..50- 



capacity, it is oasicr to increase than to curtail production and periods of over- 

 production thus last longer than pcricas of underproduction. 



For the above reasons, limber prices usually lag behind other prices in an 

 upward price covement, are Vie first to feel the effects of depression and suffer 

 more and longer than other prices. 



In addition to these main influences affecting lumber prices there are a 

 number of seasonal fluctuations. The price of building lumber is usually higher 

 in the spring at ttje peak 'of building activity when shipments exceed production 

 and stocks are running low. The state of building activity in part depends upon 

 the general business conditions already referred to and in part upon the weather. 

 A mild spring causes early building activity in the cities, but it stops build- 

 ing on the farms because of the opening of other farm work. The weather also 

 affects production. FHoous or a severe winter in the South hinder the production 

 of logs and cause a shortage later in the year. These seasonal influences often 

 blend in a larger movement, as v/hen good weather brings good crops which lead 

 to a return of prosperity, etc. 



The actual fluctuations in lumber prices sinoe 1907 shows the effect of 

 the fundamental factors tbat have checked advancer in lumber prices. It was not 

 until 1912 that lumber prices had reached the level of 1907 and then because of 

 the slight business depression in 1914 and 1915 prices again broke sharply. The 

 general upward trend of priest; which bc-gan as early as the fall of 1915, did not 

 permanently influence lumber prices until the fall of 1916. The rise in lumber 

 that has taken place s.l:ioe has been greatly stimulated by government orders and 

 the enforced curtailment, of production on account of the labor shortage. In . 

 spite of these aids, lumber prices have not risen quite so much as the average 

 prices of "all commodities". 



2. The Yellow Pine Jlarket Since 1914. 



Southern Yellow Pr.ne is the leading species of American lumber; the 

 wide distribution of its production, and the large extent to which it enters 

 into building operations throughout the nation,- cause its price to correspond to 

 general influences affecting the prices of all commodities. liany of the forces 

 controlling Yellow Pino prices have affected North Carolina Pine, and have had a 

 strong sympathetic influence upon the prices of Douglas Fir, Hemlock, Western 

 Vfliite Pine, and Western Yellow Pine, - the chief competitors of Southern Yellow 

 Pine for general building purposes c 



The general range of influences affecting all lumber \ised in building 

 will accordingly be discussed in connection with Yellow Pine prices. In sub- 

 sequent histories of the prices of other woods, only the special factors affect- 

 ing these other woods will be discussed. 



Yellow Pine prices reached a high level in 1912, and a general feeling 

 of optimism caused an expansion of production and an increase in stocks, A tone 

 of conservatism prevailing in most lines of business on account of the tariff and 



(WIB359-50) 



