The Athena press. [volume] (Athena, Umatilla County, Or.) 18??-1942, 1907-10-11
TRADE IS PARALYzED
New Lumber Rate is a Deadener on
Operations in Southern and
Western Oregon.
portland, Oregon Journal. J


Medford, Or, Sept. 28. As result
of the proposed advance in the Eastern
rail rate on lumber, the Iowa Lumber
d Box Company's plans for an i'm
mense lumber plant here will be aban.
doned, the Pacific & Eastern will
probably not be extended to the Butte
Greek forests and the large tim ber
tracts adjacent to the Rogue River
Valley be left uncut for many years.
This proposed rate will affect every
lumber industry in Southern Oregon,
as we'll as in Oregon in general, and
indirectly every business in the coun-
try.
Edgar Hafer, of the Iowa Lumber &
Box Company, stated today:
It was our intention to make exten-
sive improvements, including the
building of modern sawmill with
capacity Of $4,000 feet per day and
new box factory with a capacity of
$4,000 feet per day. These improve,
ments alone would cost $3.50, 900, but,
with the proposed Eastern rates staring
us in the face, we certainly shall do
nothing, and the only fact we regret
is the large amount of capital which
we are compelled to allow to lay DOR
mant under existing conditions.
"You ask me why the Pacific &
Eastern is not being built as contem-
plated and whether the failure of the
Oregon Trust & Savings Bank will
have any permanent effect on it's ex-
tension. As to this question I cannot
answer, but do know as long as there
is no lumber company contemplating
the opening up of the Rogue River
and Butte Greek timber to assure the
railroad tonnage. it would be folly on
their part to make any further extern
sions without the assurance or guar
antee of tonnage which would war
rant reasonable rate of interest on
the investment.
''The mills in Southern Oregon and
the Willamette Valley are compelled
to find a market in the East. as they
cannot get into San Francisco and bay
points on the present rate of $5 per
ton, which is equivalent to So. 33
per 1000 feet, and compete with the
water rate. which is $4.25 per 1000
feet from Portland, the Columbia
River and Washington points.
''The advance in the Eastern freight
rate of 10 cents per 100 pounds makes
it impossible for the lumber manufao-
tured in the Southern States, known as
yellow pine.
''In order to demonstrate the condi-
tions let us take a mill manufacturing
lumber in Southern Oregon or any
where in Western Oregon for that mat
ter and see what the advanced rate
means. The rate to Omaha is now Sc
cents per 100 pounds against rate OF
23 cents per 100 pounds from Southern
mills, and it will be advanced Novem.
Der l to 55 cents.
"Basing mill cut of lumber at a
reasonable value of $15 per 1000 feet,
I. O. b. cars, aud adding the 55-cent
rate, which amounts to $18. 33, makes
the lumber cost $33.33 in Omaha.
The present value of stumpage is about
81 per 1000 feet, against the present
value of southern yellow pine stump
age, which is about 81. Therefore,
the cut of Southern yellow pine lumber
would be worth So per 1000 more, OF
about $1S per 1000 t. o. b. cars mill.
Figuring their freight rate of 23 cents
to Omaha, which amounts to $7.66
would make the value of southern
lumber T. 0. b. cars Omaha $25. Sc
against ours of $3S.S3, which shows
conclusively that it is out of the ques
tion for Southern Oregon mill tt
compete with them even if the cost o1
stumpage aud the sawmill manufac
ture was thrown in, as you can see fol-
yourselves the fabulous profits which
can be made by the Southern yellow
pine mills above the basis of $18 a
their mills,
"New we will take up the Chicag
rate. Our rate is now 30 cents, whicl
will be advanced to so cents on No
vember /, against the Southern yellow
pine rate of % cents. This makes
difference Of $$SS.G6 IS POI 1000 feet, TAX
ing the same basis of price f. o. b
mills, which Is even greater than th