The BHSJ-SBS Best Paper for 2019
The Organization of a Sawmill Industrial Area in Postwar Japan
The Case of the Shimizu Port Lumber Industry Cooperative
2023 Volume 40 Pages 79-101
Details
2023 Volume 40 Pages 79-101
This paper elucidates the historical conditions behind the development of cooperative activity through the use of a case study in the Japanese sawmill industry, one of the industries that helped drive the country’s rapid postwar economic growth. Past business-history studies on conditions in Europe have shown that products from cooperatives initially struggled to carve out a market share, with large-scale businesses seeing little benefit in joining cooperatives’ ranks, and that cooperatives eventually began to develop when countries rolled out far-reaching subsidy policies after World War II. This paper, however, presents a case in which the leadership of large-scale businesses and the followership of smaller businesses propelled the growth of a cooperative that engaged in collective purchasing and marketing. In the postwar Japanese sawmill industry, it was autonomous corporate coordination, not national subsidy policy, that nurtured cooperative activity. The paper thus adds to the existing scholarship by highlighting a new development pattern for cooperatives.
Focusing primarily on the period from the 1950s to the first half of the 1970s, this paper looks at the management of and coordination among the members constituting the Shimizu Port Lumber Industry Cooperative (SLC) in Shizuoka Prefecture. The investigation delineates a mode of organization that would ultimately lay the foundation for the continuing existence of sawmill industrial areas in postwar Japan.
The sawmill industry played a pivotal role within the structure of Japan’s postwar economic boom. As the postwar years saw people move in droves from rural areas to urban areas and the number of households continue to climb, domestic demand for lumber expanded (Yoshikawa 2012, 122). The rise in demand at home required substantial imports of raw materials and fuel (Sugiyama 2012, 480). While crude oil was the most crucial component of that import picture, dwindling domestic forest stock and an explosion in lumber demand put wood second behind crude oil in terms of import scale.2 Much of the imported logs were processed by lumber producers and shipped to Tokyo, Osaka, Nagoya, and other major urban consumption areas. The sawmill industry thus provided the raw materials that provided support for the increasing number of households, driven by a population shift from rural areas to urban areas, and offered a form of infrastructure that supported residents’ day-to-day lives.3
Handa, ed. (1986), a prominent study of the postwar Japanese sawmill industry, looked at seven domestic sawmill industrial areas around the country to illuminate changes that took place in production and distribution amid increases in lumber imports. However, the study did not fully address two important issues. First, as Akao et al. (1986) noted, Handa, ed. (1986) shed light on the conditions underlying sawmill industrial areas but not the mechanisms through which agglomeration economies formed within those areas. Akao et al. (1986) tackled that point by drawing on economic theory to hypothesize that such areas were home to external economies and semi-internal economies. The second shortcoming of Handa, ed. (1986) was that, while it did paint an informative picture of sawmill industrial areas through careful fieldwork, it lacked a thorough examination of the activities of cooperatives—entities commensurate to the semi-internal economies that Akao et al. (1986) discussed. Historical inquiries into cooperatives have gained substantial momentum in recent years; one example is a study by Garrido (2022), which emerged shortly after the publication of the present paper’s original Japanese version. Exploring Spanish cooperative wineries, Garrido (2022) showed how products from cooperatives struggled to carve out a market share as large-scale businesses saw little benefit in joining cooperatives’ ranks. It then discussed how cooperatives eventually began to develop after massive national subsidy policies began to come into effect after World War II.
This paper centers on the role of cooperatives in sawmill industrial areas. Companies needed barkers (machines for removing tree bark) and other large-scale equipment in order to transport imported logs to their sawmills. Many secured access to these complementary assets (Hart 1995) indirectly via cooperatives that they invested in. In the 1960s, Japan saw an increase in the number of lumbering-related business cooperatives under the provisions of the Small and Medium-Sized Enterprise Cooperatives Act (enacted in 1949).4 In this paper, I refer to this phenomenon as the “organizing” (or “organization”) of sawmill industrial areas (Kawata 1980).
Focusing on historical evidence showing that the organizing of wood-importing sawmill industrial areas made it possible to meet surging lumber demand in postwar Japan, I chose the SLC for my analysis case. Shimizu Port was one of Japan’s most crucial hubs for wood imports, trailing only the Ports of Tokyo, Osaka, and Nagoya in terms of importance (Nihon Mokuzai Yunyū Kyōkai, ed. 1970, 208). Petroleum was the biggest import at Shimizu Port in terms of value from 1957 to 1962, but lumber supplanted petroleum as the leading item in 1963 and remained atop the list until 1974 (Mokusan 50 nen-shi Henshū Iinkai, ed. 2002, 472). Initially, the bulk of the lumber imports at Shimizu Port was South Sea lumber (imported from Southeast Asia) for a small group of companies that did plywood manufacturing, which had high added value and larger plant sizes compared to sawing lumber. However, cooperative activities that involved sawmill companies across the entire area sparked a sharp rise in imports of North American lumber5 in the 1960s.
Matsushima et al. (1968) and Watanabe (1976) both looked at the SLC and noted the organization’s lively cooperative activity, but there are three points that the studies failed to address. First, they did not fully elucidate how the SLC took shape after the war—and what entities comprised it—in light of the prewar context. Research on policy pertaining to small and medium-sized businesses has shown that although the principles underlying Japan’s corresponding policies exhibited shifts as the country went from the prewar period to the wartime years and then into the postwar climate, there was a degree of policy continuity in terms of the cooperative system (Matsushima 2008). That perspective would shine valuable light on the Shimizu sawmill-industry groups in the prewar and wartime periods.
Another standpoint demanding deeper inquiry comes from Abe (1989), which many consider the first Japanese historical study on production areas. Drawing on Abe’s argument that the composition of a production area’s members determines the degree of organization therein, a closer look at the cooperative’s initial postwar composition would be valuable. The second shortcoming of the past SLC-related studies is that they did not offer an analysis of the cooperative’s finances, an essential element in elucidating the underpinnings that enabled the cooperative’s activities to continue and expand (Shirai 2013; Tanaka 2017). Third, the existing research on the SLC ignored the role of the businesspeople responsible for the cooperative’s actual activities.6 In studies of policy concerning small and medium-sized business, scholars have argued that the leadership of cooperatives has a significant effect on whether or not policies on the organizing of business cooperatives and other groups can succeed (Inagawa 1971). While “leadership” is a concept with a variety of facets, of course, authors have suggested that one of the important factors behind successfully organizing a production area is how the organizers actually go about linking the area with sales markets (Takaoka 1999). It would thus be necessary to look into how the SLC’s leaders functioned as organizers, simultaneously sustaining the operations of their own individual companies and working together with their fellow cooperative members.
This paper addresses the above research gaps to offer a clearer, fuller picture of the conditions behind the organizing of the Shimizu area as follows. First, after explaining the developments in the Shimizu sawmill industry during the prewar and wartime years that led up to the founding of the SLC (1952), the paper examines the SLC’s initial composition. Comprising the next section of the paper is an analysis of the SLC’s finances. The last section takes a detailed look at SLC’s collective activities, which primarily consisted of the collective purchasing of logs and collective marketing of lumber; it also delves into the individual SLC members’ businesses.
The case for this paper is a sawmill industrial area that I refer to as the “Shimizu area.” Located in eastern Shizuoka, a prefecture on the Pacific Coast in central Japan, the Shimizu area sits inland from Shimizu Port, which was one of Japan’s most modern port facilities when it opened in 1899. The Shimizu area also lies in the vicinity of the Tokyo-Yokohama area and its enormous consumer population. The following section provides an overview of how the Shimizu area took shape, going back to the prewar years.
Industrial development in the regions inland from Shimizu Port had close connections to kaisen doiya (an Edo-period shipping agent). During the Edo period, kaisen doiya received privileged treatment from the reigning Tokugawa shogunate. Although it lost its preferential standing in the transition to the Meiji period, the company kept its shipping operations afloat and also ventured into port construction. With kaisen doiya and other shippers taking up enterprising efforts, Shimizu Port became Japan’s leading port for exporting tea (Awakura 2013). The port’s development, in turn, propelled the urbanization of the nearby inland region during the Meiji period. Local agricultural communities in the Shimizu area also saw substantial growth in their production of mikan (tangerine-like citrus fruit), which had sales markets stretching from Hokkaido to overseas territories in the Japanese empire and even as far away as North America (Shimizu Shi-shi Hensan Iinkai, ed. 1981, 364–383).
World War II dealt a significant blow to the area, with air raids shortly before Japan’s surrender wreaking extensive damage to the regional economy surrounding Shimizu City. However, trading at the Shimizu Port came roaring back from the ravages of the war thanks to increases in food imports through American financial assistance to Japan as well as rising exports of tea and mikan via American counter-purchasing of Japanese products (Shimizu Shi-shi Hensan Iinkai, ed. 1986, 535–539). A subsequent influx of factory operations also diversified Shimizu City’s industrial makeup, which came to include shipbuilding, can manufacturing, canning, sugar manufacturing, flour milling, and more.7 By the early 1960s, roughly 30% of all the households in Shimizu City—whose population had reached approximately 200,000—worked in the manufacturing sector (Kyōdo o Yokusuru-kai, ed. 1962, 169–170).
The sawmill industry in the Shimizu area developed in favorable conditions: with the Shimizu Port serving as their primary procurement channel for logs, companies had strong links with other industries in the production area and excellent access to the massive consumption hub of the Tokyo-Yokohama area. There were several modern sawmills adjacent to Shimizu Port, the first of which scholars believe was the steam engine–powered mill that Hashimoto Umakichi built in 1906 to produce building materials for tea-processing equipment (Shimizukō Mokuzai-shi Hensan Iinkai, ed. 1962, 33). In the first half of the 1920s, when shipments of North Sea lumber from Hokkaido and Karafuto (on the island of Sakhalin) began arriving and demand for lumber surged in the aftermath of the Great Kantō Earthquake (1923), the Shimizu area underwent rapid, dramatic growth. Sawmills on the outskirts of forests along the Tenryū River in western Shizuoka and the Ōi River (Ōigawa) in central Shizuoka relocated their operations eastward to the Shimizu area, while branch facilities began to sprout up in the region as well (Minami and Makino 1986, 210–211). As a result, the number of sawmills in the Shimizu area shot up from 30 in 1919 to 97 in 1926 (Shizuoka-ken Mokuzai Kyōdōkumiai Rengōkai, ed. 1968, 355). Sawmills in foothill areas moved into the Shimizu area in part because of severe cash-flow struggles amid the recession of the 1920s; lacking the resources to harvest mountain forests, they were unable to secure supplies of logs and thus found themselves clamoring for access to North Sea lumber and the high capital turnover ratios it offered (Shimizukō Mokuzai-shi Hensan Iinkai, ed. 1962, 41).
2. The establishment of trade organizations and the parties behind themWith the Shimizu area now home to a congregation of sawmills, efforts to form a full-fledged trade organization began around 1930.8 Many of the lumber businesses in the area were already part of the Ihara Shimizu Abe Lumber Dealers Association, a group that formed under the provisions of the 1900 Important Product Trade Association Act. However, the companies in the Shimizu area dealt in North Sea lumber and used routes for procuring their logs that differed from the routes other regions used. Thus, the businesses set up an independent organization, the Shimizu Port Sawmill and Box-making Association, in February 1923. That June, the Shimizu Port Lumber Import Dealers Association also launched operations as a body responsible for liaising with raw-wood dealers.
In May 1930, Shimizu-area sawmill businesses took another step by creating the Shimizu Port Lumber Dealers Association to serve as a parent organization for the associations above. Heading up the new body was Nakamura Tōtarō from sawmill company Tenryū Seizai, with Shinma Tsunezō from industry peer Shinma Seizai also on the organization’s 11-member board of trustees.
Within the Shimizu Port Lumber Dealers Association were three “neighboring associations” with separate geographical jurisdictions. The largest in terms of membership was the Sodeshi Area Neighboring Association, which engaged in laying track, purchasing, and marketing. In addition to facilitating communication among its members, the Shimizu Lumber Dealers Association was also active in pursuing a variety of joint undertakings.9
The 1920s and early 1930s saw a serious predicament befall the sawmill operators in the Shimizu area. The spike in demand for building materials following the Great Kantō Earthquake began to recede as the recovery effort progressed. Then came the Shōwa Financial Crisis in 1927 and its widespread economic impact. On top of that was the Sakhalin Forestry Policy Reforms in 1932, which made procuring logs more difficult. Sawmill companies decided to combat the challenges by reorienting elements of their operations: they began securing their wood from foreign sources, not domestic sources, and shifting the focus of their production activities from building materials to box-making materials. To boost their profit margins, these box makers found themselves needing to sell products directly to end users without going through box wholesalers. Some built box-assembly plants in locations close to their respective end users, thereby forming close ties with their target recipients. Examples include Ban Seizai supplying products to Osaka Artillery Arsenal and Osaka Military Fodder Arsenal, Marukyō Seizai and Marumatsu Seikanjo to Noda Soy Sauce Company, Kyōritsu Seizai to Ajinomoto Honpo Company Suzuki Shōten, and Nishiya Seizai to Dai Nippon Brewery Company (Mokuzai Tsūshinsha, ed. 1936, 84–87).
The environment surrounding the sawmill industry changed again during World War II. The promulgation of the Lumber Control Act in March 1941, for example, initiated a process that put the industry under closer government control. In response, operators from the Sodeshi Area Neighboring Association, led by Shinma Itsuhei, called on the Forestry Agency (part of the government’s Ministry of Agriculture and Forestry) to establish controlling organizations not on a prefectural basis but rather on a smaller, region-to-region basis. Thanks to the successful appeal, sawmill companies in the Shimizu area established the Shimizu Port Lumber Company in December 1941. The company’s president was Fukushima Shōtarō, with Shinma Itsuhei serving as senior managing director and Muramatsu Hachirō as standing auditor. Inagaki Ryōhei from Tenryū Seizai was also on the board. However, measures to enforce tighter industry controls mandated the creation of prefecture-controlled companies and thus prompted the establishment of Shizuoka Prefecture Lumber Company in April 1943. Fukushima Shōtarō and Shinma Itsuhei maintained their leadership roles in the new prefecture-wide organization, serving as managing director and director in charge of the distribution division, respectively. In August 1944, the company merged with a forestry cooperative and became the Shizuoka Prefecture Regional Lumber Company. Muramatsu Hachirō was named the new company’s Branch Chief of Chūbu (a region in central Japan).
Air raids on July 7, 1945, destroyed the majority of the factories in the Shimizu area; a mere four facilities still maintained their production capabilities after the war ended. With the local sawmill industry reeling from the devastation, salvation came in the form of damage compensation from Shizuoka Prefectural Lumber Company. The organization supplied local companies with wood that had been stored, unused, in the Shimizu area—resources set aside for the Japanese army and navy—at official (ceiling) prices. It was this initiative that enabled Shimizu-area sawmills to regain their footing in the postwar climate.
In July 1946, local lumber producers founded the Shimizu Port Lumber Business Association. Fukushima Shōtarō served as association president, while Shinma Itsuhei, Muramatsu Hachirō, and Inagaki Ryōhei assumed vice-presidential roles. They would then go on to create the Shimizu Port Wood Cooperative in January 1950 under the provisions of the Small and Medium-Sized Enterprise Cooperatives Act, installing Shinma Itsuhei as director and Muramatsu Hachirō and Inagaki Ryōhei as deputy directors. The Shimizu Port Wood Cooperative initially consisted of timber merchants and lumber producers, but the producers soon went independent and set up the SLC in June 1952.10 The newly formed SLC took over the joint projects that took place within the Shimizu Port Wood Cooperative, which thus narrowed its objectives to providing mutual aid, fostering friendly member relations, and engaging in liaison work. Although the role shuffling did result in some lumber merchants joining the SLC, sawmill companies were at the core of the SLC’s operations. Shinma Itsuhei11 and Inagaki Ryōhei remained in office as the SLC’s director and deputy director from 1952 to 1973 (Mokusan 50 nen-shi Henshū Iinkai, ed. 2002, 373–376). Key figures in industry trade organizations during the interwar period, such as Shinma and Inagaki, thus continued to spearhead cooperative activities after the war.
3. The composition of the cooperativeThis section examines the composition of the SLC at its founding. Here, I use “power number” (in kW) as an indicator of sawmill size. Figure 1 plots the power numbers for 50 sawmills at two points in time: 1957 and 1972.12 The various point shapes represent the origin of the corresponding company (the birthplace of its founder or its location at the time of its founding).13 As I noted earlier, the Shimizu area took shape as a community through an influx of sawmill companies streaming into the vicinity from other locations around Shizuoka Prefecture during the early 1920s. Given the geographical diversity underlying the organization, Figure 1 organizes companies into four origin groups: Shimizu, Ōigawa, Tenryū, and Others/unknown.
Figure 1 reveals several findings. First, all the sawmills were relatively small in 1957. Of the 50 sawmills, 41 (82%) had power numbers of 50 kW or less.14 The average power number was 39 kW, and the median was 34 kW. Although this information does not appear in Figure 1, 32 of the 50 businesses manufactured lumber for use in box making.
Second, a closer look at the origins of the sawmills shows that the companies from Ōigawa and Tenryū were relatively large in comparison to those from Shimizu, which tended to occupy the middle and lower rungs of the size scale. Historical sources suggest that Ōigawa businesses were largely box makers with strong, direct connections to their consumers; Tenryū companies primarily sold building materials to the Tokyo market; and many of the Shimizu-native companies were newcomers to the market that made their entries after World War II (Shimizukō Mokuzai-shi Hensan Iinkai, ed. 1962, 328–329).
The SLC thus comprised numerous small- and micro-scale operations. In a study on the Banshū cotton-fabric production area during the 1930s, Abe (1989) found that the local industrial cooperatives functioned effectively because the production conditions and operation scales had already begun to homogenize prior to the period in question (Abe 1989, 354–355). Despite having a different temporal context and industry type, the Shimizu-area sawmill industry during the 1950s exhibited a prominent similarity to the Banshū situation: an accumulation of uniformly small- and micro-scale companies providing the basis for dynamic cooperative activities. From that foundation, the forces that took the lead in uniting the Shimizu-area businesses into a production organization were the relatively large companies among them, such as Shinma Seizai and Tenryū Seizai.
Figure 1: Power of sawmills in the Shimizu area in 1952 and 1972
Sources: Shizuokaken Rinmubu. Tōrokugyōsha meibo [Resistered supplier list], 1957 (Shizuoka: Shizuoka Prefectural Central Library); Shimizukō Mokuzai-shi Hensan-iinkai, ed. Shimizukō mokuzai-shi [The lumber history of Shimizu Port] (Shizuoka: Shimizu Port Sawmill and Box-making Cooperative, 1962), 328; Mokusan 20-nenshi Hensyū Iinkai, ed. Mokusan 20-nenshi [The twenty-year history of the Shimizu Port Lumber Industry Cooperative], (Shizuoka: Shimizu Port Lumber Industry Cooperative, 1973), 294–309; Shimizukō Mokuzai Sangyō Kyōdōkumiai, Shusshi shōken daichō [Investment securities ledger] 1962 (Shizuoka: Shimizu Port Lumber Industry Cooperative).
Notes: The points in the figure represent the power numbers of sawmills in the SLC.
The next element of the SLC to analyze is its financial dimension. My analysis examines a time frame during which the SLC achieved significant growth and expansion, beginning with FY1952 (the organization’s founding fiscal year) and concluding with FY1974 (the fiscal year when the SLC discontinued its previously annual dividends to members as the Japanese economy sank into its first phase of negative growth in the postwar era).15
As Figure 2 shows, the indicators of SLC’s profitability and financial security swung wildly during the organization’s infancy in the 1950s. Much of that instability was inevitable, seeing as how the SLC’s management base had yet to firm up. However, a boom in the lumber market in 1960 and 1961 proved to be a turning point, prompting the SLC to begin importing more North American lumber and stabilizing both profitability and security.
Figure 2: Financial indicators of the Shimizu Port Lumber Industry Cooperative
Sources: Shimizukō Mokuzai Sangyō Kyōdōkumiai, Jigyō hōkokusho [Business report] 1952–1974 (Shizuoka: Shimizu Port Lumber Industry Cooperative).
Net profit margin ratio and total asset turnover, two indicators of profitability, experienced relatively minimal variability. The reason for that stability was the steady performance of sales and profits in the SLC’s division for the collective purchasing of logs, the operation at the core of the cooperative’s activities.16 Examining the divisional data on gains and losses in fiscal years with verifiable historical documentation, one finds that the solid, stable profits from the division for the collective purchasing of logs could cover any losses that other processing- and sales-related divisions posted.17
The indicators for financial security, meanwhile, did not just stabilize during the 1960s—they actually improved. Particularly notable is the marked drop in the organization’s financial leverage (equity capital plus debts divided by equity capital), which went from 8.7 in FY1961 to 3.7 in FY1970. What precipitated the decreases in fixed assets to fixed liability ratio and financial leverage, thereby bolstering the SLC’s financial security, was a massive increase in capital investments from the organization’s members. Starting at 4 million yen in FY1952, the total investment value skyrocketed in the ensuing years to reach 52.27 million yen in FY1960, 551.77 million yen in FY1965, 1.63625 billion yen in FY1970, and 2.8302 billion yen in FY1974.
There were two reasons for the growth in capital investments. First was an increase in the number of cooperative members. The SLC went from a roster of eight founding members in FY1952 to 61 total members the following fiscal year and 148 members in FY1974 (Mokusan 50 nen-shi Henshū Iinkai, ed. 2002, 467).
The second factor was a system for procuring capital investments that the SLC integrated with the log-purchasing framework. The SLC set the maximum value of logs that a given member could purchase from the organization to a percentage of the member’s capital investment. A look at the available data shows that the cap percentages were 10.0% in FY1952, 3.5% in FY1964, 3.0% in FY1965–1966, 2.5% in FY1968, 2.3% in FY1969, and 2.2% in FY1970, following a steady downward trend over roughly two decades.18 If members wanted to obtain more logs and expand their production, they had no choice but to boost their investment in the SLC. The SLC, meanwhile, paid a considerable portion of the profits from its activities back to members in the form of dividends. Over the 23-year period from FY1952 to FY1974, the average payout ratios for dividends on investment and dividends on usage volume of joint business came to 20.5% and 54.9%, respectively; the organization thus paid out particularly large amounts of its profits to members who made active use of its services. However, the SLC used dividends as a source of funding and called on members to make even more investments. Members were also able to receive loans from the SLC according to their investments in the organization, offering them a financing advantage.19 It was this interdependent relationship between the SLC and its members that was instrumental in improving the organization’s overall financial security.
The SLC’s business efforts consisted of collective undertakings and directly managed activities. The collective undertakings fell into two categories: collective purchasing of logs (which started in FY1952 [the following years in parentheses also indicate start years]) and collective marketing (FY1963). The directly managed operations that the SLC launched prior to FY1974 covered a wide variety of fields, ranging from paid wood-cutting services (FY1954), woodchips (FY1956), and sawtooth setting (FY1957) to ring barking (FY1966), soil improvement (FY1967), and rotproofing and mothproofing (FY1968). Meanwhile, over the years for which numerical data is available (FY1959–1974), the SLC handled cumulative totals of around 150.1 billion yen in collective purchasing of logs, approximately 41.9 billion yen in collective product marketing, and roughly 9.9 billion yen in other activities. Across that 16-year period, the annual totals trended significantly upward: from around 1.1 billion yen in FY1959 to roughly 26.7 billion yen in FY1974 (Mokusan 50 nen-shi Henshū Iinkai, ed. 2002, 464–466). The following section probes collective purchasing and collective marketing, the cooperative’s main business activities, in closer detail.
The first component to examine is collective purchasing. In its initial years, the SLC primarily procured logs from the Soviet Union, Southeast Asia (tropical wood), and Hokkaido, along with several other locations. Imports of North American lumber also began in FY1952, the SLC’s founding year, but were later suspended from FY1955 to FY1960 due to quality issues with the wood. Over the period from FY1952 to shortly before imports of North American lumber resumed (FY1960), the SLC handled 493,606 m3 of logs. Of that total, 52.1% was Soviet wood, 17.5% was tropical wood, 16.7% was from Hokkaido, 6.8% was from mainland Japan, 5.4% was North American, and the remaining 1.4% came from other sources (Shimizukō Mokuzai-shi Hensan Iinkai, ed. 1962, 291).
Importing the bulk of the initial lumber supply from the Soviet Union made sense for the SLC given its locational conditions, as it was unprofitable to saw domestic wood in the Shimizu area. The SLC did not make the Soviet Union its sole supplier, however—it continued to seek out sources offering better conditions, a process that eventually led to the resumption of North American lumber imports in FY1961. In around 1960, Shinma Itsuhei and other SLC leaders began to see the costs of transporting Soviet imports as a problem; moving the wood to the Shimizu Port was much costlier than transporting it to ports on the Japan Sea coast (Shinma 1971, 84). At the SLC board meeting in May 1960, leaders discussed information indicating that it was cheaper to transport purchases of Soviet lumber coming into ports on the Japan Sea than it was to transport the Soviet lumber that the SLC brought into ports on the Pacific side—and that in Tokyo, the market share of Soviet lumber coming into ports on the Japan Sea was growing.20 Shinma Itsuhei, Inagaki Ryōhei, and two other leaders thus decided to tour wood-production areas in Alaska, Canada, and the US Pacific Coast on a visit that lasted from April 11 to May 13, 1961 (Shimizukō Mokuzai-shi Hensan Iinkai, ed. 1962, 300–309). Based on their findings abroad, Shinma and the other leaders saw promising prospects for North American lumber in the Japanese market and decided to switch their sourcing from the Soviet Union to North America (Shinma 1971, 85). That prompted an enormous increase in the amount of North American lumber making its way into Shimizu Port. Whereas only 78,000 m3 of North American lumber came into the port in 1961, the import volume reached a peak of 888,000 m3 in 1973 (Mokusan 50 nen-shi Henshū Iinkai, ed. 2002, 506).
The 1961 North American tour would turn into a series of expeditions. After the first official “North American lumber-production area visit” in 1964, SLC representatives made trips to the continent every year through 1974, save for FY1967, FY1968, and FY1972. In 1966, a composite total of 62 SLC members—including both leaders and regular members—made three separate tours (Mokusan 50 nen-shi Henshū Iinkai, ed. 2002, 417–429).
For the SLC, there were two main benefits of sending leaders and other cooperative members on direct visits to North American production areas instead of relying exclusively on import firms for raw-wood purchasing. First, the on-site visits enabled SLC to get a firsthand look at the quality of North American lumber and obtain market-related information before signing any purchasing agreements with import firms. The trip that the SLC board approved in July 1965 is one example. They decided to send a tour team to North American production sites, tasking the members with addressing the drop in quality that leaders had noticed in the North American lumber they procured.21 Based on the team’s findings, cooperative personnel reported two conclusions at the board meeting the following month: that the lumber from the Cascades was of a good quality itself but was often partially rotted, first of all, and that lumber from the Grace Harbor area may not have been ideal for house building but exhibited minimal amounts of rotting. The second major benefit of the North American tours came from their scope; by inspecting not only North American raw-wood production areas but also sawmills on the continent, SLC ensured itself a direct supply of information on cutting-edge facilities that were still foreign to Japan. One of the technologies that the SLC gained exposure to was the ring barker, which had become a standard piece of equipment at medium- and large-scale American sawmills. Having seen ring barkers in action, the SLC purchased one from Nicholson Manufacturing Ltd. in 1966 and submitted an order for Fuji Seisakusho Co., Ltd. (Numazu City, Shizuoka Prefecture) to erect a plant for it on reclaimed harbor land in the Muramatsu Area of Shimizu City. The site thus had the ability to process wood coming in from the harbor—sending it through rings to remove the bark, cross-cutting the wood with two chainsaws, and loading the cut wood onto trucks—automatically. Trucking the processed wood from the ring barker to sawmills up to 5 or 6 km away cost just 580 yen/m3, considerably less than the conventional charges that started at 700 yen/m3.22
By installing cutting-edge assets like the ring barker and implementing them as shared facilities, the SLC was able to distribute logs efficiently. The benefits of cooperative operations stretched beyond just enhancing operations, however. Uniting in the form of a cooperative to import logs was also a valuable means of acquiring and honing an edge in negotiating with major firms. The SLC purchased wood from a variety of general trading companies, including Ataka & Co., Mitsubishi Corporation, and Mitsui & Co. One could logically assume that, for a given sawmill company, it would be easier to secure logs from traders on advantageous terms by going through the cooperative rather than making individual transactions on its own (Shinma 1971, 6–11). Being part of the cooperative also proved beneficial on the logistical side; one example was harbor loading and unloading, key components of the distribution process in importing logs. Since the SLC served as the contracting party in dealings with cargo handler Suzuyo & Co., Ltd., member companies had another advantage that likely made it possible to buy logs at even more favorable terms (Watanabe 1976, 78).
Going even further beyond benefits like enhanced negotiation capabilities, group purchasing through the cooperative also gave members access to logs at stable prices. Meriting particular mention on that point are the years 1964 to 1968, when the SLC offered wood to members at fixed prices.23 The prices that SLC paid to the general traders it did business with obviously varied from source and source and fluctuated over time, but the organization worked over the course of every fiscal year to level out the price ranges of its framework for distributing those purchases to members.24 As I noted above, the SLC used its collective purchasing of logs to modulate divisional profits and losses. The guiding principle behind that practice, however, was never to generate high profits but rather to transfer sales revenues into the cooperative in amounts that would cover necessary expenses without exceeding that minimum. Deputy Director Inagaki Ryōhei went on record saying that he could not even conceive of raising the prices of the materials the SLC sold to its members simply because of an increase in the market price for logs.25 When market prices did rise in 1969, the SLC held to its stance and actually lowered its distribution prices for October and the subsequent months so that members would not find themselves grappling with worsening income-expenditures gaps. All together, the cooperative’s efforts in collective purchasing functioned as a kind of financial cushion, absorbing the negative impact that price spikes could have on its members.26
2. Collective marketingThe other element to explore is the SLC’s collective marketing. In this section, I look at how the organization’s collective marketing began and developed through the first half of the 1970s. The company that spearheaded the launch of the organization’s collective-marketing initiatives was Tenryū Seizai, whose president was cooperative deputy director Inagaki Ryōhei. The company focused its production on building lumber and shipped its products to the Tokyo metropolitan area, one of the relatively few operations in the Shimizu area to follow that pattern. Inagaki was apprehensive about the Shimizu area’s prospects moving forward; doubting that Tenryū Seizai and the other sawmill companies in the Shimizu area would be able to survive on their own, he feared that other production areas would erode Shimizu’s market share unless something changed. After building a consensus among the Tenryū Seizai leadership, Inagaki led the drive to implement collective product marketing through the cooperative (Mokusan 50 nen-shi Henshū Iinkai, ed. 2002, 154).
Following his lead, Inagaki’s subordinates at Tenryū Seizai also did their part to help get collective marketing off the ground at the cooperative. Managing Director Uchiyama Tarō served as the SLC’s first “chair of collective marketing,” a position in which he took charge of creating specifications for the products in the collective marketing lineup. Takeshita Bunshichi, who headed up bookkeeping for Tenryū Seizai, made regular visits to SLC members’ facilities to provide help with lumber-grading methods, bundling methods, and more.
In April 1963, the SLC started dealing with wholesalers in the Tokyo-Yokohama area (Mokusan 50 nen-shi Henshū Iinkai, ed. 2002, 154). This was the result of a move by Tenryū Seizai. When the cooperative’s collective-marketing efforts were in their initial stages, Tenryū Seizai opened up its own sales channels to fellow SLC members by referring them to its existing partners. In October 1964 came the launch of Fuji Seikai, a joint organization uniting the SLC and nine wholesalers with head offices in the Tokyo-Yokohama area, including Jōhoku Mokuzai (Arakawa, Tokyo; established in 1951) and Daiwa Mokuzai (Suginami, Tokyo; established in 1952).27 Tenryū Seizai was not the only driving force behind Fuji Seikai; another important factor was Shinma Seizai’s personal network. Daiwa Mokuzai is a good example. The company was a subsidiary of Enshū Seizai (Hamamatsu City, established in 1946), and Kinpara Masaharu—formerly a section chief at Shizuoka Prefecture Lumber Company (established in 1943), the wartime government-controlled company where Shinma Itsuhei served as director in charge of the distribution division—was its representative officer. Having made Kinpara’s acquaintance at Shizuoka Prefecture Lumber Company, Shinma eventually approached his former colleague about joining Fuji Seikai when the time came.28 The formation of the Shizuoka Prefecture-wide, government-controlled company in the wartime years brought sawmill operators from different regions across the prefecture into one place, a development that proved fertile for new business ties to take root and grow in the postwar era.
The financial conditions at the companies of the leaders who propelled the cooperative’s collective-marketing initiative provide interesting insights into the effort. Tenryū Seizai offers an effective case study, as the company’s business reports for FY1961–69 remain accessible today (Figure 3). Tenryū Seizai’s net profit margin ratio, an indicator of profitability, trended upward after the creation of Fuji Seikai, going from -1.0% in FY1964 to 0.7% in FY1965 and 2.0% in FY1966. However, the company’s financial leverage—a barometer of financial security where higher values connote worse security—rose from 3.0 in FY1963 to 4.0 in FY1964. Another indicator of financial safety, the fixed assets to fixed liability ratio, sat at 67.1% in FY1963, 95.8% in FY1964, 85.8% in FY1965, 96.0% in FY1966, and 88.8% in FY1967; in these values, too, one can see a sharp increase from FY1963 to FY1964 and a plateau at a high level thereafter, suggesting a sustained drop in financial security. The rise in Tenryū Seizai’s fixed assets to fixed liability ratio stemmed from the company’s move to invest more heavily in the SLC, which, in turn, led to a higher fixed-asset total: what once amounted to 59.09 million yen in FY1961 reached 137.89 million yen in FY1966. The growth occurred over multiple segments of Tenryū Seizai’s fixed assets as well. Over the six-year period from FY1961 to FY1966, tangible fixed assets went from 44.38 million yen to 88.41 million yen, while capital investments jumped from 9.99 million yen to 39.95 million yen.29 The biggest destination for those capital investments was the SLC, which Tenryū Seizai provided 5 million yen in FY1961 and then as much as 21.3 million yen in FY1966.30 The financial situation at the company was, in some ways, the flipside of the conditions at the SLC; while the cooperative’s financial security showed promising improvements, the financial security levels at one of the cooperative’s most prominent companies were showing more and more causes for concern.
Determining whether collective marketing was beneficial or detrimental to Tenryū Seizai’s standing would require further, more detailed research. Still, the available historical sources do offer some clues. Tenryū Seizai’s business report for FY1964, when the SLC officially implemented collective marketing, shows that increasingly stiff competition in the company’s primary market of the Tokyo-Yokohama area and the resulting stagnation in selling prices were creating an operational bottleneck. The documentation also provides evidence indicating that developing price-negotiation advantages in sales markets was a key focus area for the company. In that context, one could assume that collective marketing must have had a positive significance for Tenryū Seizai.
Figure3: Financial indicators of Tenryū Seizai
Sources: Tenryū Seizai Kabushikigaisha, Eigyō hōkokusho [Business report] 1961–1969 (Tokyo: The Library of Economics, University of Tokyo).
How, then, did collective marketing impact the management of the SLC’s individual members? The only sources offering any general answers are non-numerical, as there is not enough financial data for individual sawmill companies currently available. One is a recap of a roundtable discussion in a 1968 issue of Rinzai Shinbun (an industry publication). In the conversation, Tenryū Seizai’s Inagaki Ryōhei noted that the companies in the Shimizu area all purchased the same wood, lumbered the wood via the same methods, and sold the lumber to clients in the Tokyo market, but the companies had different profitability levels.31 In response, Uchiyama Tarō (also from Tenryū Seizai) said that profitability was better at companies that engaged actively in collective marketing.32 While the statements may seem slightly at odds, what they suggest together is that collective marketing likely helped improve business performance at member companies to an extent that depended on the individual members’ management efforts.
The final element of this section examines the position of Shimizu-area products relative to other products in the Tokyo-Yokohama market. From a quantitative standpoint, the Shimizu area held the top share of the cumulative import volume for domestically manufactured lumber made with North American hemlock in the Tokyo-Yokohama area from FY1965 to FY1970: Shimizu accounted for 47.9% of the total (approx. 3.75 million m3), Tanabe 26.1% (approx. 2.04 million m3), Wakayama 9.7% (approx. 760,000 m3), the Chūgoku region 8.4% (approx. 660,000 m3), and the Shikoku region 7.8% (approx. 610,000 m3).33 As the volumes of shipments bound for the Tokyo-Yokohama area suggest, the Shimizu area’s main competitor was the Tanabe area in Wakayama Prefecture. Tanabe was home to a collection of capital-strong companies and a large-scale, dedicated plant for sawing North American lumber.34 However, Shimizu also had unique advantages of its own. Not only was it geographically close to the Tokyo-Yokohama area market, but the SLC’s collective marketing also enabled organized product sales—and those benefits made it possible for the area to overcome the disadvantage of having a stable populated by numerous small-scale businesses with minimal capital strength.35
Another facet of the SLC’s orientation in the market was its price formation. According to the SLC’s account of its own history, Uchiyama Tarō (the chair of the cooperative’s collective marketing) negotiated with wholesalers to establish fair prices that set the basis for Fuji Seikai’s pricing of North American hemlock lumber, which had a lasting impact on lumber market prices nationwide (Mokusan 50 nen-shi Henshū Iinkai, ed. 2002, 155). Collective marketing surely made a positive impact in negotiation leverage with buyers. However, a look at other contemporary historical sources raises the possibility that the SLC’s historical account may have been exaggerating in calling Fuji Seikai’s prices a baseline for pricing across Japan. In a 1968 Rinzai Shinbun article recapping a roundtable discussion that included the successors of SLC leaders Inagaki and Fukushima, an anonymous participant claimed that while 40% to 50% of the Shimizu area’s production volume went to the Tokyo-Yokohama market, the SLC had no ability to control the prices of the products.36 There is no surviving data on product prices at the time of that statement, which makes it impossible to verify actual price fluctuations that may have been occurring. The important element to note here, though, is that the people guiding the Shimizu-area lumber community saw themselves as the price leaders of their time. Comparing the product prices among different production areas in 1974 (Figure 4), the earliest year for which data is available, one finds that prices in other communities frequently sat below the Shimizu area’s selling prices.
Figure 4: Prices of rectangular hemlock arriving in Tokyo from Japanese sawmill areas (per cubic meter)
Sources: Nihonbeizai Kyōgikai, Shōwa 49 nenji nenkan beizai tōkei [Statistics on lumber imported from the US in 1974] 1975 (Tokyo: Kobayashi Kinen Ringyō Bunken Center).
As of 1961, supplies for boxing and packing applications accounted for 29.1% of all sawn lumber shipments from the Shimizu area. That percentage then proceeded to drop to 10.3% in 1965 and 6.5% in 1970, a period during which cardboard replaced wood as the principal material for packaging. Shimizu-area lumberers responded by focusing even more heavily on building materials, which saw their share of the production total rise from 48.6% in 1961 to 67.2% in 1965 and 82.2% in 1970.37 The former box makers had scant sales channels to work with in the aftermath of their production shift, so the SLC’s collective-marketing framework was extremely valuable to have access to. Essentially, the collective-marketing system—the work of head management at the cooperative—was what enabled Shimizu-area companies to make a smooth transition from wooden boxes to building materials.
That part of the larger picture provides a new perspective on Figure 1. While the departure of 10 SLC members brought their power numbers to 0 as of 1972, 40 companies maintained their lumbering operations within the SLC’s operating structure and managed to expand their businesses. In these numbers, one can appreciate the significance of the cooperative’s initiatives.
The discussion above has made three points clear. First was the basic composition of the Shimizu Port Lumber Industry Cooperative (the SLC). Formed after World War II by a group of executives from interwar trade associations and later a wartime government-controlled company, the SLC initially had a makeup that comprised mostly box makers and other relatively small-scale businesses. Second, the paper illuminated the financial side of the organization. On one hand, the SLC used dividends on usage volume of joint business to return a sizable portion of its profits to members that made active use of its cooperative initiatives. On the other, it collected investments in accordance with collective purchases of logs to fortify its financial security and thereby diversify its management structure. Third, cooperative leaders worked to make raw-wood procurement as efficient as possible through a variety of measures, from installing cutting-edge facilities for processing and distributing logs to visiting North American lumber-production sites. It also gave members access to their own sales channels—even when corporate management was on shaky ground—to create a collective-marketing structure.
Going back to the origins of the SLC, the conditions that facilitated the organization of the production area in the postwar context had three core components. First, the characteristics of the industry itself were optimal for organization, as companies working with imported lumber needed considerable funding for procuring large volumes of wood and also had to own and operate the requisite facilities. Second, the push for organization had already been building momentum in Japan since before the war, as the case of the Japanese ceramics industry illustrates (Ōmori 2015, 250–254). Third was the general homogeneity of the corresponding businesses in the area. Once an organization had taken shape on that foundation, what stabilized and strengthened the cooperative were a robust financial constitution rooted in investments from its members; management efforts to visit production areas, cut distribution costs, and more; and the cooperative-focused management approach that its leaders exhibited in realizing collective marketing, a framework that had yet to gain much traction in Japan (see footnote 4).38
In addition to contributing to economic and social stability during the protracted recession of the interwar period (Tanaka 2017, 24–26), the cooperative also helped its individual members maintain their operations amid the postwar changes in the industrial structure. As the shift from wooden boxes to cardboard made business difficult for box makers in the Shimizu area, many SLC members decided to transition to manufacturing building materials. These types of companies often found themselves essentially starting over without a base of sufficient sales channels, so membership in the SLC—and the opportunity to take part in collective marketing that came with it—must have been a boon. That dynamic fostered considerable followership among small-scale sawmill operators. Numerous sawmill companies came together in the Shimizu area, cooperated with one another, and supplied massive amounts of building supplies to the burgeoning demand center of the Tokyo-Yokohama area, contributing to Japan’s high-speed growth along the way.
There was a limit to how far the cooperative’s activities could grow, however. In the early 1970s, as the SLC’s individual members continued to enhance their marketing capabilities, companies with the ability to impact product-price formation outside the collective-marketing framework began to emerge. In terms of collective marketing—an effort that did not always involve the shared use of complementary assets—there thus existed boundaries defining companies’ cooperation under the leadership of SLC management and restrictions on the organization’s sustainability.
1 This paper is an English translation of the winner of the 2019 BHSJ-SBS Best Paper Award, which was originally published in Japanese. Due to space limitations, I have converted Table 1 from the original into Figure 1 in the translation, omitted Table 2 and Figure 2 from the original, and amended the text of the paper to cover the information in the omitted items. These modifications do not affect the central arguments of the paper. Also note that the paper represents my findings and does not reflect the views of the organization with which I am affiliated. This work represents a portion of the findings of JSPS KAKENHI (Grant-in-Aid for JSPS Fellows) Grant Number JP17J10180.
2 While the value of all crude-oil and raw-oil imports equated to just 14% of Japan’s total raw-wood imports in 1952, the relative value rose to 50–60% by the second half of the 1960s (Tōyō Keizai Shinpōsha, ed., Kanketsu Shōwa kokusei yōran 2 [Complete Shōwa state survey 2] (Tokyo: Toyo Keizai Shinpōsha, 1991), 166, 170).
3 The number of new housing projects in Japan surged from 690,000 in 1963 to 1.91 million in 1973. The increase was particularly prominent in Tokyo (where the number of total houses went from 2.51 million to 3.8 million over the same time frame) and Kanagawa Prefecture (920,000 to 1.81 million). Looking at the composition of new housing projects in 1970, one can also see that wood-frame houses accounted for 7,102 ha of the new projects’ combined floor area of 10,107 ha, or 70% of the total (Tōyō Keizai Shinpōsha, ed., Kanketsu Shōwa kokusei yōran 3 [Complete Shōwa state survey 3] (Tokyo: Toyo Keizai Shinpōsha, 1991), 343, 348, 351).
4 The number of lumber-related business cooperatives established in Japan that engaged in the collective purchasing of raw materials rose from 244 in FY1962 to 341 in FY1964. An increase also occurred in the number of cooperatives selling lumber collectively, which went from 72 to 110 over the same time frame (Fujimoto Kazuhei, ed., Nihon ringyō nenkan [Japan forestry yearbook] (Tokyo: Rin’ya Kyōsaikai, 1967) 399).
5 In the Japanese market, wood imports from the United States and Canada were often used in construction and building applications as substitutes for domestic cedar (Nomura Isamu, Gaizai no yunyū jijō to mondaiten [Import situation and problems of foreign lumber] (Tokyo: Kōrin Times, 1968), 200). Japan’s annual domestic conifer consumption peaked at 2.865 million m3 in 1964 and then proceeded to decline thereafter; meanwhile, consumption of North American lumber increased from 3.84 million m3 in 1964 to 15.49 million m3 in 1973 (Nōrin Suisanshō Tōkei Jōhōbu, ed., Mokuzai jukyū ruinen hōkokusho [Cumulative report on lumber supply and demand] (Tokyo: Association of Agriculture and Forestry Statistics, 1995), 239–250).
6 In his analysis of collective action, Olson also pointed to the need for closer consideration of businesspeople’s roles in the provision of collective goods (Mancur Olson, Jr., The Logic of Collective Action: Public Goods and the Theory of Groups (Cambridge: Harvard University Press, 1965).
7 The leading categories in the 1963 industrial statistics for Shimizu City by “shipment values, etc. of manufactured goods” (totaling 127 billion yen) were food manufacturing (27 billion yen), chemicals (13 billion yen), machinery manufacturing (13 billion yen), transport equipment manufacturing (13 billion yen), petroleum-product and coal-product manufacturing (12 billion yen), and metal-product manufacturing (11 billion yen). Lumber and wood-product manufacturing came in at 10 billion yen (Tsūshō Sangyō Daijin Kanbō Chōsa Tōkeibu, ed., Showa 38-nen kōgyō tōkeihyō: Shichōson-hen [1963 census of manufacturing: Municipalities edition] (Tokyo: Tsūshō Sangyō Chōsakai, 1966), 276–277).
8 See Shimizukō Mokuzai-shi Hensan Iinkai, ed., Shimizukō mokuzai-shi [The lumber history of Shimizu Port] (Shizuoka: Shimizu Port Sawmill and Box-making Cooperative, 1962), 83–187 for more information.
9 The Shimizu Port Lumber Dealers Association’s “Value of Manufacturing/Sales in the Association District” for 1931 came to 5.086 million yen, higher than the corresponding values for the Tenryū River Lumber Dealers Association (2.81 million yen) and Ihara Shimizu Abe Lumber Dealers Association (539,000 yen) (Shōkōshō Kōmukyoku, ed., Jūyō bussan dōgyōkumiai ichiran [List of important product trade associations] (Tokyo: Japan Chamber of Commerce and Industry, 1932), 38, 107).
10 The organization went by the name of the “Shimizu Port Sawmill and Box-making Cooperative” at its inception but later adopted the “Shimizu Port Lumber Industry Cooperative” (SLC) name in 1962.
11 Around the age of 20, future SLC director Shinma Itsuhei became absorbed in Marxist thought and took part in the left-wing labor movement (Shizuoka Ken Rōdōundō-shi Hensan Iinkai, ed., Shizuoka-ken rōdōundō-shi shiryō jō [History of labor movements in Shizuoka: Materials, part 1] (Shizuoka: Shizuoka Prefectural Labor Union Council, 1984), 845).
12 In addition to the companies appearing in Figure 1, the Shimizu area was also home to 34 non-cooperative-affiliated companies; in 1957, 59.5% of the lumber producers were cooperative members. As lumber companies grew increasingly dependent on North American lumber imports, the cooperative-membership rate among companies in Shimizu City reached nearly 100% (Mokusan 20 nen-shi Henshū Iinkai, ed., Mokusan 20 nen-shi [The twenty-year history of the Shimizu Port Lumber Industry Cooperative] (Shizuoka: Shimizu Port Lumber Industry Cooperative, 1973), 294–308; Mokusan 50 nen-shi Henshū Iinkai, ed., Mokusan 50 nen-shi [The fifty-year history of Shimizu Port Lumber Industry Cooperative] (Shizuoka: Shimizu Port Lumber Industry Cooperative, 2002), 512).
13 In Figure 1, the items in the legend correspond to the birthplace or initial business location of the given founder, as listed in Shimizukō Mokuzai-shi Hensan Iinkai, ed. (1962).
14 Even by the end of 1960, 96.8% of all the sawmills in Japan ran at 7.5–75.0 kW, and the majority were small-scale operations (Tokyo Mokuzai Seinen Club, ed., Mokuzai nyūmon 1968-nen-ban [Introduction to lumber, 1968] (Tokyo: Tokyo Mokuzai Seinen Kurabu, 1968), 132).
15 The organization’s dividend yield was 5.0% from FY1961 to FY1970, after which it rose from 5.5% in FY1971 to 7.0% in FY1972 and then 7.5% in FY1973 (Shimizukō Mokuzai Sangyō Kyōdōkumiai, Jigyōhōkokusho [Business report] 1961–1973 (Shizuoka: Shimizu Port Lumber Industry Cooperative)).
16 According to the SLC’s business reports, logs accounted for 71.6% of the organization’s total income (via sales) and 67.7% of its total expenses (via purchases) over the period from FY1952 to FY1974.
17 The SLC’s business reports provide information on profits and losses by division for FY1955–58 and FY1970. In FY1955, collective purchasing (plus head-office business) came to 5,416,136,000 yen, and sawmill operations totaled -1,885,764,000 yen. In FY1956, collective purchasing (plus head-office business) reached 7,069,002,000 yen, while sawmill operations came in at -4,919,126,000 yen, and byproduct processing totaled -469,286,000 yen. The numbers for FY1957–58 are omitted here. In FY1970, collective purchasing (separate from head-office business) totaled 317,823,526,000 yen, general affairs 83,512,855,000 yen, collective marketing -11,037,711,000 yen, collective marketing (Odawara) -2,159,827,000 yen, and other segments 58,058,022,000 yen.
18 Shinma Itsuhei, Mokuzai hitosuji ni [Lumber earnestly] (Tokyo: Nikkan Mokuzai Shinbunsha, 1971), 84; Yakuinkai gijiroku [Board meeting minutes] March 3, 1966, May 1, 1969, May 11th, 1970 (Shizuoka: Shimizu Port Lumber Industry Cooperative).
19 Ibid., May 19, 1965.
20 Ibid., May 2, 1960.
21 Ibid., July 28, 1965.
22 Ringu bākā kōjō ga kansei [Ring barker plant built], Rinzai Shinbun (October 29, 1966), 4.
23 The prices of mixes of North American hemlock over the period in question were as follows: July 1964–March 1965: 11,160 yen; April 1965–February 1967: 11,340 yen; March 1967–November 1967: 11,520 yen (Nihon Beizai Kyōgikai, Shibuchō kaigi tōkei shiryō [Statistics for branch chiefs meeting] March 19th, 1965, September 21, 1965, March 24, 1966; Nihon Beizai Kyōgikai, Beizai tōkei [Statistics of North American lumber] March 23, 1966, April 12th, 1968 (Tokyo: Kobayashi Kinen Ringyō Bunken Center).
24 From a statement by Shinma Itsuhei (Nihon Beizai Kyōgikai, Shibuchō kaigi hōkokusho [Report of branch chiefs meeting] March 1965 (Tokyo: Kobayashi Kinen Ringyō Bunken Center)).
25 From a statement by Inagaki Ryōhei in “Zadankai: Beizai no mondaiten o tsuku” [Roundtable discussion: Pointing out problems with North American lumber], Rinzai Shinbun (April 3, 1968), 3.
26 Shimizu beizai haibun teisei-yasu no haikei [Background of revision to lower price of North American lumber in Shimizu], Rinzai Shinbun (October 18, 1969), 3.
27 Nikkan Mokuzai Shinbunsha, Nobiyuku kigyō Kanto-shiku 350-sha no yokogao [Growing companies: The profiles of 350 companies in Kanto area] (Tokyo: Nikkan Mokuzai Shinbunsha, 1966), 85, 94, 96–97, 113, 263–264, 268; Yakuinkai gijiroku [Board meeting minutes] May 31, 1967 (Shizuoka: Shimizu Port Lumber Industry Cooperative); Mokusan 20 nen-shi Henshū Iinkai, ed. (1973), 174.
28 Shinma Hiroji (director and senior adviser of Shinma Seizai as of June 2017), in discussion with the author, June 17, 2017 (Shizuoka City Shimizu Industry & Information Plaza).
29 Tenryū Seizai Kabushikigaisha, Eigyōhōkokusho [Business report] 1961–1969 (Tokyo: The Library of Economics, University of Tokyo).
30 Shusshi shōken daichō [Investment securities ledger] 1962 (Shizuoka: Shimizu Port Lumber Industry Cooperative).
31 “Zadankai: Beizai no mondaiten o tsuku” [Roundtable discussion: Pointing out problems with North American lumber], Rinzai Shinbun (April 2, 1968), 4.
32 Ibid., April 3, 1968, 3.
33 Nihon Beizai Kyōgikai. Beizai tōkei [Statistics of North American lumber] March 23, 1966, April 12, 1968, March 20, 1969, March 26, 1971, April 7, 1972, April 22, 1974, April 10, 1975 (Tokyo: Kobayashi Kinen Ringyō Bunken Center).
34 Mokuzai Shōkō Kenkyūkai, ed., Kinanchihō seizai kōjō no jittai chōsa hōkokusho: Gobō, Tanabe, Hioki, Koza, and Shingū, Showa 22 nendo [Report on the actual conditions of sawmills in the Kinan Region: Gobo, Tanabe, Hioki, Koza, and Shingū, FY1958] (Tokyo: Rin’yachō, 1958), 27–65.
35 Shizuoka Ken sanchi shōkai [Introduction of production area of Shizuoka Prefecture], Rinzai Shinbun (May 24, 1967), 5.
36 “Shizuoka Ken no seizai JAS o kataru zadankai” [Roundtable discussion on lumber JAS in Shizuoka Prefecture], Rinzai Shinbun (October 17, 1968), 5.
37 Calculated based on Mokusan 50 nen-shi Henshū Iinkai, ed. (2002), 508. Total shipment volumes came to approx. 190,000 m3 in 1961, 350,000 m3 in 1965, and 540,000 m3 in 1970.
38 The story of the SLC, where the leaders of its core member companies drove the cooperative’s activities, draws a stark contrast with the Spanish cooperative wineries that I mentioned at the beginning of the paper. Still, it deserves mention that the case of the SLC and the lumber industry do not necessarily reflect characteristics common to all the cooperatives in Japan.
