Beview 0f lVestern Pine Industry for l$4$

ByRobert O. Leonard \(/estern Pine Association

and it was this development which forced a number of the higher cost pine operations out of the picture, at least temporarily. The loss of these units, presence of which in 1948 provided the extra footage for the record 7144 million production, was in a large measure responsible for the deep cut in output. Even established mills, hobbled by weather, were unable to manufacture and ship at a pace comparable with 1948.

At the turn of the quarter, authoritative industry estimates foresaw a reduction of approximately ten per cent in second quarter shipments under 1948 but, surprisingly, actual performance showed a 0.6 per cent increase, on July 1. The trend reversal was more comparative than real, however. Where during the second quarter of 1948, excessive rainfall and flood greatly hampered operations, 1949 weather was the exact opposite and operators were able to compensate in part for handicapped first quarter performances.

Nineteen hundred and forty-nine-is apparently destined to be known, in the vernacular of Paul Bunyan, as the Year of the Big Winnow in the \Mestern Pine industry.

Like a rusty logger, the postwar pine industry, in common with so many others, ran into its first thoroughgoing test in the sweat of a changing market. And as everyone predicted, some of the superfluous poundage melted away, but the frame, sound like the basic economy it is, came through swineing.

Entering 1949 on the momentum of the largest production and shipment year in its history, the industry was beginning to feel the pinch of a shrinking demand. Late in 1948 many retailers, uneasy over the general election outcome and perhaps unsure that 1948's incredible building record could be duplicated, reduced their stocks in contrast to the previous early winter when they were still expanding.

And one of the worst winters in the history of the west chose that time to happen. The net result was a production reduction of 32.5 per cent in the first quarter ol 1949from 7248 million board feet to 842 million-and a drop of 28.8 per cent (1387 million to 987 million) in shipments.

The residential building market, meanwhile, was obviouslyshort of the strength of a year before. Starts lagged well behind in 1948 and, while the economy home program was getting underwav, the outlook was not bright.

As a consequence, the market showed no signs of reversing a downward trend that set in earlier in the year

Shipments in the second period totaled 1727 million against 1716 million for the year before and production jumped 4.8 per cent-1911 million over l8Z4 million board feet.

An approximation of the true condition appeared in figures for the entire first half. In that period shipments dropped from 3103 in 1948 to 2714 million-a slip of 12.5 per cent. Production meanwhile slidfrom 3072 to 2753 million, or 10.3 per cent.

But at thispointwell established mills, able to meet customer requirements and ship thoroughly dried, wellmanufactured stock, were handling a volume of orders not far removed from the same period of 1948. Continuing lack of firmness in the market, however, kept many highcost plants under slow bell or entirely suspended.

The situation remained unchanged through the third quarter. Uncertainty as to the ultimate outcome of the then current economic readjustment was the basis for mid-year predictions of third period shipments approximately ten per cent under 1948-still, by prervar standards, indicative of a good lumber demand.

Preliminary estimates at the end of the quarter showed shipments were 10.7 per cent under those of 1948 and production was off 14.7 per cent. The figures were: Shipments, 1852 million against 2O74 in 1948; production, 2019 million in 1949 and 2367 the year before. For the first three quarters shipments of 4566 million were off 11.8 per cent from 1948 and production of 4772 million was down 12.3 per cent.

But, again, decreased production and shipments were felt onlyslightly by the backbone of the industry. Despite the turn froma seller's to a buyerls market, most

We Are Pteased

millswhich could furnish product quality demanded by the buyer, and could produce at a cost in line with current market values, maintained a volume of business at near 1948 levels. The reduction in total regional performance resulted largely from the lower operating rate of marginal unitsand of units with facilities inadequate to satisfy custonrer requirements.

Unfilled order files exceeded 700 million feet at the end of September, the largest order file at any time over the past three years.

Inventories follou'ed their usual pattern during the year and while larger than 1948 were still below those of prervar when, in addition, demand was considerably less. Starrding at 1625 million on Dec. 31, 1948, they dwindled to 1527 on March 31 before turning uprvard to 1700 on June 30 and 1880 million on Sept. 30, 1949.

,9ladou@d hos moved to o new locolion in order lo keep poce with our exponding production-lo offer o better service during l95O-ond lhroughout lhe yeors io comelo our old cuslomers ond new occounts .

,9tadoaPodis monufoclured from kiln dried lumberproducts of selected QUAilTY ond GRAIN. li is processed by speciol equipment io remove the soff, or summer growth wood, leoving the hord groin or winter growth slond out-creoting the SHADOWOOD effect. Color schemes for finishing ore truly unlimited. Beoutiful qs well os unusuol ontique effects moy be developed for SHADOWOOD which ore impossible to obtoin from ony other wood surfocing.

,9tdoanodis monufoctured for use in Southern Colifornio homes-for remodeling ond new conslruction. SHADOWOOD is new ond different-it connot be motched ot ANY PRICE. Contocl us lodoy for courleous cooperolion, ond so you will be oble to offer this product of DISTINCTION to your potrons

Fronk W. Biggs, President,

Predictions on Oct. 1 were fora volume of shipments during the balance of the year at about the same level rvith those of 1948 or about 1500 million feet. Home construction, despite its hesitant start, bounced upward in the summer months and in August exceeded its 1948 pace by 11,000 starts. Good early fall weather promised building at the same rate.

The Western Pine outlook for 1950 rests, as always, very largely on the home construction industry. And that apparently depends upon the willingness of builders to accept a market like that of late 1949 which, as one penetrating observer pin-pointed it, was neither a buyer's market nor a seller's market, but a salesman's market.

Alert builders in 1949 found that better planning, more equipment, better locations, extra neighborhood features and salesmanship paid off, in low brackets and high. At the lor,ver end of the scale, Long Island builder William Levitt boosted his plans from 4000 to 4700 units on his $7990 house. And at the other end, Washington and Chicago developments ranging from $25,000 to $50,000 per house-'rvell located and attractively designed-were filled as rapidly as the doors were hung. Builders who simply built houses, on the other hand, found them standing empty months after completion.

Income is currently 7 per cent higher and purchasing power 6 per cent above 1948. Savings are three times rvhat they 'ivere in 1940 and private debt is at an all time lorv. Some 22 per cent of all families have incomes of $5000 or more and 47 per cent have incomes of $3000 or over. If 1950 rvill hold forth as a buyer's market, it will be unlike any in history.

It \\'ill then, in truth, be a salesman's market, up and dorvn the line. From manufacturer, through rvholesaler to dealer, the organization with the ability to produce and a 'rvillingness and facility to sell will probably find 1950 a year of good business.

Appointed Mcncger

Bob Sutton, formerly with Associated Lumber Co., Los Ar.rgeles, has been appointed manager of Airline Lumber Company, San Diego.

John Boone is yard superintendent.