What is thought to be a very rich deposit of iron has just recently been found on one of the islands in the San Juan group, within the territory of the United States, said to equal the Texada deposit in British Columbia, which the iron works at Irondale, near Point Townsend, use. The Irondale furnace commenced work again about a month since. In regard to the precious metals: there have been no developments of importance on this side of the mountain. The Okanogan, Salmon River, Coeur d'Alene and Colville mines promise richer and richer as they are more developed. [Sidenote: Lumber business growing.] 4. The activity in the lumber business is unabated--is on the increase. The increase of the lumber mills, that I have mentioned in the first part of this letter, indicates _that_. The traffic on the railroad, both in logs and manufactured lumber, is much larger than had been anticipated, and is increasing. In July the road hauled 2,843,464 feet of logs. September log haul was about ten per cent. greater. I could not get the exact figures to-day. [Sidenote: Population and freights increasing.] 5. Spokane Falls is still growing very rapidly, and now claims 12,000 to 15,000 inhabitants, and is building very substantially. Along the line of railroad on this side of the mountain the country is filling up, of course, with small ranches or home-makers, and those already on the line are making increased clearings, and will therefore have more to ship. The following shows something of what is being done in July: "Coal freight, 2,750 tons; miscellaneous, 3,090; passenger traffic, $6,150; and the advance has been about the same as in logs, except on coal." [Sidenote: Labor strike at Gilman Mine.] [6. Mr. Whitworth next gives an account of certain difficulties and troubles, chiefly with miners, which ended in a "strike" that was somewhat prolonged, but he thought the men would soon go to work on the company's terms. Of course, the high hopes concerning these mines (Gilman) had not been realized. Mr. W. proceeds as follows:] [Sidenote: Gilman coal seams.] On the Smith, or No. 4 vein, we had just got the gangway driven far enough to turn rooms. The Andrews vein we were driving the gangway entirely in the coal, but were not yet far enough to turn rooms. Nos. 1 and 2 veins had gotten, with the gangway, well in under the hill, and was looking very fine, and turning out good coal. With the prospect of No. 4, or Smith vein, and Andrews vein, I am still well pleased. On the vein in Section 26, just across the valley, I have started in a tunnel to open it; have already driven about sixty feet through the rock, and have about seventy feet still to go. This tunnel is still going on, not having been stopped by the 'strike.' [Sidenote: Progress of the West Coast Railroad.]