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 March 31, 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 May 12, 1997 - 4,375,548. 


<TABLE>

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

Item 1:  Financial Statements
-----------------------------

                                              PORTEC, INC. CONSOLIDATED BALANCE SHEET
                                    AS OF MARCH 31, 1997; DECEMBER 31, 1996; AND MARCH 31, 1996
                                                      (THOUSANDS OF DOLLARS)

<CAPTION>
                                       Unaudited                Unaudited
                                        3/31/97     12/31/96     3/31/96 
                                      ----------   ----------   ----------
<S>                                   <C>          <C>          <C>
CURRENT ASSETS
 Cash and cash equivalents            $    4,582   $    4,979   $    3,686 
 Accounts and notes receivable,           17,356       14,816       16,646 
  less allowances
 Inventories                              18,460       18,038       16,465 
 Deferred income tax benefits              3,286        3,286          800 
 Other current assets                        266          981          484 
                                      ----------   ----------   ---------- 
  Total current assets                    43,950       42,100       38,081 
                                      ----------   ----------   ---------- 

PROPERTY, PLANT AND EQUIPMENT, AT COST
 Land                                        220          220          220 
 Buildings and improvements               10,892       10,964       10,950 
 Machinery and equipment                  23,234       23,010       21,203     
                                      ----------   ----------   ----------  
                                          34,346       34,194       32,373 
 Less accumulated depreciation           (20,093)     (19,651)     (18,297)
                                      ----------   ----------   ---------- 
  Total property, plant and equipment     14,253       14,543       14,076 
                                      ----------   ----------   ---------- 

Assets Held For Sale                       2,070        2,070        2,070 
                                      ----------   ----------   ---------- 
Intangible Assets                          4,857        4,922        2,978 
                                      ----------   ----------   ---------- 
Notes Receivable and Other Assets          2,311        2,315        2,033 
                                      ----------   ----------   ---------- 

  Total                               $   67,441   $   65,950   $   59,238  
                                      ==========   ==========   ==========  

CURRENT LIABILITIES
 Current portion of long-term debt    $       46   $       46   $       46 
 Accounts payable                          7,166        7,015        7,047 
 Other accrued liabilities                 8,284        9,058        8,407 
                                      ----------   ----------   ---------- 
   Total current liabilities              15,496       16,119       15,500 
                                      ----------   ----------   ---------- 

LONG-TERM DEBT                            12,852       10,768       11,303 
                                      ----------   ----------   ---------- 

DEFERRED CREDITS
 Pensions                                  1,868        1,868        1,923 
 Deferred income tax                       1,220        1,365           -  
 Other                                       584          844          596 
                                      ----------   ----------   ---------- 
  Total deferred credits                   3,672        4,077        2,519 
                                      ----------   ----------   ---------- 

STOCKHOLDERS' EQUITY
 Common stock, $1 par value; authorized
  10,000,000 shares; issued 4,373,596,
  4,373,596 and 4,333,176 shares           4,374        4,374        4,333 
 Additional capital                       46,880       46,841       46,629 
 Cumulative translation adjustment          (295)         (99)        (412)
 Accumulated deficit                     (15,537)     (15,968)     (20,544)
                                      ----------   ----------    --------- 
                                          35,422       35,148       30,006 
Treasury stock, 44, 16,421 and
 9,562 common shares at cost                  (1)        (162)         (90)
                                      ----------   ----------    --------- 

  Total stockholders' equity              35,421       34,986       29,916 
                                      ----------   ----------    --------- 

  Total                               $   67,441   $   65,950    $  59,238 
                                      ==========   ==========    =========

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



                                 PORTEC, INC.
           CONSOLIDATED STATEMENT OF INCOME AND ACCUMULATED DEFICIT
           FOR THREE MONTHS ENDED MARCH 31, 1997 AND MARCH 31, 1996
                 (THOUSANDS OF DOLLARS EXCEPT PER SHARE DATE)
                                  (UNAUDITED)



                                                                         
Three Months Ended 3/31  
-----------------------  

                      
                                            1997              1996   
                                         ----------        ---------- 

Revenues  
 Net sales                               $   24,770        $   27,284  
 Other income (expense)                         (12)              (70) 
                                         ----------        ----------
  Total                                      24,758            27,214  
                                         ----------        ----------  

Costs and expenses
 Cost of goods sold                          17,644            19,616 
 Selling, general and administrative          5,717             5,362 
 Interest                                       206               199 
                                         ----------        ---------- 
  Total                                      23,567            25,177 
                                         ----------        ---------- 


Income before income taxes                    1,191             2,037 
Income tax provision                            410                64 
                                         ----------        ----------

Net income                                      781             1,973 
Cash dividends paid                            (350)               -  
Accumulated deficit - beginning of year     (15,968)          (22,517)
                                         ----------        ---------- 
Accumulated deficit - end of period      $  (15,537)       $  (20,544)
                                         ==========        ========== 

Earnings per common share                $      .17        $      .43 
                                         ==========        ========== 

Dividends per common share               $      .08        $       -  
                                         ==========        ========== 

Average number of shares outstanding      4,500,987         4,568,206 


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





                                 PORTEC, INC.
                     CONSOLIDATED STATEMENT OF CASH FLOWS
         FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND MARCH 31, 1996
                            (THOUSANDS OF DOLLARS)
                                  (UNAUDITED)


                                                 3 MONTHS ENDED 3/31   
                                              --------------------------

                                                1997              1996
                                              ---------         --------
Cash flows from Operating Activities:
 Net income                                   $     781         $  1,973 
 Adjustments to reconcile net income
   to net cash used by operating
   activities:
     Depreciation and amortization                  708              633 
     Increase in receivables                     (2,540)          (3,516)
     Decrease (increase) in inventories            (422)           1,512 
     Decrease in other net assets
      and deferred charges                          719              642 
     Gain on sale of assets                          (1)              (2)
     Decrease in deferred credits                  (405)             (78)
     Decrease in accounts payable and
      accruals                                     (153)          (1,412)
                                              ---------         -------- 
     Net cash used by operating
       activities                                (1,313)            (248)
                                              ---------         -------- 

Cash flows from Investing Activities:
 Capital expenditures                              (390)            (494)
 Acquisitions                                       (30)              -  
 Proceeds from disposal of property,
  plant and equipment                                 3                5 
                                              ---------         -------- 
    Net cash used by investing
     activities                                    (417)            (489)
                                              ---------         -------- 

Cash flows from Financing Activities:
 Net borrowing on revolving credit                2,100            1,200 
 Payment on capitalized leases                      (16)             (15)
 Purchase of treasury stock                        (270)            (168)
 Payment of cash dividends                         (350)              -  
                                              ---------         -------- 
   Net cash provided by financing
     activities                                   1,464            1,017 
                                              ---------         -------- 

                                              
Effect of exchange rate change                     (131)             (71)
                                              ---------         -------- 
Net increase (decrease) in cash and
 cash equivalents                                  (397)             209 
Cash and cash equivalents at
 beginning of year                                4,979            3,477 
                                              ---------         -------- 

Cash and cash equivalents at
 end of period                                $   4,582         $  3,686 
                                              =========         ======== 


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






                                 PORTEC, INC.
                 NOTES TO FINANCIAL STATEMENT - MARCH 31, 1997
                            (THOUSANDS OF DOLLARS)



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


                                       3/31/97      12/31/96       3/31/96
                                     ----------    ----------     ---------

      Raw Materials and Supplies     $    6,596    $    6,361     $   5,436
      Work-in-Process                     4,682         3,468         4,705
      Finished Goods                      7,182         8,209         6,324
                                     ----------    ----------     ---------
                                     $   18,460    $   18,038     $  16,465
                                     ==========    ==========     =========


2.   Financial statements  for  the  three months  ended  March 31,  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.


                                   



ITEM 2.  Management's Discussion and Analysis of Financial
         -------------------------------------------------
         Condition and Results of Operations
         -----------------------------------


Net sales for the quarter ended  March 31, 1997 were $24,770,000 compared with
$27,284,000 for  the same period in  1996.  The  decrease in net sales  of 9.2
percent during  the first  quarter of  1997 was  due to  reduced sales  by the
Company's  Materials Handling  and Railway  Products segments.   Significantly
lower sales volume was generated by Countec as prices for recycled commodities
continued at a level which did not justify expenditures for capital equipment.
This condition is expected  to continue into the second quarter of  1997.  The
shortfall  in  the  Materials Handling  segment  was  partially  offset by  an
increase in the  segment's traditional product lines due mainly  to work being
done on a U.S. Post Office project.  In the Railway  Product segment, sales of
load securement products were down due to production declines in the specialty
railcars  that use our  equipment.  The  Company also experiences  lower sales
volume at Portec (U.K.) Ltd. resulting from a slow down in systems work.   The
Construction Equipment segment sales  were up 4.9 percent  over those of  last
year despite severe weather conditions at their plant early in the year.

Income  before  income taxes  was  $1,191,000 for  the  first quarter  of 1997
compared  with $2,037,000 for the quarter ended  March 31, 1996.  The decrease
of  $846,000 reflected the lower  sales volume and  increased selling, general
and administrative expense.   These changes were partially offset  by slightly
lower other expense.  While gross margins  were 29 percent of sales during the
first quarter of  1997 versus 28  percent for the  same period last year,  the
lower  sales  volume resulted  in less  contribution  to selling,  general and
administrative  expenses.     Selling,  general  and   administrative  expense
increased $355,000  primarily due to  increased medical insurance  expense and
professional fees. 

Net income  for the quarter  ended March  31, 1997 of  $781,000 was  below the
$1,973,000  reported for the same  period last year.   The Company's provision
for  income taxes was  $410,000 and $64,000  in the first  quarter of 1997 and
1996, respectively.   This significant increase was due to  the utilization of
all domestic tax  loss carryforwards during 1996.   Domestic earnings will  be
fully taxed in the future.

Current assets were $43,950,000 at March 31, 1997 compared with $36,451,000 at
December 31, 1996  and $38,081,000 at March 31, 1996.  The increase in cash of
$896,000  from  March  31,  1996  was  due  to  cash  generated  from  foreign
operations.    Accounts receivable  of  $17,356,000  were  up $2,540,000  from
December  31, 1996  due to increased  sales during  the first  quarter of 1997
versus  the fourth  quarter of  1996.   Inventories increased  $1,995,000 from
those of  March 31, 1996  due to  an increased  backlog of  orders at  several
operating divisions.  Deferred income tax benefits were up $2,486,000 from the
$800,000  recorded at  March  31, 1996  as  a  result of  a  reduction in  the
valuation allowance and a reclassification  of tax attributes.   Other current
assets decreased $715,000 and  $218,000 from December  31, 1996 and March  31,
1996, respectively.  The decrease from  December 31, 1996 was primarily due to
the  collection of taxes receivable  and changes in  various prepaid accounts.
The  reduction from  March 31,  1996 resulted  from the  collection of  a note
receivable related to the disposal of a business.
 
Fixed asset acquisitions were $390,000 during the first quarter of 1997 versus
$494,000  for  the  same  period  last  year.    Intangible  assets  increased
$1,879,000 from March 31, 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.
Other  assets and notes  receivable were up  $278,000 over those  of March 31,
1996 due to the addition of long-term lease receivables.

Long-term debt was $12,852,000 at March 31, 1997 compared with $10,768,000 and
$11,303,000  at December  31, 1996  and March  31, 1996,  respectively.    The
increase  of $2,084,000 from year  end was attributable  to additional working
capital needed  during the first and  second quarter as a  result of increased
sales.   The $1,549,000  in  debt added  since March  31,  1996 resulted  from
increased working capital needs.

The increase  in stockholders' equity  of $435,000 from  December 31,  1996 to
March 31, 1997  was attributable to earnings and  the contribution of treasury
stock  to the  Savings  and  Investment Plan  for  company employees.    These
increases were partially offset by the payment of a cash  dividend of $350,000
during  the first quarter of  1997 and the  cumulative translation adjustment.
The $5,505,000 increase in stockholders'  equity from March 31, 1996 to  March
31, 1997 was due to  earnings during the last  three quarters of 1996 and  the
first quarter of  1997, to the exercise of stock  options, to the contribution
of stock  to the Savings  and Investment Plan for  company employees and  to a
decrease  in the cumulative translation adjustment.  This was partially offset
by the payment of cash dividends.  

The  Company received new  orders of $33,389,000  during the first  quarter of
1997 compared with $29,259,000 for  the first quarter of 1996.  The 14 percent
increase  was  attributable to  higher orders  in  the Materials  Handling and
Railway Products  segments.  The  order backlog  was $28,821,000 at  March 31,
1997 compared with $20,885,000 and $23,012,000 at December  31, 1996 and March
31, 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 effect  of adopting  SFAS 128  on the  Company has  not been
determined but is not anticipated to be significant.

 
 
Liquidity

On February 12, 1993,  the Company entered into a credit agreement with a bank
which was amended on April 26, 1994, and June 13, 1995.  The amended agreement
provides up  to $15,300,000 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.<PAGE>
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 2.8,  2.6 and
2.5  to  1  at  March  31,  1997,  December  31,  1996  and  March  31,  1996,
respectively.  At  March 31,  1997, the  Company had  available $2,250,000  of
unused credit  under its loan  agreement, plus  cash and  cash equivalents  of
$4,582,000.  This compared with $4,350,000 and $4,075,000 of unused credit and
$$,979,999 and  $3,686,000 of cash and  cash equivalents at  December 31, 1996
and March 31, 1996, respectively.


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

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
-------------------------------------------------------------


The Company held its Annual Meeting of Stockholders on April 23, 1997 ("Annual
Meeting").   There were 4,373,552 shares of  the Company's common stock issued
and entitled to  vote at the Annual Meeting.   Proxies were solicited pursuant
to the nominees of the Board of Directors of the Company.

At the Annual Meeting, Messrs. Frederick  J. Mancheski and John F. McKeon were
elected directors for three year terms and the votes cast were as follows:

                                                              Total Votes For
                                          Total Votes       Which Authority To
                                         For Election          Vote Withheld  
                                         ------------       ------------------

Frederick J. Mancheski                     2,628,003               8,925 
John F. McKeon                             2,632,928               4,800  

Following  the election,  the Company's  Board of  Directors consisted  of the
following eight named individuals:

                   Name                             Expiration of Current Term
                   ----                             --------------------------

Albert Fried, Jr.                                               1998
L. L. White, Jr.                                                1998
Michael T. Yonker                                               1998
J. Grant Beadle                                                 1999
Frank T. MacInnis                                               1999
Arthur McSorley, Jr.                                            1999
Frederick J. Mancheski                                          2000
John F. McKeon                                                  2000


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 March 31, 1997, the Company
     did not file any reports on Form 8-K.

                                                          



                               SIGNATURE
                               ---------

Pursuant to the requirements of  the Securities and 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

Date:  May 12, 1997                 By:  /s/ Nancy A. Kindl          
                                         --------------------------------- 
                                         Nancy A. Kindl
                                         Vice President, Treasurer, and
                                         Secretary and Chief Financial
                                         Officer







                                 EXHIBIT INDEX
                                 -------------

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

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