Exhibit 4.2.8
                                    AMENDMENT
                           DATED AS OF JANUARY 1, 1998
                                       TO
                          CREDIT AND SECURITY AGREEMENT
                          DATED AS OF NOVEMBER 30, 1992


         Reference is hereby made to that certain Credit and Security  Agreement
("Credit  Agreement")  dated as of November 30, 1992 among Principal Mutual Life
Insurance Company,  Aetna Life Insurance Company,  The Northwestern  Mutual Life
Insurance  Company,  Chemical  Bank,  Seattle-First  National  Bank  and Bank of
America Oregon,  and WTD Industries,  Inc. and its Affiliates and the Term Notes
issued by the Borrowers in  connection  with the Credit  Agreement.  Capitalized
terms used herein  shall have the same  meaning  ascribed  thereto in the Credit
Agreement.

         The Term Notes  currently  are held by the  following  entities  in the
proportions set forth herein:

         Principal Mutual Life
           Insurance Company                         57.111632%

         The Northwestern Mutual Life
           Insurance Company                         20.450484%

         Foothill Group, Inc.                        13.532675%

         Oppenheimer & Co., Inc.                      6.911127%

         Fixed Plus Partners, beneficial owner
           of Note registered in the name of
           Bear Stearns Securities Corp.              1.994082%

         The Credit Agreement is hereby modified as follows:

         1.  Credit  Agreement  Section  6.01.C  is hereby  restated  to read as
follows:

                  C. Collateral  Coverage Ratio.  Maintain a ratio of Borrower's
         Current  Collateral  to the  outstanding  balance of the Term Loan (the
         "Collateral  Ratio"),  not less  than the  Collateral  Ratio  set forth
         below, at all times during the periods set forth below:

                           Period                            Collateral Ratio

                  Effective Date through 4/30/95              0.55 (55%)
                  5/1/95 through 12/31/95                     0.60 (60%)
                  1/1/96 through 2/29/96                      0.54 (54%)
                  3/1/96 through 3/31/96                      0.55 (55%)
                  4/1/96 through 6/30/96                      0.56 (56%)
                  7/1/96 through 12/31/97                     0.60 (60%)
                  1/1/98 through 7/31/98                      0.57 (57%)
                  8/1/98 through 1/31/99                      0.60 (60%)
                  2/1/99 and beyond                           0.65 (65%)

                  As used herein, "Current Collateral" means for Borrowers, on a
consolidated  basis,  all in accordance with GAAP, (i) all Current Assets,  less
(ii) the sum of (x) Borrower's current assets which are classified on Borrowers'
consolidated  balance  sheet as  "prepaid  expenses",  excluding  the  amount of
interest prepaid on the Term Notes, and otherwise  included in prepaid expenses,
(y)  Borrowers'   current   liabilities   which  are  classified  on  Borrowers'
consolidated  balance  sheet as "accounts  payable",  and (z) all of  Borrowers'
current  liabilities  which are  classified on Borrowers'  consolidated  balance
sheet as "timber contracts payable."

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<PAGE>
2. Credit Agreement Section 6.01.G is hereby restated to read as follows:

                  G.  Minimum  Cumulative  Adjusted  EBITDA.  Maintain a minimum
         EBITDA  (calculated  from and  including  the  first  day of the  first
         calendar month  following the Effective  Date) minus (a) actual Capital
         Expenditures,   minus   (b)   Timber   and   Timberlands   Expenditures
         Non-Current, of not less than the respective amount set forth below, at
         all times during the periods set forth below:

                           Period                            Millions of Dollars

                  Effective Date through 4/30/93                       0
                  5/1/93 through 7/31/93                               2
                  8/1/93 through 1/31/94                               5
                  2/1/94 through 7/31/94                              10
                  8/1/94 through 12/31/95                             20
                  1/1/96 through 6/30/96                              19
                  7/1/96 through 12/31/96                             22.5
                  1/1/97 through 6/30/97                              25
                  7/1/97 through 7/31/98                              27.5
                  8/1/98 through 10/31/98                             32.5
                  11/1/98 through 4/30/99                             40
                  5/1/99 through 4/30/00                              52.5
                  5/1/00 and beyond                                   67.5
     

         3.  Credit  Agreement  Section  6.01.J  is hereby  restated  to read as
follows:

                  J. Minimum Working Capital.  Maintain minimum working capital,
         at all times during the periods set forth below,  calculated as Current
         Assets  minus  Current  Liabilities;   provided,  for  the  purpose  of
         computing  Current  Assets  under this Section  6.01.J,  the portion of
         Current  Assets  which  consists of Timber and  Timberlands  Current or
         contract rights relating thereto shall be included only up to an amount
         equal to (x) on or before  January 31, 1993,  forty-five  percent (45%)
         and (y)  thereafter,  forty percent (40%),  of the amount of Borrowers'
         overall Current Assets determined in accordance with GAAP:

                  Period                                     Millions Of Dollars

         Effective Date through 12/31/95                              25
         1/1/96 through 6/30/96                                       19
         7/1/96 through 6/30/97                                       22.5
         7/1/97 through 9/30/97                                       25
         10/1/97 through 12/31/97                                     21.5
         1/1/98 through 10/31/98                                      17.5
         11/1/98 and beyond                                           20

         4.  Credit  Agreement  Section  6.01.K  is hereby  restated  to read as
follows:

                  K.  Minimum   Operating   Income.  In  no  fiscal  quarter  of
         Borrowers,  incur an operating loss in excess of Three Million  Dollars
         ($3,000,000),   calculated  as  EBIT,   except  that  with  respect  to
         Borrowers'  fiscal quarter ending January 31, 1998, said operating loss
         shall  not  exceed  Three   Million  Five  Hundred   Thousand   Dollars
         ($3,500,000), calculated as EBIT.





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<PAGE>
         5.  Credit  Agreement  Section  6.02.A  is hereby  restated  to read as
follows:

                  A. Capital Expenditures.  Make Capital Expenditures and Timber
         and  Timberlands  Expenditures  Non-Current  in an aggregate  amount in
         excess  of  Eight  Million  Dollars  ($8,000,000)  per  fiscal  year of
         Borrowers, except that for Borrowers' fiscal year ending April 30, 1998
         said expenditures  shall not exceed Eight Million Five Hundred Thousand
         Dollars ($8,500,000).

         6. In all other respects,  the Credit  Agreement shall remain unchanged
and in full force and effect.

EFFECTIVE DATE:   January 1, 1998

PRINCIPAL MUTUAL LIFE                          THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY                              INSURANCE COMPANY


By:                                            By:
   ------------------------------                -------------------------------
Its:                                           Its:
   ------------------------------                -------------------------------
                                               (pro rata interest: 20.450484%)
By:
   ------------------------------
Its:
   ------------------------------              FOOTHILL GROUP, INC.
(pro rata interest: 57.111632%)

                                               By:
                                                 -------------------------------
OPPENHEIMER & CO., INC.                        Its:
                                                 -------------------------------
                                               (pro rata interest: 13.532675%)
By:
   ------------------------------
Its:
   ------------------------------              WTD INDUSTRIES, INC.
(pro rata interest:  6.911127%)

                                               By:
                                                 -------------------------------
FIXED PLUS PARTNERS, Beneficial                Its:
Owner of Note Registered in the Name             -------------------------------
of Bear Stearns Securities Corp.


By:
   ------------------------------
Its:
   ------------------------------
(pro rata interest: 1.994082%)






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