl.ed out with varying degrees of success and, by those 
who cooperated and put into effect, was and still is considered sound. 
Reports late in 1932 shovred in the previous four months a decline in 
stocks of 31-^ of u^jpers, and 52^o of lower grades, which developed 
shortages in some items and the estimate was na.de that the plan had 
worked so well unsold stocks were then at KY/o helow nornal, total re- 
duction among the mills reporting of 483 million feet between Januarj'' 1 
and October 1, 1932 was indicated. The plpji was in effect up until the 
beginning of the agitation for an ITRA code. 



9813 



-259- 



XI' I. ECONOLIIC- TRUCE. 

In L'arch 1S52, there "opgan to "oe a^^itntion an'iong a niomber of in- 
dustries, including machinery, te;-tile, food, lunter, and others, for 
relief from the anti-tnast acts. In the lumlaer industry the motivating 
force \7as the desire to control production and the idea seemed to majiy 
lumbermen, as '••ell as those in other industries, to be so fair, so easy 
to put into effect, and so beneficial to the public a-5 ^nell as to private 
interests, it seemed as though the entire industry had concentrated on 
this idea. At least two tyoes of control vere thought of, one, a 
commission to be appointed by the President, and the other a joint 
committee to co;isist of five members of' the House of Representatives and 
five Senators, The disciissions and. conferences finally reached the point 
Trhere a bill was introduced, in the Senate, 5. J. Resolution 87, by Senator 
Steiwer. This bill orovided for a joint congressional committee of five 
members of the Eouse of five members of the Senate "which shall investigate 
and report to the Congress its findings and recommendations whether 
amendnents should be nade to the anti-trust lav/s'^, and provided in 
Section 2 thereof that "-until s^-id committee shall have reported its 
findings niid recoi.inendations to the Congr?ss and Congress shall h^ve 
actpd thereon", nothing contained in the various anti-tru.st acts •■'hich 
C'xe enumerated "shall be construed to applj' to agreements between com- 
petitors in the natural resourf ^ adustries for the purposes of regulatp 
ing oroduction, conserving na.+ l resources, and maintaining continuity 
and sta.bility of eraploj'-ment * ■' unless such a.greements are contrary 
to the public interest," ll"turi,l resources industries •:ere defined to 
include those engaged in the production of minerals' and forest products, 
while Sections 3 and 4 referred to the administration of the Act by the 
Federal Trade Com-iission, The resolution w^'S never passed but later the 
substaaice of it was incorporated in an amendment to another bill, which 
amendment never became law, 

XVII, FIR STABILISATIGil PL-ilT. 

The first :cention I find of this proposed plan was early in 1932 
¥/hen it hnd a.ttained sufficient importance in the minds of industry and 
others so that Governor IJeier of Oregon and Governor Hartley of Washing- 
ton joined in an effort to ha,ve the Attorney General or Congress approve 
a plan permitting an agreement among operators to not sell below a 
standard cost a.ud the two governors also joined in a telegram to 
President Hoover, The interest of the states were said to have arisen 
because of the shipping otit of these states of a tax-paying natural 
resource without any taxable returns and reference was made to waste of 
natural resources, the effect on enplojnnent, and other fa.ctors. The 
plan provided for the forming of a corporation which would (1) establish 
minim-am standard costs; (2) regula,te production month by month tv"^ what 
the markets •jOLild absorb; (5) coo'oerate with the government to keep 
within all laws, A state^-ient was made 'in the press that the President 
stated tha.t the government would cooperate in every possible way and one 
of the wa^rs that cooperation wp,s expected was through a test ca.se. The 
'i— L Lumber ilov-s of Julj'" 15, 19S2, stated that the indiistry was desperate 
and a prominent eperator heavilj'- interested in the South ajid West said 
in the sane month that "the time for quibbling over legal technicalities 
has passed * *," This and similar industry expressions bears out the 

£813 



-260- 



theorj'' of des'oex'atipn reieri'PcL to in the ne'-'s itora abovp.. 

The forra of organization required t]i->t suliccri'o<--rs tcr stock in the 
corporation suhscribe in proportion to their relative ■oroducticn. The 
stock v.'ould not he di.elivp.red tut -rs held in escrow, pjid failure to c0;3ply 
v'ith the agreement as to not selling below standard cost ::aight retxlt in 
a -oenalty or fine which would he trken from the fu^ids deposited for pay- 
ment of the stocko 

Industry lemhers had def icuj-tj'- in agreeing to the feattirps to he 
incorporated in the plan, snne good sized, t-^riff li'jhts having sorung ui? 
between raembprs of the industry, industry attorne-^s rendered adverse legal 
opinions, rmd for these and ^^erhapd other reasons the plan was dropped 
without the corooratiori actun.lly being formed.. It mny be noted that 
this plan with its attempt to fix a standard cost below which opera-tors 
should not sell r>iid the va,rious other plans providing for certain oercent- 
ages of former "Troduction pnd the .like, -vfe re verj similar to the ideas 
incorporated in the uirabcr Code covering -jrices ■■md production. 

XVIII. FIE MSHGEE. 

In the suniner of 1931, some large western operators again brought 
forth the idea of the possibility of a fir merger and a plan was written 
up and given the name of the author, discussed at some length in the 
industry and to some extent with the bpiil-ing fraternity, but- beyond 
occupying the • -attention of a number of people in the industry for some 
few weeks or months, did not ajiount to ^ajiything, 

Recent nevrs in v:\rious trade journals '-nd. other publications, 
supplemented, by the observations of an -executive in the Forest Service 
who has recent I3" made a two months' trip throughout the producing sections 
of the West, indicate that there is an increasing nuiaber'of new S'^all 
mills, .and mills both large and sii-11 which have been shut- down for a 
number of yeaxs, now coming into -oroduction, quite a few of them ^r, 
reason of loans from the Federal pLeserve Baail' and from the aeccnstrj.ction 
Fint.,nce Corporation, ranging in anouiits up to several hundred thousfuid 
dollars. The 4-L Luober Uev;s of October 1, 1935, sa;''S that for several 
weeks lumber production has been "creeping upon orders ajid shipments." 
It states also that employment in camps -and mills in the best in a decad-e 
an.d add.s that "it is hoped that uncontrolled "iroducticn \7ill not spoil 
this improved situation," 

Recent lumber statistics show in some \7eeks an e-:cess of production 
covering the entire Unit^^d States of p •.luch as 10^^ over shipments or 
sales. The question, it seems to me, naturally arises as to whether or 
not the industry will shortly be forced to seek other ,and perhppd new 
methods of controlling production and whether or not, in the absence of 
the ability to find such methods, the industry"- will not .agfin find itself 
in about the situation it was at the beginning of the code era. 



October 29, 1935. 



981S 



APPMDIX II 
■TABLES C^ EXHIBITS 









MUMl 




, IKaU 


HI tiMr^i i/ 




r 


a TwiUM 


rn 


11a P—r^lm 




Total 




cort- 




Total 


Aroaa 3/ 


Cort- 

Araaa I4/ 






Sav 

TlabBF 
Araaa 2/ 


":^k/ 


Baat 


dtlaa 




TUWr 


A^I S/ 






teflon ud SUta 




'.'TmI, 


*lr to 


itolUDc 


Total 


r.irio 
aati*. 


•toeklDi 


raatoi7 


ttoaldac 


Iw BlriMd 










































CoajMottcnt 


1.5R 


209 


889 


3*7 


157 


895 


123 


501 


197 


7I4 


600 


78 


3140 


126 


56 


•7 


8 


w 


23 


1 


Uu 


II..I190 


10.177 


1,279 


2.175 


859 


11.819 


8,602 


986 


1.618 


611 


2.2ia 


1,278 


252 


"91 


220 


1150 


297 


111 


6< 


» 


lU-Chn..!!. 


3.255 


1470 


1.063 


1.235 


1W7 


2.157 


318 


690 


813 


316 


863 


119 


291 


313 


lUO 


235 


33 


82 


90 


30 


I>« RM^iiMr. 


U.MS 


99» 


69U 


1.9*7 


n6 


2.876 


6142 


352 


1.565 


J17 


1,072 


115 


230 


9oe 


225 


M7 


2<41 


m 


UO 


1> 


Tamoot 


JI9 


1.992 


<U 


2n 


55 


1»5 


7 


57 
275 


73 
193 


714 


1,5011 


ap 


JO 

557 


» 


27 


lA 


19 


3 


' 


' 


fct.1 


J7.!7! 


1;,!60 


«.81.3 


s.i"" 


:."?5 


19.576 


10,8314 


2.8141 


14.279 


1.622 


6,1102 


2,«r7 


1.700 


1.571 


70I4 


1.295 


599 


302 


2911 


100 


UdAle AtlfSllc 










































I^..^-. 


3!0 


32 


268 


u 


7 


86 


9 


72 


■3 


2 


2114 


25 


196 


11 


11 




- 


. 




. 


HaiTlud 


!.1M 


500 


1.395 


176 


97 


863 


196 


5145 


72 


50 


1,275 


296 


830 


108 


U 


30 


I 


20 


1 


1 


I..J».« 


1.97? 


29U 


610 


687 


382 


1.523 


152 


1470 


5»5 


376 


35I1 


11* 


101 


75 


29 


96 


IJ 


39 


51 


13 


InT»n 


9.»J 


I1.637 


2.816 


1.376 


76» 


5.808 


2.918 


1.590 


770 


550 


3,718 


1,70« 


1,217 


57I4 


219 


67 


11 


9 


311 


13 


■ »1 HI 


11.M5 


l.JII 


5.W9 


3.7W 


2,079 


7.190 


U77 


5,li08 


1.957 


1.5148 


3,880 


1,292 


1.269 


955 


56I4 


2.015 


62 


752 


860 


3111 


Total 


?7.13» 


7.29U 


10.518 


5.998 


3,529 


15.1470 


3.752 


6.085 


3,5117 


2.506 


9,1161 


5,1168 


3,613 


1.723 


657 


2.201 


914 


820 


926 


368 


IM 










































UdUO 


19.000 


1.750 


2,5^ 


9.m 


14.823 


12.9147 


1.209 


1.563 


6,915 


5.1160 


5,7(0 


1450 


1,085 


1.5211 


701 


2.293 


91 


102 


I.I133 


667 


■lo...ot. 


ao.joo 


1.650 


2.6,0 


10.670 


5.210 


12.178 


1490 


5I46 


7,1426 


5.716 


11,7116 


653 


1.239 


1,955 


899 


3.276 


W7 


906 


1.285 


999 


IortbIi.«ot. 


W 


10 


uo 


252 


125 


50 




9J 


- 


- 


1130 


10 


60 


*7 


115 


15 




- 


10 


9 


ntoooalD 


16.200 


1.705 


5.550 


7.367 


5.598 


9.617 


952 


1.267 


»,9l4l4 


2.11714 


5,3115 


680 


2.221 


1,673 


769 


1.238 


93 


no 


7511 


351 


tola 


55.855 


5.095 


8.880 


28.166 


15.75I1 


311.792 


2.651 


3.226 


15,285 


9.650 


11..28I 


1.793 


I4.607 


5,399 


2,1.82 


6.222 


671 


1.0117 


3.1182 


1.622 


Cantral 










































IU1K.1. 


3.196 


2.MI 


5» 


123 


52 


250 


ua 


70 


57 


25 


2,9112 


2,377 


1470 


65 


30 


ll 


1. 


- 


- 


- 


IoU»» 


'■'" 


1.815 


1.090 


371' 


159 


810 


192 


266 


252 


100 


2,615 


1,620 


8111 


1211 


57 


13 


3 


10 


- 




lo.. 


2.35» 


1.755 


581 


15 


7 


152 


120 


32 


- 


- 


2,206 


1,635 


5I19 


15 


7 


5/ 


5/ 


- 


- 


- 


lonnicJqr 


10.256 


2.767 


U.1U.1 


2.169 


919 


».iia 


1.790 


1.905 


1.035 


Wl 


5,136 


971 


2.528 


1,123 


511. 


19 


6 


8 


3 


2 


Hlaaowl 


16.500 


3.166 


6.735 


11,636 


1.901 


9.ST> 


1,«B9 


3.eaB 


2.511 


1.026 


7,076 


1,269 


2.836 


2,0140 


955 


146 


7 


19 


111 


6 


(Mo 


».651 


2.736 


1.519 


278 


lie 


1.686 


916 


611 


UU 


115 


2,8911 


I.77I4 


887 


160 


73 


71 


1.6 


21 


3 


1 


Tofloaaaa 


llt.DUl 


5.067 


7.170 


1,267 


537 


7,6112 


3,005 


5.956 


502 


199 


6.071 


1,858 


3.115 


755 


3115 


328 


2014 


121 


2 


1 


taat nmu. 


9,769 


1,1.38 


3.516 


3,3«2 


1.1133 


6.262 


751 


2.236 


2.51411 


951 


3,216 


65U 


1.235 


911 


1.16 


291 


33 


I15 


1115 


6< 


Mil 


61..2U9 


21.22U 


25.592 


12,!lrt 


5.189 


51,319 


8,763 


12.936 


6.885 


2.755 


32,158 


12,158 


12.1132 


5.193 


2.575 


772 


303 


2211 


167 


78 


Smih 










































1UI..O. 


21.6M 


7.127 


U.M7 


11,538 


5.308 


111,791 


11, 9» 


5.006 


5.0511 


5.801 


6,522 


2,281 


I.5I18 


1.UJ6 


l.»57 


367 


196 


53 


67 


51 


lA-aa, 


22.000 


7.700 


7.000 


3.565 


3.955 


15,051 


5,818 


3.857 


2.386 


2,990 


5,9P 


890 


5.II15 


9142 


956 


1.018 


992 


- 


15 


1' 


nortj. 


23.600 


6.030 


6.921 


li.90« 


5.7I41 


20,759 


5.525 


5.950 


14.121 


5.165 


2.266 


265 


901 


5W 


55I4 


595 


2U0 


90 


151 


UH 


Oaorr . 


22.S72 


6.900 


7.566 


5.8711 


11.552 


13,637 


14.172 


11.5117 


2.183 


2.755 


8.966 


2,557 


2.967 


1.708 


1.75I1 


269 


171 


52 


26 


20 


Lonlal^ 


17.922 


7.383 


2.U59 


3.7211 


14.556 


114.851 


6.157 


2.032 


2.957 


3.705 


2.999 


1.218 


W! 


685 


695 


72 


8 


26 


22 


16 


Htaalaalppl 


H.29) 


5.067 


2.1M 


11.969 


5.811 


12.007 


3.282 


1.531 


5.193 


k.cm 


6.2611 


1,778 


9111 


1.773 


1.799 


22 


7 


1 


' 


6 


-rtl. t„ol,„ 


20.216 


■..192 


7.890 


3.7*9 


11.585 


10.077 


2.360 


3.782 


1.7147 


2.188 


9.759 


1.659 


3.997 


2.026 


2.017 


W) 


175 


m 


66 


» 




*.?79 


1.800 


7*" 


781 


9114 


).73l4 


1,661 


I4I45 


715 


896 


U90 


152 


329 


lU 


15 


55 


- 




P 


211 


K..1. Carol,™ 


12,«15 


3.757 


3.9U7 


2,171 


2.5W> 


7.979 


2,»11 


2.525 


1.262 


1.581 


11.393 


917 


1.613 


925 


958 


113 


29 


9 


3 


2 


Ia,U 


12.62U 


1..150 


3.700 


2,200 


2.57I1 


9.618 


3,260 


2.3W 


1.7814 


2.2314 


5.000 


885 


1.360 


375 


580 


6 


5 




1 




nrsioi. 


1U.857 


2.859 


5.582 


2,957 


3.1159 


6,91U 


1,1488 


2.1419 


1.555 


1.672 


7.296 


1,1117 


2.816 


1.65* 


1.679 


6U7 


22U 


3I17 


115 


33 


I...1 


190.75" 


57.265 


52.702 


37,236 


113.555 


129.398 


I4I.I49I 


32.2211 


214.717 


50.966 


57.866 


15,729 


19.789 


12.0814 


12.2611 


5.I49I1 


2.0145 


689 


1435 


327 


Pa«!tlo Cout 










































c^ironi. 


17.538 


12.587 


306 


1,813 


2.852 


8,7514 


5,6314 


230 


i.on 


1.813 


60 


- 




28 


52 


8.7211 


6.953 


76 


655 


1.01.0 


0,«o. 


2!.«3< 


19.675 


5.815 


2,087 


3.261 


10,581 


7,6714 


815 


779 


1,315 


5.1110 


1,087 


567 


6«U 


802 


15.117 


10,9111 


2.1455 


6«U 


1.086 


I.^,^.. 


20.309 


11,878 


2.562 


2,390 


3.579 


8,603 


3,859 


1.125 


1.5I18 


2,271 


1.899 


655 


361 


1107 


U7! 


9.807 


7,166 


1.076 


527 


>38 


Total 


*b.6J5 


W.IW 


6.613 


6.190 


9.672 


27,938 


17,167 


2.170 


5.2014 


5,397 


5.099 


1,7110 


928 


1.119 


1,512 


33.6M 


25,233 


3.5»5 


1.866 


2.994 


Rrtli «ookr Honolaln 












































17.I46I1 


9.964 


1.964 


3,1122 


2,1114 


3,380 


1.550 


31411 


8314 


652 


807 


286 


50 


2^ 


212 


15.2n 


8,128 


1.570 


2.299 


1.280 


Hontau 


1U.R5 


7.062 


3.7W 


2,511 


1.552 


2,5145 


1.61-. 


372 


299 


25» 


606 


78 


259 


1U8 


121 


11,7111 


5,314' 


3.109 


2.0914 


1.167 


Total 


52.325 


17.026 


5.70» 


5,933 


3,666 


5,925 


3.190 


716 


1.133 


886 


1.1113 


361. 


309 


W7 


533 


211,991 


13,1.72 


14.679 


11.593 


2.1*7 


Soath BocKr Motmtaln 


5.651 


■3.61I' 




5 


511 


W 


142 


. 


. 


. 


. 


. 


. 


. 




3,609 


3.572 


. 


5 


32 




Colondo 


12.516 


7.839 


3.651 
95 


7 


958 

711 


2,579 
177 


985 
97 


1.2U7 
77 


' 


3UI 

3 


" 


" 


" 


" 




9,937 


6.8511 


2.WU 


9 


997 
69 


laa Uazieo 


3,so6 


3.710 


- 


8 


88 


1,092 


1.018 


- 


1 


75 


- 


- 








2,7111 


2.692 


- 


5 


19 


Soath Dakota 


1.2!li 


675 


!»>6 


2 


21 


310 


IW 


165 


- 


5 


- 




- 


- 




9711 


535 


1121 


2 


16 


HUh 


3.3M 


!.>32 


378 


Ot 


1492 


310 


. 1.6 


53 


14 


227 


113 


3' 


3 


5 


1 


2.995 


2.352 


3112 


37 


2611 


lyiMnc 


5.5M 


».270 


1.219 


6 


63 


588 


106 


161 


- 


11 


- 


- 


- 


- 


- 


5.000 


3.e5i. 


1.088 


' 


51 


Total 


50.570 


22.7»1 


5.959 


160 


1,710 


5,098 


2.71* 


1.683 


11 


660 


m 


311 


J 


5 


1 


25.1429 


19.963 


11.273 


11.5 


I.OM 


Uatam Parion. 


565.31k 


10U.73S 


102.535 


89,789 


68.252 


250,555 


67.1451 


57.512 


58.15 


117,279 


120,168 


13,575 


142.1U1 


25.970 


11.1182 


114.591 


5.712 


3.082 


5.302 


2.»95 


I,ata™ Saflon. 


129.5S' 


83.907 


IJ.tW. 


12.283 


I5.OM 


38,961 


23.101 


11.569 


I4.3W 


6.9I15 


6,555 


2.118 


1.2140 


1.551 


1,6116 


eh.ou 


58.668 


12.537 


6.1.011 


6.1499 


All BagloM 


U9».!9J 


1S8.H.5 


120.881 


102,072 


83.300 


269.516 


90.552 


M.Kl 


62.861 


5)4,222 


126,725 


55.713 


1'5.5»1 


27.501 


20,128 


98.659 


►2,580 


15.619 


11.706 


8.951. 




lacloB aad fliata 


Total 


SS'aV 


Coi4- 

A"a.y 


faotOT 


itniTo. 


Total 


8a» 


Cort- 


•f""! 


atooU.. 


Total 


Sa> 

Tl-liar 
Araaa 1/ 


^°^y 


TaiitotT 


atooklB* 




Sa* 
Ar». i 


A^;!y 


i;ii:k_ 


itodanit 






All Cl».... ot oJ, 


erahlp 




Indaat 


rial OaoaraliiF 2^ 






^ 


~ ■""— 






?o 


»1U «.,.u,^ _ 





low By »ppl7ln« thi. regional parceDUfl i 



k11 for ••■ \ogt but Imrgt ■»}ucb ( 



|aaraot......r. 

0813 








mai'S= 


"USaSij/" 


___.^«r_?^^JJ^ 


il 


"^^^^^^ 


C,^^ 


T '^ 


-==sS1£ 


■■ 


, ^**^ il . 


laftaoad l|/_ 




~Tw 


15) 


m 


(71 


(1) 


01 


(10) 


■W ^1M« 






















0>r.xuni 


l.W) 


>M 


•31 


2ak 


109 


159 


936 


Uk 


>92 


r> 


I|J.»MI<«<11. 


15.W 


5.IM 
5»l 


9.ru 


12.167 


22a 


7.7tO 


1.172 


vt 


lU 


I.ISO 


«- Sjaptfllr. 


;.«ii 


LOW 


l.«2 


1.7*7 


705 


1.062 


taa 


21. 


661 


219 


I»-4. Itltfl 


•5 


?1 


5« 


3 


" 


1) 


57 


15 


•2 


' 


T.n...t 


».1!» 


1.5D0 


2.65< 


!.7ii. 


i.om 


1.630 


1.127 


25'> 


." 


317 


I.<l.i»l Kia 


n.'W 


5.W« 


16.132 


lr.l9' 


7.2" 


10.9» 


5.112 


i.tta 


'.77' 


1.921 


maan m»aitc 


y,s 


65 


301 


W 


„ 


3> 


2» 


36 


2.2 


,, 


II..71UI 


!.«! 


!55 


1.635 


5'.3 


1.* 


I.H 


l.M 


155 


1.096 


in 


a- J.rm 


!T« 


17« 


»12 


309 


79 


2» 


579 


72 


907 


" 


>.. T.A 


ID.IK 


i.n) 


■ .0> 


<.96> 


1.521 


a.u.1 


3.237 


<03 


2.«)» 


917 


r...Mi— !■ 


;.!)<. 


1.6JT 


1.-^ 


...uio 


615 


1.79' 


•.953 


7i« 


5.-1. 


•33 


»*■"-> w 


-■2.B.1 


>.0J1 


1!.6U 


9.291 


2.'71 


6.921 


11.306 


l.W* 


9.100 


2.052 


U£ 








a.5« 


l.,« 


-.•m 


a.31. 


I til 


.■X17 


'41 


Hlaw*<i> 


S6V. 


,\^ 


3.0)> 


2!590 


all 


l!a» 


t.OWt 


925 


2.119 


W 




;; 




95 


17 




17 


7. 


- 


7. 


W 


I1.C.U1. 


4.9?5 


1.U.I 


5.>76 


3.257 


769 


2.a" 


t.<W 


1.113 


>.55' 


loy 


itloatl Total 


11.550 


..no 


15.7» 


lo.aa. 


2.161 


7.91' 


11.106 


'.3»9 


7.757 


a/ 


Cantral 


55i 


: 


;■: 


1.996 
1.096 


7» 


z 


E 


1! 


E 


» 


I.«..a>7 


1.555 


M 


!."7 


1.707 


lit 


1.59" 


2.007 


lao 


1.B7 


21.1 


...aourt 


).o» 


«) 


..9« 


1.7.1 


110 


1.62. 


•.239 


225 


).olu 


m 


T.™.... 


l.W 




«.2J7 


a.ou 


268 


3.79) 


a.'!)5 


295 


1.9«0 


5>0 


I..I nvau 


5.511 


J75 


5.136 


1.9X 


131 


1.9« 


3.1« 


222 


2.966 


357 


S<«loBal TOlal 


30.S56 


2.»0 


29.576 


i».7ia 


97. 


"■'" 


ia.06< 


9T9 


.'.o« 


i,n» 


SmU 


ia.!?6 


;•- 


».!69 


':Z 


z 


3.3S5 


z 


i.!9« 


C25 


9«5 


n.na. 


9.2U 


5.275 


J.967 


5.'39 


2.926 


2.U63 


'.213 


1.963 


1.250 


OO 


5..rfl. 


15.W* 


t.610 


t.m 


6.9» 


3.790 


3.130 


7.059 


a.n2 


•.7'.7 


l,i»5 


t^U.I^ 


IJ.OS! 


6.90J 


5.190 


9.55! 


S" 


«.»= 


l.l' 


■5» 


5:.a 


■37 


.......IW 




'.57» 


t.M 


6.01! 


'.2«5 


2.7>7 


1.W.7 


I» 


565 


555 


.a,a, C.r.11.- 


u.m 


..™ 


6.»!0 


6.356 


1.132 


2.9* 


7.5«2 


>.636 


2.952 


1,037 


CUJ,». 


J.TO 


I.IU. 


•a 


1.W7 


76» 


6»J 


'm 


251 


17! 


139 


s™tb e.r.11.. 


lo.atl 


5.555 


a.>7« 


6.0»7 


3.2* 


2.763 


1.6» 


2.25! 


H26 


72! 


UlMZ 


j.sj: 


».!57 


1,T76 


ii.oi, 


•.t^ 


2.262 


2.155 


I.'IS 


!39 


529 


nrBaU 


s.ia 


5.66! 


».sa 


»,0« 


2.210 


1.559 


■.16« 


3.155 


2,010 


6n 


RaClaaU Total 


ut.m 


*.963 


la.lM 


S7.2H 


16.512 


30.726 


3S.692 


23.637 


15.055 


7.«n 


yadflc 






















Calir-inda 


50.076 


50.076 


- 


»9.a9i 


U9.U91 




11 


11 




57> 


Otaca. 


n.a^; 


n.m 


!« 


76.621 


76.U11 


277 


3.907 


'.775 


32 


»!» 


TaaUB«taa 


to.ai 


59.990 


237 


56.!.'! 


56.31! 


!«■ 


3.013 


'.9!« 


2" 


692 


Hactaaal Tatal 


Wi.Ije 


191.176 


556 


1.2.701 


1«.220 


W 


S.571 


o.TTt 


" 


2,S0 


lortlt BMka Klwtala 


.-'.s.i 


25.SO 


. 


21.161 


21.161 


. 


2.6K 


2.6.2 




1.-.7 




Hantaaa 


=..T. 


'•-'•" 




"••'" 


''■'" 




6.7-2 


'.732 




1.2CT 


Santa aodn U" ■.-,: " ' r 






















irlioa. 


3.036 


3.62^ 


- 


3.625 


3.625 






- 




1 


ea..™,. 


SJO 


12.«t 


* 


11.2-« 


IK 


■ 


1.192 


1.16! 


2a 


9 


>.. ItaUaa 


2.521 


2.921 


- 


2,919 


2.919 




- 






2 


'""■°-°- 


512 


912 


- 


719 


719 




192 


192 


- 


' 


1^'^a* 


1o!k! 


lo.«! 




9.719 


"m 


. 


1.136 


1.136 


. 


', 


Bactaaal Tatal 


IJ.Bi 


33.299 


* 


30.»9 


30.6«9 




2.65J 


2.626 


» 


" 


batan U, S. Total 


ns.isa 


!5.9<2 


127.9H 


119.90 


»9.57i 


lo.toti 


lO.-U 


'0.705 


19.579 


13,732 


laataiti U. S. Tat.1 


J7J.52J 


272.S3 


581 


2M.970 


2tia.li* 


h!l 


19.816 


19.995 


^ 


a,95« 


Otitad Stataa Tatal 


W.Tl! 


35S.225 
(2) 


i2«.i«a 
(3) 


• l») 


29t.o65 
15) 


70.7B 


99.17< 


69.521 


«9.65« 

(9) 


1..690 


Iraa aad Stata 


Total a/ 


softoooa ay 


Bart-oo* a/ 


fatal 5/ 


!.m..J6/ 




Total 5/ 


Mt-^JJ 


ito-.4«aas/ 


Total 9/ 





















"^. 








uioumconiBm 


' 'm-in ■ 






roBiiiT oi^<aiuxu» 






»>»oi>n« 


«>ICIN1 


todn ud tu%< 




I>«u\rtal 


it 


2._ folUX 


Total 


«• 


loMl rar 


at 




Ottov 






fottl 


tonroo* 


Ktfte»*« 


tout 


ToUl 


taftnol 




fold 


kflooot 1 lu4no4 


Total tonooo. 1 




.atU ..f.^ 




Total li.n-0.1 


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III 




3 

Eh 



D lunocnt xmua r 



■ ftiTXs rm 19W w 193* 





■iCln Mi ItkU 


Mt.1 


Sofl««o4« 


...^t. 




f- rtff 










0.— .tic. 


tt.!6j 


6.0a 


:9a 




lUllM 


169.5HO 


152.499 


17.0W 






52.7J7 


41.512 


u.aj 




■«Iiq.l>lr. 


130.767 


111.505 


19.261 




A«4» lalaiA 


».l.5« 


2.545 


1.89J 




T«IW>Bt 


65.76! 


33.470 


!2.293 




Kl.1 


«!7.J9« 


547.552 . 


90,246 




iiMi. ttxmi. 










MUnn 


5.«19 


!.5« 


1.893 




MUTlud 


30.W6 


15.902 


15.084 




In J«ra«7 


!.7» 


380 


8.J79 




I»I.ft 


79.416 


17.034 


62.!«2 




MuriTui. 


159.7H 


46.776 


112.942 




•lUl 


z«i,;n 


•3.608 


200.680 




LA. 










IUd)l«u 


joo.ias 


71,424 


228.705 




■!».»>. 


1*6.105 


111,544 


54.561 




lortb Sdntft 




- 


- 




n.»ui. 


noi.ja 


170.B69 


230.952 




JOU 


8KS.055 


353.837 


494.a« 




Ssial 










nilnola 


U.TW 


279 


I8.470 




Illi. 


75.7a 


20 


75.708 




1^2/ 


9.5» 


37 


9.489 




Iratuky 


lUJ.USO 


11.782 


131,668 




IU««rarl 


101.133 


19.179 


81,954 




(Wo 


n.W5 


324 


n.i6i 




»»>..<. 


339.656 


bl.S04 


277.852 




!■■% Tlr«lftlft 


3014,980 


59.071 


245.909 




Kt.1 


1.074.707 


152.496 


922.ai 




JojU 










!!.>_ 


1.015.1«* 


865.372 


150.0J2 




bb..u 


b9O.b70 


450.0J7 


240.633 




nortd» 


b>7.00 


582.313 


54.768 




«.<»»« 


635. U12 


550.566 


84.84« 




LOTdiluu 


1.160.99S 


766.077 


394.921 




Uidi.trpi 


1.202.6k 


946.492 


256.130 




■c«l. 0.„U„ 


664.253 


532.538 


131.715 




>V1.... 


120.073 


108,265 


11.808 




fc«bC.r.llU 


557,010 


420,018 


137.062 




»». 


77it.3» 


659,945 


114.439 




ntclnlA 


U1.U7! 


276.302 


135.171 




»><.J 


7.869.450 


6.157,925 


1.711.525 




FMino c.»«t 


l.lbS.wt 


1.169.001 


187 




Callforala 2/ 




»w 


2.K4.2» 


2.869.254 


15.02< 




fc*iactea 


4.190.541 


4.175.46! 


■ 15.078 




I..J 


8.244.009 


8.a3.71B 


30.291 




lorti >pd9 nnxali 










lUM 


565.173 


564,976 


197 




KoBtVM 


2O8.655 


208,613 


42 




total 


n3.828 


773.589 


235 




iottth fcdteF Mowrtala 


96.102 


96.102 






IrlaoM 




UUrU. 


49.9* 


49,401 


103 




>mHu1o« 


102.0JT 


102.097 


- 




go«tk OikoU 


J8.027 


J8.027 


- 




•Uk 


6.<U 


6.657 


153 




•>«•< 


19.682 


19.646 


3« 




J.t.1 


312.222 


Jll.JJO 


•92 




ka>N<i» 


v,m,mi 


U.9*.<H 


J.>*.J«I 




liKl«a ud stkU 


r>t>i 


■oftmada 


"-'~- 



y iMlaA** XUM* • 



Im1«Am 1 



9l3iZ. 



209 

' fOraST FHCCUCT8 (OTHtH 1 





Total 


Soft.ood. 


HardaotdJ 




aa, lUb, 


r Slta Traaa 


■ 




Oor 


4M«d Alia traaa 1 




u a. TS^ " 


•'u . • li 


iif 


■ooda 


Hardai 


>ol. 


Total 


TStSaa"^ 


lari—oJ. 


R4&10D A auta 


H. Cu. Ft. 


H. Ou. Ft. 


H. Cu. Pt. 


H. Cu.Tt^ 


■ . Ft. I.H. 


H. flu. rV. 


1. ft. ».y. 


1. Jo. ft. 


1. n. i.». 


». STtt 


■ . 0». Ft. 




K«» gmgiifl 


(11 


(2) 


(31 


(4) 


(51 


(61 


171 


(81 


(91 


(101 


(Ill 


(121 


Conosotlout 


2«.''?« 


3.533 


22.945 


10.543 


48.824 


3.159 


14.772 


7.3»» 


3».052 


15.935 


J7» 


»5.5«1 


lUUu 


176. )61 


72.650 


103. 7U 


72.780 


339.617 


64,412 


301.021 


8.368 


38,596 


103.581 


t.rjt 


»5.3»J 


ll.>»clm.«tU 


50. MS 


17.913 


32.575 


a. 273 


99.159 


15.853 


74.141 


5.420 


25,018 


29.215 


2.060 


17.155 


New lUapBhlro 


1J1.6M 


54.459 


77.150 


5».587 


254.756 


48.280 


225.666 


6.JO7 


29,090 


77.022 


6.179 


70.W3 


RfaQd« Zelud 


«,»!» 


661 


3.753 


1.758 


8,186 


661 


3.122 


1.097 


5,0« 


2,«5« 


- 


2.656 


V,rmorit 


63. 6M 


16.432 


47.217 


Z6.tt6 


122.978 


14.560 


68,062 


U.906 


54.916 


J7.M3 


l.»7« 


35.311 


Total 


»5J.599 


165.648 


287.351 


187.407 


873.520 


146.925 


686.784 


40.482 


186.736 


265.592 


18.723 


2M,a« 


mam. Ati^iti. 


























D.Urar. 


11,220 


4,126 


7.094 


3,218 


14,941 


1.074 


5.0*2 


2.144 


9,899 


8.0O2 


3.052 


•.950 


UATTlMd 


62,25« 


15.982 


46.276 


17,538 


81,282 


5.036 


23.621 


12.502 


57,661 


*«.7» 


10.9»« 


33.77* 


»,. J,r,.j 


63,360 


6,016 


57.344 


5,045 


23,320 


526 


2.473 


4.519 


20,847 


58.315 


5,»90 


52.825 


N.. York 


281.551 


39.814 


241,737 


40.144 


186,761 


21.526 


100,922 


18. 6U 


85.839 


241.407 


U.2W 


223.119 


P.™rlT.„l. 


233. "65 


25.925 


■ 207.540 


45.814 


ai.743 


6,474 


30.336 


39,3*0 


Ul,407 


187.651 


19.451 


168.200 


Tot.1 


651. »5« 


91.863 


559.991 


111.759 


518. 047 


- 


162,394 


77,123 


J55.663 


5*0.095 


57.227 


t<2.a68 


ias. 


























UlcMg&n 


253.199 


43.810 


209.389 


50,947 


223.143 


14.175 


63.572 


36,772 


159.571 


202,252 


29.6J5 


172.617 


lllo„..ot. 


213.0*3 


117.569 


95.474 


43,413 


193.981 


39.123 


175.352 


4.290 


U.629 


169,630 


7a,«*< 


SliU* 


North DakotA 










41 


- 


1 


- 


40 


- 


- 


- 


Wlnoonnln 


353.082 


99.064 


254.018 


72.540 


319.483 


32.820 


147.100 


39.720 


172.383 


280.542 


66,2*4 


a*.29e 


Tol.1 


619. 32» 


260,443 


558,881 


166.900 


736.648 


86.118 


386.025 


80.782 


350.623 


652.42* 


174.325 


478.099 


CgeJlSl 


























ZlllnolB 


79.763 


177 


79.586 


37.428 


163.316 


177 


a«5 


37.251 


162,451 


42.335 


- 


•s.335 


IniUwia 


127.970 


68 


127.902 


60.233 


262.453 


68 


355 


60.165 


262,098 


67.737 




67.737 


loo • 


U3.119 


5.550 


107.569 


53.849 


237.748 


4,181 


21.128 


49.668 


216,620 


59.270 


1.369 


57.901 


Konuiokj 


262.258 


47. 506 


214.752 


126.784 


577,863 


35,640 


180.373 


91.1*4 


397,490 


135.47* 


U.8«6 


123.608 


lU..o>u-l 


228.237 


9.187 


219.050 


109,698 


482,647 


6.905 


34,952 


102.793 


4*7,695 


118.539 


2.282 


116.257 


OHIO 


127.508 


54 


127.454 


59,771 


260,685 


54 


307 


59.717 


260,378 


67.737 




67.737 


Teuioiact 


456.944 


92.471 


364.473 


219,865 


1,006,648 


69.196 


350.152 


150.669 


656,496 


237,079 


23.275 


213.80* 


West Virginia 


227.152 


26.811 


200.3*1 


108,613 


487,256 


19.965 


101,054 


88,648 


386,202 


118,539 


6.8*6 


111.693 


To<.,a 


1.622.951 


181,824 


1.441,127 


776,241 


3,478,616 


136,186 


689,186 


640,055 


2,789,430 


844.710 


46.638 


801.072 


aouth 


























U.tBU 


328,426 


183,690 


144.736 


209,7), 


984. 5«2 


106.386 


550,306 


103.351 


434,276 


118,689 


77.30* 


•1,395 


Ark&neae 


393,177 


191,615 


201,562 


250,750 


1.164,367 


114. 311 


591,332 


136.439 


573.035 


142,427 


77.30* 


65.123 


noria. 


ia,626 


106,848 


14.778 


74,151 


370.291 


60,466 


312,933 


13.685 


57.358 


47,475 


W.3*: 


1,093 


Oeorela 


339,519 


257.057 


82. 442 


220,820 


1.072.182 


148,832 


769,608 


71.998 


302.57* 


118,689 


108,225 


10.*«t 


Lwlalua 


301,467 


162.607 


138.660 


194,647 


908.201 


93.033 


481,206 


101,614 


*26.995 


106.820 


69,57* 


37.2»« 


Hleimippl 


368,861 


219.343 


149.518 


238.303 


1.124,458 


126,578 


654,749 


111,725 


469.709 


130.55a 


92,765 


37,793 


Horu C«-olln. 


459.861 


281,180 


178. 6S1 


293.697 


1.394,714 


165.224 


854,653 


126,473 


540,061 


166.16* 


U5,956 


50.206 


Otlahom 


96.548 


19.345 


77.203 


60.941 


267,204 


11.615 


59,966 


*9,326 


207,238 


35.607 


7.730 


27.9n 


aouth OroUn. 


227.109 


164,886 


62.223 


144.027 


697.446 


95.313 


492.7*2 


48,71* 


204.704 


83.082 


69.573 


13.509 


Tsna 


354.665 


117,812 


236.853 


224,107 


1.010.408 


71.430 


369.310 


152.677 


641.098 


130.558 


*6.38« 


8*. 176 


Vlrslnla 


302,450 


154,225 


148.225 


195,630 


911,734 


92.382 


477.922 


103.2*8 


»33.ai2 


106.820 


61.8*3 


**,977 


T0..1 


3.293.709 


1,858,608 


1.435,101 


2,106,820 


9,905,587 


1.085.570 


5,614,727 


1,021,250 


4,290.860 


1,186,889 


773,03« 


•13.851 




62.205 


56,198 


6.007 


48,951 


280,078 


48.951 


280,078 






13,254 


7,2*7 


6.007 


OragoQ 


152.927 


149. 4<2 


3,465 


145,620 


829.735 


142,676 


815,403 


2,9*4 


14.332 


7.307 


6,786 


5a 


VKSlilngtOQ 


285.383 


282.518 


2,865 


274,957 


1.567.663 


272,360 


1.555.025 


2.597 


12,638 


10,426 


10.15" 


26a 


Total 


500,515 


488.178 


12,337 


469,528 


2.677.476 


463,987 


2.650. 506 


5.5*1 


26.970 


30,987 


2*.191 


6.796 


Ho. Roon K. 


46,090 


46,089 


J 


38,628 


163.745 


38,627 


163.742 


1 


3 


7,462 


7,»62 


. 


Idaho 


Itontao. 


14,530 


14,530 




8,290 


35.155 


8,290 


35.155 


- 


- 


6,240 


6,2*0 




Total 


60.620 


60,619 


1 


46.918 


198,900 


46.917 


198.897 


1 


3 


13.702 


13,702 


- 


So. Rootr HI. 


























Arltona 


11.394 


U,394 




5.869 


28,383 


5.869 


28.383 




- 


5.525 


5.525 




Colorado 


5.207 


5.087 


120 


2,696 


13.011 


2,576 


12.459 


120 


552 


2.511 


2.511 




Harada •• 


- 










- 






- 




- 




lea Halloo 


11.373 


11,373 


- 


5.848 


28.277 


5.848 


28.277 


- 


- 


5.525 


5.525 




South Dalota 


3.732 


3,719 


13 


1.891 


9.134 


1.878 


9.076 


13 


58 


1.841 


1.8*1 


- 


Utah 


77s 


422 


356 


443 


2.091 


220 


1.068 


223 


1.023 


335 


202 


133 


»yo.lne 


1,982 


1,982 




97a 


4.730 


978 


4.730 






1,004 


1.004 


- 


Total 


34.466 


33.977 


489 


17.725 


85.626 


17.3® 


83,993 


356 


1.633 


16.741 


16,608 


133 


AIX REOIONS 


7.436.438 


3.141.160 


4.295,278 


3.883,298 

"■ "■ "toI 


18.474.420 


2.017. 708 


10.472.512 


1,865,590 


11 »t B ti — 


3.553.140 


1,123.452 


2.429,688 

y. Cu. Ft. 


Raglon • Slat. 


u. Cu. rt. 

Total 


"■ m- rt. 


-^^^ 




H. Ft. B.H. 

=§1 I 


Saa Tl. 




'• '^' Im. 


o'oia^- 


Total 
!sd 


^'l"Ti^l 


iamoo^f 



Incliid«« t&nsse snd 



ottTwd from Table S"!, 



I bj aubtrnotlag tli« ATBrags 1 



Suob adjuetmeot 



I 1925 to 1929 Inoluol 



. riguro allglitU ( 



1 by BMlUplylng tho reelo"*! ' 
I r«BlonAl totals by the percec 
in the oorTQiponaine flgurei U 
Aa, Sou*Ji D*kot« and l^aalfis i 



)to fo«t by »ppljlns ths i 
. »aeb state total la to t 



I stst* And r«^oi 



inJ pervflotaeai t 
±j Mountain Stat 

I rational totala 



totals, aoftveod and bardaood aa* 
U>9 Dal tad atataa.* Regional totals 
I tbe peRlooal II oublo foot totala •♦- 
In coluane 7 and 9. State total* la 



totals taken 1 



I betvaen ooIumos 10 and 11. 



balance baloe i 






11 1 



■eelonal total 1 
iluMH 6. In thi 



eomapoodloft figure 



t«v Mazieo. thlB n- 
I in eelcvn 10 and th> 
iWrb the r«sional 



afTO 



C3i 



51 

■s 
i 


1 


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i ' p ' s » ^ ' ' ' ' 

8 "■ -" 


. , , , 


« II § g s 




1 ' a ' § s S ' ' ' ' 


, . . , 


■ ^ Si ? ■ 5 s; 


1 


1 ' Pi ' 3 S S ' ' ' ' 


, . . . 


g 1 1 1 £ 5 


si 
1 » 


1 


IN § § S § g ^ g 8 S s 


S K ^ 


K> ,_( r- K\ ir\ f^ « 

0* r^ r^ r^ »o" to oJ 
K ^ 1^ rN 2 5- 2! 


Ip 1 § s 1" S S & R " ^ 


1 S S ' 


t 
i 


1«§§£s-ssslc 


!■ £ 5 3 


u-\ flo ^'^ .^ r^ ^ 




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rH iH «} 1 <-« « 

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H 


IN § § ^ f 1 II s § § 


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K R 1 S S S i 


!R ^ ~ -^ ■" 


SI § s 


S 1 .8 5 g & g 


1 

rH 
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1 




g R 1 


° lo w Ih H 5^ 


gC f- LJ 3 -^ ^ -^ 


K t; R ' 

H 


■s 

1 

i 


It 8 S 1 f 1 K § S 1 


1 ^ 1 K 


3 II S R s 




S ?^ S" 5 


s 5^ - a ■ ■" ^ 


1 


?. ^g^glls^^g 


in »o p^ «o 
r*- ^^ r<^ m 

lf\ H 1^ ITi 


s S S ^ S« ^ 


1 ■ £ § 5 § 1 ^ g § - S 


S S: 5- R 


8 s ;?. S S 8 f 


1 
1 


t 
i 


1 1 -^ ^- S" 5" ~" f -■ 5 


sis 

1 5 s" ■ 


§ ® 1 ^ 3 3 


1 


11 ^" ~" Si" 5 -" !^ ^" s ? ■ 


S s! S 8 

K^ 0\ «> H 


^ w « 
r- 0. ^^ rH in 
"O r^ ^ Os 




1 8 ^ ^1 R£ &§ £^ 


S5s 1 


r^N ^<^ K^ <0 Oi 
rl j^ W >o H fi- 
in 3- evj K\ ^ rt 




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r- r^ H w 


a D 




^ o a o 

« 43 C 
*> -^ • W 


■° 1 s i i ■£ 

£ £ 5 S 5 5 


3 


♦3 


lilliillll 


c 

s^ § § 1 

3 ^ t' n 


1 1 

g 2 1 1 

tl . 3 s 1 3 3 



{2? « 
:e s 



5: ? 
V. I 



2S I 

a ft *» o^ • 

1« 1 ?l I- 



6.^ 

51 



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-- ? 



g:.:? 



1 5 I2 . 5 



.? dSC S8SS 

• ^ «E«S cot 

»>io b3*o -oht. 



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s°?s 



g| i«7i| III" 



M 



%l r 
S5 !■ 



e ao o « e « 

g n*-" = * s * * ■ 

PS a'ja- !_ i 
I 

"lis 






9ga3 



55 I 



i:s'3 



.e 



^ (^« 



3i5! 



li 



3££ Si5 *5 



.- 11^5 ... . 

H (fit* * « • _ *-* *» 

!• 3^58 £S 11 3 

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St.*. 2k5S °j?_^s5 S 
'^^ .fSS Jv. S '3 ft s « 

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771.99! 


119.738 


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559.991 


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253.199 


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209.3n 


35.053 


10.169 


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111.926 


112.256 


99.213 


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10.829 


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661.501 


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67.689 


262.258 


67.506 


216.752 


31.596 


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29.836 


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269.006 


60.769 


10.270 


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22.626 


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123.325 


656.966 


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356.67, 


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336.695 


356.615 
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663,595 


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238.696 


757.191 


625,765 


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655.067 


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191.515 


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321.632 


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555.576 


269.055 


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257.057 


82.662 


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571.304 


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853.010 


551.563 


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185.167 


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162.807 


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656.316 


301.651 


265.508 


56.16, 


356.665 


117.812 


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6.662.936 


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1.858.608 

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5.252 


927.579 


776.652 


772.565 


1.787 


152.927 


169.662 


3.*65 


212.781 


212.711 




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1.737.9'»7 


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1.551.601 


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2.618 


285.383 


212.518 


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11.396 


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17.812 




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11.300 




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10 


88 


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262 


26 


236 


116 


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2.336 




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106 


7.Z10 




IH..«rl 


239 


7 


95 


3li 
15 


17 

7 


17 


151. 
66 


9 


1U9 
62 


9.902 
1I.256 




'•"> 


295 


22 


273 


112 


21 


21 


190 


11 


179 


12.238 




«... Tlrjlnl. 


119 


9 


110 


17 


9 


8 


77 


1. 


73 


I..953 




Tot«I 


1.1a 


83 


1.0»5 '' 


162 


81 


81 


727 


Ul 


686 


k6.Bt 




"Zb- 


515 


322 


193 


156 


103 


53 


732 


552 


200 


11.832 




AncaSMi 


6110 


iioo 


2110 


193 


128 


65 


910 


661 


2*9 


II..703 




n.rid. 


56» 


353 


211 


170 


113 


57 


801 


583 


ae 


12.95> 




(taorcla 


629 


39U 


235 


190 


126 


EU 


89U 


651 


2«3 


IU.1.61 




Lo^tlau 


U2, 


26J 


160 


130 


86 


¥. 


609 


¥.. 


166 


9,8W 




Ulitlailppl 


32? 


20H 


123 


99 


65 


31. 


1.61. 


338 


U6 


7.511 




Borlh C«.ll« 


526 


329 


197 


159 


105 


5H 


7117 


51« 


203 


12,0«5 




dclabou 


US 


70 


142 


311 


22 


12 


160 


U6 


» 


2.5* 




S».h C^olU. 


335 


210 


125 


101 


67 


31. 


1.76 


3M 


130 


7. 698 




I.^ 


3M 


2H 


127 


103 


68 


55 


1185 


353 


132 


7.852 




Tlrctnla 


367 


230 


137 


111 


73 


38 


521 


379 


11« 


8.»T7 




t.lJ 


"US' 


2.99'' 


1.790 


I.IM 


956 


I190 


6.799 


I1.9I.6 


1.853 


109.999 




PMlflc COMt 
























CJlt.M. 


173 


171 


2 


79 


78 


1 


»53 


IM 


5 


12.S91. 




Or.r.» 


31» 


312 


2 


11.5 


»3 


2 


825 


a( 


9 


23.1'90 




l*aUii«t»B 


193 


192 


1 


89 


87 


2 


507 


501 


6 


11..1I39 




Total 


MO 


675 


5 


313 


308 


1. 


1.755 


1.7S5 


20 


50.823 




north Hocb HOMStolii 


a, 


a. 


. 


71 


71 


. 


501 


301 


. 


11.929 




.o.l««, 


19» 


19« 


- 


61. 


6U 


- 


275 


275 




10.101 




KIJ 


»16 


U6 


- 


135 


135 


- 


576 


576 




22.790 




Scoii, tool, iiooat^a 
























in.oo. 


25 


25- 


- 


10 


10 




119 


l« 


- 


3.61J 




Cdormdo 


ao 


SO 


- 


32 


32 


- 


157 


157 


- 


11, M9 




R«T*d« 


2 


2 


- 


1 


- 




» 


1. 


- 


296 




Ve« Moxlw 


26 


26 


- 


10 


10 


- 


50 


50 


- 


3.711 




Soutb SakotB 


9 

19 


9 
19 


. 


, 


8 


. 


3a 


17 
38 


■ 


1.260 




troaliK 


V 


3« 


- 


15 


>5 


- 


7I> 


71. 


- 


5.519 




T0..I 


199 


199 


- 


80 


79 


- 


JW 


389 


- 


28.69I 




TOTAL AU STATES 


J.912 


u.sio 


1..102 


2.685 


1.709 


976 


11.731 


8.511 


3.W 


3M.52« 






(1) 


(2) 


13) 


m 


(!) 


(6) 


(7) 


(8) 


(9) 


(10) 




3tott ud ItMtloa 


'Total 


'ioftvood 


"■"•JSJ« '••' 


' Total 


' Softvool 




_ ' bta_' "_. 


».«. Taat >.«. 
SoftveoA 




k* nakar aai 

KrtrminM 


















_ 



St«l9 totals In eolunit H 



I Iha raglaaBl totelt 1 

ractoBal tot*la la oolnnu 6 a») 7 < 



I r*sl0&Al total* la eolsa 5 e 



• 7 allii S roapMttvalj. 




aaayfffjM ^ 



■ntlty Sold - TotrJ 



«,., . R,y,n 


?ot*l 


Xll lio»!« 


Par", ft! s!". 


.."Ph. 


. .Boftwoo«j 
Reoelved 


pr.t:"^:.,.j 


Total '■ 
ftj.nUtj 


. !lhM««S< 


Avorae^ 

Prlc- Rtcalvad 


lletf E.ipjand 


»9,W 


1 298, «M 


t t-of 


4.9,1 


• '2.85« 


• 6.» 


24.893 


1 144,885 


• 5. 82 


'l.ln. 




5,6M OJJ 


7.00 


7r-j.086 


e. 250. 159 


7.29 


47.759 


192,078 


4.02 


U....c«i..ctt. 


Ite.sU; 


979,06* 


6,9' 


74.936 


579.251 


7.73 


8.5«7 


57.753 


6,14 


::- ■i™.,hir. 


367, 5M 


2.»',.-Jll 


6,69 


245,655 


1,759.290 


7.16 


13. w 


70,705 


= .«> 


•J-J- iii.na 


V 


2/ 


V 


J/ 


tl 


1/ 


SI 


s/ 


V 


V.a.„„l 


^:^6^■•k 


'.^OO.IM 


6.07 


'5,89': 


199,282 


= .=■■ 


"71.65' 


!,<«-, 0!6 


■-.00 


Tol-l 


1.9)7.171 


l^-?7.5»^ 


6-64 


1,081,486 


7.120,836 


7.23 


46;. 991 


2.-22,437 


4.98 


UldaX« Atlp-ntlo 


«.oa6 


5". 661 


6.76 


4,726 


33.980 


7.19 


1,659 


13.768 


8. 30 


D,U..-r, 


lir.leaa 


OS. 86! 


606,720 


6.14 


49,669 


340.W 


6.85 


33.50? 


174,919 


5.22 


!i™ .Vrt.y 


2/ 


2/ 


1/ 




il 


il 


1/ 


V 


V 


>!-. York 


JJ6.661 


2,106,»O5 


6. 45 


ir,r'2 


142,749 


B.14 


144,408 


1,056,557 


7.32 


Penneylvwiln 


.»69,-95» 


3,149,1402 


6.70 


37,097 


234,752 


7.6; 


306,238 


2,043,U1 


6.67 


•ot,l 


W.W 


5,917.208 


6.55 


109,024 


801,180 


7.J6 


485,807 






i^ 


1.U.?.109 


9,16»,05; 


6.35 


.98,123 


1,62', 204 


4.08 


696,900 


5.JJ5.614 


7.66 


lilnnKoU 


012. ';o 


5.900,000 


6.47 


817,842 


5,704,958 


6.98 


72,214 




1.64 


norih D.Sof 


i/ 


V 


2/ 


il 


il 


il 


il 


tl 


t/ 


IJl.con.lr 


1.0mU,057 


6,762,219 


6.24 


78,172 


322,241 


4.12 


90,0« 


708.183 


7.86 


lot.l 


'.■»3».M6 


21.826,27? 


6.35 


1,294,137 


7.650.403 


5.91 


859,199 


6. 161. 934 


7.17 


Siiiiril 


IU,712 


212.821 


14.47 


y 


il 


il 


12, '62 


204.621 




Inainni 


iw.;«7 


2. '97.098 


16.38 


il 


il 


il 


89,588 


1.412,393 


15.77 


Ion 


£/ 


^ 


2/ 








SI 


il 


il 


-entu.Ky 


207,000 


1,039,360 


5.02 


2.204 


8.241 


3-74 


197,593 


988,027 


5.00 


L".„»rl 


210,502 


1,136,160 


4.93 


72.852 


350.077 


4.81 


68,802 


361.132 


5.25 


Ohio 


210.109 


2,167,167 




193 


1.340 


6.94 


208,801 


2,159.543 


10. 3» 


T.nn.s.et 


6;o.29i' 


1,437,517 


5.29 


47.026 


194,110 


4.13 


193,407 


1.317.390 


6.81 


■*eet Vlrelola 


1,22;.»61 


0,W0.60U 


4.98 


8.570 


25,574 


2.98 


1^0,726 


i.97i,;i; 


• .1' 


Total 


2,6S2.»51 


16,480,727 


6.14 


130.845 


579.342 


4.42 


1.251,279 


5,121.621 


6.» 


AlBbama 


2.0>l.lUi6 


.;, 680.615 


4.27 


1.218,4*4 


4.802,184 


3.94 


80,874 


367.344 


4.54 


Arfc.... 


S,)!*,!!! 


12,J90,«04 


5.62 


831.881 


4,350,683 


5-23 


283,291 


I.8O3.733 


6.37 


noria. 


2,712,!*; 


a.yu.m 


5.5J 


2.70!.m 


I5.I3.TO 


5.» 


a. jK 


A »■"' 


- J.» 


0«orslB 


967,629 


3.766.552 


'.89 


629.70' 


2,226,933 


-:-'A 


22.664 




LOUl.lM,, 


E.S^O.te'i 


17.235,613 


6.09 


1.159,810 


6,925,318 


5.97 


489,481 


2. 859. 028 


5.84 


l!l„I„lppl 


2,60«.566 


12.549,507 


4.81 


1,865.101 


9,103,097 


4.88 


137,440 


657.604 


4.78 


north Cu-ollra 


1.2W.J55 


5.519.800 


4.44 


749,202 


',478,378 


4.64 


188. 549 


»5.7>3 


4.49 


aa,j..o.. 


775. ;90 


2,304,550 


2.97 


5'7.861 


1,5*2,887 


2.69 


42.363 




2.65 


south CaroUh. 


1.772.S93 


6,306,495 


4.59 


568,776 


2,842,214 


5.00 


95,395 


317.473 


3.33 


Texu 


J.6-2.J7» 


24,899,272 


6.85 


1.933,095 


15,607,507 


8.07 


150,994 


729.4*6 


4.33 


Vlrglr.16 


981.397 


5,036,934 


5.13 


350,827 


1,741,022 


4.96 


149,416 


695.550 


4.66 


Total 


3.913,219 


11^.6*7.5)7 . 


W» 


i2.5«».ra 


67.«».00« 


».)• 


■.«..[« 


•.8J».J» . 


MJ 


Paciric 


lli,U.^5,46U 


44.49S,30: 


3-07 


14,485.354 


44,496,018 


'.07 


il 


y 


SI 


Or-Soo 


26.7'*2,lt«5 


77.935.167 


2.71 


2S. 716. 652 


77,877,391 


2.71 


23,663 


54,551 


2.31 


•••""Ston 


27,766,1164 


88.162.060 


3-18 


27,755 911 


88,140.474 


3.18 


7,879 


18.179 


2.31 


Total 


70, jy,..;-*' 


210.5^5,^29 


2.97 


70,957,917 


210.515.683 


2.97 


'1,542 


72,730 


2.31 


Idaho 


2.133.991 


7.867,117 


3.69 


2,1'7.925!>/ 


7.653.104 


3.69 








Lontaha 


1.151,081 


1,865,624 


1.62 


1,151,016 


1.865.521 


1.62 


65 


103 


1.5a 


I.tal 


3,285,072 


9.732.7''l 


2.96 


3,278,941 


9.718,626 


2.96 


65 


103 


1.58 


So. Rooky lit. 


i/ 


i/ 


SI 


il 


il 


V 


2/ 


il 


4/ 


ColottJo 


2/ 


i/ 


3/ 


il 


il 


il 


2/ 


il 


31 


K.vad, 


1/ 


%/ 


SJ 


t/ 


SI 


SI 


SI 


tl 


tl 


'■" !••'""' 


1/ 


H 


, tl 


s« 


SI 


SI 


SI 


SI 


SI 


3o-,th Dakota 


i/ 


il 


il 


il 


n 


il 


il 


il 


11 


»t-h 


il 


^ 


iJ 


y 


il 


11 


il 


il 


il 


Wyoffllna 


il 


w 


ll 


il 


il 


H 


il 


il 


V 


TOTAL ALL STATES 


14P».T*.«» 


JS2.097.586 


. il 

>.7> 

p.>srK.-5.u.-- 

Avoraae 


il 

»iantitj 


il 

J«.«45.97> 
-R^.l«8- 


il 

mp~s; pt. B.ii. 

ATeras* 


il 

4.T«.672 


i/ 

».I01.9» 


il 


St,to > Resloo 


Tot*l 


RBoelvpd 


ftjahtlt; 


Z\ll 


Price Rccelvea 
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DIR 5!r2,Slf 3 IS^RS2;a5£E X asi S SR 



r'8l«SS 5 SX?58lSI?5s 



?5!f 5 3S a ^SsSsSB S ? 



S2=3,2~S-= » ^J i IJ E »3-Si3= J S 



SIfsS? 



S8*s3l 



SSSSS^ 3 






ISsI § 51 I I ,l.i§iSS I llJiltlfSII I iSi I 



? i?S S Si § S .383 . . i S 



,S«22ff i S25SSS5S322 3 5S 



E;al3K3S«SS3E 



8|°| I sic'js's'sj I SSSKS'lSEfiS j ?li ? S^' E *^ sr"'! 2 



llij 

iil 

1 I-' I 
I \^ 1 

1 11 ; 



3331- 

K^»3 3: 3 

J- a:: :a - 
33^^*2 |3 - 

i'-.t-i-.i-tzs,. 

a a a aaa 






88SSS8 8 88888 8 8gS8 8 88S888S8 



I 1 



in s 



5: = l5 

m 






aSKSS? 3 



•"»»*« S 



«R'| 



c K ;8isss 






8 88888888888 8 88 

ill i 






"^S3S s assscssassc » m 



?S3=S3£S« S 



issssssacB 






8 K3 5SSSS 



=0 8 E3S»R*S 



SsS S 15 s CSsafts^ 









sffSRsa s 



R3 3;S3 



3 3 KS;R s e^iiRRR^^ssi; 3 flC^ S ?^ II S8S 

1, >- .A^j; 3 RSPlSfas2RR^ E gas R 8- ^ ^"^^ " " ^ 



« »2 B S 



I S 3^ S ^ 






-22 E so 



-s ;|s 

1= |f=5 3 



i<li2f 



VM 3 

sits « 

I"" 



liils I 5bS S 



iliiSlRS R SisS?ssS2IS ? §13 i al H IIkISP s S 



5a 55 :2 3 j-jil-'j" a 3 1.> 3 f a 3 Jsi.r » 



Sill i 

§'3 - 3 

r;: 1 ■ 

si: a -: 

ji| I I 

i\\ i ' 



■iiiiiiti iiiisiaiit.: 



sss safsssst 







M^iu iiji iiP 

ilH p|i]|iil lilt ill! 



I inuB, BX nATu km mdiois 



I 19a Dmf iuti— a To o»f) y 



Tlab«r Una 

dhOUMBd 






Onit atuMpt; T*iiM 



TlBbar TklM* , Tftlu* 



I Bv4«a rroAu» 

A«MIMd I (if of UM 

T*l(w of I ToWl 1$2»- 

>*• TLab«r < taU- 19>k 

kod Uod I Mt«« (a. rt, 

(Tbousand |)| Talus) B. H.i 



5.15« s 


00 6,316 


2.690 U 


00 10,760 


«.»« 3 


00 H,5«9 


1.W5 3 


00 4,215 



5.919 
29.905 



13.«7« 
5.307 



3.2* 



9.908 
7,2'W 



5.790 


3.00 17,370 


13,012 


6.729 


3.00 20.187 


16,326 


7.J75 


3.00 22.125 


12.874 


5.060 


3.00 15.180 


12.951 


4.019 


3.00 12,057 

3.00 5,400 


10.675 
2.459 


3.72« 


3.00 u,«4 


9.034 


i.ws 


3.00 12.435 


11.745 


2.635 


3.00 7.905 


4.535 


55,220 


3.00 165,660 


120,461 


5.63» 


2.00 11.266 


177,051 


8.761 


2.00 17,522 


232.341 


4.512 


2.00 9.024 


182.885 


li.907 


2.00 37.814 


592.277 


1.836 


2.00 3,672 


28.020 


1,718 


2.00 3.436 


13. 7U 


3,554 


2.00 : 7.108 


41,731 



9,516 

«13.760 



«r7 


16.69 


14,537 


7.29 


530 


7.73 


2.009 


7.16 


29 


il 


6.138 


5.55 


23,870 


7.23 



4.585 
17.558 



4,363 
31,320 



15,705 
7.515 



5.735 
74.656 



4.02 


234.274 


6.14 


1J.829 


s.w 


3»,392 


y 


571 


5.00 


42.228 


4.98 


329.445 


8. JO 


848 


5.22 


6.878 


iJ 


5.823 


7.J2 


136,769 


6.67 


39,076 


«.77 


189,394 


7.66 


112.930 


1.64 


21,161 


V 


417 


7.86 


70.499 


7.17 


205.007 



4.54 


83.933 


6.37 


132,960 


^^ 


■^ij*^45j 



85.766 
9.485 



3,488 
19.032 



254,034 
15.140 
3«,«0 
610 
48,147 

359.348 



8.35» 

6.666 

150.647 



U6.248 

23.447 

437 

73.723 

213.»55 

61.452 
41,449 
14,559 
35.171 
25.524 
53,346 
75.109 
24.041 
330.651 



105.626 
153.084 
95..«1 ■ 
94.648 
190.700 
U4.302 
97,823 
14,885 



543.544 


554.814 


632,555 


650.077 


582,417 


591.441 


1.758.518 


1,796.332 


103.394 


107.086 


22.212 


25.648 


125.606 


132.714 



4.320 

24,588 



84.8 

57.8 



53.4 
"3.7 



61.4 
72.4 



(U) 

3.005 
132.098 
U.734 
27.937 
488 
26.481 
20.743 



127.749 
25.653 



m.947 
9.191 



71.216 
192.35* 



14.885 
33.2*2 



17.762 
37.379 
52.126 



43.065 

157,709 
61.037 
81.878 
9.273 
21.327 
61,931 
27.877 

588.950 

310,141 
411,498 
195.767 
917.406 

64.239 
8.823 



5.005 

5*5 
4.570 



(121 r 

2,5*0. 3*0 

151.400 

3«.«30 

6.100 

4<1,*70 

3.593.*" 

9,*«0 

•3.5*0 j 

66.660 

1.506.470' 

4*3.830 
2,109.940 



113) 



(141 



»}.M 



14.W I 

va.v i*.M 

52.727 ! 2.«7 

130, 7<r t.ao 

*.*5» 1.57 

«5.7«3 I 7.32 

*J7.7»« i.a 

5,*o» j 1.75 
30,98< 



79,*1< 
159.7U 



300.129 
iw.u; 



737,230 401. S2X 
1.906.05*1 8*8.055 



*1*.490 
1*5.590 
351.710 



fcl-.09o' 
240.410 



1>.7*9 
75.721 
9.535 
1*3.450 
101.133 
■1.485 
339.656 
304,980 



3.306.«:1 1,074,706 



41,486 I 1,530.) 



1,143,020 
782,580 
148,850 



1.160.' 
1.202.1 



7,8e.4;o 



5,548,1*0 1 1.169,118 
6.500.770 2.884.280 
4.731.528 I 4,190.541 
16.780.438 8.244,009 



070.660 


565.173 


256.480 


208.655 


327.140 


7n.aa8 


3.240 


96,ioe 


68.000 


•«,50t 


1O.9O0 


y 


106,280 


102.097 


7.360 


38.05 


6.900 


6.810 


*3,200 


19.682 


2*5,880 


J",222 



U.M 
«.7« 
7.«2 

).» 

\.m 



J2.9* 
5.*7 
15.27 



6.53 

2.21 



1.57 
1.66 



1.23 
1.7S 



Ullllon (ui 

ft. B. ».) I Ft 

8»w TiBhar 



^- ■•.*"* I '^""""^ fl T-l..*^ 






iaplo;«d In tti« prsoadlng t 
r i^eioo «»«8 



282 



s 

1 


i 

i 

IK 

: 




11 


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ll 




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1 


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la 


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Jill 


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^^ 


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a 


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353 & 


SCK C 


£« w 


t 


iS 


s s^ 


ff- ON 


'" 8S 


222 § 


SsS "5 



9SIJ 





SSS2 

"ess 


KS 


ii'i 




' 'SSSB 


llh 


■ 


J>r- 


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i383 


?'3«SS2=" 'S 


■pp'i 




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i 




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a'isSi 


KS| 


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fO^BC 


&K| 


■■ 


•2S5§'§ 


^&g?^S33l§l 


slsffiSS'l 


§§|g.tg 


ooo 


2 




«»r^ 






-^ 














i, 




■S 


oo w 






^^ 




ffi'3 


IT,? 




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?1§^ii§..^ 


■glsss'S 


|S|Sg| 


s^s 


1 




«» 
















8 


8' 


3S§' 


Ms 


1 r So 1 (^ 


?3§^ 


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o" 


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ri O (O h 



5258 




in r>- p J* cu 

1-4 iH 5 l?\ Cy 

r«- r— r^ r^ vo 



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2fi0 



TABLE XVI 
rePCDTTAOE OF CAPAClrY AlID NUMBrP CF laLLS 



Arkaneae 

California 

Colorado 

Connecticut 
Delaware 
Florida 
Georgia 



O.JS 
0.04 
1.06 

e-33 



7.17 

0.67 
3.55 
■5.50 
O.Jg 

0.12 

0.07 
3.'*7 
6.23 



1,390 
16 

l»5 
73 

29 



Louisiana 

Ualne 

Uaryland 

UaesacbusettB 

WloMgan 



Mln 



Ota 



Mleelselppl 
lIlBBOurl 
Uontajia 
Nebraska 

Kerada (See Calif, supra) 
New Hampshire 
Now Jersey 
New Mexico 
New York 

North Carolina 
North Dakota 
Ohio 

Oklahoma 
Oregon 

Pennsylvania 
Rhode Island 
South Carolina 
South Dakota 
Tennessee 

Texae 

Utah 

Vermont 

Virginia 

Washington 



0.39 
2.20 
0.01 
0.06 
6.«1» 

5. 60 
2.10 
O.gJ 
l.Og 
3.82 



6.'il 



3.40 
0.70 
0.13 



0.«6 
l.gQ 



0.61 
0.01 
0.89- 
0.39 



0.01 
0.61 
14.50 

0.36 
0.01 
3.03 
0.36 
1.2« 

3-55 
0.15 
0.25 
4.28 
17.69 

0.00 

0.76 
0.17 



5^ 
^3'^ 



111 

56 

5? 
9"* 



56 
4JZ 



i 

50 

204 
1,382 



>t«2 



526 
25 
361 

"^35 
5a 

50 
908 

37"* 



9813 



f 287 



vwocsir^-^ «p«o^ow«> r^owf— r- r^r-io^'O'O (Mowaoi »Ofyr-^CTi (*~\OOM0r^ Qifw*.-i<> «>ir\r-K. to 









CSC- 9SiO« 



cuS^ (u wi~. S'a' Rg irS wr 



»- C 



""■"iDSI^ ff'SJS.ri''' ir\i*MO uS(*-\ ty'T?::'*^ ttioo;>OK\ g^if^io^ "^ 5,"rr\h-'« f^ib'f^^OJt Ni^irvr^ Si 



sa;! 



« g£S 



1^ c 



^ rt ir.K\5 :? C 



-pjO o r^o o rH f'-^ f^ in r-Sh-iBf<% o f^ii 



"SSS 






'\Q\cySp QOOPjO eor^w(^f^ ^o3- r- 
^3-^ iTi o o eg cu iH r^o r^ oj J- f^u 



?3!?3 "- 



KS5 



nir\«£ri 



S^SiS S RS^-- 



;;ss,tc 









Si^f: S' i^ 






?S3f 



9813 



i.S£^ 



Jii; 









-r>>> »»fr» 



a 



288 



9813 



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« tA ^TftiV ^- ''"^ H iH"f^ ftj^ o» o* o^ o"\o ^"vo K\u>o w w" w w cy 



r— mfid- iTi (-t ifMTiBO «o t\j c g r^ cu m« 



eg *^,'3 lo"^ '^ '^ '^ '^ 



-^5. ^5^:s^ 






iiSto wcri "Ocji iTif^Qty oor^'O Bo^^«)Q<^ i-<vo;*r^ S 

r-*rH r-I'> r^ C\JpwK\ OJ -O rr\ f^W ^05 r^^ r^ >0 



5(yr*\cy cuwksovo gv^O\*ooi "O^OOf^vo r^^o^r'-vg; wiO^t- »o rH^ h^ rr\cyBOr 



fir^ifirH^ CTMnr-*^^ H r^ f^;:t ^ r-r-ij- r-«)^ r- 









3 cy ''^rt '^^^Jt r^ 



r- f"-Ovr^ ^-r*-5- r 






>Ojt inr^coo r^-o 



0*0 r^'O J- oi o r^'O ov c 



53 S 



-<^-2oO OOt-lSM MMMMJ 









6 

i 

'i I 

5 S 



c 



01 



289 



SABIX ZVIII 

BICAFlTnLATlOH BT IKTEHTALS 07 UMBSB. PBOSQCIBS 
IHOSI MILL CiPACITT IS EHOU (*) 



Siaib«r of 
Producers 



Total Eotirly 
Capacity for 
Intarral 
(la Bd. rt.) 



. 

101 . 

201 . 

301 • 

401 • 

501 . 

761 . 

1,001 . 

2,001 . 

3,001 . 

4,001 • 

6,001 ■ 

6.001 • 

7,001 . 

8,001 . 

9,001 ■ 

10,001 . 

11,001 . 

12,001 • 

13,001 . 

14,001 • 

15.001 • 

16,001 - 

17,001 - 

18,001 - 

19,001 - 

20,001 - 

22,001 - 

24.001 • 

26,001 - 

28.001 • 

30.001 • 

36.001 . 

40,001 - 

45,001 - 

50,001 - 

60,001 - 

70,001 - 

-Total 



100 

200 

300 

400 

600 

760 

1,000 

2.000 

3.000 

4,000 

6,000 

6.000 

7,000 

8,000 

9,000 

10,000 

11,000 

12,000 

12,000 

14,000 

15.000 

16.000 

17,000 

18,000 

19,000 

20,000 

22,000 

24,000 

26,000 

28,000 

30,000 

35,000 

40.000 

46,000 

50,000 

60,000 

70,000 

Vp 



492 

1,371 

2,442 

2,101 

2,122 

2.126 

3,189 

2,016 

664 

289 

165 

89 

64 

45 

50 

26 

27 

28 

15 

16 

26 

7 

14 

16 

13 

10 

29 

17 

16 

17 

16 

IB 

12 

10 

11 

12 

7 

1 

17,467 



49,200 
274,200 
732,600 
840.400 
1,061,000 
1,594,500 
3,189,000 
4,030,000 
1,692,000 
1,156,000 
775,000 
534,000 
378,000 
360,000 
450,000 
260,000 
297,000 
336.000 
195,000 
224,000 
390,000 
112,000 
238,000 
270,000 
247,000 
200,000 
638,000 
408,000 
390,000 
476,000 
480.000 
630,000 
480,000 
450,000 
550,000 
780,000 
490,000 
80,000 

25,736,900 



Soorea: Blyitlo&al Coda lathorities 
*Iaclud«8 all codal dlTlsions and sabdiTlaions i^lek 
and Phllii)pine Uahosaay. 4 

9813 



saw Itmber except Mahogany 



290 



fABLjt ZIZ 

EECAPITtJLATION BT STATES 0? 
asaVS LUUBZB PB0DUC2SS* 



^ 




Nvmher of 


Number of 






Total 


Producers 


Producers 






Number 


Whose Mill 


Whose Mill 


Total Hourly 




of Known 


Capacity 


Capacity 


Capacity 




Producers 


is Ibknown 


is Known 


(In Bd. Tt.) 


Alabaaa 


1,695 


104 


1.591 


1,638.600 


Alaska 


6 




6 


27.800 


Arizona 


22 


6 


16 


140.200 


Ai^ansae 


1,157 


49 


1,108 


1,101,600 


California 


195 


51 


144 


1.136.500 


Colorado 


103 


29 


73 


79.100 


Connecticut 


67 


16 


51 


42.300 


Celawara 


26 


1 


25 


16.700 


District of Columbia 


2 


1 


1 


3.000 


yiorida 


537 


4 


633 


770.500 


Georgia 


1,455 


37 


1,418 


1,405.150 


Idaho 


S07 


68 


139 


700.400 


Illinois 


239 


185 


54 


19.650 


Indiana 


400 


166 


234 


111.300 


Iowa 


I 




1 


400 


Eansaus 


3 




» 


^.300 


Usatvuzky 


001 


2 


599 


367,000 


Louisiana 


394 




394 


986,100 


Maine 


231 


62 


179 


250,900 


Maryland 


92 


1 


91 


70,500 


Massachusetts 


ISO 


29 


91 


129,450 


Michigan 


894 


760 


144 


295,750 


Minnesota 


286 


82 


204 


177,200 


Mississippi 


2,046 


68 


1.978 


1.947.100 


Missouri 


651 


8 


54? 


287,400 


Montana 


131 


44 


87 


372.700 


ITerada 


1 




1 


2,000 


New Hampshire 


201 


39 


162 


219.300 


New Jersey 


6 


1 


5 


3,700 


New Mexico 


52 


12 


40 


184,660 


New Torlc 


197 


65 


132 


138,850 


North Carolina 


1,438 


26 


1,410 


1.363.850 


Ohio 


570 


297 


273 


117,250 


Oklahoma 


187 


5 


182 


172,350 


Oregon 


517 


65 


462 


2,998.100 


PennsylTania 


271 


111 


160 


129,850 


Ehode Island 


11 


6 


6 


5,100 


South Dakota 


29 


4 


25 


76,500 


South Carolina 


639 


4 


635 


744,850 


Tennessee 


1.163 


17 


1.146 


791.000 


Texas 


542 ■ 


3 


539 


860.400 


Utah 


93 


41 


52 


30.650 


Vermont 


116 


29 


87 


89.150 


Virginia 


1,472 


34 


1.438 


1.307,350 


Test Vii'ginia 


384 


2 


382 


378.200 


Washington 


423 


43 


374 


3,656.350 


Wisconsin 


972 


748 


224 


452,850 


Wyoming 


37 


11 


26 


36.000 




20,781 


3,314 


17,467 


25.736.900 



Source: Dirisional Code Authorities. 

* Includes all codal dirisions and subdivisions which saw lumber except Mahogany and 
QQ^ oPhilippine Mahogany. 



9 S 












3 E S fc a 



Illc 



il^- 



29i 



C'Hs RSRS S^S ^Sl-S^SiJ S^^£SI.eI ^&I ^I.SSi^&S?:l$.l 8 S s 



3S^oc^^x^SW■o r^r-tlr^Or■ 



h(oo\0 f*Mrvos ^*^^-l r^o»«) r'x'Ow ri-i^j* «) iH^ 


















H ^ BO If -* »0 CT» O inwj >o3 ^ t\j\5p 






lotricUf^rHOJr^LnftJlTtd-H-^^ r^OJ KnOJ rH KAH^ ftl f'M^M'V* W in W CJ ftj 3- ^ tVj OJ r^ If .rH^ fVl If .CJ^O, f^. 

0^5lHt=^^o^^e^r^t^^fK^■o3^^B.HWc^JOr^o^lf^oCJf<^■-^w)^^f<^w)Or^o^ "O 

cuo\0 cO«J d^o cOc. i-4r^vd ir^r i*^a\f^r-« if\r«xd- if.O^ wt-MTiO O rnOoO'OWBOOsd-rHu- iTitO rji^^ ^ 

Oi oj ^-BO^O (miTaO^o^j* f^M K>B3 r— r^cQW o (M f--^ mpj^o cy r— ov cy oj t^r-r^p [u r^ (^ ''>£^,':^ Ji"!^ JT JH 

v5 o r'^^ -o «3 OJ M r— »D Q pj Cij ir^ c\j 






£5 I ~- 






k,"^ 



Ifc*" 









Sit" 



l°i 



I s 









r'V*OMfV*^^ rHr-tr-MArHlf.'Or-tWr^ lf\Hir.r^rH Oi'-t H iH CV W 



U ^•«52£S§ S«^> I^S^^l 



^oa3oB>i55jE5^ul«S£^l«aa = z2=Bo<zfc^ow>omHo»3^HQ2zi-. *<o 



Cnp nclt yl/ 

Hardwood Softwood 



Arlcflnpas 

Cpllfornla 

Colorpdo 

Connecticut 

Delpwarp 

Florida 



IlllnolP 

Indians 

Iowa 

KansfF 

Kentucky 

LouiBlanr 

r?inp 

Wary land 

Uar-rachueettB 

Michigan 



J.:iFSOurl 
i^ontana 
Nebraska 



York 



North Cprollna 
North Dakota 
Ohio 

OklPhona 
Oregon 

Pennsylvania 
Rhode leland 

SoutV) Carolina 
South Dakota 



Utph 
Vermont 
Virginia 
Washington 

Wer.t Virginia 



1H9 


4,00? 




379 


992 


1,983 




3,066 




Plk 


118 


66 


6 


39 


lUfi 


1,935 


?1S 


3, 476 




1,891 


53 




301 




1 




9 




9?1 


60 


76? 


i,90n 


286 


391 


116 


74 


148 


202 


1520 


279 




478 


l,26h 


3,993 


527 


249 




1,006 



159 


216 


882 


2,800 


311 
120 


346 
8,095 


148 

6 

319 

1,422 


202 

6 

1,692 

204 

714 


342 

102 
872 


1,981 

8-? 

139 

2,388 

9.872 


1,004 
756 


.1] 
97 



Ratio Stand 


to OaoacltyS/ 


Hardwood 


Softwood 


10.45 
12.93 


4.19 
52.31 

5.72 
92.12 
221.39 


13.56 
11.83 
14.78 

19.03 


1.19 
.92 
6.81 
4.26 
51.07 


58.81 
7.19 
11.07 




5.20 


12.23 


20. RS 
52.51 
9.22 
V84 
24.96 


6.7« 

7.29 
12.37 


m 


7.18 
3.24 
1.16 
49.50 


10.19 
133.50 

72.20 


12.86 

55.3? 
28.84 
30.25 


9.49 


3.95 


13.32 
9.03 


10.20 
54! 08 


72.10 
28. f 4 
5.99 


5.67 
4.83 
5.53 
15.73 
1.63 


12.88 

60.83 
7-18 


5.94 
93.86 
15.12 

2.02 
32.50 


4.41 
11.26 


37-12 

5.41 
335.91 



U. S. Forest Service Releape. 

Total Hardv/ood and Softwood St?nd aivldet^ by Softwood Ca 



omplled by the DlvlBlon of 



2/ 



Stand of Saw Tlmb?r In the United Gtatee. 



9 8' 5 



293 



1 Cl3 

^< -p S 



9813 



H Ht~-C\J 



isoosH ir> 



C\J oj CVJ c\j 



o^ CM irv 



rHcyr^Mt f^ i-iWKv* 



cMir.^-io 



60 O^ONC 
«0 rM O I 



0\iJ-K)KO 



OOO i-l 

o oo>o 

0000\ 






H OJ ^'^* r^ rH cu ^'^:* r^ HC\Jr<%=)- r^ fHCur<%^ 



i 



294 



TABLE XXII I 



Appalachian 

and Southern Northern 

HardwoodB Hardwoode 

U Ft. B.M. M Ft. B.M. 



North 
Centrel 
U Ft. B.U. 



2,189,000 
2,203,000 



'M\ 



19,000 
20,800 
2't,700 
30,000 



let Quarter 
2n4 " 



2,571*, 000 

2,700,000 
2,673,000 

2,71'', 000 



670,000 
Ti9 , 600 
742,300 
jl'.OOO 



11,900 

33,1*00 
31,900 

30,100 



let Quarte 
2nd ■ 
3^^ " 



2,621,000 
2,557,000 
2,1*20,000 
2,35l*,000 



801,100 
831,900 
771,500 
692,000 



26,900 
26, 100 
21,100 
22.100 



2,203,000 
2,159,000 
1,992,000 
1,827,000 



676,100 
62l*,600 
53't,100 
1*22,000 



21,100 
20,200 
18,800 
17.000 



let garter 
2nd ■ 

Ira 
Uth « 

1934 

let Quarter 
2nd ■ 

3rd ' 



1,700,000 
1,413,000 
" '"",000 
,000 



J.,-TJ._7,^ 

1.433,0 
1,534,0 



1,566,000 

1,604,000 
1,628,000 
1,572,000 



416,700 
345,400 
295,700 

311,000 



156,006 

161,643 
140,789 
322,122 



120,200 
125,479 
109,242 
94,013 



70,000 
72,500 
71,400 



15,900 
11,400 
11,800 
15,500 



15,700 
17,o4« 
17,561 
17,716 



Source: Lumber Code Authority Docket #5, 2nd Quarter, 1935- 



9813 



(i 



295 



ino oo 
^ 8 o oj 


o 


oooo 
r-l aj«oo\ 


8 

t<^ 


O O OO 

H C\J r--rH 


O 

IT. 


O OlTiLTi 

ir\0 cvj f^ 


8 


O QOO 




t^O O^ 




in 


S3 i-IOn«0 


ISO 


ojoj r^o 


o 


Jd- w vovo 


O 
«0 


Oj?«3^ 
or^cuiH 


to 
o 


10 W)0 C\J 




r' .^^<^o 


<0 




vo ISO r^^ 


r-f 


Lr\>o Lfvd- 


^'^ 


1*-!:* r<-\cy 


«) 


CVJCVJ t\J iJ 


IM 


M cy^ t<-\ 


w 


r^r^vK\C\j 


«0 


NO 



C\l OJ OJ C\l 



O OOOO O OOOO O 

O LIMrMTMn O OOOO o 

o r~r-i~~^- o irMrvUMTv o 

in r<M«M^Kv » ^J^jit^ 0\ 

CTv CytVlCUOJ in r-lr-dHH J* 



oooo ^'^ 



i^ i^o oo 



in J- 
o 3- 

to r-< 



Eu,: 8 



ir\ VOVOMDO r-t OJOJOJCJ 



OJ Oj CVJ OJ r-) Oj 0-1 r^KN 



3? 

o o 
CD fe 

rH -p 
to Vi 



8 o o o 
O Q O Q 
O OOOO 



\0 ^ j:}- ^ I<^ r<-\^ c\j c\j 



OOOO H r-l |--0\^ 

OOOO r~- ir\r-to\o 

OOOO V3 mi-^r^o 

(OOr^in cj c^^<^^-lc^ *o ^tOCT^^ 



OOOO o ooo< 



OOOO to NOt\)CJ\i-H 
OOQO r- t\Jjd-HO\ 
^r<^-3-i~- in toto^^ 



V3 CU C\J^ 1^ 



OJ 0\^ 1^ I-- ^ O to K\ 1-1 O r^to to 

LT^HrHCJ H Cyr^.CUK\ tO UTxinJ OJ 



LTvLfMnin 



OOOO to o r— o o 



o I c Lninir ir> o LfMnLnm o ojcjc\jc\j o OOOO o oooo to cy\OMnin 



toto toto t^ 

r-l r-l r-l iH !<". 



^ ono\onO\ ^ \o^vo\o o to r^\inc\i 
1^ iniTMnm vo *ovo^^ ctv i^to h-in 



m mo o o o oooc 
cu i^oino in ooinc 



OOOO in mo cur— 



r^ to irvto cu 



OOOO IT. O O < 



r-novDto ON ^^O^^Or'^ -d- On I^no cy 



KiifXij-m to ^ OJ O O 



^ 0\ CVJ I^^ K\ NO CU l<^H O O KNNO CT\ 
r^ :d-^r<%d- o ^ r^\ini^ in to 0\ to to 



r^ ^ cvj^ r^ NO r^i^^-m r^ inoNNOr-- r^ tOrHcvNo to ^Norr^m o ir^tooNO 
H mtomrj r— to rn inr-i iri OLr>i^r-i h cximcurH r<^ os^Hto j± i~-o inrH 
t\i to mir cvi o No^ojr- r^ mo. to-=J" to cuinNO-* t<^ HNOONin no i<->CT\tom 



r^tc O NO to TO r-l O On 



r'"\tQ r~i m 



ON r-l r^O K\ O^.Jlf h-CJ NO ON O O O 0\ KANO CNJ NO 

CM to 1^1^ NO o r«-\mNO r^ cvino^o 



r-l itnon in r<-\ cv o K^to m to NO^d- 1»- 



CUO O 0\ r-l 



9813 



s J 


8 

o 


o o o o 

OOOO 

oooo 


o 
o 
o 


oooo 
oooo 
oooo 


O 

8 


o o oo 
oooo 
oooo 


o 
o 
o 


oooo 
oooo 
oooo 


o 

8 


oooo 
oooo 
oooo 


o 

8 


QO oo 

oooo 
oooo 


O 

8 


:8 

NO 


Xi c ■ 
:3 eu ■ 


o 

NO 


r^i^to CNj 

CO cj CNJ m, 

o O OnnO 


o 
m 


^ rH mo 
o in^h m 
r-l o ^^l^^ 


o 


r^NO to On 

to^ oto 
ai OJ oto 


to 

NO 

o 


h^to ojm 
o ojmto 
c--to^-r- 


o 

o 

CNJ 


mto o 1^ 
-*.* o o 

NOtO-d- K. 


o 
to 

NO 


O inoNNO 
mf--o^ 
^ f^OtO 


to 
in 




en 


r- 


r<^roo,' cv.' 


r~ 


CNJ C\J rH rH 


d- 


i-\ r-i r-i 


r<^ 




^ 


H H 


^ 


rH rH rH 


in 


in 



H OJ ri-v^ 1^ rH CNJ K\^ 



I OJ r<\^ rr\ rH OJ ri%d- r^ rH cnj r<-v:)- 



S96 



DIVISIONS 



Appalachian 

and Southern 

Hardwoods 

U Ft. B.M. 



Northern 
Hardwoods 
a Ft. B.M. 



North- 
Hardwoods 
U Ft. B.U. 



North 
Central 
U Ft. B.U. 



1929 

let Quarter 



1,2S6,000 
1,251,000 
1,1*57,000 
1,321,000 



313,600 
277,900 
196,300 
151,200 



130,250 
130,250 
130,250 
130,250 



95,250 
95,250 
95,250 
95,500 



13,200 
19,200 
19,700 
19,H00 



1,838,300 
1,773.600 
1,898,500 
1,717,350 



let Quarte 
2nd " 
3rd " 
ftth " 



1,189,000 

1,086,000 

810,000 

707,000 



335, ?oo 
25s, kio 

121,600 
79,500 



96,250 
96,250 
96,250 
96,250 



57,500 
57,500 
57,500 
57,500 



11,900 
11,100 
6,300 
7,000 



1,690,150 

1,509,250 

1,091,650 

91*6,250 



let Quarter 
2nd • 

}'^ '. 
4th " 

1932 

1st Quarter 



1933 

let Quarter 



19?!* 

1st Quarte 
2nd " 
3rd > 
ftth ■ 



661*, 000 
646,000 
476,000 
459 , 000 



408,000 
1*25,000 
289 , 000 
273,000 



279,000 
488,000 
749,000 
574,000 



566,000 
603,000 
458,000 
323,000 



11*4,800 
62,200 
51,500 



59,250 
59,250 
59,250 
59,250 



134,100 
52,000 
19,500 

24,400 


32,500 
32.500 
32,500 
32,500 


240,000 


l4o,ooo 


46,000 
^6,500 
71,800 
85,700 


35,000 
35,000 
35,000 
35 , 000 


281,075 


144,676 


112,420 
80,326 
46,076 
1*2,253 


56,000 
54,223 
18,160 
16,293 



37,000 
37,000 
37,000 
37,000 



21,000 

21 , 000 
21,000 

21,000 



27,600 

27,600 
27,000 

27,600 
150,752 

48,352 
1*6,500 
31,600 
24,300 



4,500 
7,100 
5,000 
6,600 



2,700 
2,800 
1,600 
2,100 



2,900 
3,500 
6,300 
9,300 



4,624 
4,154 
3,329 



970, 250 
894,150 
639,450 
613,350 



598,300 
533,300 
363,600 
353,000 



390,500 
590,600 
889,100 
731,600 

2,543,465 

7«7,627 
788,673 
557,990 
409,175 



Source: Lumber Code Authority Docket #5. 2nd Quarte 



»8ia 



^97 



SvS 



gfc 



' -a 



I ■: 



iZ s 



w ^ r^ K\ o 

P © i? fi S 



Si 8 



O O <-t 



H f*> gs o 



€ S5 8 3 



;* OS W 



S 8 



2 2^3 $ 5 S 
^ ^ 5 ^ 5 o M 



3 P; 



s S IS ;^ 



9813 



III I I I I 11 

sl si 



II III 



1 a 



. +* -d -d ^ +> 



g- I g- & 

•d -d 43 _ -p 



s^g 



s a 



298 



or- r- ^ 



o o o 



^ J* r-- 



s 5 s; ?. 8 s 



J* t^ Jt 



S R s? 



Sf K 



H O 



s s 



S 1^ S 8 2' 



Pi !i S 



S 3 g 



rH 'O 



8 S»5? Si.S^S 






::; § 



9813 



III mi im mi mi mi i 



299 



«0 CT\ On 



ir\ m lr^ 



TO r^ ITv 



ix> J- H 



C\JC\iC\JC\]C\JC\JC\JC\JC\J 



yD ^ cu r^ 



ir\ ^ Ln to *o ^'^ r<-\ 



§5 



(T\ (T\ ON 



ON ON <iO '-0 



^ ^<^ in >o 



C\J C\J CM c\j 



^ 






;^ :5i 



LTi LTN in 



r^ C\J KN 






J* J* H iH 

iTN KN r^ r^ 



^ 



ON lA CVJ 



r^ r^ OJ c\j c\j c\j c\j 



r^ r<^ cvj r<-\ oj OH 



<D • f-i o 

•rl <D S"f< 

CO 71} 0) 

4) C p. 

0) n, 'M CD 

J3 K -H rH 



^iH or'\irNr<Nr<NOi-ic\j 



p, CO ho 



^51 



^r— (TSONITN'OISOW) 

*o r<NC\j trN«) ir>if\o 



p. » 



CO tn -p CO +> s ( 



CO CO a> .H -H 

■H »rt " 

S J3 +> 



d o 
m q 



B e s 



H 4 t» > 

n) cd M (D w 

Eh t-" -H tJ -H 



^^ <D o a o 



9813 



CO H 1^ 
M id ON 
■H ;3 iH 



CO CO m cn m OQ 



,gNO0N'60c^^lrN^c<^t\Jr^ 
^^|cvJ^*^cy.c^Jc^JCucvJC^JC^JCVJ cy 

CdlONCTNONCTNCjNONONONONONCJN 



B 3 M )> 

(1) .• 

ID <U (1> ^ O 

Si S3 SI Q a 

e- ti E- d o 

rnlail r<^ cD 



'U 



a 



Table XXIX 
Wastom PljM Oosti 





First 
Quarter 

'If 


Year 


Tear 

w 


Tear 


Tear 


Tear 


Tear 


Logging 


% 6.93 


% 7.53 


% 7.53 


* 9.17 


$9.73 


110.28 


$10.02 


Samnlll and yard 


^.11 


4,54 






4.40 






Pond to trimmer 






1.77 


2.27 




2.41 


2.41 


Chain to pile inclusive 






l.5»^ 


1.40 




1.72 


1.63 


Overhead 


KIO 


•^.35 


2.44 


1.53 


3.46 


1.91 


1.77 


Depreciation (Sawmill, eto.) 




.g? 


.&6 


.55 





56 


53 


Cost In pile 


- 16.40 


17.24 


14.14 


14.92 


17.59 


16.94 


16.37 


Pile to planer inclusive 


1.27 


1.67 


1.40 


2.03 


3.01 


1.97 


1.67 


Shipping ejqjense 


1.5"^ 


1.56 


1.20 


1.23 




1.40 


1.45 


Depreciation (Planing mill, etc. 




.27 


.36 


.25 




.32 


.29 


Selling expense 


2.12 


2.64 


1.55 


1.39 


5/ 


1.32 


1.19 


Cost in car 


■ 21.33 


23.33 


IS. 65 


19.82 


20.60 


21.94 


20.96 


Stumpage (Lumber tally basis) 


2.11 


2,86 


2.89 


2.17 


2.47 


2.42 


2.46 


Operating costs and stunipage 


23.m 


26.24 


21.54 


21.99 


23.07 


24.36 


23.42 


Other costs 


.00 


.00 


.30 


.77 


.00 


.87 


1.05 


Total - All coBta 


23.44 


26.24 


21.84 


22.76 


23.07 

5/ 


25.23 


24.47 



I 



Industry questionnaires. 

Western Pine association. 

U.S. Tariff Commission. 

Western Pine Manufacturer's Association. 

Without selling and interest. 



Sources: Indicated by column references 
Compiled by: D. N. Burnham, C.P.A. 

Division of Review.NRA. 



o 
o 



o 



304 

liBLE X7X 

LDUBEBt Costs and Bealization* 

BASIS t Ihaosand Feet Board Measure 





Heported 
Costs 


Industry Data 
Under Code 
Jany-Feby-Mch . 
I93I; 


United 
States 
Ikriff 

COIB* 




Beported 
fiaalization 


mission 

Costs 

1929 


Southern Piziei 








Large lails 


$21^.53 


♦ 26.63 


»(1) 


Small ULlls 


20.1i2 


22.21^ 


(1) 


All Hills 


2h.0h 


26.07 


28.25 


Southeim Eardvoodt 


28.58 


32.33 


(1) 


J^palachian Hardirood 


32.68 


35.i<2 


(1) 


Western Pine 
"(Ponderosa) 


2i^.08 


23,18 


23.07 


West Coast t 






22.96 


Douglas Fir and Hemlock - 






Large lails 


I8.5I 


17.91 


(1) 


Small laUs 


12.31 


li^66 


(1) 


Sitka Spmoe 


22.83 


22.19 


(1) 



(1) Hot separately tabulated by United States Tariff Conmission. 



98ia 



Con^>iled Byt D. N. Bumham, C.P.A. 

Review Division, H.R.A. 
Sources t Industry Data from 

Industry Questionnaires 
Tariff Commission Data 
from Report to the 
President on Lamber Re- 
port No. 32, Second Series. 
Page 22. 



302 



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305 



SECT . II CHAPTER 2 TABW HXn 

LUMBER AND TIIIBKR CORPORATIONS 

(FOREST PRODUCTS rNDU3TRIl:S) 

OONDENSEB BALANCE SHEET AND mOFIT AKD LOSS DATA 

(000 omitted In all dollar amounte) 



BALANCE SHEET DATA 



ASSETS 

Caah 

Recelvablee 

Inventorlee 

Capital AseetE - Lees Depreo. 

and Deple. 
SeourltlsB - Not tax exampt 

■ - Tax exempt 
Uleoellanaoue ABsets 


A 

142,403 
609.463 
770.014 

1.853,88« 

73^071 
571,519 


B 
124,880 
558,985 
740,276 

1,766 315 

62,355 
540,893 



138,678 
612,707 
707.050 

1,804,793 

, 57,519 
428,091 


D 

121,666 
620,034 
705.313 

1,723,264 
264,368 
54,054 
183,660 


E 

113,808 
490,624 
637,856 

1,677.301 
257.991 
42,156 
224,058 


T 
82,978 

241;^? 

1,511,880 
292,381 
38.403 
150,155 




77.100 
1,448,283 

143,010 


68,823 
297.506 
356.613 

3*. 059 
156,379 


Total AeeetB 


4,023.358 

692,017 
461,580 
159,972 

285,434 
1.377.612 
1,046,743 


3.793,704 

666,449 
322,649 
161,010 
209,910 
1,345,422 
1,088,264 


3,748,838 

650,411 
231,647 
212,191 
229,118 
1,340,409 
1,085,062 


3,672,359 


3.443,793 


2,892,578 


2,704,425 


2.548,733 


LIABIUTIES CAPITAL 

NotcB and Accounte Payable 

Other LlabllltleB 

Bonded Debt and Mortgagee 

Preferred Stock 

Common Stock 

SurplUB 


594,746 
231,049 
237.848 
217.177 
1.278,737 
1,112,802 


530,086 
203^7 
259.567 

1,266; 844 
968,218 


380,349 
181,010 
265,498 
197.869 
1,190,320 
677. o?2 


366,171 

177,804 
253,441 
1*3,035 
1,224,870 
499,104 


350.652 
168.590 
231.307 
175,894 
1,159,225 
463,065 



4,023,358 3,793,704 3,748,838 3,672,359 3,443,793 2,892,578 2,704,425 2.548,733 



mOTIT AND LOSS DATA 



Oroes SaleB 2 

LeBB Coet of Salee 2 

OroBB Profit from Salee 

Other Income 

Net Profits 

CaBb DlrtdendB Paid 

Stock Dividends Paid 

Income Tax Paid 


,938,014 
,254,973 
683,041 
88,950 
116,810 
124,291 
15,072 
21,907 


2,694,795 
2,072,926 
621,869 
111,934 
43,379 
108,586 
9,672 
15,61' 

mniBER OF 


2,730,761 
2,088,316 
642,445 
114,004 
81,958 
112.558 
11,643 
15,210 

CORPORATIONS 


2,684,104 
2,050,193 
633,911 
112,979 
78,018 
102,973 
12:418 
13.437 

REPORTIWl 


1,910,432 

68,962 
4,528 
3,591 


1,284,660 
1,076,945 

„ 64,539 

^ 177.752 

35.241 

1.678 

1.379 


793,996 

687,884 

106,112 

,, 61,623 

2/ 202,266 

25,860 

411 

2,237 


922,936 
696,691 
226.245 
,/ 64.071 
2/ 66,069 
1».655 


Number Reporting Net Income 


4,591 


4,178 


4,290 


4,195 


2.340 


1,525 


541 


1,«3« 


Number Reporting No Net Income 


3,271 


3.353 


3.367 


3.294 


4,868 


5.150 


5.929 


4,882 


Number Reporting Inactive 


y 


285 


290 


380 


293 


279 


237 


359 


Total Number Reporting 


7.862 


7.816 


7,947 


7.869 


7,501 


6.954 


6,707 


6,879 


Number Reporting with Balance Sheets 


7.244 


7.230 


7,190 


7,094 


6,824 


6.137 


6,147 


6,161 


1/ Not eegregated from Ulscellaneous 
2/ Deficit or Net Lobs. 
y Not tabulated. 


Assets in 


this year. 






Prepared "by: 
Source : 


D. N. Bumham, O.P.A. 
DlTlBion of Review, WU. 
Statistics of Income, 
Bureau of Internal Revenue 





306 



SECT. II CHAPTER 2 TABLE HCT 

LUMBER AND TIKBER COBPORATIONS 

(FOREST PRODUCTS INDUSTRIES) 

NUMBER OF CORPORATIONS REPORTINO PROFIT AND NO PRCTIT 

IN EACH OF TIC CLASSIFIED 0R0UP3 



All Corporatlor.a 

Number Reporting Profit 
Number Reporting No Profit 
Total Number Reporting 

Oorparstlone With Total Aesete Under 150,000 
Number Reporting Profit 
Number Reporting No Profit 
Total Number Reporting 

♦50,000 - 1100,000 

Number Reporting Profit 
Number Reporting No Profit 
Total Number Reporting 

1100,000 - 1250,000 

Number Reporting Profit 
Number Reporting No Profit 
Total Number Reporting 

$250,000 - $500,000 

Number Reporting Profit 
Number Reporting No Profit 
Total Number Reporting 

$500,000 - $1,000,000 

Number Reporting Profit 
Number Reporting No Profit 
Total Number Reporting 

$1,000,000 - $5,000,000 

Number Reporting Profit 
Number Reporting No Profit 
Total Number Reporting 

$5,000,000 - $10,000,000 

Number Reporting Profit 
Number Reporting No Profit 
Total Number Reporting 

$10,000,000 - $50,000,000 

Number Reporting Profit 
Number Reporting No Profit 
Total Number Reporting 

Over $50,000,000 

Number Reporting Profit 
Number Reporting No Profit 
Total Number Reporting 



1.35t 
6,177 



460 
1,572 
2,052 

262 

818 

1,080 



321 
1,078 
1,399 



126 
570 
696 



<35 



65 
332 
397 



520 

5.627 
6,147 



210 
2,157 
2,367 



102 
1,187 
1,289 



i 



1,584 
*,577 
6,161 



499 
1,995 
2,494 



1,2Z4 



365 



«7 
233 
320 



Prepared by: D.N.Bumham, C.P.A. 

DlTlelon of Review, SRA. 
Source: Statletloe of Inooffle 

Bureau of Internal Revenue . 



9813 



^ 



d 



307 



aEOT. Ill OHAPTIR 2 TABLI COTI 
OORPORtTIOH RITURNS 
OLASSIFUD BY MAJOR INDUSTRJ OR0UP3 
PEHCEUTAOI OF 0ORP0RATIOII8 REPORTIIIO PROriT 





1920 


1921 


1922 


1923 


192U 


1925 


1926 


1927 


1928 


1929 


1930 


1931 


1932 


All OorporatloBi 




























IgTloultun 


HZ 


36 


W 


HI 


46 


47 


44 


45 


44 


42 


32 


23 


11 


Uinta i ^uxTjiag 


UO 


25 


36 


28 


' 27 


29 


31 


28 


28 


29 


27 


22 


17 


Manufaotur Ing- Total 


63 


H6 


59 


63 


59 


61 


59 


57 


57 


57 


1*3 


33 


16 


Food Product! 


55 


52 


59 


62 


63 


63 


60 


59 


59 


60 


53 


44 


24 


Tobaooo ■ 


1/ 


y 


1/ 


t9 


46 


1/ 


58 


59 


54 


56 


48 


41 


30 


Taxtllea 


55 


k9 


a 


65 


56 


61 


57 


59 


56 


55 


39 


33 


17 


LaatlMT 


57 


U5 


58 


57 


55 


58 


57 


57 


56 


54 


36 


33 


20 


Rubber 


112 


31 


M 


45 


51 


55 


50 


51 


48 


49 


37 


32 


18 


Foraet Produota 


73 


W 


66 


71 


62 


61 


58 


53 


54 


53 


31 


22 


08 


Paper-Pulp 


«0 


W 


61 


68 


64 


66 


67 


67 


64 


66 


53 


40 


23 


Print Inf^Publlahlng 


79 


64 


66 


67 


65 


66 


66 


63 


64 


63 


52 


39 


18 


Ohsmloali 


52 


US 


57 


55 


55 


57 


56 


55 


56 


51* 


45 


39 


23 


Stons, Olay, aiasa 


73 


5H 


63 


69 


63 


62 


60 


55 


55 


53 


38 


26 


10 


Ketal 


67 


35 


53 


63 


56 


59 


60 


56 


59 


61 


39 


24 


10 


Hot Eleewhexe 

Olaaalfled 


60 


W 


55 


60 


58 


59 


53 


51 


50 


48 


37 


26 


13 


OonatTuotlon 


70 


58 


62 


65 


66 


63 


60 


57 


57 


52 


44 


33 


11 


Transportation & 
Public ntilltles 


63 


62 


67 


68 


65 


63 


62 


60 


59 


57 


51 


46 


28 


Tiada 


66 


19 


62 


68 


65 


66 


63 


61 


61 


59 


44 


31* 


15 


Profeealooal -Ho tele 
AffluaementB 


ee 


56 


58 


62 


59 


57 


55 


53 


52 


51 


45 


37 


15 


Bazililng, Ina. Real 
Eataie Stooka It Sonde 70 


65 


64 


65 


64 


63 


59 


57 


55 


53 


47 


39 


18 


1/ Kot available aa aaparata Item 














Prepared by: 
Source : 


D. 'N. Bumham, O.P.A. 
Dlvleton of Review, KRA. 
Statistic e of Income 
Bureau of Internal Revenue. 





9813 



aow 



SECT. Ill CHAPTER 2 TABLE XXCTII 
CORPORATE RETURNS 
CLASSIFIED BY MAJOR INDUSTRY OROUPS 
OP ASSET VALUES OF CORPORATIONS REPORTING PROFITS 



*grloultur» 


71 


55 


68 


Ulnlng A Quarrying 


87 


W 


64 


Manufaoturlng- Total 


67 


63 


80 


rood 


61 


67 


77 


Tobaooo 


1/ 


i/ 


1/ 


TejtlloB 


69 


68 


84 


Laather 


5* 


58 


79 


Rubbar 


77 


18 


59 


Foreat 


89 


58 


84 


Paper-Pulp 


96 


56 


79 


Printing 


90 


82 


99 


ChemloalB 


82 


55 


87 


Stona Clay 


9U 


77 


87 


liatal 


89 


62 


77 


Not eleevhare 


83 


66 


82 


Clasalflai 
Conatruotlon 


»h 


72 


74 


Transportation 


85 


80 


83 


Trade 


75 


61* 


79 


flerrloa, Profeealon- 
sl, ABUseaents, 
Hotels 


85 


75 


76 


Finance 


80 


77 


80 


V Hot available 


as eepi 


irate Itea. 





71 


77 


77 


77 


54 


71 


59 


70 


75 


5'* 


85 


79 


85 


83 


66 


86 


67 


89 


71 


64 


97 


98 


98 


96 


93 


69 


81 


73 


72 


32 


74 


82 


77 


72 


53 


72 


72 


67 


64 


51 


76 


69 


72 


71 


36 



D. N. BumhaJn. C.P.A. 
Division of Review NRA 
Statistics of Income. 
Bureau of Internal Revenue 



1932 
36 



9813 



309 



TABLI XI3C7III 
JOHIST PRODUCTS COHPOBATIOHS 

nr iicouE, OB loss, cash ditidskds 

IBS FEDERAL INCOME TAXES PAID 



(,000 oaltt«d In all dollar amounts) 



Tear 


Het Income 

or 

Het Loss 


Cash 
Dirldenda 


Federal 
Income Taxes 


Het Surplus 
Reduction 


1936 


$116,810 


$124,291 


$ 21,907 


$ 29,388 


1927 


43,379 


108.586 


15,612 


80,819 


1928 


ei,95S 


112,558 


15,210 


45,810 


1929 


78,018 


102,973 


13,437 


38,392 


1930 


1/ 109,576 


68,962 


3,591 


182,129 


1931 


1/ 177,752 


35.241 


1,379 


214. 372 


1932 


1/ 202,266 


25,860 


2,237 


230,363 


1933 


1/ 66,069 


14,655 


3,254 


83,978 


Totals 

for 
period 


l/$235,498 


$593,126 


$76,627 


$905, 251 



1/ Het Loss 



Prepared ty D. N. Bumham, C.P.A. 
Division of Review, HRA 



Source: Statistics of Income 

Bureau of Internal Revenue 



9813 






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312 



DISTRIBUTION OF HAHDWOOD UniBER 
FROII mODUCINO HBJI0N3 TO CONSUUINO RBttlOllS ANB STATES 
1934 
(U rt. Bd. U.) 



ReSlon 




















====== 


== 


== 


== 


from- 




























State 




Appala- 


North 




North 






South- 


Appala- 


North 


North- 


North 




to: 


Southern 


chian 


Central 


Northern 


saetem 


Western 


Total 




chian 


Central 


1.49 


eaetem 

72-29 


Western 


l(onih AtjlsnlUs 


10,259 


11.285 


1,154 


1,338 


65,146 


937 


90,119 


11.38 


12.52 


1.28 


1.04 


Ualna 


331 


239 


27 


343 


18,476 


427 


19,843 


1.67 


1.20 


.14 


1-73 


93-11 


2.15 


N«« HampsMr* 


221 


287 




171 


13,019 




13,698 


1.61 


2.10 




1.25 


95-04 




Tarmont 


110 


143 


- 




10,654 


_ 


10,907 
31,794 


1.01 


1.11 


_ 




97.68 


_ 


UaBeaohuettta 


7,170 


6.025 


859 


584 


17,051 


105 


22.55 


18.95 


2.70 


lT84 


53-63 
27-49 


"33 


Rhode Iiloncl 


662 


1,100 




69 


694 




2,525 


26.22 


43.56 




2.73 


Oonneotlcut 


1.765 


3,491 


268 


171 


5,252 


4^5 


11,352 


15.55 


30.75 


2.36 


1.51 


46.26 


3.57 


ma-Atimtio 


190, gl« 


106,011 


7,570 


4,322 


108,326 


603 


417,680 


45.69 


25.38 


1.81 


1.04 


25.94 


-H 


H*w Yort 


63,322 


45,284 


2,255 


1,543 


38,641 


352 


151,397 


41.83 


29.91 


1.49 


1.02 


25-52 
14.20 


• 23 


Hew Jereej 


17,320 


8,129 


201 


69 


4,258 




29,977 


57-78 
39.49 


27.12 


.67 


-23 




Penni7lTanla 


76,339 


45,235 


4,510 


2,504 


64,714 


. 


193.302 


23.40 


2.33 


1.10 


33.48 


_ 


Delamre 


2,868 


430 


- 


. 


- 


_ 


3,298 


86.96 


13.04 




_ 




_ 


UuTland 


30,227 


6,503 


604 


137 


713 


251 


38,435 


78.64 


16.92 


1.57 


.36 


1.86 


.65 


Wetrlct of 




























Coluabla 


772 


430 


- 


69 


- 


- 


1.271 


60. 74 


33.83 


- 


5.43 


- 


- 


Southeastern 


411,0110 


220,197 


2,174 


823 


2,194 


56 


636,484 


64.58 


34. 60 


• 3'* 


.13 


.3* 


.01 


West TlTRlnla 


2,648 


55,850 


67 


3^ 


1,669 


. 


60,268 


4.39 


92.67 


.11 


.06 


2-77 




Virginia 


71,044 


3,873 




103 


- 


- 


75,020 


94.70 


5. 16 




.14 




_ 


Horth Carolina 


119,252 


2,821 


- 


69 


. 


_ 


122,142 


97.63 


2.31 


_ 


.06 


, 


_ 


South Carolina 


5,516 


- 


- 




_ 


_ 


5,516 


100.00 




. 




_ 


_ 


Georgia 


12,907 
22,174 


48 


81 


274 


525 


- 


'^.:Ul 


93.29 


'36 


.58 


1.98 


3.79 


« 


norlda 


430 


- 


- 




- 


98.10 


1.90 




_ 




_ ; 


Alateiia 


20,409 


669 


- 


3t 


- 


. 


21,112 


96.67 


3.17 


_ 


.16 


- 


. 1, ' 


klBeleelppl 


44,347 


48 


- 




- 


. 


44,395 


99.89 


.11 


. 




_ 


_ ' 


Tenneeeee 


93.327 
19,416 


107,39s 


13 


2M0 


. 


- 


200,978 


46.44 


53.44 


.01 


.11 


« 


» 


Kentucky 


49,060 


2,013 


69 


- 


56 


70,614 


27.50 


59.48 


2.85 


.10 


- 


-07 


Lake States 


177,831 


125,759 


120,224 


331.798 


11,799 


1,484 


768,895 


23.13 


16.36 


15-64 


43-15 


1.53 


.19 


Ohio 


35,191 


70,292 


52,508 


5.830 


8.216 


45 


172,082 


20.45 


40.85 


30.51 
41.35 


3.39 


i».77 


.03 


Indiana 


36,405 


10,079 


37,703 


6,071 


900 


22 


91,190 


39.92 


11.06 


6.66 


-99 


.02 


IlllnolB 


60,895 
39,714 


23,526 
17,453 


20,295 


56.jt55 
144,497 


1,913 

714 


693 


163,777 


37.18 


14.36 


12.39 


34.47 


1.18 


.42 


Michigan 


8,040 


m 


210,793 


18.84 


8.28 


3. 81 


68.55 
92.49 


.3^ 


.18 


WlBOoneln 


2,75« 


2.391 


1.302 


«3.13« 


56 


89,889 


3.07 


2.66 


1.44 


.07 


• 27 


Ulnneeota 


2,868 


2.008 


376 


35.807 




105 


41,164 


6.97 


4.88 


.91 


86.99 




.25 


Hld-Ieatem 


70,603 


9.324 


2,846 


3,738 


113 


535 


87.159 


81.00 


10.70 


3-27 


4.29 


.13 


.61 


KlBoourl 


58.027 


8.6O7 


2,846 


1.748 


113 


41 


71,382 


81.29 


12.06 


3.99 


9!64 


.16 


.05 


Eaneas 


41744 


191 


- 


617 




296 


6.399 


82.75 


2.98 




- 


4.63 


Ioi<a 


526 


- 


892 


- 


116 


6.278 


75.57 


8.37 


- 


14.21 


- 


1.85 


Nebraska 


2.537 




- 


309 


- 


41 


2,887 


87.88 




- 


10.70 


- 


1.4a 


South Dakota 




- 


— 


69 


- 


41 


110 


. 


_ 


- 


62.73 


- 


37.27 


North Dakota 


- 


- 


- 


103 


- 


- 


103 


- 


- 


- 


100.00 


- 




Sjmthweetam 


228.356 


2,630 


- 


3"* 


- 


209 


231,229 


98.76 


1.14 


- 


.01 


- 


.09 


Arkaneae 


119,363 


1,769 


. 


. 


_ 


209 


121,341 


98.37 


1.46 


. 


_ 


. 


-17 


Loulalana 


59,571 
47,216 


765 


- 


- 


- 


- 


fl^^^ 


98.73 


1.27 


- 


- 


- 




Texas 


96 


- 


3"* 


. 


- 


99.73 


.20 


- 


■ 07 


- 


- 


Oklahooa 


2,206 


- 


- 




- 


- 


2,206 


100.00 


- 


- 




- 


- 


Inter-Mountain 


1,655 


48 


- 


240 


- 


959 


2,902 


57.03 


1.65 


- 


8.27 


- 


33.05 


Montana 


. 


. 


. 


137 


. 


139 


276 


. 


. 


_ 


49.64 


. 


50.36 


Idaho 


- 


- 


- 




- 


112 


112 


. 


- 


. 


- 


- 


100.00 


doming 


221 


- 


- 


- 


- 


- 


221 


100.00 


- 


- 


- 


- 


-f 


Colorado 


772 


48 


- 


- 


- 


86 


906 


85.21 


5.30 


- 


- 


- 


9.41 


Utah 


331 


- 


- 


103 


- 


112 


546 


60.62 




- 


18.86 


- 


20.5? 


IferadB 




- 


. 




- 


510 


510 


- 


. 


- 


- 


- 


100.00 


Arltona 


331 


. 


> 


- 


- 




331 


100.00 


- 


- 


- 


- 


- 


Hew Mexico 




- 


- 


- 


- 


- 




- 


- 


- 


- 


- 


- 


Pacific Coaat 


12,576 


2,917 


255 


686 


- 


32.698 


49,132 


25.60 


5.94 


.51 


1.40 


- 


60.55 


Washington 


883 


239 


. 


137 


. 


12,964 


14,223 


6.21 


1.68 


- 


.96 


. 


91.15 


Oregon 


221 


96 


. 


103 


. 


16,402 


'16,822 


1.11 
63.43 


.57 


- 


.61 


- 


V.-^2 


California 


11,472 


2,582 


255 


446 


- 


3,332 


18,087 


14.27 


1.41 


2.47 


- 


Grand Total 


1,103,168^/ 


478,171^/ 


134, 223^^ 


342, 979^/ 


I87,578i/ 


37,48li^ 


2,283.600^ 


48.31 


20.94 


5.88 


15.02 


8.21 


1.64 



Luaber Code Authority Docket #5, Snd. quarter, 1935- 

"Lumber Dletrlbutlon and Coneufflption, " Department of Agrioulture, Forest Service 193'^. (Alto work sheets of similar data fo 

the years 192S and 1934.) 
■World Lumber Press Information," Department of Commerce, Torelgn and Domestic Commerce, Issue #7. February 10, 1935. P* 3- 

region of origin and the total of each of origin 
Forest Servloe data. 

L. C. A. hardwood shipments less hardwood exports. 



9813 



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316 



TABLE XLV 
Softwood Exports: United States Share of World Market 



1 

I 

i 



Year 


United States 


Per Cent 
of 
Total 


All other 
Countries 


Per Cent 
of 
Total 


World Total 


Per Cent 
of 
Total 








(M ft. b. ra.) 








1929 


3,213,325 


20.7 


12,285,805 


79.3 


15,499,130 


100 


1930 


2,268,655 


19.9 


11,398,150 


80.1 


13,667,005 


100 


1931 


1,664,778 


15.6 


8,998,078 


84.4 


10,662,856 


100 


1932 


1,066,100 


10.8 


8,801,326 


89.2 


9,867,426 


100 


1933 


1,197,152 


10.8 


9,880,130 


89.2 


11,077,282 


100 


1934 


1,386,498 


12.3 


9,863,893 


87,7 


11,250,391 


100 



Source: Pacific Lumber Inspection Bureau, Seattle Washington. 
See Table - World Imports and E3q)ort8 



•l 



9813 



31V. 



TABl£ NO. XLVI 



DlvlHlon - Stst 



Alabimo 

Callfnrnla (North) 
North Carolina 
South Carolina 

TotPl for DlvlFl:^ 



■; 


- Georgia 


6 


- Illlnole 


7 


- Indlcna 


s 


- Kentucky 


9 


- Loulelena 


10 


- Michigan - South 


11 


- Delawfire 




District of ColumblH 




Uaryland 




New Jersey - South 




Pennsylvania - East 




Total for DlvlBlon 


l^ 


- MlBBlBSlppl 


13 


- Colorado 




Now Mexico 




Wyoming 




Total for Dinelon 


It 


- Nebraslra 


15 


- New Jereey - North 


16 


- New York City 


17 


- Connecticut 




Maine 




Maesachupette 




New Hamoshlre 




New York {excl. NYC) 




PennBylvanla - McKean Cty. 




Rhode lEl-'nd 




Vermont 




Total for Division 


>lg 


" MlnneBota 




North Dakota 




South Dakota 




Iowa 




Total for Division 


19 


- Ohio 


20 


- Pennsylvania - West 


SI 


- Arkansas 




Missouri 




Kansas 




Oklahoma 




Total for Division 


S2 


- TennSFsee 


?1 


- Texas 


?k 


- Utah 


25 


- Virginia 


26 


- Idnho 




f-iontana 
N<>vHda 




Oregon 




Washington 




Total for Division 


27 


- Wept Virginia 


28 


- Michigan - North 




Wisconsin 




Total 'or Division 


29 


- Illlnole - Cook Cty. 


10 


- :JleB0url - St. Louis Cty. 


'^l 


- Arizona 


^2 


- California - South 




TOTAL 







Percentage 


Nunber 




of 


of 


Dealers 


Reporting 


Known Dealers 


Reporting 


to Known 


652 


11 


5-67 


633 


7.11 


197 


~ 


- 


362 


- 


- 


559 


3 


0.005 


296 


11 


31.42 


372 


3-76 


1,011* 


119 


11.74 


614 


'1^ 


28.66 


323 


12. 3« 


235 


24 


10.21 


726 


120 


16-53 


39 


5 


12.82 


19 


1 


5.26 


13« 


28 


20.29 


105 


21 


20.00 


689 


ll« 


17.13 


990 


173 


17.47 


147 


g 


5.44 


312 


96 


30.77 


115 


IS 


15.65 


90 


17 


18.89 


517 


131 


25.34 


m 


12« 

40 


'VM 


453 


^ 


8.61 


176 


22.73 


167 


11 


6.59 


723 


58 


17.96 



67 
61 

1,979 
401 

III 
626 

1,327 

914 
497 
254 
775 
924 
726 

2,679 

398 
2,076 

115 
1,091 

229 

309 
35 

582 

l,5?o 



23.531 



7 

121 

5 

7 

5 

254 
53 



173 

127 
174 



253 

257 

32 
21 
62 

154 

3,554 



11.29 
11.06 
17.24 
10.45 
8.20 

12.83 
13.22 



23.29 

26.37 
19.32 
3.15 
22.32 
13.74 
23-97 

17.99 

6.53 
10.93 
10.43 
3-76 
3. 06 
16-18 
8-57 
4-53 
10-14 

8.89 

9.15 
6.67 

27-80 



16.84 
20-00 
69-66 
26.?? 

15.10 



In Division #18, North Dakota, the nuTiher of known dealers reporting 1 
Thlp high percentage of return for this state may be attributed to the 
Lumbci Coi^pany at Mlnot, covering R"? yards, throughout the state. It 
company was recorded fs only one til known dealer by tha Code Authority whe 
5} separate reports. Counting this company's report 
would be reduced to 26 or 17-61 per cent- 



wn as 80 or TO. 31 per cent. 
rt submitted by the Midwest 
ry probable tr.at this lumber 
have Included It as 
only 1 report, the number reporting In N. D. 



0813 



id.t^ 



,5 i 






S "3° 



J to . 

I 



I"! ^ 



318 

WJ*c^o^-+^Ol*^or^r^^-lr^^o«)wo^r^Olpc^lJ^^-^ocycuc>Jl^HK^cyr^^ 5 

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cyr»^«~r-^io"tu<7rorc\j"j-"i--rw»o"wc\j"ovrr\'0 oj r-r^r-r^O O^ t<\ t<\ a ir\ ^ in j* 

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Rr?, sl?,?ii?, S^CS-*!^. S<Sf;S.SSS?.g.SK?.l?;^S!i5'§S!S,S! 3 

K ^" K 5 i" I *: S" fi S ? si S I §■ g" ^ ^ f S g ^ J g' 5 g" & g i S K « I 

ri J |i- "v o K to 5 o K e S IIN cvJ_ » T~- « w 1^ J_ ■<> « i^ ■* ~ >". 1^ 'O. "^ ~ "» 
F- J o Oi r-- 1^ ni o_ li-. os_ » J- a w_ -o_ » cu o_ lI^ o_ 1I^ ir\ ■©_ r~ rt w_ o, w r^ o. 'o o_ o>_ 



I 5 

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9813 



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£ h 



lalllisllllllllllliiesH 



TABLE HO. XLVIII 

RETAIL LUMBER DEALERS 

RECAPITULATION 

EXPENSES TO NET SALES DOLLAR 

YEAR 19Tt 

KNOWN DEALERS 2? 531 - ' DEALERS REPORTING 3,551 



(see Exhibit 











Percentage 


of Each to Net 


Bale. 




™ 








Handling 


Selling 


Interest 


Total 






Sales 


OroBs 


Rework 


Delivery 


Admin. 


Bad Debts 


Mad, 
Expense 


Profit 




000 Omitted 


Profit 


Mill Exp. 


Expense 


Expense 


Expense 


Loss - 


Industry 


I 166,763 


27-71* 


.75 


7-12 


17.08 


3-27 


28.22 


.4*. 


DlTlelon - State 


















1 - Alabama 


1,1*09 


35-01 


3.86 


8-04 


17-17 


3.20 


32-27 


2.84 


2 - No. Ca If. 


2,1*26 


27.43 


1.03 


7-11 


14.78 


3-18 


26.10 


1-3? 


3 - Carol Inas 

4 - Florida 


107 


37-58 


5-90 


7-82 


20.52 


1.18 


35 •'*2 


2.16 


6,06a 


29-36 


1-08 


6-77 


14.58 


3-17 


25. 60 


3.76 


5 - Georgia 


1,786 


28.31 
27-46 


2-24 


7-52 


13.82 


1-93 


25.51 
27.41 


2.80 


6 - Illinois 


3,872 


-12 


7-18 


16.89 


3-22 


.05 


7 - Indiana 


6,307 


27-78 


-53 


6.66 


17.63 


3.36 


28.18 


.40- 


S ~ KenUioky 


1,81*3 


31.08 


-75 


6.99 


19-48 


3.15 


30-37 


-71 


9 - Loulolana 


1,630 


27-18 


.11 


7.17 


16-73 


1.55 


25-56 


1-62 


10 - So. Mloh. 


6,099 


27-99 


-69 


7-97 


16. 50 


3-18 


28-34 


•35- 


11 - Total 


12,883 


28-04 


-63 


8-44 


16.80 


3.58 


29.45 


1-41- 


Delaware 


5IW 


28-87 


_ 


7-27 


14.98 


1-24 


23-1*9 


5-38 


D. of 0. 


1*1 


21-33 


- 


5-40 


8.62 


1.28 


15-30 


6.03 • 


Maryland 


1,827 


27-66 


-91 


6.95 


15.83 


2.88 


26-57 


1.09 


So. N. J. 


1,283 


28.01 


.84 


8.49 


22.05 
16.54 


10.31 


41.69 


13-68- 


East Penna. 


9,030 


28.22 


.60 


8.87 


2.95 


28.96 


-7lt- 


12 - MlsBlselppl 


551 


30.7s 


.05 


7-1*3 


21.25 


5-03 


33-76 


2-98- 


13 - Total 


5,073 


25-87 


.10 


5-35 


16.29 


2-70 


24.44 


1.43 


Colorado 


3,'t36 


24.67 


.12 


5-81 
4.02 


15-82 


2.27 


24.02 


.65 


Ne» Mexico 


82* 


25.96 


.12 


16-01 


2.58 


22.73 


3-23 


Wyoming 


30. 81 


- 


4.74 


18-51 


4.61 


27.86 
24.16 


2-95 


lit - Nebraska 


3,785 


23.28 


.21 


5-98 


15-99 


2.18 


.as- 


15 - No. N. J. 


1,111 


32-41* 


-39 


9-95 


21.23 


3-64 


35-21 


■ ?:2t 


16 - N. Y. City 


3,9X5 


31.64 


-65 


11-13 


19.00 


2-70 


33-48 


17 - Total 


23,173 


29.21 


-98 


8.60 


17. 51* 


3-71 


30-83 


1-62- 


Conn. 


1*,9S6 


29.40 


-05 


l:% 


15.85 


4.3« 


29-25 


-15 


Maine 


661 


30.26 


2-51 


16.16 


2.67 


26-98 


3-28 


Maes. 


'•m 


29.21 


1-21 


9.75 

10.14 


17-51 

i4.si 


3. 16 


31.63 


2.42- 


N. H. 


32.70 
28.46 


5-21 


3.42 


33-58 


.88- 


N. Y. State 


9.350 


.88 


7-83 


18.04 


3.46 
4.67 


30.21 


1.75- 


Pa. 3 C'tles. 


884 


3"*. 59 
31.49 


8. 63 


5-97 


10.00 


30.27 

43. oe 


4.32 


R. I. 


.65 


9-84 


24.30 


8.29 


11.59- 


Vermont 


354 


31.62 


1.67 


4.88 


21.31 


.98 


28.84 


2-78 


18 - Total 


«.657 


24.27 


- 


6.01 


14.24 


2.02 


22.27 


2-00 


Iowa 


3,690 


24.10 


_ 


7.40 


11.85 


1.93 


21.18 


2.92 


Minn. 


2,5''8 


24.87 


_ ' 


6.86 


13.50 


':% 


23-03 


1.84 


North Dak. 


1,^^82 


25.06 


_ 


1.-?2 


18.29 


22-55 


2-51 


So. Dak. 


1,01*8 


22.37 


_ 


2.59 


19.09 


2.23 


23-91 


1-5*- 


19 - Ohio 


10,590 


30.66 


1.06 


7.68 


18.65 


3.90 


31-29 


.63- 


20 - Penna. Weet. 


4,269 


29.62 


.96 


7-57 


19.32 


4.08 


31-93 


2.31- 


21 - Total 


13,575 


25-89 


.12 


4.13 


17.39 


2.89 


24.53 


1.45 


Arkansas 


167 

i,oi4 


28-02 


_ 


8.63 


14.44 


^.53 


27.60 


.42 


Kaneae 


27-39 


.01 


3-99 
4.95 


18.79 


3.20 


25.99 
24.45 


1.40 


Missouri 


5,040 


25-64 


-32 


16.92 


2.26 


1.19 


Oklahoma 


5,351* 


25-23 


_ 


3-31 


17-13 


3.27 


23.71 


1.52 


22 - Tennessee 


1.276 


30.45 


-89 


6.20 


20.20 




30.52 


.07- 


23 - Texas 

24 - Utah 


6,914 


27.59 
24.52 


.18 


2.28 


19.75 


^94 


25.60 


1.99 


551 


.42 


5.87 


13-79 


25-02 


.50- 


25 - Virginia 


3,293 


27.25 


2.16 


7-05 


15-22 


2:75 


27-18 


.07 


26 - Total 


5,007 


29.81 


-38 


7-48 


16.36 


'*.33 


28-55 


1.26 


Idaho 


281 


27.06 




4.63 


l-?.45 


9.95 


28-03 


.97- 


Montana 


2,079 


29.32 


• 30 


6-57 


15.26 


4.90 


27.03 
28.74 


2.29 


Nevada 


96 


27.04 




5-30 


21.05 


2.39 


1.70- 


Oregon 


633 


32.15 


-02 


6-34 


■im 


2.53 


29.22 


2.83 


Washington 


1,917 


30.10 


.64 


9-38 


Ul 


30.03 


.07 


27 - West Va. 


1,001 


27. 61 


-76 


6-75 


14.99 


27. 06 


.55 


2S - Total 


9,142 


24.56 


-21 


6-6S 


14.29 


3.03 


24.21 


.35 


Mloh. No. Pen. 


211 


26.16 


- 


8.09 


12.18 


2.11 


22.3s 


3.78 


WlBooneln 


8,932 


24.52 


-22 


5.65 


14.34 
20.49 


3.p5» 


24.26 


.26 


29 - Chicago Area 


3,510 


29.65 


.24 


8. 17 


3-46 


32.36 


2.71- 


30 - St. Louis County 


1,855 


31-07 


1.84 


9-52 


21.50 


2-08 


14.94 


3.87- 


31 - Arizona 


2,536 
10,548 


27-97 


.01 


7-7'^ 


17.31 


3-I3 


28.19 


.22- 


32 - So. Calif. 


23-19 


2-39 


7-67 


16.33 


3.S6 


29.95 


6.76- 



Complied By: 
Source : 



Industry ^Mstloimalrei . 







Sslrr 


_ 






Volume 


Grose 






000 Omltts't 


Pront 


Industry 


» 166. 763 


38.39 


ClTle 


ion - Stnte 






1 


- Alabama 


1.U09 


53.87 


2 


- No. Calif 


2,1*26 


^7-80 


I 


- C[,rollna8 


107 


60.21 


- Floriao 


6,068 


41. "^6 


5 


- Georglp 


1,786 


39.49 


« 


- IllinolB 


3,«7i 


37.86 


7 


- Indiana 


6,307 


^8.47 


e 


- Kentuclty 


l,tU2 


45.il 


9 


- Loulelana 


1,6-C 


37-32 


10 


- So. Mloh. 


6,099 


38.87 


11 


- Total 


12,8b2 


38.97 




PelttFftrB 


5W 


40.58 




Diet, of '51. 


193 


27.12 




Maryland 


1,827 


38.23 




So. N. J. 


1,282 


38.91 




E. P«nna. 


9,030 


m\ 


1? 


- Mlap. 


551 


1} 


- Tots] 


5,0,2 


34.90 




Colo. 


3,1(35 


32.71* 




N. lls.x. 
Wyo. 


813 

823 

3,7S4 


35.05 
44.54 


11* 


- Neb. 


30.35 


15 


- No. tl. J. 


3,111 


48.01 


16 


- N. 1. Clt.v 


3,914 


46.29 


17 


- Total 


23,173 


41.25 




Conn. 


i*,9S>; 


41.64 




Malnp 


661 


43.40 




Wans. 


< 349 

U05 


4i.26 




:i. H. 


48.59 




N. Y. State 


9,3'*9 


39.78 




Penna. Part 


183 


52.88 




R. I. 


SS3 


1*5.97 




Vermont 


353 


46. ?4 


18 


- Total 


8,657 


32.05 




Iowa 


3.689 


31.75 




Minn. 


2.538 


33-11 




No. DaK. 


i;38l 


33. i*? 




So. Dak. 


1,01*7 


28. SI 


19 


- Ohio 


10,590 


44.21 


20 


- W. Penna. 


4,26s 


42.08 


21 


- Total 


13.574 


34.94 




Ark. 


167 


38.92 




Kane. 


3.013 


33.74 
43.78 




Mo. 


5,03? 




Okla. 


5.354 


22 


- Tenn. 


1.275 
6,914 


12 


- Texae 


38.10 


- Utah 


551 


■^2.48 


25 


- Va. 


3,29? 


37.46 


26 


- Total 


5,006 


42.46 




Idaho 


280 


37.10 
41.48 




Mont. 


2,078 




Nevada 


96 


37.03 




Oregon 


633 


47.38 




fash. 


1,917 


43. 06 


27 


- W. Va. 


1,001 


38.14 


28 


" Total 


9,142 


32.56 
35-43 




Ho. Mich. 


210 



.03 



13.41 
1.05 9.33 

.28 8.86 

10.95 

»180. 8,931 32.49 .29 8. 81 

29 - Cook Oty, 111. 3,509 42.15 -35 11-61 

30 - 3t. Louie. Oty. 1,855 45.07 2.66 ? .81 

31 - Arliona 2,535 38.84 .01 lj.75 

32 - So. Calif. 10,547 30.20 3.12 9.98 



TABLE ;.c; XIIX 

RETAIL LUUBF.H 3EAU:P.S 

RECAPITULATION 

UODAL COST DETAILS 

YFAR 19'4 

KrOWN CEALWS P^.^i^l - DEAL^i-S PCPCBTIKO 3,';=4 

(Sp" Table No. 1 

„._Pw*'.-pnta£_e of Each to To tal Coat of G oofle Sold 

Ttrnd'llng SelTTne"* Interest Total " 

Re»ork IcllTerj Ad"lltj_ 9.id Debts Made 

ViLl Fxp. Expense Expense rxrjir.pe pypeVr' 



5.93 12.37 

1.41 l.go 

9.45 u,53 

1-53 9.59 

3.13 10.69 

.17 9.89 

.73 9.22 

1.09 10.14 

.15 9.84 

.96 11.06 

.88 11.72 

10.21 

6.87 

1.25 9.61 

1.16 11.79 

.84 12.35 

.08 10.73 

.14 7.22 

.16 7.72 

.16 5.43 
6.85 

.01 7. SO 

■ 57 14.73 

.96 16.29 

1.18 12.15 

.67 12.71 

1.60 8-09 

1.71 13-78 

7.73 15.0S 

1.23 10.95 

13-19 9.12 

.95 14.37 

2.45 7.13 

7-53 

9-74 

9.14 

4.43 

3-33 

1.53 11-07 

1.36 10.76 

.16 5.58 

11.99 

.01 5.50 

.43 6.65 

4.42 

1.28 8.91 

.25 3-1" 

-55 7-78 

2.97 9.69 

.54 10.66 

6.35 

.44 9.29 



26.43 


4.92 


49.65 


4.22 


20.38 


4.38 


mi 


1.83 


32.87 

20.64 


1.89 


3-47 


4.49 


36.25 


5-31 


19.28 


2.69 


35-59 


3-90 


2'. 29 


4.43 


37-78 


.08 


24.42 
28.27 


4.65 
4.57 


39-02 
44.07 


i:Er 


22.97 


2.13 


35-09 


2-23 


22.93 


4.41 


39.36 


.49- 


23-35 


4.97 


40.92 


1-95- 


21.06 


1.75 


33-02 


7.56 


10.95 


1.63 


19-45 


7.67 


21.88 


3.98 

14.32 
4.11 


36-72 


1.51 


30.65 
23.04 


U:ll 


19.01- 
1.03- 


30.70 


7.27 


48.78 


4.32- 


21.97 


3.64 


32-97 


1-93 


20.99 


3.02 


31.89 


.85 


21.63 


3.48 


30.70 


i*-35 


26.75 
20.84 


6.66 


4o.26 


4.28 


2.84 


31.49 


1.14- 


31.42 


5.39 


52.11 
49.00 


4.10- 


27.80 


3-95 


2-71- 


24.78 


5.24 


43.55 


2.30- 


22.45 


6.20 


41.43 


.21 


23.18 


3.82 


38.69 

44.68 


4.71 


2''-73 


4.46 


3-42- 


22.01 


5. 08 


49.90 


l:^-- 


25.21 


6.84 


42.23 


16.82 


7.14 


46.27 


6.61 


35 •'*7 


12.09 


62.88 


16.91- 


31-17 


1.43 


42.18 


4.06 


18.80 


2.68 


29.41 


2.64 


15.62 


2.55 


27-91 


3.84 


17.96 

24.40 


3.55 


30.65 


2.46 


1.26 


30.09 


3-?4 


24.59 


2.SS 


30.80 


1 9P- 


26.89 


5.62 


li5.ll 


.90- 


27-45 


5. SO 


45 -37 


3.S5- 


23.46 


3-91 


33.11 


1.S3 


20.06 


6.29 


38.34 


• 58 


25-87 


4.41 


35-79 


1-95 


22.75 


3.04 


32-87 


1.60 


22.91 
29.04 


31.70 
43-87 


2.04 
.09- 


27.27 


4.69 


35-35 
33-14 


2.75 


18.27 


6.54 


.66- 


20.93 


3-78 


37-37 


.09 


23.11 


6.16 


40.67 


1-79 


18.44 


13.64 


38.43 


1-33- 


21.'=;9 


6.93 


38.25 


3-23 


P8.S4 


3-28 


39.39 
43-O6 


2-36- 


29.95 


3-74 


4.32 


23-52 


5.11 


42.96 


.10 


20.71 


6.30 


37.39 


-75 


18.94 


4.02 


32.10 


.46 


16.49 


2.86 


30.30 


'■'^ 


19.00 


4.05 


32.15 
46.01 


29.13 


4.92 


3.86- 


31.19 


3.02 


50.68 


5.«i- 


24.03 


■*•'? 


39.14 


.30- 


21.26 


L.61* 


39.00 


8.20- 


Coraplleri 


:-.: D. N. 


BurnhaA, C.P.A. , 






DlTlBl 


on of Revleif, NRA 




Source: 


Induet 


.ry Questionnaires 





9813 



ss^ 



TABU NO. L 

RETAIL LUMBER DEALERS 

RECAPITULATIOH FOR IHDUSTRI 

OPERATIOK RESULTS ig'^'* 

KNOWN DEALERS 23,531 - DEALERS REPORTING 3, 55** 

Percentage 



LuBbar, bullfllng Katerl&le 

Direct eai^lot aUpaente, luaber, and bulldlnjt materlBli 

Stook alllvork 

Special manufsutured nillwork 

Builder*"' euppllee (aee luaber code, aJ't, II, par. 1) 

Direct oar-lot ehlpaente buildere' euppllea 

Retail atore Itame and building epeolaltlee 

Ooal and other fuela 

Feed, aeed, grain, fertilizer 



Other I tea a 



II: 



Total aalea 

Dlioounts and allovanoee 

Net sales (12 alnua 1?) 



61.9lt 


1 103,S96,326 


3. 12 


5,206,990 
6,lt39.elll 


T.«6 


3-16 


li'jsi'.'in 


8.83 




1,816,769 


10,573.159 


7.96 


13,273,603 


1.73 


2,893.715 


3.13 


5,2114,99'' 



I. COST or ooocs sole 

15. InT«ntory - Beginning January 1, 193'*, or ei 

16. Purohsse of all Itooe 1 to 11 

17. Ksnufaoturwl apeolal mllwork ( Iteoi 01-11) 

18. Iot»l 15-16-17 

19. In»«ntor7 - Cloelng Dao. 31, 19W, or aarll. 

20. Coat of gooai aoia (18 mnue 19) 

21. Oroaa profit tltao *-l'» nlnua B-20 

22. Total saw ana planing mill azpanae (02) 

23. Total handling and dallvory oxpenee (D) 

24. Total BfllliDg-adminiatratiTa expenaa (E) 

25. Total other deductions (D 

26. Total mode expense (22 to 25) 

27. Depreciation 



Total (26 to 29) 

31. Het profit (21 le«> 30) 

32. Other incase 

33. Interest and discount earned, lost aoci 
jJ*. Net profit for period per the books 

01. KU, TOR iiANurACTura; of spkciai. yiLLwom 



Superintendent and forenan wages 
mil labor - dirsct and indirect 
Supplies 



36. 

38. Maintenance and repairs - mill only 

39. Hsat, lights and power - mill only 

40. Kill expense, other - not including ta 

depreciation, and rent 
In. Total Bill costs (include as B-I7) 

02. SAW A1II> PLAinro MILL (incidental remaiiufa 



■2. Labor 

.3. Supplies and incidental expense 

4. Total saw and planing ffllll expensi 

hanhlins uid celivxhi expensi: 

^. Tard labor 

•6. Tard maintenance and repairs 

.7. Yard supplies 

k8 . Denurrage 

i9. Truck labor 

iO. Truck and garage maintenance and : 

il. Truck gas and oil 

)2. Hired trucks 

13. StSble labor 

A. stable-wagon mai 
Feed and supplis 



(transfsr total 



''.97 
1.97 
2.26 



56. Other items ( specify) .69 

57. 

58. Total handling and asliirery expenss (transfsr total to lins 23) 23.32 



SnjJNO AND ADIONISTRATIVE EXPENSE 

'9. Salssmsn's salaries, commission, 

0. AdTertising 

11. Officers' or partners' salaries 

>2. Office wages 

•3. Postage, stationery, and euppliei 

A. Telegraph and tslsphons 



yard and office) 



Heat, light and water (f 

66. Accounting fees 

67. Legal fees 

68. Dues and eubecrlptlona 

69. Collsction expense 

70. Donations 

71. Travel and promotion other than E-59 

72. Office maintenance and repairs 

73. Payments to Cods Authority 

74. Insurance (all kinds except life) 

75. Taxes (except Federal income tax) 

76. Rent 

77. Other (specify) 
7«. 

79. Total (transfsr to lins 2t) 



7.33 
1.70 
15.13 
10.90 



3.15 

5.52 

2.55 

1.91 



t 62,075,916 
111,792,607 
3. 190. 861 
180,059,387 
59. 5^15. 677 
120,503,710 
16.260.062 

1,217.317 
11,873,811 
28,190,608 

5.151.156 
17,065,952 

3,001,339 

219,361 

622.262 

50,908,911 

1,618,852- 



5,895,273 
■180 , 167 
118,080 

2,532,595 

1,002,582 

1,150,972 

358,652 

85 , 201 



3,731.810 

861,838 

7,701,276 

5,517,637 

717,613 

722,051 

163,153 

111,265 

251,562 

287,736 

161,928 

99,117 

287,081 

193,160 

157,553 

1.775,039 

2,808,969 

1,398,309 

971.176 



3.1»0.<g1' 



38.39 

I.OI 
23! 61 

39 !« 



r. OTHER DEDUCTIONS 

80. Interest paid (not 

81. Bad debts 

82. Total other deduct 



Compiled By: 



Industry Qusstlonnalr 



9613 



322 



TABLE LI 
Lumber Cost at Chicago, lillnois 
Code Period January to March, 1934 



Douglas Southern Western Oak 



Pir 



Shipping Weight per U Ft. 

Freight rate per 100 pounds 

Costs per U. B. li, 

Stuiopage 

Logging and Uilling 
Labor 
Other Costs 

Shipping £uid Selling 
Lahor 
Other Costs 

Overhead and Administrative 

Officers and Owners Peor 

Other Costs 

Total Mill Costs 1/ 

Freight 

Cost to Betaller 

Retail Costs 2/ 



2,800# 
$ .72 



Labor 

Officers 4 Owners Pay 

Other Costs 



6.89 
2.71 
8.13 



Total Cost to Consumer 



Stumpage 

Logging and Milling 

Selling and Administrative 

Preigli* 

Retailers Costs 

Cost to Constmer 



$56.69 

HECAPITULAIION 

2.42 

11.69 

4.69 

30.16 

17.73 



Pine 



3,000# 
$ .38 



Pine 
2,300# 
$ .51 



4,300# 
$ .295 



$ 2.42 $ 4.31 $ 2.11 $ 6.31 



5.11 
6.58 


7.58 
6.13 


6.35 
7.77 


9.27 
6.91 


1.06 
1.21 


1.61 
1.07 


1.90 
1.95 


2.35 
1.53 


.62 
1.80 


1.05 
3.50 


.76) 
) 

2.60) 


4.11 


$18.80 


$25.25 


$23.44 


$30.48 


20.16 


11.40 


11.73 


12,75 



$38.96 $36.65 $35.17 $43.23 



6.43 6.22 
2.55 2.44 
7.65 7.34 



7.64 
3.01 
9.03 



$53.33 $51.17 $62.91 



4.31 
13.71 

7.23 
11.40 
16.68 



2.11 
14.12 

7.21 
11.73 
16.00 



6.31 
16. IS 

7.99 
12.75 
19.68 



$56.69 $53,33 $51.17 $62.91 



1/ Total mill costs derived from Industry cost questionnaires. 
981.3 2/ Retail costs derived from Industry cost questionnaires 



323 



TiBLI LI I 

Lumber Cost at Haw Tork, New York 
Code Period January to Uarch 1934 





Douglas 


Douglas 


Southern 


Western 




Fir 


Fir 


Pine 


Pine 




3,100# 








Shipping Weight per U Jt. 


2,800# 


3,000f 


2,300# 


Freight Bate per 100 pounds 




$ .87 


$ .37 


$ .73 


post, oer U. B. M. 










Stunpage 


$ 2.42 


2.42 


4.31 


2.11 


Logging and Milling 
Labor 


5.11 


5.11 


7.58 


6.35 


Other Costs 


6.58 


6.58 


6.13 


7.77 


Shipping and Selling 
Labor 


1.06 


1.06 


1.61 


1.90 


Other Costs 


1.21 


1.21 


1.07 


1.95 



Oak 



6.31 



9.27 
6.91 



2.35 
1.53 



Orerhead and Administrative 

Officers and Owners Pay 
Other Costs 

Total Mill Cost 1/ 

Freight 

Cost to Retailer 



.62 
1.80 



.62 
1.80 



1.05 
3.50 



.76) 
2.60) 



$18.80 $18.80 $25.25 
10.20 24.36 11.10 



$23.44 
16.79 



4.11 



$30.48 
17.75 



$29.00 $43.16 $36.35 $40.23 $48.33 



Retail Costs 2/ 

Labor 

Officers & Owners Pay 

Other Costs 
Total Cost to Consumer 



6.51 


9.69 


18.16 


9.08 


10 


1.77 


2.64 


2.22 


2.46 


2 


5.96 


8.88 


7.48 


8.28 


9 



$43.24 $64.37 $54.21 $60.00 



Stumpage 

Logging and Milling 

Selling and AdministratiTe 

Freight 

Retailers Costs 

Cost to Consumer 

Water Rate 83^1 of $12.00f-25^ 



RECAPITULATION 
















$ 2.42 $ 


2.42 $ 4, 


,31 


$ 2. 


11 


$ 6. 


31 


11.69 


11, 


,69 


13, 


.71 


14, 


,12 


16. 


,18 


4.69 


4. 


,69 


7, 


,23 


7, 


,21 


7. 


.99 


10.20 


24, 


.36 


11. 


.10 


16, 


,79 


17, 


.75 


14.24 


21. 


.21 


17. 


,86 


19, 


,77 


23. 


'22 



$43.24 $64.37 $54.21 $60.00 



1/ Total mill costs derived from Industry cost questionnaires. 
9oX«-* 2/ Retail costs derived from Industry cost questionnaires. 



32<i 

TABLE LIII 



Total Stocks, Shl.Mients 


and Production 


of Softnood Lumber In Mllllonn of Feet and 
Show Secular (long tljne) Trend 


EUmlnatlt 


in 0*" Seaeonal Fluctuations to 






Stock on Hand At 
Beginning of Period 


Trend of 
Stocks 


Shipments 
During Period 


Trend of 
Shipments 


Production 
During Period 


Trend of 
Productlor 


1923 
1924 
1925 
1926 

1927 
192S 




6,600 
7,500 
7,800 
8,500 
8,800 
9,300 


1 1.019 
1.019 
1.019 
1.019 
1.019 
1.019 


- 6,470 
7,360 

IX 

8,610 
9,120 


10.004 J 

29,106 

31,010 

10,169 

27,942 

29,367 


I 4 
4 
4 
4 
4 
4 


7,501 
7,276 
7,752 
7,542 
6,986 
7,1'*? 


10,904 i 

29,406 

11,710 

10 , 469 

28,442 

28,345 


4 
4 
4 
4 
4 
4 


= 7,726 
7,352 
7,928 
7,617 
7,110 
7,086 


1929 let 

2nd 
Ird 
4th 


Quarter 


8,416 
8,148 
8,143 
8,661 


1.019 
.992 
.996 
.993 


8,259 
8,214 
8,176 
8,722 


7,107 
8,121 
7,t50 
6,248 


.908 
1.074 
1.082 

.936 


7,827 
7,561 
6,885 
6,675 


6,839 
8,116 
7.968 
7,020 


.863 
1.08S 
1.087 

.962 


7,925 
7,460 
7,310 
7,297 


1930 let 
2nd 
Ird 
4th 


Quarter 


9,433 
9,4T? 
10,030 
10,068 


1.019 
.992 
,996 
.993 


9,257 
9,509 
10,070 
10,139 


5,586 
5,791 
'^.092 
4,113 


.908 
1.074 
1.082 

.936 


6,152 
5,192 
4,706 
4,629 


5,586 
6.3S8 
5,110 
4, 227 


.863 
LOSS 
1.087 

.962 


6,472 

4,719 
4,394 


1931 let 
2nd 

4th 


garter 


9,962 
9,4l0 
9, ■148 
9,036 


1.019 
.992 
.996 
.99? 


9,776 
9,486 
9,186 

9,ioo 


4,067 
4,100 
3,921 
2,879 


.908 
1.074 
1.082 

.916 


4,479 
4,004 
3,62U 
3,076 


1,515 
4,238 

1,609 
2,561 


.861 
1.088 
1.087 

.962 


'*,073 
3,895 
3,320 
2,662 


1932 let 
2nd 
3rd 
4th 


Quarter 


8,718 
7,997 
7,610 
7,069 


1.019 
.992 
.996 
.993 


8,5-5 
8,061 
7,641 
7,119 


2,701 
2,720 
2,848 
2,516 


.908 
1.074 
1.082 

.916 


2,975 
2,533 
2,632 
2,688 


1,980 
?,3?i 
2,307 
2,222 


.863 
1.088 
1,087 

.962 


2,294 
2,144 
2,122 
2,310 


1933 1st 
2nd 
jrd 
4th 


Quarter 


6,775 
6,183 
5,715 
5,645 


1.019 
.992 
.996 
.993 


6,649 
6,414 
5.738 
5,68=; 


2,216 
1,450 
3,997 
3,133 


.908 
1.074 
1.082 

.936 


2,441 
3,212 
1,694 
3,31*7 


1,824 
2,782 
3,927 
3,176 


.863 
1.088 
1.087 

.962 


2,114 
2,557 
3,613 
3.301 


1934 1st 
2nd 
3rd 
4th 


Quarter 


5,688 
5.895 
6,218 
6,071 


1.019 
.992 
.996 
.993 


5,582 

5,943 
6,243 

6,ll4 


3,116 
3,112 
1.123 
2,827 


.90S 
1.074 
1.082 

.936 


3,'t32 

3,102 
3,071 

1,020 




.863 
1.088 
1.0S7 

.962 


3.851 
3,359 
2,922 
2,583 


1935 1st 
2nd 
ird 
4th 


Quarter 


5,729 
5,435 
5,o46» 


1.019 
.992 
.996 


5,622 

5,479 

5,066 


2,941 
3:545* 
3,679* 
3,182* 


.90S 
1.074 
1.082 

.936 


3,241 
1,100 
i,4oo 
3.400 


2,649 
3.156* 


.861 
i.08« 


3.070 
2,901 



* Anticipated 

Note: ^arterlj figures 



not available prlo 



9813 



325 



TABLE LIV 



Hoxirs of Labort Number of Establlsrunents and Number of Wage 
Sarners by Prevailing Hours of Labor per Weelc, 1929. 



Sanmills 


Per Cent 
of 
Total 


Millwork 


Per Cent 
of 
Total 


Sawmills 

and 
Millwork 


Per Cent 
of 

Total 


(Total Establinhments 
(Total Wage Earners 


12,915 
419,084 


100,0 
100.0 


4»849 
90,134 


100.0 
100,0 


17,764 
509,218 


100.0 
100.0 


(Establishiaents vith 
(hours not reported 
(number of wage earners 


6,333 
31,514 


49,0 
7.5 


560 

1,442 


11,6 
1,6 


6,893 
32,956 


38.8 
6.5 


(40 hours and under 
(Number of establishments 
(Number of wage earners 


350 
15,874. 


2.7 
3.8 


300 
4,787 


6.2 
5,3 


650 
20.661 


3,6 

4.1 


(Over 40 nours but 
(\inder 45 hours 
(Number of establifiiments 
(Number of wage earners 


75 

4,635 


0,6 
1.1 


1,098 
17,984 


22,6 
20,0 


1,173 
22,619 


6.6 
4.4 


(45 hours to 48 hours 
( inclusive 

(Number of estaDlishnients 
(Number of wage earners 


1,803 
95,068 


14.0 
22.7 


680 
16,637 


14.0 
18.5 


2,483 
111,705 


14.0 
21.9 


(Over 48 hours but not 
(over 54 hours 
(Nivnber of establinhinents 
(Hvunber of wage earners 


1,391 
48,125 


10,8 
11,5 


1,377 
27,980 


28,4 
31.0 


2,768 
76,105 


15.6 
14.9 


(Over 54 hours 

(Number of establishments 

(Somber of Wage carters 


2,963 
223,868 


22.9 
53.4 


834 

21,304 


17,2 
23.6 


3,797 
245,172 


21.4 
48.2 



Sourcat Census of Manufactures, 1929; Percentages, and sums for Sawnills and 
Millwork, computed from Census figures shown. 



9813 



imaiT 'If 

3a<i_ 



INDEX NUMBERS 

(AVERAGE OF I905,'l0,'l5,'20, 

'25.'30,'35- 100) 



PRICE TREND 

SOUTHERN PINE ROOFERS 3/4x5i/2,*4 
BY YEARS. 1905-1935 



leo 




















1 

1 


1 

1 






160 




1 

12- MONTH AVERAGE PRICE .' 








140 






1 
1 / 


\ 










; 


^„ 3-YEAR SLIDING AVERAGE PRICE 1 


130 
120 

no 

100 
90 
80 
70 


i\ /- 








// 


i^>- 


'"-\^o 








/ i 


1 iV 

1 / 
, / 
; 1 




\ 


I 


NADJUSTED 


// 


y 


' 


.\ 






// 


^. ADJUST 


W 

ED PRICE TREND \ \ / / 






;'/ 


/ V\ 


\M^ 






\U 


/-"^ 


^■~ " 


/ V 


/^<\V 


/^ -— 


— 1/ / 
'/ / 
.'/ / 




1 






/ %\>r<?^ 


3-YEAR SLIDING AVERAGE PRICE 

ADJUSTED FO" DiipruA<;iNr: 


SO 
40 
30 
20 
10 



* 


-'-• \ 


A / 


VALUE OF DC 


)LLAR 




















































1 1 1 1 


1 1 1 1 


1 1 1 1 


1 1 1 1 


1 1 1 1 


1 1 1 1 



1905 1910 1915 

SOURCE "new YORK LUMBER TRADE JOURNAL" 

^13 



1925 



1930 



I93S 



NRA 

DIVISION OF REVIEW 

STATISTICS SECTION 

NO. 495 



cr 

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9813 



330 




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9813 



331 




9813 



332 




9813 



333 

EXHIBIT "I" 
AVERAGE LUMBER PRICE BREAKDOWN AT CHICAGO. LLINOtS 

CODE PERIOD JANUARY TO MARCH, 1934 




D0U9LA8 Fl* tOUTHCIM ntl WttTCRN nHI 



9S/3 



SOURCE' LUMBER ANO TlueER PRODUCTS STUDY UNUt, 

division' of review, N R a. 



N R A 
DIVISIOM or REVIEW 
STATISTICS SECTION 

Wl SW 



334 

EXHIBIT "J" 
AVERAGE LUMBER PRICE BREAKDOWN AT NEW YORK, N.Y 

CODE PERIOD JANUARY TO MARCH, 1934 




ReT»lL COSTS-OTHER 



RETAIL COSTS-OfFICERS 



AMD aHMERS PUT 



RETAIL COSTS- LA80R 



OVERHEAD, ETC. 
OFFICERS AND OWNERS MY 
SHtmNO AND SCLUNa-OTHER COSH 
AND SEUJNe-LABOR 



LDCGMG <K> MIUMS-OTWR COSTS 



LXieOINIi AND MLUNC-LABOR 



SOURCE- LUMBER AND TIMBER PRODUCTS STUDY UNIT, 
DIVISION OF REVIEW, N.R.A- 



NR A 
DIVISION OF REVIEW 



9813 



335 



9813 




to n 



IITH *q*o-; 90\ii a»t88 sSsibat 




III. 



51 a- 



ll 




5 J 


II 

5i 


III? 


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i|Ji!lil=tll|li 

llliliSllill^il: 



OFFICE OF THE NATIONAL RECOVERY ADMINISTRATION 
THE DIVISION OF REVIEW 



THE WORK OF THE DIVISION OF REVIEW 



Executive Order No. 7075, dated June 15, 1935, established the Division of Review of +he 
National Recovery Administration. The pertinent part of tha Executive Order reads thus: 

The Division of Reviev/ shall assemble, analyze, and report upon the statistical 
information and records of experience of the operations of the various trades and 
industries heretofore subject to codes of fair competition, shall study the ef- 
fects of such codes upon trade, industrial and labor conditions in general, and 
other related matters, shall make available for the protection and promotion of 
the public interest an adequate review of the effects of the Administration of 
Title I of the National Industrial Recovery Act, and the principles and policies 
put into effect thereunder, and shall otherwise aid the President in carrying out 
his functions under the said Title. I hereby appoint Leon C. Marshall, Director of 
the Division of Review. 

The study sections set up in the Division of Review covered these areas: industry 
studies, foreign trade studies, labor studies, trade practice studies, statistical studies, 
legal studies, administration studies, miscellaneous studies, and the writing of code his- 
tories. The materials which were produced by these sections are indicated below. 

Except for the Code Histories, all items mentioned below are scheduled to be in mimeo- 
graphed form by April 1, 1936. 

THE CODE HISTORIES 

The Code Histories are documented accounts of the formation and administration of the 
codes. They contain the definition of the industry and the principal products thereof; the 
classes of members in the industry; the history of code formation including an account of the 
sponsoring organizations, the conferences, negotiations and hearings which were held, and 
the activities in connection with obtaining approval of the code; the history of the ad- 
ministration of the code, covering the organization and operation of the code authority, 
the difficulties encountered in administration, the extent of compliance or non-compliance, 
and the general success or lack of success of the code, and an analysis of the operation of 
code provisions dealing with wages, hours, trade practices, and other provisions. These 
and other matters are canvassed not only in terms of the materials to be found in the files, 
out also in terms of the e:-:periences of the deputies and others concerned with code formation 
and administration. 

The Code Histories, (including histories of certain NRA units or agencies) are not 
mimeographed. They are to be turned over to the Department of Commerce in type^-ritten form. 
All told, approximately eight hundred and fifty (S50) histories *ill be completed. This 
number includes all of the approved codes and some of the unapproved codes. (In W ork 
M aterial s No_ 18, Content s of Code Hi: tries, will be found the outline which governed 
the preparation of Code Histories.) 

(In the case of all approved codes and also in the case of some codes not carried to 
final approval, there are in NRA files further materials on industries. Particularly worthy 
of mention are the Volumes I, II and III which constitute the material officially submitted 
to the President in support of the recommendation for approval of each code. These volumes 
9768~l . 



-ii- 

set forth the origination of the code, the sponsoring group, the evidence advanced to sup- 
port the proposal, the report of the Division of Research and Planning on the industry, the 
recommendations of the various Advisory Boards, certain types of official correspondence, 
the transcript of the formal hearing, and other pertinent matter. There is also ouch offi- 
cial information relating to amendments, interpretations, exemptions, and other rulings. The 
materials mentioned in this paragraph were of course not a part of the work of the Division 
of Review. ) 

THE WORK MATERIALS SERIES 

In the work of the Division of Review a considerable number of studies and compilations 
of data (other than those noted below in the Evidence Studies Series and the Statistical 
Material Series) have been made. These are listed below, grouped according to the char- 
acter of the material. (In Work Materials No. 1.7, T entati ve Outlines and Summaries of 
Studies in P rocess , these materials are fully described). 

I ndus try Studies 

Automobile Industry, An Economic Survey of 

Bituminous Coal Industry under Free Competition and Code Regulation, Economic Survey of 

Electrical Manufacturing Industry, The 

Fertilizer Industry, The 

Fishery Industry and the Fishery Codes 

Fishermen and Fishing Craft, Earnings of 

Foreign Trade under the National Industrial Recovery Act 

Part A - Competitive Position of the United States in International Trade 1927-29 through 

1934. 
Part B - Section 3 (e) of NIRA and its administration. 
Part C - Imports and Importing under NRA Codes. 
Part D - Exports and Exporting under NRA Codes. 

Forest Products Industries, Foreign Trade Study of the 

Iron and Steel Industry, The 

Knitting Industries, The 

Leather and Shoe Industries, The 

ijumber and Timber Products Industry, Economic Problems of the 

Men's Clothing Industry, The 

Millinery Industry, The 

Motion Picture Industry, The 

Migration of Industry, The: The Shift of Twenty-Five Needle Trades From New York State, 
1926 to 1934 

National Labor Income by Months, 1929-35 

Paper Industry, The 

Production, Prices, Employraent and Payrolls in Industry, Agriculture and Rail.vay Trans- 
portation, January 1923, to date 

Retail Trades Study, The 

Rubber Industry Study, The 

Textile Industry in the United Kingdom, France, Germany, Italy, and Japan 

Textile Yarns and Fabrics 

Tobacco Industry, The 

Wholesale Trades Study, The 

Women's Neckwear and Scprf Industry, Financial and Labor Data on 

9768—2 



ihi'f'l y- < -. , .,f 



- IIX - 

Women's Apparel Industry, Some Aspects of the 

T rade P ractic e Stu dies 

Commodities, Inforaiation Concerning: A Study of NRA and Related Experiences in Control 
Distribution, Manufacturers' Control of: Trade Practice Provisions in Selected NRA Codes 
Distributive Relations in the Asbestos Industry 
Design Piracy: The ProbJem and Its Treatment Under NRA Codes 
Electrical Mfg. Industry: Price Filing Study 
Fertilizer Industry: Price Filing Study 

Geographical Price Relations Under Codes of Fair Competition, Control of 
Minimum Price Regulation Under Codes of Fair Competition 
Multiple Basing Point System in the Lime Industry: Operation of the 
Price Control in the Coffee Industry 
Price Filing Under NRA Codes 
Production Control in the Ice Industry 
Production Control, Case Studies in 

Resale Price Maintenance Legislation in the United States 

Retail Price Cutting, Restriction of, with special Emphasis on The Drug Industry. 
Trade Practice Rules of The Federal Trade Commission (1S14-1936) : A classification for 
comparison with Trade Practice Provisions of NRA Codes. 

Labor Studies 

Cap and Cloth Hat Industry, Commission Report on Wage Differentials in 

Earnings in Selected Manufacturing Industries, by States, 1933-35 

Employment, Payrolls, Hours, and Wages in 115 Selected Code Industries 1933-35 

Fur Manufacturing, Commission Report on Wages and Hours in 

Hours and Wages in American Industry 

Labor Program Under the National Industrial Recovery Act, The 

Part A. Introduction 

Part B. Control of Hours and Reemployment 

Part C. Control of Wages 

Part D. Control of Other Conditions of Employment 

Part E. Section 7(a) of the Recovery Act 
Materials in the Field of Industrial Relations 
PRA Census of Employment, June, October, 1933 
Puerto Rico Needlework, Homeworkers Survey 

Administrativ e Studies 

Administrative and Legal Aspects of Stays, Exe.mptions and Exceptions, Code Amendments, Con- 
ditional Orders of Approval 

Administrative Interpretations of NRA Codes 

Administrative Law and Procedure under the NIRA 

Agreements Under Sections 4(a) and 7(b) of the NIRA 

Approve Codes in Industry Groups, Classification of 

Basic Code, the — (Administrative Order X-61) 

Code Authorities and Their Part in the Administration of the NIRA 
Part A. Introduction 
Part B. Nature, Composition and Organization of Code Authorities 

9768—2. 



Part C. Activities of the Code Authorities 

Part D. Code Authority Finances 

Part E. Summary and Evaluation 
Code Compliance Activities of the NRA 
Code Making Program of the NRA in the Territories, The 
Code Provisions and Related Subjects, Policy Statements Concerning 
Content of NIRA Administrative Legxslatitn 

Part A. Executive and Administrative Orders 

Part B. Labor Provisions in the Cedes 

Part C. Trade Practice Provisions in the Codes 

Part D. Administrative Provisions in the Codes 

Part E. Agreements under Sections 4(a) and 7(b) 

Part F. A Type Case: The Cotton Textile Code 
Labels Under NRA, A Study of 

Model Code and Model Provisions for Codes, Development of 

National Recovery Administration, The: A Review of its Organization and Activities 
NRA Insignia 

President's Reemployment Agreement, The 

President's Reemployment Agreement, Substitutions in Connection with the 
Prison Labor Problem under NRA and the Prison Compact, The 
Problems of Administration in the Overlapping of Code Definitions of Industries and Trades, 

Multiple Code Coverage, Classifying Individual Members of Industries and Trades 
Relationship of NRA to Government Contracts and Contracts Involving the Use of Government 

Funds 
Relationship of NRA with States and Municipalities 
Sheltered Workshops under NRA 
Uncodified Industries: A Study of Factors Limiting the Code Making Program 

Legal Stud ies 

Anti-Trust Laws and Unfair Competition 

Collective Bargaining Agreements, the Right of Individual Employees to Enforce 

Commerce Clause, Federal Regulation of the Employer-Employee Relationship Under the 

Delegation of Power, Certain Phases of the Principle of, with Reference to Federal Industrial 
Regulatory Legislation 

Enforcement, Extra-judicial Methods of 

Federal Regulation through the Joint Employment of the Power of Taxation and the Spending 
Power 

Government Contract Provisions as a Means ;f Establishing Proper Economic Standards, Legal 
Memorandum on Possibility of 

Industrial Relations in Australia, Regulation of 

Intrastate Activities Which so Affegt interstate Gpmmsrce as to Bring them Under the Com- 
merce Clause, Cases on 

Legislative Possibilities of the State Constitutions 

Post Office aiid Post Road Power — Can it be Used as a Means of Federal Industrial Regula- 
tion? 

State Recovery Legislation in Aid 3f Federal Recovery Legislation History and Analysis 

Tariff Rates to Secure Proper Standards of Wages and Hours, the Possibility of Variation in 

Trade Practices and the Anti-Trust Laws 

Treaty Making Power of the United States 

War Power, Can it be Used as a Means of Federal Regulation of Child Labor? 

9768—4. 



THE EVIDENCE STUDIES SERIES 



The Evidence Studies were originally undertaken to g,athor material for pending court 
cases. After the Schechter decision the project was continued in order to assemble data for 
use in connection with the studies of the Division of Review. The data are particularly 
concerned with the nature, size and operations of the industry; and with the relation of the 
industry to interstate commerce. The industries covered by the Evidence Studies account for 
more than one-half of the total number of workers under codes. The list of those studies 
follows: 



Automobile Manufacturing Industry 
Automotive Parts and Equipment Industry 
Baking Industry 

Boot and Shoe Manufacturing Industry 
Bottled Soft Drink Industry 
Builders' Supplies Industry 
Canning Industry 
Chemical Manufacturing Industry 
Cigar Manufacturing Industry 
Coat dnd Suit Industry 
Construction Industry 
Cotton Garment Industry 
Dree.s Manufacturing Industry 
Electrical Contracting Industry 
Electrical Manufacturing Industry 
Fabricated Metal Products Mfg. and Metal Fin- 
ishing and Metal Coating Industry 
Fishery Industry 

Furniture Manufacturing Industry 
General Contractors Industry 
Graphic Arts Industry 
Gray Iron Foundry Industry 
Hosiery Industry 

Infant's and Children's Wear Industry 
Iron and Steel Industry 



Leather Industry 

Lumber and Timber Products Industry 
Mason Contractors Industry 
Men's Clothing Industry 
Motion Picture Industry 
Motor Vehicle Retailing Trade 
Needlework Industry of Puerto Rico 
Painting and Paperhanging Industry 
Photo Engraving Industry 
Plumbing Contracting Industry 
Retail Lumber Industry 
Retail Trade Industry 
Retail Tire and Battery Trade Industry 
Rubber Manufacturing Industry 
Rubber Tire Manufacturing Industry 
Shipbuilding Industry 
Silk Textile Industry 
Structural Clay Products Industry 
Throwing Industry 
Trucking Industry 
Waste Materials Industry 
Wholesale and Retail Food Industry 
Wholesale Fresh Fruit and Vegetable Indus- 
try 
Wool Textile Industry 



THE STATISTICAL MATERIALS SERIES 



This series is supplementary to the Evidence Studies Series. The reports include data 
on establishments, firms, employment. Payrolls, wages, hours, production capacities, ship- 
ments, sales, consumption, stocks, prices, material costs, failures, exports and imports. 
They also include notes on the principal qualifications that should be observed in using the 
data, the technical methods employed, and the applicability of the material to the study of 
the industries concerned. The following numbers appear in the series: 
9768—5. 



- vi - 

Asphalt Shingle and Roofing Industry Fertilizer Industry 

Business Furniture Funeral Supply Industry 

Candy Manufacturing Industry Glass Container Industry 

Carpet and Rug Industry Ice Manufacturing Industry 

Cement Industry Knitted Outerwear Indvstry 

Cleaning and Dyeing Trade Paint, Varnish, and Lacquer, Mfg. Industry 

Coffee Industry Plumbing Fixtures Industry 

Copper and Brass Mill Products Industry Rayon and Synthetic Yarn Producing Industry 

Cotton Textile Industry Salt Producing Industry 

Electrical Manufacturing Industry 

THE COVERAGE 

The original, and appro-ved, plan of the Division of Review contemplated resources suf- 
ficient (a) to prepare some 1200 histories of codes and NRA units or agencies, (b) to con- 
solidate and index the NRA files containing some 40,000,000 pieces, (c) to engage in ex- 
tensive field work, (d) to secure much aid from established statistical agencies of govern- 
ment, (e) to assemble a considerable number of experts in various fields, (f) to conduct 
approximately 25% more studies than are listed abo\e, and (g) to prepare a comprehensive 
summary report. 

Because of reductions made in personnel and in use of outside experts, limitation of 
access to field work and research agencies, and lack of jurisdiction over files, the pro- 
jected plan was necessarily curtailed. The most serious curtailments were the omission of 
the comprehensive summary report; the dropping of certain studies and the reduction in the 
coverage of other studies; and the abandonment of the consolidation and indexing of the 
files. Fortunately, there is reason to hope that the files may yet be cared for under other 
auspices. 

Notwithstanding these limitations, if the files are ultimately consolidated and in- 
dexed the exploration of the NRA materials will have been sufficient to make them accessible 
and highly useful. They constitute the largest and richest single body of information 
concerning the problems and operations of industry ever assembled in any nation. 

L. C. Marshall, 
Director, Division of Review. 
9768—6 . 



)