e Price of White Pine Stumpa^e and lumber During The Movement of New Hampshire Sawmills Into and Out of Production By Michael R. C. Massie and Oliver P. Wallace Station Bulletin 480 AGRICULTURAL EXPERIMENT STATION UNIVERSITY OF NEW HAMPSHIRE DURHAM, NEW HAMPSHIRE e Price of White Pine Stumpage and lumber During The Movement of New Hampshire Sawmills Into and Out of Production By Michael R. C. Massie and Oliver P. Wallace Station Bulletin 480 AGRICULTURAL EXPERIMENT STATION UNIVERSITY OF NEW HAMPSHIRE DURHAM, NEW HAMPSHIRE The material in this bulletin is taken from a thesis submitted by Mr. Massie to the University of New Hampshire in partial fulfillment for the degree of Master of Science in Forestry. DECEMBER, 1963 TABLE OF CONTENTS Page LIST OF TABLES 2 LIST OF FIGURES 3 SUMMARY 4 A PROBLEM 5 REVIEW OF LITERATURE 5 Sawmill changes 5 Decline of lumber production 6 Lumber price and quality 7 Industry readjustment 7 DETERMINATION OF SAWMILL MOVEMENT 8 Sawmill population 8 Dependency upon white pine stumpage 10 CHANGES IN SAWMILL PRODUCTION 12 PRICE RELATIONSHIPS 13 Stumpage price 13 Wholesale price indexes 13 Wholesale prices of white pine lumber 14 Wholesale price indexes for white pine lumber 15 Wholesale prices and wholesale price indexes, adjusted 16 RESULTS 18 Sawmill movement 18 Sawmill size 18 Lvimber price 21 CONCLUSIONS 26 Sawmill movement and size 26 The margin between stumpage and lumber prices 26 LIST OF TABLES Table Page 1. Sawmill Population in New Hampshire, 1947-1961 9 2. Sawmill Population in New Hampshire with Registered Sawmills and Mills Representing The Annual Cut, 1946-1961 10 3. Buyers of Forest Products, 1947-1961 10 4. Number of Sawmills Purchasing Hardwood and Softwood Logs, 1946-1961 11 5. Annual Cut of Lumber by all New Hampshire Mills in M b.f., 1946-1960 11 6. Number of Sawmills Purchasing Logs and Stumpage, 1946-1961 12 7. Average Volume Cut per Mill in M b.f., 1946-1960 13 8. Price and Price Index for White Pine Stumpage in New Hampshire in Dollars per M b.f., 1946-1961 14 9. Wholesale Price Indexes (1947-1949 = 100) , 1946-1961 14 10. Wholesale Prices of White Pine Lumber by Size and Grade per M b.f., 1946-1961 15 11. Wholesale Price Indexes of White Pine Lumber by Size and Grade per M b.f., 1946-1961 17 12. Wholesale Prices and Indexes Adjusted to Quality of Stumpage per M b.f., 1946-1961 17 LIST OF FIGURES Figure Page 1. Sawmill Population in New Hampshire, 1947-1961 18 2. Movement of Sawmills in New Hampshire Into and Out of Production, 1947-48 to 1961 19 3. Total Annual Cut of Lumber for New Hampshire, 1946-1960 20 1. Average Volume of Lumber Cvit per Mill, 1946-1960 20 5. Wholesale Prices of White Pine Lumber (1x6), 1946-1961 22 6. Wholesale Prices of White Pine Lumber (1x12), 1946-1961 22 7. Wholesale Price of White Pine Lumber (1x6), Adjusted to Quality of Stumpage, Compared to Prices of 1x6 Common Lumber, 1946-1961 23 8. Wholesale Price of White Pine Lumber (1x12), Adjusted to Quality of Stumpage, Compared to Prices of 1x12 Common Lumber, 1946-1961 23 9. Wholesale Price Indexes of White Pine Lumber (1x6) by Grades, 1946-1961 24 10. Wholesale Price Indexes of White Pine Lumber (1x12) by Grades, 1946-1961 25 11. Price Index Comparisons, 1946-1961 25 SUMMARY This study was designed to describe sawmill industry changes in New Hampshire with reference to number of producing sawmills through the years 1946-1961. It is concerned with the industry's dependency on white pine as a component of the total annual cut and describes fluctuations in the total annual cut, the white pine cut, and corresponding fluctua- tions in sawmill movement to and from production. It acknowledges that the industry is undergoing a period of change, and that the readjust- ment of the industry and the causes behind this readjustment are both myriad and complex. Beyond annual cut fluctuations and producing sawmill fluctuations, the scope of the paper was limited to include only the levels of price for both raw material and finished product at which fluctuations oc- curred. It is realized that the complexity and interrelation of all the factors responsible for the industry's position will not allow a complete and isolated comparison. It does show, however, the position and strength of a few factors as industry fluctuations occurred. An overall picture of the New Hampshire lumber industry can only be described by comparing the operating unit fluctuations and the price consider- ations discussed in this paper with further information from wide and varied sources. The paper presents data that have been condensed and tabulated into a form readily interpreted graphically. It depended heavily on infor- mation taken from the New Hampshire Biennial Reports* and the New Hampshire Forest Market Reports to present considerations on the New Hampshire sawmill industry. Active sawmills were tabulated each year from 1946 to 1961, and the annual cut of white pine lumber was compared with the number of active mills each year. Stumpage prices were calculated for each year, as were the changes in stumpage price from one year to the next. Lum- ber prices for 4 grades and 2 sizes of lumber were compiled from quota- tions by the Boston Commercial Bulletin. These prices by grade and size through the years, reflecting the New England price, were com- pared by years with both sawmill movement and stumpage prices. The results of the study indicate that there has been a significant de- cline in the number of operating sawmills in New Hampshire from 1946 to 1961 and that the movement from production of a larger number of New Hampshire sawmills has not been accompanied by any significant increase in sawmill size. This conclusion is supported by the fact that there has been a decline in the annual cut of white pine lumber at a rate equal to, or greater than, the rate of decline in production units. During the sawmill movement stumpage prices for white pine have increased relatively greater and faster than lumber prices. While lum- ber prices have increased significantly in general, most of the increase has come in the upper grades. Typically, number 4 common lumber has shown the least change in price. The decline in the New Hampshire sawmill industry has occurred during a period when the margin between stvimpage and lumber prices has become increasingly narrower. Several other factors not covered in this paper are also felt to be causative, but the extent of their effect is unknown. The narrow margin has resulted from an adverse price-quality relationship between stumpage and the derived lumber. * State Forestry and Recreation Commission. The Price of White Pine Stumpage and Lumber During The Movement of New Hampshire Sawmills Into and Out of Production By Michael R. C. Massie and Oliver P. Wallace* I. A PROBLEM The sawmill industry in New Hampshire has been declining in pro- duction and number of mills over the past several years. Explanations for these reductions cite loss of markets, decline in quality of the for- ests and price changes. No specific studies have been made of the de- cline but evidence of it is clear-cut in annual reports of the State For- estry and Recreation Commission.! A decline or rise in the sawmill in- dustry is of vital importance to the state of New Hampshire. The citizens of the state whose economic welfare is dependent upon the industry, as well as pulilic and private forestry agents who help plan for future sup- plies of the industry's raw material, are interested in its well-being. It seems apparent that quality of stumpage and lumber, along with the reflected price of these factors, may be a deterrent or an incentive to the operation of sawmills. An investigation of this situation should be of economic interest and concern as it describes, in part, the weKare of the state. Since prices for white pine lumber and stumpage over time are avail- able! and since price is a measure of quality, the interrelationship be- tween price, quality and decline in white pine lumber production in New Hampshire seemed to be a logical first study. To do this, the changes in the sawmill industry situation since 1946-47 and annual fluctuations in lumlier output were determined. These are then related to white pine stumpage and lumber prices over the same period. II. REVIEW OF LITERATURE Sawmill Changes Hopkins (1961) indicates that the significance of the small mill in the southern lumber industry will tend to diminish. His view is that larger, more efficient mills with lower processing costs will subject them to severe competition. Lehman (1961) reports of the change in the saw- mill industry in the Tennessee Valley. A study covering the period from * Mr. Massie was formerly a graduate student in the Department of Forestry, and a research assistant with the Agricultural Experiment Station. Dr. Wallace is Asso- ciate Forester, Agricultural Experiment Station. t Now the Division of Resources Development in the New Hampshire Department of Resources and Economic Development. t New Hampshire Forest Market Reports, Extension Service. The Commercial Bulletin, Boston, Massachusetts. 1950 to 1960 indicated that half the sawmills went out of business. He further reports that 80 percent of the failures were in portable mills and that the proportion of portable mills dropped from 50 to 25 percent. In a recent address to the Northeastern Loggers' Association, Mancini (1961) reports on the lumber industry in New York State. He notes a decline of from 1500 sawmills to 1000 sawmills in the period from 1953 to 1960. Residual average mill size increased; this was the result of a lower proportion of small mills and a higher proportion of large mills. Holland (1960a) posed the problem: Whether or not it will even be possible for producers of only low average quality eastern white pine lumber to pay higher prices for stump- age and still stay in business depends to a considerable degree upon how effectively this industry can hold down future production costs. Holland (1960b) also states that the operating ruargin for sawmills is declining rapidly as is the number of mills operating. He stresses variable costs and the cost of labor: It is well known that low-grade lumber produced in small mills cut- ting small timber, even though investment in plant and equipment is low (or better because investment in plant and equipment is low), is still relatively costly to manufacture per thousand board feet because of high average variable costs. These mills use less capital equipment but much more labor per thousand board feet of lumber manufactured. Labor is expensive and becoming more so. In a recent Northeast Regional Publication (1960) the position of the sawmill in New England was further clarified. It was found that : Year-round operation was reported by almost three quarters of the sawmills in the New England and Middle Atlantic States. However, year- round or intermittent operation of the sawmills is strongly related to size. As might be expected there was a positive correlation between size of the sawmill and the number of days in which it operated. The small- est sawmills in New England were found to be the most marginal wood- using industry in the entire Northeast, 94 percent operating intermittent- ly and 79 percent for less than 60 days in the year. Stoddard and Hovise (1960) mention the reduction of sawmills in New Hampshire since 1950. They feel: This reflects in part the reduction in sawlog cut which has tended to squeeze out the smaller marginal operator. It also reflects the shift to larger capacity, permanent-type mills, better able to compete in price and quality with both in-state and out-of-state producers. They report that a number of efficient medium-sized mills still exist but that a shift to larger, more efficient mills with good manufacturing and marketing facilities is a favorable trend for both the landowners and the industry. The very small mills go in and out of production rapidly. Their output is not important except locally, they are not efficient producers, and they do not sell to distant markets. Simmons (1961) indicates there are about 1200 sawmills in northern New Eng- land. About half are part-time, and the part-time mills cut only about 5 percent of the total lumber production. Decline of Lumber Production Zivnuska (1955) indicates that the lumber supply is decreasing and that demand is increasing in the United States. Ruttan and Callahan (1962) show that overall lumljer production and the relative price of lumber had downward trends in the 1950's. Fedkiw and Stout (1959) note an overall decline in eastern white pine lumber production. Hol- land (1960) comments that the supply of eastern white pine lumber has tended to decline, total demand has expanded, and lumber price has risen sharply. Stoddard and House (1961) sum up the New Hamp- shire situation. They state: . . . available evidence raises doubt that the white pine industry can operate at present cutting levels and meet the foreseeable trend in de- mand for quality sawlogs ... It is interesting to note the substantial de- crease in the amount of softwood species cut since 1949, due in part to increased grade requirements in the pine lumber market and decreased demand for box lumber. Lumber Price and Quality Holland (1960a) refers to the premium price paid for certain grades of eastern white pine lumber despite competition from quality western lumber. Wallace and Aniidon (1958) foimd that number four common lumber presented a major selling problem in Maine and New Hamp- shire and was under heavy competition from substitute materials. Con- versely, number three common and better lumber grades seemed in- adequate to meet the demand, especially in longer lengths. Fedkiw and Stout (1959) indicate that: The basic problem of the industry with respect to expansion, and per- haps even maintenance of its level of output, seems to be a problem of controlling the production of No. 4 common and lower grade lumber, or of expanding the market for it without serious price concessions; or more likely, a combination of both. They further explain (1960a) that number four common has not done as well as the upper grades. It is their belief that: . . . the high proportion of No. 4 common grade out-turn, 50 percent, places a serious restriction on the ability of the eastern white pine in- dustry to expand except under extraordinary favorable market conditions. They indicate that the prices of number three common and better lumber have risen greatly relative to the almost stalile price of number four common. Number one and two common, followed by number three common, continue to have the greatest market strength. This brings them to the conclusion that : No matter how one looks at the trends and fluctuations in prices and production, the eastern white pine industry is strongly tied to the apron string of the market for No. 4 common lumber. Holland (1960a) indicated that stumpage prices for eastern white pine in general continue to increase faster than lumber prices. Swain and Wallace (1956) noted the poor quality of New Hampshire stump- age by log sampling at mills. Average length was fovmd to be 10 feet, and average diameter, small end, was found to be 9.0 inches. Industry Readjustment Holland (1960b) mentions three factors acting to increase logging and milling costs and to decrease supply in almost all major lumber areas. These are (1) declining availability of quality stumpage, (2) declining size and increasing taper of available sawlogs, and (3) increasing labor, log, and related costs. The declining sawmill industry can improve its position somewhat despite low log quality according to House and Stod- dard (1961). They mention several methods used to meet the problem of selling the low grades of lumber. These include paying more for better stumpage, gang mills, packaging and marketing more lumber as knotty pine panelling, and the use of small- blank-making machines for box and reel blanks. These efforts, however, do not seem to have satis- factorily increased the utility of the lower grade pine. Alternative out- lets are available in some cases. Heebink (1961) notes the use of paper overlays on low-grade lumber to increase its marketability, and Milne (1961) deals specifically with the improvement of low grade white pine lumber into a marketable product by finger jointing and edge glueing. Wallace and Amidon (1958) noted some improvements which have increased sawmill production and marketing efficiency. They recommend even better manufacture and vigorous promotion of current products. Simmons (1961) notes a modernization and efficiency increase in New England mills resulting in more accurately cut and graded lumber as well as better care in handling and drying. Fedkiw and Stout (1959) strongly recommend quality improvement in stumpage as quickly as possible to adjust the industry to consumer demand. They note: . . . the output of the upper grades cannot be increased without a proportional increase in the output of the lower grades . . . insofar as the basic grade yields are fixed by the quality of timber being grown, the matter of controlling grade yields is a problem of growing better white pine timber. They show (1960a, 1960b) how pruning can help provide better quality stumpage. Improved quality yields are obtainable through for- est managenjent and pruning, these actions being economically feasible to the timber owner. III. DETERMINATION OF SAWMILL MOVEMENT Sawmill Population The New Hampshire Biennial Forestry Reports show sawmill popu- lation by year in two forms. They list the number of registered sawmills in the state each year and the total number of all mills in the state re- sponsible for the annual cut of wood products. These yearly listings, while giving some idea of the total sawmill population, are not adequate in themselves. All registered sawmills do not necessarily have to produce in the year that they register, and, if they do, it may not be for the entire year. Also, registration did not become compulsory for all mills until 1952. The figure for all mills representing the total annual cut is correct but gives no indication of the proportion of sawmills, or of mill activity over a yearly period. Several very small mills are included which cut only a few thousand out of the millions of board feet in the total annual cut. These mills move rapidly into and out of production (often several times in any one year), and their limited production is usually fitted to personal or local demand rather than to total market demand. The annual New Hampshire Forest Market Report lists sawmills and other wood-using plants active in buying raw material. This list shows the sawmills in operation and indicates the kinds of timber the mills purchase. Some mills may be omitted unintentionally. Also, a few mills may own the source of all their raw material and hence are not listed as buying raw materials. The true figure of sawmill population will thus lie somewhere between those active mills given by the New Hampshire Forest Market Reports and the total mills responsible for the annual cut as shown by the New Hampshire Biennial Reports.* An exact figure is difficult to isolate. The Forest Market Report list includes all large and medium size plants and gives a minimum basis for operating saw- mills. Their number by years since 1947 is shown in Table 1. The total has been broken down into portable and stationary sawmills. These figures were compiled from the names of sawmill owners listed each year in the New Hampshire Forest Market Report. It can be seen that both portable and stationary sawmills have declined from 1947 to 1961. The bigger loss has occurred in the portable mills, but the stationary sawmills have also undergone an overall decline. When the loss in total active mills is compared to registered mills and all mills repre- senting the annual cut (Table 2), the same trend is indicated; that is, a general overall loss. In Table 3, a breakdown of the buyers of forest products is listed. The total numbers listed from 1947 to 1961 show a general decline. From the components, however, it can be seen that while sawmills have declined, buyers and loggers have increased in numbers. Table 1. Sawmill Population in New Hampshire, 1947-1961 ;ear Stationary Portable Tola 142 400 150 406 122 388 125 403 134 402 169 428 136 390 115 379 117 353 111 352 93 307 73 279 57 262 53 238 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 258* 256* 266 278 268 259 254 264 236 241 214 206 205 185 * Figure only available for period 1947-1948, and 1948-1949. Source — New Hampshire Forest Market Reports. * The 1958 Census of Manufacturers (1961) lists an even more conservative figure for active sawmills in a particular year. Table 2. Sawmill Population in New Hampshire, with Registered Sawmills, and Mills Representing the Annual Cut, 1946-1961 Year Total Active Rt ;gistered Mills Representing Sawmills* Sawmillst Annual Cut 1946 534 1947 400 743 1948 406 614 1949 391 598 1950 388 417 552 1951 403 438 558 1952 402 500 506 1953 428 452 477 1954 390 424 478 1955 379 409 393 1956 353 413 390 1957 352 359 357 1958 307 329 318 1959 279 308 296 1960 262 283 271 1961 238 Source — * New Hampshire Forest Market Reports. t New Hampshire Biennial Forestry Reports. Table 3. Buyers of Forest Products, 1947-1961 Year 5awmi lis Buyers & Loggers Total Listing Percent Sawmills 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 400 406 388 403 402 428 390 379 353 352 307 279 262 238 23 25 21 22 24 24 31 47 62 67 77 72 86 42 423 431 409 425 426 452 421 426 415 419 384 351 348 280 95 94 95 95 94 95 93 89 85 84 80 80 75 85 Source — New Hampshire Forest Market Reports. Dependency Upon White Pine Stumpage Sawmills in New Hampshire cut predominantly softwoods, as Table 4 shows. A few mills cut hardwood only; a larger number saw both hard- wood and softwood; but the majority saw softwood only. This is em- 10 phasized in Table 5, which shows that between 64 and 74 percent of the annual cut in any year was white pine. The hardwood volume has re- mained about constant at 10 to 12 percent of the annual cut of lumber. The form of raw material purchases is shown in Table 6. Stumpage purchases have declined at a faster rate than log purchases. The total percent buying stumpage alone falls between 77 and 86 percent in one year. Table 4. Number of Sawmills Purchasing Hardwood and Softwood Logs*, 1946-1961 Year Hardwood Only Softwood Only Both Percent Using Softwood 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 15 7 8 8 8 7 7 7 6 7 9 9 9 192 211 198 197 217 238 212 206 198 205 175 149 142 122 193 187 183 198 177 182 171 166 148 141 125 121 111 107 96 98 98 98 98 98 98 98 98 98 98 97 97 96 * Total number of sawmills equal to the total sawmill population as shown in Table 1. Source — New Hampshire Forest Market Reports. Table 5. Annual Cut of Lumber bv All New Hampshire Mills in M b.f., 1946-1960 Year Hardwood Softwood White Pine Total Percent White Pine 1946 40,908 341,476 282,899 382,384 74 1947 53,636 364,357 297,654 417,993 71 1948 36,003 308,333 239,079 344,336 69 1949 28,964 261,099 184,344 290,063 64 1950 26,282 283,880 216,889 310,162 70 1951 34,011 310,321 247,732 344,332 72 1952 30,507 276,485 221,790 306,992 72 1953 25,431 262,127 209,002 287,558 73 1954 26,680 209,481 162,052 236,161 69 1955 20,350 224,779 174,473 245,129 71 1956 33,388 233,657 175,738 267,045 66 1957 24,246 191,232 154,155 215,478 72 1958 24,010 136,595 104,505 160,605 65 1959 22,683 166,687 132,109 189,370 70 1960 22,187 152,167 120,952 174,354 69 5ource — New Hampshire Biennial Forestry Reports. 11 Table 6. Number of Sawmills Purchasing Logs and Stumpage*, 1946-1961 Year Logs (Roadside & Delivered) Stumpage Both Percent Buying Stumpage 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 75 85 89 76 73 66 61 69 62 51 55 49 47 45 109 105 77 82 91 123 107 87 83 115 65 47 47 45 216 216 222 245 238 239 222 223 208 186 187 183 168 148 81 79 77 81 82 85 84 82 82 86 82 82 82 81 * Total number of sawmills equal to the total sawmill population as shown in Table 1. Source — New Hampshire Forest Market Reports. IV. CHANGES IN SAWMILL PRODUCTION A relevant hypothesis is that if the number of operating sawmills is declining, and if the annual cut is declining at a lesser rate, then the latter could mean that those mills still in production either are produc- ing larger volumes or are the larger plants. This means that New Hamp- shire might have an economically sound sawmill industry producing less annual cut for quality or consumer preference reasons and having fewer, but larger and possibly more efficient sawmills. Some information is available to indicate trends that may be pertinent to this hypothesis. Reviewing Table 1, it can be seen that the greatest decline came in portable mills. Stationary mills also show a decline, but of a lesser amount. If these remaining mills are cutting a larger average volume per mill than the all-mills average in the past, then the hypothesis is substantiated. The general decline in annual cut has been from nearly 290 thousand board feet of lumber in 1946 to 121 thousand in 1960 (Table 5). The rate of decline of the average annual cut compared to the rate of decline in producing mills will be reflected by the average volume cut per mills. Table 7, average volume cut per mill, was com- piled from the total in Table 1 and Table 6 and shows the changes. It was further enlarged to include the total mills representing the annual cut as well as the active mills responsible for most of the annual cut. From 1946 to 1960 there is an evident reduction in the average saw- mill production. However, since 1954 the trend seems vxpward with ont further sharp drop during the slack business period around 1958. 12 Total Number* ActiVe Millst 716.1 562.6 952.9 560.8 781.3 485.1 561.9 799.4 617.1 854.4 606.7 763.7 602.8 671.9 494.1 605.5 623.7 646.8 648.7 756.5 603.6 612.2 505.0 523.1 639.8 678.7 643.4 665.4 Table 7. Average Volume Cut per Mill in M b.f., 1946-1960 Year 1946 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 * Column 1. Based on the total annual cut, and the total number of mills repre- senting the annual cut. Source — New Hampshire Biennial Forestry Reports. t Column 2. Based on the total annual cut, and the mills actively in production as shown by Table 1. Source — New Hampshire Forest Market Reports. V. PRICE RELATIONSHIPS Stunipage Price A range for the price of white pine stumpage is given in the New Hampshire Forest Market Reports. These ranges were listed by years in the first cohimn of Table 8. After the O.P.A. ceiling prices were re- moved in 1947, the price range began to rise. The minimum price in- creased only three dollars while the maximum increased 17 dollars over this period 1946-61, The mid-point was used in Table 8 (column two) to show the trend in stumpage prices. In general, the price of stunipage has risen from 8 to 18 dollars per M b.f. in 13 years. A price index was also calculated for stumpage so that the relative rise in stumpage price can be compared with the relative gains in the wholesale price of lum- ber. This index is shown in column three. Wholesale Price Indexes Three standard wholesale price indexes were used in the comparison of relative changes in price. These are shown in Table 9. The national wholesale price index for lumber has not followed the trend of the indexes for all commodities or the "all-commodities less farm produce." Especially noticeable is the greater yearly fluctuation in the relative price of lumber. 13 Table 8. Price and Price Index for While Pine Stunipage in New Hampshire in Dollars per M b.f., 1946-1961 Year Range Mid-Point Index (1947-1949=100) 1946* 6-10 8 87 1947* 6-10 8 87 1948 5-15 10 109 1949 4-15 9.5 103 1950 5-15 10 109 1951 6-20 13 141 1952 7-21 14 152 1953 8-22 15 163 1954 8-22 15 163 1955 8-22 15 163 1956 9-24 16.5 179 1957 9-26 17.5 190 1958 8-30 19 207 1959 5-30 17.5 190 1960 6-30 18 196 1961 9-27 18 196 * Price set by O.P.A. Source — New Hampshire Forest Market Reports. Table 9. Wholesale Price Indexes (1947-1949=100), 1946-1961 Year All Commodities All oth( Commo er than dities Farm All Lumber Produce & Food 1946 78.7 78.3 1947 96.4 95.3 94.5 1948 104.4 103.4 107.3 1949 99.2 101.3 98.2 1950 103.1 105.0 114.5 1951 114.8 115.9 123.6 1952 111.6 113.2 120.5 1953 110.1 114.0 119.3 1954 110.3 114.5 117.3 1955 110.7 117.0 124.4 1956 114.3 122.2 127.2 1957 117.6 125.6 119.7 1958 119.2 126.0 118.0 1959 119.5 128.2 127.1 1960 119.6 128.3 121.4 1961 119.1 127.7 115.4 Source — Handbook of Basic Economic Statistics Wholesale Prices of White Pine Lumber The wholesale price of white pine lumber was compiled for two size^ and four grades. These prices are shown in Table 10. They are the prices 14 Table 10. Wholesale Prices of White Pine Lumber by Size and Grade per M b.f., 1946-1961 1x6 1x12 Year Commons Commons Ds&b* 1&2 3 4 Ds&b* 1&2 3 4 1946 8 81 S 63 8 57 8 53 8101 $ 75 $ 65 S 55 1947 103 87 79 68 130 102 89 71 1948 131 101 89 77 158 113 99 80 1949 143 109 88 71 186 126 96 79 1950 179 124 96 76 217 135 103 82 1951 220 134 102 90 243 146 110 94 1952 220 134 103 87 235 145 113 89 1953 223 140 110 87 231 155 118 92 1954 224 144 113 82 232 157 121 87 1955 226 151 121 84 239 164 128 87 1956 237 160 124 90 259 173 131 91 1957 233 167 126 89 256 182 133 91 1958 233 170 126 86 261 181 138 85 1959 219 168 119 87 263 187 140 88 1960 219 164 116 87 266 187 131 90 1961 235 171 131 92 283 193 144 103 * D select & better. Source — Commercial Bulletin (Quotations) Boston, Mass. of 4/4, dried, surfaced, white pine lumber, f.o.b. mill. Two sizes were used for representation because of price differences according to width. The narrower 1x6 boards are more liable to price fluctuations than the wider 1 x 12 boards. The prices given in the table are yearly aver- age prices for each size and grade. The center points of the ranges given in the first issue for each quarter of The Commercial Bulletin under "Quotations" were averaged to obtain ihe yearly price. This was done for the years 1946 through 1961. These average yearly prices are based on quotations which focus the New England wholesale price for white pine himber. The general price trend has shown an increase up through the years. It can be noticed, however, that the greatest change comes in the higher grades. Wholesale Price Indexes for White Pine Lumber The wholesale price indexes for white pine lumber are shown in Table 11. They were derived from Table 10 by equating the base years 1947- 1949 to 100 for each grade in the two sizes and calculating the relative change in price from this base. They serve to amplify the changes in price indicated in Table 10. A significant overall rise in prices is noted and the higher the grade in either size class the higher the rise in price from 1946 to 1961. It is noticeable that in the early years, namely 1946- 1948, all grades increased in price at relatively the same rate. The period 1948-1951 saw a continued rise but an irregular rate. From 1951 on a general leveling trend can be observed. 15 Wholesale Prices and ^ holesale Price Indexes, Adjusted In order to show a wholesale price and relative change in price for lumljer as it conies from the sawmill, the wholesale prices and their indexes must he adjusted. This adjusted price of lumher will reflect the revenue received hy a mill. A considerahle portion of all lumher sold hy New Hampshire mills is sold wholesale.* The average quality of New Hampshire stumpage has shown little marked improvement since the last days of the virgin cut. There is only limited factual data to support this general forestry opinion, hut assuming little real improvement hetween 1946 and 1961, a pertinent study hy Wallace and Amidon (1958) f gives accurate data on tiie quali- ty of white pine stumpage. Their study found the average log quality in New Hampshire to saw out 4 percent D select and better, 13 percent number 1 and 2 common, 38 percent number 3 common, and 45 percent number 4 and 5 common.J These figures show that sawmills in New Hampshire do not produce large quantities of the highest priced lum- ber. It would, of course, be natural for them to produce as much high quality and high priced lumber as they could, but on the average their grade recovery should be in line with the above percents. This means that the wholesale price they received per M b.f. of lumber will be 4 percent of the price received for D select and better, 13 percent of the price received for number 1 and 2 common, 38 percent of the price received for number 3 common and 45 percent of the price received for number 4 and 5 common. The figures in this paper can then be adjusted on this basis to reflect sawmill price, in effect, an actual yard- run wholesale price based on what the mills produce. To keep the price figures on the conservative side it should l)e understood that the 45 percent number 4 and 5 common is entirely number 4 common. This eliminates the poorest grade and will leave the adjusted price received by the mills at as high a level as is conceivably possible in the actual situation. Table 12 gives these adjusted prices and the adjusted indexes to re- ject the relative changes in price. It can be seen by comparison with Table 11 that both the adjusted price and the adjusted index fall be- tween number 3 and number 4 common lumber. The effect of this trend should be of special interest when considering the effect of lumber prices on producing mills. Marketing studies indicate, also, that num- ber 3 common is considered as medium quality lumber and that num- ber 4 common lumber is poor quality material with only limited de- mand. Another important factor should not be overlooked; that the average price of ungraded or mill run lumber is approximately equiva- lent to the price for number 4 common lumber. Unpublished mill studies * Wallace and Amidon (1958) indicate that this figure might be as high as 70 percent. t They derived the grade recovery for the 1956 annual cut. Their sample was based on 75 million feet to separate grades D select and better, number 1 and 2 com- mon, and number 3 common and poorer. A 15 million bd. ft. sample separated number 3 common from number 4 and number 5 common. + The Executive Secretary of the Northeastern Lumber Manufacturers' Association, following a check with industry in 1955, has estimated average quality of stumpage as D select and better, 3 percent; number 1 and 2 common, 12 percent; number 3 common, 25 percent; number 4 common and poorer, 50 percent (Holland, 1960). 16 for 1959-1960 in New Hampshire strongly suggest that this is true throughout the industry. Table 11. Wholesale Price Indexes of White Pine Lumber by Size and Grade per M b.f.*, 1946-1961 1x6 1x12 - Year Commons Commons Ds&b 1&2 3 4 Ds&b 1&2 3 4 1946 65 64 67 74 64 66 68 71 1947 82 88 93 94 82 89 94 92 1948 104 102 105 107 100 99 104 104 1949 113 110 104 99 118 111 101 103 1950 142 125 113 106 137 118 108 106 1951 175 135 120 125 154 128 116 122 1952 175 135 121 121 149 127 119 116 1953 177 141 129 121 146 136 124 119 1954 178 141 133 114 147 138 127 113 1955 179 153 142 117 151 144 135 113 1956 188 162 146 125 164 152 138 118 1957 185 169 148 124 162 160 140 118 1958 185 172 148 119 165 159 145 110 1959 174 170 140 121 166 164 147 114 1960 174 166 136 121 168 164 138 117 1961 187 173 154 128 179 169 152 134 *D select & better. *Cc »mpiled from Table 10. (Base year 1947-1949 equal 100) Table 12. Wholesale Prices and Inc lexes A .diusled to Qua lity of Stumpage per M b.f.*, 1946-1961 Year Price Price Index Index 1x6 1x12 1x6 1x12 dollars 1946 $ 57 $ 63 70 69 1947 76 84 92 92 1948 87 95 106 103 1949 85 96 103 104 1950 94 102 112 110 1951 106 113 126 122 1952 104 111 125 120 1953 108 116 129 124 1954 108 115 127 123 1955 112 119 134 127 1956 118 124 140 132 1957 119 125 141 134 1958 118 124 140 132 1959 115 128 137 135 1960 113 125 135 133 1961 123 138 146 147 Compiled from Tables 10 and 11. 17 VI. RESULTS Sawmill Movement Figure 1 shows the overall decline in sawmill numbers since 1947. Curves C and D, Stationary Sawmills and Portable Sawmills Estimated in Production, respectively, show a similar decline, although the port- able mill numbers show more fluctuations. Actually a total of 190 pro- ducing mills dropped out of operations from 1953 to 1961, including 74 stationary and 116 portables. Fig. 1. Sawmill Population in New Hampshire, 1947-1961 500 1*00 300 200 100 A. Registered Sawmills B. Total Savnllls Estimated In Production C. St«tlonary Sawmills Estimated In Production D. Portable Sawmills Estimated In Production 1947 19^*9 1951 1953 1955 1957 1959 1961 Considering the movement of sawmills to and from production over the years on the basis of estimated mills in production each year, a noticeable trend is shown by Figure 2. From 1946 to the end of 1952 there was considerable fluctuation but a general movement to produc- tion, the mills increasing from 400 in 1946 to 428 at the start of 1953. By referring again to Figure 1 it can be seen that this gain was in port- able mills. One stationary mill came into operation together with 27 portable mills. From 1953 to 1961 there was a consistent movement of both portable and stationary mills out of production. While both de- clined, the greater loss was 116 portable mills as compared to 74 sta- tionary mills. During this movement, two years showed a decline only in portable mills, the total decline being offset by a movement into pro- duction of 10 stationary mills in 1954 and 5 stationary mills in 1956. This leaves an overall decline, but to a much lesser degree in stationary mills. Sawmill Size The average size of New Hampshire sawmills can be derived from the volume of lumber cut annually and the number of sawmills in operation. 18 Fig. 2. Movement of Sawmills in New Hampshire Into and Out of Production, 1947-48 to 1961 (1947-48, 400 mills to 1961, 238 mills) 30 15 . Oaln In Sawillls In SiMlllllj 15 _ 30 . ^5 _ • Figure only available for period 19'»7-'*8 •• n.pire only available for period 19'*8-'*9 ■ ** I , 1951 I ,1953 ■ ^955, ,1957 ■^959, .iHfb The annual cut (Table 6) indicates that from 1946 to 1960 from 64 to 74 percent of all lumber produced in the state was white pine. This ex- tremely heavy dependency upon white pine by the industry means that the average mill in New Hampshire, even considering the total cut, de- pends mainly upon white pine for lumber. The total annual cut divided equally among the number of mills in operation each year will give an accurate average sawmill size for New Hampshire. It follows that this size is dependent on white pine. In Figure 3 the total volume (hardwoods and softwoods) cut and the white pine cut have been graphed. The total cut in each case shows a relatively constant decline. If the total annual cut each year is divided by the total operational sawmills each year, a graphic line can be shown representing the average volume cut per mill per year. This line, or more correctly the slope of a straight line running through the collec- tion of points forming the average volume cut per mill line, will indi- cate an overall decrease or increase in sawmill size. The average volume of lumber cut per mill based on line B and Figure 4 graphically repre- sents a yearly change in sawmill size for all mills representing the annual cut. When this line is smoothed mathematically so that a trend line may be drawn,* a very slight positive trend line can be shown. Line B does not consider the fact that a fairly large number of the sawmills in New Hampshire produce only a very small amount of the annual cut. * Trend lines were substantiated by using the curve smoothing method shown by Scarborough (1958, Chapter 16, pp. 489495]. 19 Fig. 3. Total Annual Cut of Lumber for New Hampshire, 1946-1960 500 '*00 _ 300 _ 200 _ £ •o • ^ 100 o A. Total Cut B. Softwocxj Cut C. White Pine Cut -m? 19'*9 1951 1953 1955 1957 1959 Fig. 4. Average Volume of Lumber Cut per Mill, 1946-1960 1000 _ m 800 600 A. Based on active mills as listed in the New Hampshire Forest Market Reports. 3 O 1400 _ igu? 191^ 1951 1953 1955 1957 1959 As suggested by Simmons (1961), this can run as high as 50 percent of the mills responsible for 5 percent of the annual cut. For this reason only actively producing mills were used to formulate a trend line for average volume cut per mills by years. Line A, based on active mills represents the average volume cut per mill by years for all the actively producing mills in the state. It omits several small part-time mills pro- 20 ducing a relatively negligible amount of the annual cut. Again using the smoothing process a very distinct and negative trend line occurs. This trend line then indicates that the average volume cut per mill per year in New Hampshire is declining rapidly. This is not proof-positive that all mills are getting smaller.* It does however, indicate that all mills, or even the majority of mills, are not getting larger. If the ma- jority of mills were getting larger, the minority of mills remaining would have to produce a very small amount to cause a trend line such as that based on active mills ( A) . While the total number of mills has declined, stationary mills have declined at a substantially slower rate than port- able mills. Some of the former are known to have become larger and more efficient. This factor considering the trend line, has resulted in reduced production for several of the remaining mills. It would be high- ly probable that the greatest loss in production occurred at portable mills. Lumber Price Price comparisons are being made on a basis of square edge, graded lumber. It is known that a considerable portion of the lumber manu- factured in New Hampshire is sold both mill run and round edge. Evi- dence is limited but Wallace and Amidon (1958) found that round edge was losing ground to square edge. The former has declined from 63 percent of the white pine lumber cut in 1925 to 43 percent of the cut in 1956. They indicate that small producers prefer to sell mill run to manufacturers or wholesalers and that a yearly production of close to half a million feet is necessary to make standard grading practicable. The mills dependent on ungraded lumber are mostly small and sell to local markets. The price is comparable to number 4 common and they move rapidly to and from intermittent production depending on their local markets. It is entirely possible that much of the decline in sawmills is due to a movement of mills from production when markets such as the box industry disappear. Sales of round-edge and the lower grades of lum- ber by larger mills offer stiff competition to the smaller sawmills, especially when the operating margin of the smaller mills is decreased by the lack of income returns from grading. In other words, the oper- ating margin without the benefit of increased income from grading would be extremely narrow. The extent of this margin cannot be clear- ly defined but changes in grade prices will indicate changes in margin. Figure 5 shows the price trends in four grades of white pine 1x6 boards from 1946 to 1961. Grading and price reflect definite trends. D select and better rose rapidly to a premium price in 1951. Since then there has been only a slight general increase. Number 1 and 2 common and number 3 common have risen continually and steadily from 1946 to 1961, showing not only a steady rise in price, but a distinct trend of continual gain. Number 4 common rose slightly and somewhat erratical- ly to a price of approximately 90 dollars per M b.f. in 1951 and then stopped. There has been no significant price change since that time. * It would be impossible to consider all sawmills in the state as getting smaller. Both written and visual evidence indicate several large and efficient mills are in operation. 21 Fig. 5. Wholesale Prices of White Pine Lumber (1x6), 1946-1961 250 200 a 150 . ■E 100 _ 50 _ 8. A. D select and better B. Number \8£. conmon C. Number 3 common D. Number 4 comaon 19^7 \9^ 1951 1953 1955 1957 1959 1961 Fig. 6. Wholesale Prices of White Pine Lumber (1x12), 1946-1961 300 250 _ g 200 _ 150 _ 9 o H 100 & 50 A, D select and better B. Number 142 common C, Number 3 common D. Number '* common 19^*7 1 — 191+9 T "T" T 1951 1953 1955 T 1 1 1 1 1 1957 1959 1961 In Figure 6, using 1 x 12 instead of 1 x 6, the pattern is similar with two possible exceptions; one, a very sharp increase to 1951 in D select 22 and better prices followed by a slower but still upward advance from 1951 to 1961. The number 4 common prices rose moderately to 1951 and then leveled off. The second exception is in 1958 when a slight up\vard trend in curve D occurred, and which strengthened slightly in 1960. Figure 7 shows the wholesale price of 1 x 6 boards when adjusted to average log quality available in New Hampshire. The wholesale price Fig. 7. Wholesale Prices of White Pine Lumber (1x6), Adjusted to Quality of Stumpage, Compared to Prices of (1x6) Common Lumber, 1946-1961 200 150 100 50 B. Number 142 common C. Number 3 common D. Number k common X, Price adjusted to quality of stumpage T" 19^*7 1 — 19^9 "T" 1 — 1951 "T 1 — 1953 T" 1955 1957 1959 T 1 1961 Fig. 8. Wholesale Price of Wliite Pine Lumber (1x12), Adjusted to Quality of Stumpage, Compared to Price of (1x12) Common Lumber, 1946-1961 200 ;:; 150 100 U s. 50 _ ^ B B. Number ISZ common C» Humbar 3 common D. Number ** cannon X. Price adjusted to quality of stumpage 19^7 1 — 19U9 T" 1 1951 T" 1 1953 "T 1955 T \ 1 1 1 1 1957 1959 1961 23 of grades 1, 2, 3 and 4 common is given for comparison. It can be seen that the adjusted price generally falls slightly below number 3 common. If mill run and ungraded lumber approximate the price for number 4 common, mills that grade have a slight but increasing advantage in revenue. It may not be practical for small mills to grade their small volume. The larger mills, however, should be able to cover the cost of grading. This should increase their revenue per unit of volume by the difference between trend lines D and X, Figure 7. This margin has steadily increased from 1946 to 1961 and now represents an increase of approximately 30 dollars per M b.f. Figure 8 shows the same situation but for 1 X 12 boards. Fig. 9. Wholesale Price Indexes of White Pine Lumber (1x6)*, by Grades, 1946-1961 175 150 125 100 o 75 50 A. D select and better B. Number 142 conmon C. Number 3 conmon D. Number *» common • Base year 19'*7-19'+9 equal to 100 19^7 19'*9 1951 1953 1955 1957 1959 1961 A trend of rising prices has been established. Of further interest, how- ever, are the rates relative to each other at which the noted grades of lumber have risen in price. As can be seen by Figure 9, the wholesale price indexes for 1x6 lumber show very definite trends. D select and better rose much faster than the other grades before 1951. Number 4 common shows the least rate of increase and has shown a general trend of almost no increase since 1951. Figure 10 depicts the same situation for 1 X 12 lumber. The wider board, however, does not follow exactly the pattern indicated by the narrower 1x6 lumber. Here, D select and better index rose very rapidly to 1951, declined slightly, and then rose slowly but steadily in comparison to the other grades. Number 1, 2 and 3 common 1 x 12 lumber indexes rose steadily and rapidly. Number 4 24 Fig. 10. Wholesale Price Indexes of White Pine Lumber (1x12)*, by Grades, 1946-1961 A, D selict and better B. Number ISZ conunon C. NuBber 3 conmon D, Huaber ^ connon • Base year 19'»7-19'*9 equal to IflO I 1 — 19t7 19t9 1951 1953 "I 1 — 1955 1957 1959 — I 1961 250 -, 200 150 - 100 - K 50 Fig. 11. Price Index Comparisons*, 1946-1961 A. Price Index of stumpage B. Wholesale price Index of white pine lumber (1x6), adjusted for quality of aturapage C. Wholesale price Index of all lumber • Base year 19'*7-1949 equal to 100 19'*7 19U9 1951 1953 25 1955 1957 1959 1961 common 1 x 12 lumber rose sharply until 1951 compared to the other grades. A leveling off period followed, but 1960 showed a definite sharp upturn in the relative price. The relative change of the price of lumber, adjusted to the quality of stumpage, can also be shown by wholesale price index comparisons. Both 1x6 and 1 x 12 lumber followed similar trends. That is, the rel- ative change in price falls slightly below number 3 common Jjut well above number 4 common. Figure 11 shows the price index for 1x6 lumber in comparison to the national wholesale price index of lumber and the price index for stumpage. It can be seen that the adjusted price of eastern white pine lumber enjoys a slight advantage over all lumber in price increases since 1946. The price index for stumpage has risen very sharply and steadily. It compares closely with the steady rise of the indexes for grades 1, 2 and 3 common (Figures 9 and 10). It is far above the index for the adjusted price of all lumber. Figure 11. This rise in price of the industry's raw materials at a mvich faster rate than the price for lumber has reduced the industry's operating margin. VII. CONCLUSIONS Sawmill Movement and Size The sawmill industry has undergone a period of decline in terms of both production units and volume of lumber cut from 1946 to 1961. A decline in the number of sawmills was noted for total mills representing the annual cut, for registered mills, and for active sawmills. The largest decline in active sawmills occurred to portable mills, but stationary mills also had a decline. Operating mills declined from 400 in 1946 to 238 in 1961. The major period of decline, however, was from 1953 to 1961 when active sawmills decreased from 428 to 238 mills without even one yearly increase or movement into production. This loss amounts to 44 percent of the industry's production units. The annual cut of lumber in New Hampshire, and more particularly the white pine cut, has shown a significant decline. The cut of white pine lumber has decreased from almost 283 million feet in 1946 to about 121 million feet in 1961, a decline amounting to 57 percent. The annual cut is evidently decreasing at a rate greater than the rate at which sawmill numbers are decreasing. This means that for the in- dustry in general the mills are not becoming larger, and average mill size is decreasing despite actual production increases by a few individual mills. The Margin Between Stumpage and Lumber Prices The wholesale prices of eastern white pine lumber have been estab- lished by market demand since the removal of the O.P.A. ceiling prices in 1946. Sawmills in order to move into operation, or stay in operation, must receive enough revenue from selling lumber to cover their cost of operation, pay for their raw materials, and return them a profit. Sawmill 26 operation is then dependent upon three factors : * ( 1 ) the price of lum- ber reflecting mill revenue, (2) the price of raw materials, or stumpage, and (3) the margin between the previous two factors composed of total operating costs and profit. Information is not available on operating costs and advantages gained by efficiency. It is assumed for individual units that operating costs are known. The upper limits of the margin over costs are set by the market prices. Thus the individual mill has a set margin; and if that margin becomes increasingly narrower, operating costs and profits must be lowered or compressed. Advantages in mill efficiency immediately become obvious. If a point is to be reached where operating costs exclude profits, this point should be reached first by the least efficient mills. It follows that the narrower the margin becomes, the greater is the possibility of in- efficient sawmills moving out of production. Lumber prices in general have steadily increased. The greatest rela- tive change came in number 1, 2 and 3 common grades. D select and better has shown a slight leveling trend in comparison to number 1, 2 and 3 common grades over the past few years. Number 4 common, although still showing a rise in price, has been almost level compared to the other grades. It rose rapidly to a price of approximately 90 dol- lars per M b.f. in 1951 and has remained at about this level since that time. The wholesale price of lumber adjusted to average quality of stumpage is well above number 4 common but below number 3 com- mon grade. There has been a steady increase in the price of stumpage since 1946 amounting to well over 100 percent. The midpoint of the price range offered for stumpage in New Hampshire in 1961 was approximately 18 dollars per M b.f. as compared with the O.P.A. price of 8 dollars per M b.f. in 1946. The change in the price of stumpage has been faster and the price is relatively higher, when comjiared on an index basis, than lumber prices. In effect, for the majority of sawmills in New Hampshire, the margin between the cost of raw material and the revenue from lumber produc- tion has steadily decreased. This has been caused by a greater increase in the price of stumpage relative to the rate of increase in the adjusted price of lumber. It is important to note that the higher grades of lum- ber have shown strong price increases, and it is the lower grades that do not show significant increases. The adjusted price, then, has been reduced by the large percentage of low grade lumber produced and sold at a low price (Wallace and Amidon, 1958) . The decline of the sawmill industry in New Hampshire, in both pro- ducing units and production over the past several years, has occurred during a period when the margin between stumpage prices and lumber prices has declined. The effect of operating costs, efficiency, and the availability of markets is not known. It is felt, however, that these factors * Two other related factors and their effect must be noted at this point. These are the availability of stumpage and the size of the market for eastern white pine lumber.. The relative scarcity or abundance of these two factors within the industry will be reflected by price and hence is pertinent to this paper. Absolute scarcity of stumpage or lack of markets for lumber, however, is not covered in this paper and their effect on sawmill operation or production is not considered. It is entirely possible that this could be responsible in part for the decline in the lumber industry. 27 are related to the decline, and that they have had some causative effect. The narrowing margin has definite quality implications. High quality lumher is selling at a higher price relatively than low quality lumber. All qualities of lumber produced in New Hampshire are from stumpage that is not rising in general quality despite a sharp rise in its price over the past several years. 28 LITERATURE CITED Commercial Bulletin, The. 1946-1961. First issue each quarter. Lumber Price Quo- tations (Eastern White Pine). Curtis Guild and Co., Boston. Cooperative Extension Service University of New Hampshire 1947-1961. New Hampshire Forest Market Reports, Durham, New Hampshire. Economic Statistics Bureau. 1962. The handbook of basic economic statistics. Economic Statistics Bureau, Washington, D. C. 256 pp. Fedkiw, John, Frederick S. Hopkins, Jr., and Neil J. Stout. 1960. Economic aspects of growing high quality pine through pruning. The Northeastern Logger 4:16. Fedkiw, John, and Neil J. Stout. 1959. Production trends in the eastern ivhite pine industry. The Northeastern Logger 10:12. . 1960a. Eastern ivhite pine lumber grade price trends and relationships. The Northeastern Logger 1:14. 1960b. Timber quality determines white pine lumber grade recovery. The Northeastern Logger 3:14. Hair, Dwight and Herbert B. Wagner. 1958. The demand and price situation for forest products. The U. S. Department of Agriculture, Forest Service and Commodity Stabilization Service. 32 pp. Heebink, Bruce. 1961. Paper overlays on low-grade lumber. The Northeastern Logger 10:14. Holland Irving L 1960a. An explanation of changing lumber consumption and price. Forest Science 6:171-191. . 1960b. A suggested technique for estimating the future price of eastern white pine stumpage. Forest Science 6:369-396. Hopkins, Fred S. Jr., 1961. Discussion: factors influencing the consumption of south- ern pine. Journal of Farm Economics 43:1332-1335. Lehman, John W. 1961. The changing sawmill industry. Tennessee Valley Authority. Division of Forestry Relations, 23 pp. Mancini, Angelo. 1961. Recent changes in lumber marketing in New York state. (Speech before Northeastern Loggers' Association, Inc., Annual Conference.) New Hampshire Forestry and Recreation Commission. 1957-1960 and 1961 prelim- inary. Biennial Reports of the Forestry Divisions. Concord, New Hampshire. Northeast Regional Technical Committee. Marketing forest products from small woodland areas in the Northeast. Pennsylvania State University Agricultural Experiment Station. Row, Clark and Sam Guttenburg. 1962. Changing price patterns affect southern pine lumber industry. Journal of Forestry 60:120-123. RuTTAN, V. W. AND J. C. Callahan. 1962. Resource imputs and output growth: comparisons between agriculture and forestry. Forest Science 8:68-82. Scarborough, J. B. 1958. Numerical mathematical analysis, 4th edition. The John Hopkins Press, Baltimore. 576 pp. Simmons, Fred C. 1961. The lumber industry in northern New England. The North- eastern Logger 5:14. Stoddard, Charles H. and William P. House. 1961. Small business in New Hamp- shire's forestry and forest products industries. New Hampshire State Plan- ning and Development Commission. Concord, New Hampshire. 64 pp. Swain, Lewis, C. and Oliver P. Wallace, 1956. Buying practices of ivood-using indus- tries in New Hampshire. University of New Hampshire, Agricultural Experi- ment Station. Station Bulletin 433. 11 pp. U. S. Bureau of Census. 1961. U. S. Census of Manufacturers, 1958. U. S. Govern- ment Printing Office, Washington, D. C. Special Report MC 58 (S) 2.3. Wallace, Oliver P. and Elliot L. Amidon. 1958. Marketing of eastern white pine lumber from Maine and New Hampshire. University of New Hampshire Agricultural Experiment Station. Station Bulletin 452, 14 pp. ZiVNUSKA, John A. 1955. Supply, Demand, and the lumber market. Journal of For- estry 53:547-553. 29 Massie, Michael R. C. and Wallace, Oliver P., 1963. The price of white pine stumpage and lumber during the movement of New Hampshire sawmills into and out of production. Since 1950 there has been a steady decline of sawmill numbers, princi- pally portables. During this same period the relative price index of white pine stumpage, which comprises 70 percent of their annual volume, has risen faster than the relative price index of lumber. In addition, other factors such as decline in stumpage quality and the box board market contributed to this decline. N. H. Agri. Experiment Station Bulletin No. 480, UNH, Durham, N. H.