SECURITIES AND EXCHANGE COMMISSION
                                                        
                           WASHINGTON, D. C.   20549

                                   FORM 10-Q

(Mark One)

( X ) QUARTERLY  REPORT UNDER SECTION 13  OR 15(d) OF  THE SECURITIES EXCHANGE
      ACT OF 1934.

For Quarterly Period Ended June 30, 1997, or

(   ) Transition  report pursuant  to Section  13 or  15(d) of  the Securities
      Exchange Act of 1934.

For the transition period from __________ to __________

Commission File No. 1-500

                                 PORTEC, Inc.
------------------------------------------------------------------------------
            (Exact name of Registrant as specified in its charter)

      Delaware                                       36-1637250
------------------------------------------------------------------------
(State or other jurisdiction of                 (I.R.S. Employer
incorporation or organization)                  Identification No.)

One Hundred Field Drive, Suite 120, Lake Forest, Illinois  60045
------------------------------------------------------------------
(Address of principal executive offices)                (Zip Code)

                               (847) 735-2800
------------------------------------------------------------------------
            (Registrant's telephone number, including area code)

Former address:                                                               

------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since 
last report).

Indicate by  check  mark whether  the  Registrant (1)  has filed  all  reports
required to be filed by Section 13 or 15(d) of the  Securities Exchange Act of
1934  during the  preceding 12  months (or  for such  shorter period  that the
Registrant was  required to file  such reports), and  (2) has been  subject to
such filing requirements for the past 90 days.

                              YES      X       NO         
                                    ------          ------

Number of shares of Registrant's Common  Stock ($1 per share par value) issued
and outstanding at August 13, 1997 - 4,369,074.





                                    PART I
                                    ------
                             FINANCIAL INFORMATION
                             ---------------------

ITEM 1:  FINANCIAL STATEMENTS
-----------------------------

                   PORTEC, INC. CONSOLIDATED BALANCE SHEETS
           AS OF JUNE 30, 1997; DECEMBER 31, 1996; AND JUNE 30, 1996
                            (THOUSANDS OF DOLLARS)

                                   (Unaudited)                   (Unaudited) 
                                     6/30/97      12/31/96          6/30/96   
                                   -----------   -----------     -----------

CURRENT ASSETS
 Cash and cash equivalents         $     5,586   $     4,979     $     4,605 
 Accounts and notes receivable,         16,699        14,816          16,932 
  less allowances
 Inventories                            16,514        18,038          14,700 
 Deferred income tax benefits            3,286         3,286             900 
 Other current assets                      284           981             207 
                                   -----------   -----------     ----------- 
  Total current assets                  42,369        42,100          37,344 
                                   -----------   -----------     ----------- 

PROPERTY, PLANT AND EQUIPMENT, AT COST
 Land                                      220           220             220 
 Buildings and improvements             11,052        10,964          11,212 
 Machinery and equipment                23,720        23,010          21,534 
                                   -----------   -----------     ----------- 
                                        34,992        34,194          32,966 
 Less accumulated depreciation         (20,688)      (19,651)        (18,735)
                                   -----------   -----------     ----------- 
  Total property, plant and equipment   14,304        14,543          14,231 
                                   -----------   -----------     ----------- 

ASSETS HELD FOR SALE                     2,070         2,070           2,070 
                                   -----------   -----------     ----------- 
INTANGIBLE ASSETS - NET                  5,019         4,922           3,413 
                                   -----------   -----------     ----------- 
NOTES RECEIVABLE AND OTHER ASSETS        2,302         2,315           2,036 
                                   -----------   -----------     ----------- 

  Total                            $    66,064   $    65,950     $    59,094
                                   ===========   ===========     ===========

CURRENT LIABILITIES 
 Current portion of long-term debt $     2,142   $     3,246     $     1,046 
 Accounts payable                        6,064         7,015           7,059 
 Other accrued liabilities              10,338         9,058           9,353 
                                   -----------   -----------     ----------- 
   Total current liabilities            18,544        19,319          17,458 
                                   -----------   -----------     ----------- 

LONG-TERM DEBT                           7,544         7,568           7,591 
                                   -----------   -----------     ----------- 

DEFERRED CREDITS 
 Pensions                                1,868         1,868           1,923 
 Deferred income tax                     1,220         1,365             - 
 Other                                     628           844             637 
                                   -----------   -----------     ----------- 
  Total deferred credits                 3,716         4,077           2,560 
                                   -----------   -----------     ----------- 

STOCKHOLDERS' EQUITY 
 Common stock, $1 par value; authorized
  10,000,000 shares; issued 4,378,618
  4,373,596 and 4,333,176 shares, 
  respectively                           4,379         4,374           4,333 
 Additional capital                     46,908        46,841          46,629 
 Cumulative translation adjustment        (227)          (99)           (764)
 Accumulated deficit                   (14,698)      (15,968)        (18,623)
                                   -----------   -----------     ----------- 
                                        36,362        35,148          31,575 

 Treasury stock, 9,544, 16,421 and 
 10,021, respectively, common shares 
  at cost                                 (102)         (162)            (90)
                                   -----------   -----------     -----------
  Total stockholders' equity            36,260        34,986          31,485 
                                   -----------   -----------     ----------- 

  Total                            $    66,064   $    65,950     $    59,094 
                                   ===========   ===========     ===========

The accompanying notes are an integral part of these financial statements.


<TABLE>
                                                           PORTEC, INC.
                                     CONSOLIDATED STATEMENTS OF INCOME AND ACCUMULATED DEFICIT
                                  FOR THREE AND SIX MONTHS ENDED JUNE 30, 1997 AND JUNE 30, 1996
                                           (THOUSANDS OF DOLLARS EXCEPT PER SHARE DATA)
                                                            (UNAUDITED)
                                                                              
<CAPTION>
                                            Three Months Ended 6/30               Six Months Ended 6/30
                                          ---------------------------           -------------------------      
                                              1997           1996                   1997         1996
                                          ------------   ------------           -----------   -----------  

<S>                                       <C>            <C>                    <C>           <C> 
Revenues
 Net sales                                $     28,661   $     28,592           $    53,431   $    55,876
 Other income (expense)                            (21)           (67)                  (33)         (137)
                                          ------------   ------------           -----------   ----------- 
   Total                                        28,640         28,525                53,398        55,739
                                          ------------   ------------           -----------   -----------

Costs and expenses
 Cost of goods sold                             20,436         20,309                38,080        39,925
 Selling, general and administrative             5,665          5,467                11,382        10,829
 Interest                                          188            198                   394           397
                                          ------------   ------------           -----------   -----------
  Total                                         26,289         25,974                49,856        51,151
                                          ------------   ------------           -----------   -----------



Income before income taxes                       2,351          2,551                 3,542         4,588
Income tax provision                               809            630                 1,219           694
                                          ------------   ------------           -----------   -----------




Net income                                $      1,542   $      1,921                 2,323         3,894
                                          ============   ============
Cash dividends paid or declared                                                      (1,053)          - 
Accumulated deficit - beginning of year                                             (15,968)      (22,517)
                                                                                -----------   -----------
Accumulated deficit - end of period                                             $   (14,698)      (18,623)




Earnings per common share:                $        .34   $        .42           $       .51   $       .85  
                                          ============   ============           ===========   ===========


Average number of shares outstanding         4,534,251      4,582,973             4,517,682     4,575,590






<FN>
The accompanying notes are an integral part of these financial statements.                                                      
</TABLE>









                                 PORTEC, INC.
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
           FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND JUNE 30, 1996
                            (THOUSANDS OF DOLLARS)
                                  (UNAUDITED)


                                                6 MONTHS ENDED 6/30   
                                               ---------------------

                                                  1997       1996
                                               ---------   ----------
Cash flows from Operating Activities:
 Net income                                    $   2,323   $    3,894 
 Adjustments to reconcile net income
   to net cash provided by operating
   activities:
     Depreciation and amortization                 1,424        1,271 
     Increase in receivables                      (1,807)      (3,802)
     Decrease in inventories                       1,590        3,277 
     Decrease in other net assets
      and deferred charges                           687          819 
     Loss (gain) on sale of assets                     8           (1)
     Decrease in deferred credits                   (361)         (37)
     Increase (decrease) in accounts payable
      and accruals                                   499         (457)
                                               ---------    --------- 
     Net cash provided by operating
       activities                                  4,363        4,964 
                                               ---------    --------- 

Cash flows from Investing Activities:
 Capital expenditures                             (1,046)      (1,082)
 Acquisitions                                       (436)        (500)
 Proceeds from disposal of property, 
  plant and equipment                                 14            6 
                                               ---------    --------- 
    Net cash used by investing
     activities                                   (1,468)      (1,576)
                                               ---------    --------- 

Cash flows from Financing Activities:
 Net borrowing on revolving credit                (1,100)      (1,500)
 Payment on capitalized leases                       (28)         (26)
 Issuance of common stock                             19          -  
 Purchase of treasury stock                         (371)        (168)
 Payment of cash dividends                          (700)         -   
                                               ---------    ---------  
   Net cash used by financing
    activities                                    (2,180)      (1,694)
                                               ---------    --------- 

                                              
Effect of exchange rate change                      (108)        (566)
                                               ---------    --------- 
Net increase in cash and
 cash equivalents                                    607        1,128 
Cash and cash equivalents at
 beginning of year                                 4,979        3,477 
                                               ---------    --------- 

Cash and cash equivalents at
 end of period                                 $   5,586    $   4,605 
                                               =========    ========= 

Interest paid                                  $     388    $     385 
Income taxes paid                              $     514    $     359 



The accompanying notes are an integral part of these financial statements.






                                 PORTEC, INC.
                 NOTES TO FINANCIAL STATEMENTS - JUNE 30, 1997
                            (THOUSANDS OF DOLLARS)





1.  Inventories at June 30, 1997; December 31, 1996; and June 30, 1996 were:

                                     (Unaudited)                   (Unaudited)
                                       6/30/97        12/31/96       6/30/96 
                                     -----------     ----------    -----------  

       Raw Materials and Supplies    $     6,204     $    6,361    $     5,018
       Work-in-Process                     3,489          3,468          3,422
       Finished Goods                      6,821          8,209          6,260
                                     -----------     ----------    -----------
                                     $    16,514     $   18,038    $    14,700
                                     ===========     ==========    ===========


2.  Financial statements for the six months ended June 30, 1997 are subject to
    audit adjustments.


3.   The accompanying financial statements reflect all adjustments which were,
     in the opinion of management, necessary to a fair statement of the results
     for the period presented, and all of these adjustments were of a normal 
     recurring nature. For full disclosure of significant accounting policies,
     see Note 1 of the PORTEC, Inc. 1996 Annual Report.
 
4.  Certain amounts in the Consolidated Balance Sheets as of December 31, 1996
    and June 30, 1996 have been reclassified to conform to those of June 30, 
    1997.



                               


ITEM 2.   Management's Discussion and Analysis of Financial
          -------------------------------------------------
          Condition and Results of Operations
          -----------------------------------
 
Results of Operation
--------------------
Second Quarter of 1997 Compared with
Second Quarter of 1996

Net sales  of $28,661,000 for the  quarter ended June 30,  1997 were virtually
the  same as the net  sales of $28,592,000  for the same period  in 1996.  The
Construction  Equipment segment saw increased sales primarily due to a greater
demand for sand washing equipment.  Net sales of the  Railway Products segment
were up slightly  as a result of improved volume  in various track components.
These increases were partially offset by  a decrease in the Materials Handling
segment  resulting from the reduced  number of capital  investment projects in
the  recycling industry.  Activity  in specialty conveyors,  including a large
order for the U.S.  Post Office, helped to cover some of  the shortfall in the
Materials Handling segment.

Net income of $1,542,000 for the second quarter of 1997 was 19.7 percent below
the net  income of $1,921,000  for the  same period  in 1996.   The  operating
profit  of  the Materials  Handling and  Railway  Products segments  were only
slightly below that of last year due to changes in product mix or volume.  The
Construction  Equipment segment  experienced  lower operating  profits in  the
second  quarter compared  with 1996  due to  increased manufacturing  overhead
spending related to labor  and other payroll expenses.  In  addition, selling,
general and administrative expenses at the Construction Equipment segment were
up as a result  of an increase in group  insurance and bad debt expense.   The
provision for  income tax was $179,000  greater in the second  quarter of 1997
compared  with  the same  period  last year  as the  Company  no longer  has a
domestic tax loss carryforward to be used.<PAGE>
Selling, general and administrative
expenses during the second quarter of 1997 increased from  $5,467,000 for the
same  period last year to  $5,665,000.  The primary  reason  for the  increase
was an increase in the Company's  group insurance expense as well as bad debt
expense. 



Results of Operations
---------------------
First Six Months of 1997 Compared with
First Six Months of 1996

Net sales  and  corresponding  net income  were  $53,431,000  and  $2,323,000,
respectively, for the six months ended  June 30, 1997, compared with net sales
of $55,876,000 and net income  of $3,894,000 for the first six months of 1996.
The Materials Handling  and Railway Products  segments both experienced  lower
net sales during the first  half of 1997.  In the Materials  Handling segment,
the  shortfall in  sales  of  recycling  equipment  was  partially  offset  by
increased  activity in specialty conveyors.   The decreased  demand for heavy-
duty  tie-down equipment  continued  to effect  the Railway  Products segment.
Increased sales  in the traditional Kolberg  and Pioneer product lines  of the
Construction  Equipment  segment  more than  offset  a  decrease  in sales  of
environmental and Innovator products.

The  decrease in the net income  for the six month period  ended June 30, 1997
versus the same period last year reflected the decreased volume and the higher
selling, general and administrative expense in addition  to an increase in the
tax provision of $525,000.  The change in the tax provision reflected taxes on
all domestic earnings in 1997 versus the recognition of tax loss  carryforward
benefits for a portion of 1996 domestic earnings.

Current assets were $42,369,000 at June  30, 1997 compared with $42,100,000 at
December 31,  1996 and $37,344,000 as June 30, 1996.   The increase in cash of
$607,000 and $981,000 from December 31, 1996 and June 30,  1996, respectively,
was  due to  cash generated  from operations.   Accounts  receivable increased
$1,883,000 from  December 31,  1996 due to  increased sales during  the second
quarter of 1997 versus the fourth quarter of 1996.  Inventories were down from
December 31, 1996 by $1,524,000 primarily due to reduced Canadian inventory in
anticipation  of their  lower  seasonal sales.    The $1,814,000  increase  in
inventory from June 30, 1996 reflected the increased backlog of orders at June
30, 1997.   Deferred income tax benefits were up  $2,386,000 from the $900,000
recorded  at June  30,  1996 as  a  result of  a  reduction  in the  valuation
allowance and a reclassification of tax  attributes.  The decrease of $697,000
in  other current assets  related to  the collection  of taxes  receivable and
changes in various prepaid accounts.

Fixed asset expenditures  were $1,046,000 during the first half of 1997 versus
$1,082,000  during the same period  last year.   Depreciation and amortization
was  up  $153,000  over  that  of  last year.    Intangible  assets  increased
$1,606,000 from June  30, 1996 as a result  of goodwill recorded as a  part of
acquisitions and a fee for  a license agreement entered into by  the Materials
Handling  segment.   Normal  amortization  partially  offset these  increases.
Notes receivable and other assets were up $266,000 over those of June 30, 1996
due to the addition of long-term lease receivables.

The increase in the current portion  of long-term debt of $1,096,000 from June
30, 1996  and the decrease  in the same of  $1,104,000 from December  31, 1996
reflected  the  change  in   working  capital  needs.    Long-term   debt  was
reclassified in the Consolidated Balance Sheets  of December 31, 1996 and June
30, 1996 to conform to the classification of the Consolidated Balance Sheet of
June 30, 1997.   Accounts payable  were down from  both December 31,  1996 and
June  30, 1996  as  a result  of  lower inventory  purchases.   Other  current
liabilities were  up $1,280,000 and $985,000  from December 31,  1996 and June
30,  1996, respectively, due to  increased income taxes  payable and dividends
payable.

The increase  in stockholders' equity of $1,274,000  from December 31, 1996 to
June 30,  1997 was attributable to earnings during  the first half of 1997, to
the exercise of stock options, and to the contribution of stock to the Savings
and Investment Plan  for company  employees.  These  increases were  partially
offset  by  the  payment  of  cash  dividends and  the  change  in  cumulative
translation adjustment.  The $4,775,000 increase in  stockholders' equity from
June 30, 1996  to June 30, 1997  was due to earnings  during the last half  of
1996  and the  first half of  1997, to the  exercise of stock  options, to the
contribution of stock to the Savings and Investment Plan for company employees
and to the change in cumulative  translation adjustment.  These increases were
partially offset by the payment of cash dividends and the purchase of treasury
stock.

The Company received  new orders of $23,442,000  during the second  quarter of
1997 compared with $24,104,000 for  the second quarter of 1996.  The 3 percent
decrease was attributable to significant reductions in bookings for  recycling
equipment  and load  securement equipment  as well as  construction equipment.
The order backlog  was $22,876,000 at June 30,  1997 compared with $20,885,000
and $17,698,000 at December 31, 1996 and June 30, 1996, respectively.

In February 1997, the FASB  issued SFAS No. 128,  "Earnings per Share."   SFAS
No. 128 requires public companies to present basic earnings per  share and, if
applicable, diluted earnings per  share, instead of primary and  fully diluted
earnings  per share.   Adoption  of SFAS  is required  for interim  and annual
periods  ending after  December  15,  1997  and  earlier  application  is  not
permitted.   The Company has determined  that the effect of  adopting SFAS 128
will not be significant.


Liquidity
---------

On February 12, 1993,  the Company entered into a credit agreement with a bank
which was amended  on April 26,  1994, June 13,  1995 and June  2, 1997.   The
amended agreement provides  up to  $17,000,000 of credit  available as  either
cash  or  letters  of  credit.    The  provisions  of  the  agreement  include
restrictive covenants relating  to minimum net  worth, interest coverage,  net
working capital  and  leverage  ratio  requirements and  limit  cash  dividend
payments and additional indebtedness.

The Company does  not have available lines of credit  beyond its existing bank
agreement and is prohibited by the agreement from making other borrowings.


The Company presently has a facility for sale or lease in Troy, New York.  Due
to  economic conditions and other  factors, the efforts  to sell this property
have not been  successful.  A property  in Pittsburgh, Pennsylvania,  has been
leased on a long-term lease with an option to buy which has been exercised.

Due to the seasonal fluctuation in the Company's working capital needs and the
limitations  on  borrowing,  the  Company  continues  to  exert  careful  cash
controls.   However,  management  believes its  existing  line of  credit  and
anticipated operating results will  provide the Company with sufficient  funds
for  working  capital,  capital   expenditures  and  acquisitions  to  support
anticipated  growth.  The  Company's working capital ratios  were 2.3, 2.2 and
2.1 to 1 at June 30, 1997, December 31, 1996 and June 30,  1996, respectively.
At June  30, 1997, the Company had available $7,150,000 of unused credit under
the  loan agreement,  plus cash  and  cash equivalents  of  $5,586,000.   This
compared  with $4,350,000 and $6,775,000  of unused credit  and $4,979,000 and
$4,605,000 of  cash and cash  equivalents at  December 31, 1996  and June  30,
1996, respectively.

 
                          PART II - OTHER INFORMATION
                          ---------------------------

ITEM 5.  ACQUISITION
--------------------

In April, 1997, PORTEC  (U.K.) Ltd., a wholly-owned United  Kingdom subsidiary
of  the Company, acquired the assets of Whitehough Engineering Limited (WECO),
a small United Kingdom  manufacturer and marketer of lubricator  equipment for
the  railroad industry, for approximately $175.  The acquisition was accounted
for as a purchase. 



ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

      (a) Exhibits:
          ---------

          11  The  Company's statement regarding computation of per share 
              earnings.

      (b) Reports on Form 8-K
          -------------------

          During the quarter ended June 30, 1997, the Company did not file any
          reports on Form 8-K.





                                  SIGNATURE
                                  ---------

Pursuant to  the requirements  of the  Securities  Exchange Act  of 1934,  the
Registrant has  duly caused  this report  to be  signed on  its behalf  by the
undersigned thereunto duly authorized.


                                                        PORTEC, Inc.   
                                              ------------------------------
                                                         Registrant


Dated:  August 13, 1997                       By: /s/ Nancy A. Kindl 
                                                  --------------------------
                                                  Nancy A. Kindl
                                                  Vice President, Treasurer,
                                                  Secretary and Chief Financial
                                                  Officer







                                 EXHIBIT INDEX
                                 -------------
                                                                   Page No.
                                                                     Within
                                                                 Sequential
                                                                  Numbering
                                                                  System of
Exhibit                          Description                        Exhibit
-------                          -----------                        -------

  11                   Registrant's statement regarding
                       computation of per share earnings.                12