TIMBER PRICES

Sun (Auckland), Volume 1, Issue 115, 5 August 1927, Page 2

TIMBER PRICES

Reply to Mr. Hockley M.P.

On July 12, Mr. F. F- Hockley, M.P. for Rotorua, discussed the timber question at length in the House of Representatives, and made allegations to which strong exception is taken by Auckland timber merchants. One of them wrote a letter to the editor of the Auckland “Star” replying to Mr. Hockley’s charges. Our contemporary refused to publish the letter on the ground that it was not officially endorsed by the Auckland Timber Merchants’ Association. As that does not appear to be an adequate reason for refusing publicity to facts of interest and importance to the community, THE SUN, having satisfied itself of the bona fides of the writer, prints the letter, so that the public can judge for itself between Mr. Hockley and the timber merchants. The following: is th ■ • • f the letter:— Sir. — Your issue of ISlIi Ir contained a report of Mr. Hockley's appeal to the House on behalf of the New Zealand sawmillers. a most estimable class of gentlemen engaged in a severe struggle, and whose position merits serious and sympathetic consideration. Mr. Hockley’s Government, by raising railway freights and increasing royalties, augmented the difficulties of a severely handicapped industry, after which came the flood of imported timbers, which' effected the “coup de grace.” Dealing with the sawmillers’ position, Air. Hockley was on safe ground: his constituency contains many large sawmills, and there is no doubt that the figures quoted were based on actual results, drawn from carefully and accurately-kept records. It is to be regretted that before accusing the timber merchant of profiteering and being responsible tor the present high price of timber, he did not take the trouble to interview some of them and ascertain the position at first hand. After going very carefully into our costs for the last five years' trading, we find that, based on sales, our yard expenses work out to between 9s and 10s a hundred, and other merchants, whose records enable them to speak authoritatively on the subject, confirm this figure. Railway freight (based on Ohakune prices) costs 5s lid a hundred, and cartage to the yard costs lid a hundred. So that to the cost of 18s 5d mentioned in Air. Hockley's speech must be added 1 r»s lOd before the merchant makes one penny profit, or a total of 34s ?d per hundred. Here are some prices: For 0.8. scantlings we get 23s 6d: for rough heart scantlings, 26s 6d: for 0.8. rimu flooring. 34s 6d; for 0.8- matai flooring, 31s; and for O B. match lining, 265; in all cases less the builder’s discount. Before the imported weatherboard came on the scene, what the merchant lost on the lower grade timbers he was able to regain on the better grades of heart, which the local bodies insisted on being used for outside work. But to-day not one house in twenty uses heart rimu, matai or kauri weatherboards, and even the flooring is being reduced in class, so that instead of using dressing heart rimu or matai flooring at 54s 6d a hundred, the builder demands rough heart at 35s 6d. A very good instance of the iniquitous profit made by the merchant is afforded by the dressing heart flooring mentioned above. For the class of timber required to produce this the sawmiller asks and gets 42s rd a hundred. This is undressed and “green.” This works out as under: Dressing heart rimu or matai

PROFITEERING REPUDIATED

If the merchant is very lucky h« will get 57s Gd for this, which includes Is per hundred “dry” rate. (Mr. Hockley states that it costs 5s a hundred to cry timber. Probably he is right; but the “grasping” timber merchant only gets 35.) Generally he will not get the “dry” rate, which leaves him with 6d for his flooring, netting him is under: D.H. rimu or matai flooring .. 214 • Less builder's discount. 5 per cent. * * Return to merchant 2 H * Cost as above - 5 ” Gross profit for merchant .. • Out of this exorbitant profit the merchant has to pay his overhead expenses, labour, cost of filletting the timber, machining, loading, tallying and interest on the cost of the timber during the period required for drying (usually some six months). This on our costs works out to 9s 7d a hundred, and leaves a deficit to swell our ill-gotten gains. If Mr. Hockley or anyone else will show us a profit under these circumstances, he will be a welcome visitor to our yards. In point of fact the merchant is between flie upper and nether millstones. Any careful student of the dally prw* cannot fail to have been struck ®y the alarming number of bankrupted* among the builders during the la* l two years. The causes of this many and various, but the principafactor is that the prevailing slackness of trade causes many of them to toj« jobs at prices which cannot po»«W; pay, and, while they are doing no fc?r themselves, they prevent the le& m timate builder and the merchant fro® making a living. Of course there af* many other factors, but it is c ® rt * , J that most merchants will agree that L is the inexperienced, incompetent unprincipled builders, most of wnj* have nothing to lose, that are the cnltf culprits. . It is quite easy for judges, offl r*r assignees and legal luminaries to fulminate about the ease with which the* folk obtain credit. But they «ee® r forget that they are in the happy tioii of being wise after the event, awthat they have no knowledge ot w circumstances under which the creo*’was granted, or the plausible tale tm** was given to the merchant. Crefl» regulation is one of the most diffle** l '; problems we have to face, and. bdnj: human, the merchant is bound to fw* in frequently. If some of our critic* were to spend six months or so in of our offices, it would open his eyes to some of the difficulties we nave t* face, and incidentally make him a little less caustic in his criticisms. But the best refutation of Mr. Hoc** ley’s statements is provided by a »tu<j r of the balance sheets published W the larger timber merchants of Auckland. In this connection it must be remembered that some of drff s make joinery in addition to selling timber and that the returns on joined) are better than these on timber. Nearly all of them showed a verpoor trading return, and it is certsJ* that many of the smaller firms, are not compelled to publish their f-V ures, would have to show a loss. The last paragraph of Mr. Hockley* speech is sheer nonsense. He acwdj* the merchant of specifying import*® timber for the main portion of tr* building. He surely must be awaj* that the specification is a matter trim which the merchant has nothing to and that the decision of the class timber to be used is the prerogatn* of the architect, builder or owner* T** merchant simply supplies such timber as is ordered. shavuk*

(f.o.r. loading: station) 2 2 6 Less 7i per cent. trade discount 3 2J 1 13 1" r < -ash 1 0 Add freight and cartage 1 18 31 6 11 Cost in yard of green tinui eased timber .. .. - 5