AMENDMENT                Exhibit 4.2.4
                   DATED AS OF JANUARY 1, 1996
                                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 Note originally issued to Aetna Life Insurance
Company was split into two Notes which were sold to Franklin
Principal Maturity Trust ("Franklin") and Foothill Group, Inc.  The
Term Notes originally issued to Chemical Bank, Seattle-First
National Bank, and Bank of America Oregon were sold to Oppenheimer
& Co., Inc. ("Oppenheimer").  The Franklin note is now held by Bank
of America Illinois, ("Bank of America").

     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 4/30/98                      0.60 (60%)
     5/1/98 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."

     2.   Credit Agreement Section 6.01.D is hereby restated to
     read as follows:

          D. Tangible Net Worth.  Maintain a positive Tangible Net
     Worth of not less than the respective amount set forth below,
     at all times during the periods set forth below:

             Period                        Tangible Net Worth
         ---------------                  --------------------

     Effective Date through 7/31/93            $ 6.5 Million
     8/1/93 through 4/30/94                    $ 8.0 Million
     5/1/94 through 4/30/95                    $10.0 Million
     5/1/95 through 10/31/95                   $15.0 Million
     11/1/95 through 12/31/95                  $13.5 Million
     1/1/96 through 6/30/96                    $11.0 Million
     7/1/96 through 4/30/98                    $15.0 Million
     5/1/98 through 4/30/99                    $20.0 Million
     5/1/99 and beyond                         $25.0 Million

     3.   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 4/30/97                       27.5
     5/1/97 through 4/30/98                       35
     5/1/98 through 4/30/99                       50
     5/1/99 through 4/30/00                       65
     5/1/00 and beyond                            80

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

          I. Total Liabilities Ratio.  Maintain a ratio of
     Borrowers' Total Liabilities to Total Assets (the "Liabilities
     Ratio"), not greater than the Liabilities Ratios set forth
     below, at all times during the periods set forth below:

             Period                        Liabilities Ratio
        -----------------                 -------------------

     Effective Date through 7/31/94            0.95 (95%)
     8/1/94 through 4/30/95                    0.90 (90%)
     5/1/95 through 12/31/95                   0.85 (85%)
     1/1/96 through 6/30/96                    0.87 (87%)
     7/1/96 through 4/30/98                    0.85 (85%)
     5/1/98 through 4/30/99                    0.80 (80%)
     5/1/99 and beyond                         0.70 (70%)

     5.   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 and beyond                            25

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


EFFECTIVE DATE:  January 1, 1996.


PRINCIPAL MUTUAL LIFE              THE NORTHWESTERN MUTUAL
INSURANCE COMPANY                  LIFE INSURANCE COMPANY  


By:____________________________    By:____________________________

Its:___________________________    Its:___________________________

                                   (Pro Rata Interest: 20.235984%)
By:____________________________

Its:___________________________    FOOTHILL GROUP, INC.

(Pro Rata Interest: 47.228439%)
                                   By:____________________________

OPPENHEIMER & CO., INC.            Its:___________________________

                                   (Pro Rata Interest: 18.729872%)
By:___________________________

Its:__________________________     WTD INDUSTRIES, INC.

(Pro Rata Interest: 6.838639%)
                                   By:____________________________

BANK OF AMERICA ILLINOIS           Its:___________________________


By:___________________________

Its:__________________________

(Pro Rata Interest: 6.967066%)