Business: Texas Newsprint

Charles Holmes Herty’s 1933 proof that newsprint could be made out of Southern slash pine excited Southern publishers: with slash pine growing like weeds in the South, they ought to get their newsprint a lot cheaper than the $42.50 a ton then charged by the Canadian and Northern U. S. manufacturers. (Current price: $48 to $50.) When a Southern lumberman named Ernest Lynn Kurth announced early in 1937 that he would build the South’s first newsprint plant at Lufkin, Texas, the publishers were even more excited. But though kraft paper factories were fast becoming the South’s biggest industrial baby, Southern capital was hard to find for newsprint. Texans were more interested in cotton, oil and cattle, were skittish of Northern capital.

Last week Promoter Kurth’s Southland Paper Mills Inc. finally found its money. Of the $5,000,000 needed to build the plant, RFC put up $3,425,000. The rest will be raised by stock sales, Yankees not barred. Southern publishers contributed $429,000 in capital, signed for 250,000 tons of newsprint.