THE CALIFOR}-IIA LUMBERMERCHANT JackDionne

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How Lumber Looks

Seattle, Washington, January 8, 194O.-The rveekly average of West Coast lumber production in December (4 weeks) was 118,168,000 feet, or 6O.O per cent of the weekly average f.or I92G|9D, the industry's years of highest capac- ity rcalization, the West Coast Lumbermen's Association reports. Orders averaged II5,&4,W feet; shipments, 113,489,000. Weekly averag'es for November were: Production, 733,492,W feet (57.8 per cent of the highest capacity realization index) ; orders, 1O2,675,ffiO1' shipments, 119,785,000.

For 52 weeks ol 1939, cumulative production, 6,426,951 ,M f eet ; sam e period, 1 938,-5, 1 82,32f,M ; 1937 -4,322,654,000.

Orders for 52 weeks of 1939 break down as follows ; rail, 2,787,O19,W feet ; domestic .cargo,' 2,528,802,@0; export, 421,67 I,OOO ; local, 962,@L,ffi

The industry's unfilled order file stood at 452,187,0N leet at the end of December; gross stocks, at 930,@0,00O.

The most significant feature of the December market for West Coast lumber was a partial recovery from the curtailed buying rvhich follorved the buying hysteria of September. December was thus a "return to normalcy," following the up and down extremes in lumber buying during the fall mo,nths. The net volume of December orders for West Coast lumber was approximately the same as that for March, 1939, which represents a normal relationship. -

Behind the recent rise, fall, and substantial recovery of the market for West Coast lumber are these facts:

1. The market for West Coast lumber has been affected but slightly by the war; and that effect has been adverse through still further reducing our limited volume of foreign trade.

2. The December recovery reflects primarily the continuing strength of the housing movement in the United States. The sustained volume of building permits, particularly for new residences, and of building contracts, has created a stable demand for lumber. Lumber dealers ate anticipating a good building market in the spring of 194O and are stocking their bins in preparation for it.

Yearly Lumber Facts-1939

The outstanding feature of i939 as a lumber year was a steady continuation of the upward movevment in building, and particularly residential building, in the United States. This started in the early spring and continued through the year with scarcely a backward slip. 1939 was cl'ose to a 2-l billion dollar year in construction, probably exceeding 1938 by from 15 to 18 per cent. Well over 50 per cent of this building was residential, with low-cost homes predomi- nating. Dodge estimates for 37 Eastern States yield a figure ol 263,QO dwelling units constructed in 1939, in that territory alone. The estimate for next year in the same area is 300,000. This does not include rural and small-town building, and it leaves out the important California and Northwest building regions.

The effect of the European \A'ar upon lumber r'vas only temporary. Like so many other commodities, lumber experienced a sharp buying wave in September, rvith moderate advances in price. When this rvave broke, demand slumped badly for i month; and then-toward year's endresumed the normal course of the prewar months in satisfying the building demands of the United States.

For West Coast lumber, 1939 brought the best market since 1930. Net orders for the year totaled 6,699,000,000 feet as compared with 5,458,0CS,@O in 1938 and 5,911,000,@O in 1937. The year's production also topped the records since 1930, with a total cttt of 6,427,U&,00O feet-substantially more than in 1938 and slightly more than In 1937.

The year's exports of West Coast lumber were 412,W NI feet as compared with 298,000 M feet in 1938. The increase was due to greater trade with South America and heavy purchases by Great Britain in the months preceding the war, while the seas u'ere still open for normal traffic. Since the advent of u,'ar, export shipments have again dropped to a very low ebb.

West Coast lumber usually {ollows the curve of general busi,ness. Its course through the fall of this year reflected the increase of industrial and business activity throughout the country. Important factors were the revival of railroad buying, and the increased demand for lumber for industrial uses. Some shop items have shown great strength in the market. There is a pronounced demand for scaffold plank to use in ship building. But in the main the industry has been steadily plowing alo,ng 'ivith home building, and this promises to be its best field throughout 1940.

The forecasts of statistical agencies indicate a continued, gradual rise in home building; a decrease in public construction; a partially offsetting increase in private, commercial and industrial construction.

No appreciable effect of the war upon the lumber market is yet apparent. West Coast lumber expects to go on making its bread and butter by harvesting its trees Ior the building of homes in the United States.

During the week ended December 23, 1939, 472 mills produced 195,651,000 feet of softwoods and hardwoods combined, shipped 188,101,000 feet, and booked orders of 193,695,000 feet, according to the National Lumber N{anufacturers Association.

Revised figures for the preceding u'eek, 533 mills reporting, were: production 2n,872,W feet, shipments 196,9V),0@ feet, and orders h7,233,ffiO feet.

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