A Railroad Blockade Broke the Lumber Glut
Puget Sound mills had been selling below cost. Then floods and a strike cut the supply line—and manufacturers finally got the upper hand on prices.
The story, cleaned up
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After a long period of depression there are now unmistakable signs of revival in the lumber trade of the Sound. The turning point has evidently been reached, and lumber and shinglemen are becoming bullish in their discussion of prices and trade prospects. The Port Blakely mill is running night and day on export orders, and the cedar lumbermen on the east side of the Sound are refusing orders because the stock accumulated during the two months' enforced shut-down is already sold, and are preparing to resume operations as soon as they can secure cars. The railroad blockade caused by the floods and the strike has done what no amount of argument could accomplish: enforced a two months' shut-down, during which the demand has caught up with the supply.
A well-known and successful mill owner said: “We have now reached a point where we are refusing orders at prices that have been current for the past two months. We have 100 cars of shingles ready to ship at the list prices current in the country, and a month ago we accepted orders at 10 cents per 1,000 lower than we will sell for today. A month ago we sold at prices set by dealers, and now we are setting our own prices. We are receiving orders directly from Eastern lumber yards that are 10 cents higher than quoted by local dealers, so I can safely say that there has been an advance of 10 cents.”
“The mills have been selling at prices lower than reason; the manufacturers are waking up and if they keep awake there will be a steady advance in prices. The bear has had his day and now the bull appears on the scene. The dealers need stock for their fall trade and they will be willing to come up to the price quoted by the manufacturers.”
In the lumber trade the change for the better is unmistakably a fact. Fir logs have advanced $1 within the past few days. Heretofore the ruling price has been from $4 to $5 per 1,000, according to quality, and now the prices quoted are $5 to $6. Less than a week ago one logging firm sold a lot of first-quality logs at $6 per 1,000. The next two months promise a better revolution in prices in the shingle and lumber trade.
“The bear has had his day and now the bull appears on the scene.”
The 1899 rebound was less a triumph of optimism than an accidental supply-chain correction: washed-out rails and a strike interrupted shipments long enough for demand to catch up. Puget Sound's resource economy still swings on rail and port bottlenecks, and the mill owners' insistence on setting prices rather than taking dealers' terms echoes modern fights over market power in Washington's timber and shipping industries.
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