GROWTH. 29 



of lumber at points which have a higher freight rate than the lumber 

 centers, and includes all profits in operating and selling. Operating ex- 

 penses vary with the accessibility of timber, class of operation, and the 

 ability of the operators. The average expense at present in producing 

 yellow poplar in Tennessee is above $14 per 1,000 board feet. The allow- 

 ance for difference in freight rates amounts to 30 cents per 1,000 board 

 feet for each difference of 1 per cent per 100 pounds in the freight rate. 

 This difference should be deducted from the value shown in Table 1 1 when 

 the freight rate is less than the rate from the lumber centers, and added 

 when the freight rate is higher. The prices given for lumber are based on 

 well graded and well sawed stock in car lots. When lumber is sold through 

 brokers and commission men the prices are from 5 to 8 per cent. less. 



The value of the yellow poplar trees in a stand are determined by ascer- 

 taining by measuring and tallying the number of trees of each diameter, 

 and multiplying these numbers by the value of trees of the respective 

 diameters under the appropriate cost of operating. 



Increase in price. In addition to the increase in volume and increase 

 in quality, which accompanies growth, due to increase in the proportion 

 of higher grades, there is a third but irregular increase in value due to 

 increase in price. Since this increase varies with the proportion of the 

 different grades of lumber which can be sawed from the tree, it can be 

 calculated only by considering the increase in the price of these compo- 

 nent grades. During the past 20 years there has been a greater per cent, 

 of increase in the prices of lower grades than in those of the higher 

 grades. The higher grades, consisting of Nos. 1 and 2, and saps, have 

 increased in price at Knoxville about 3.7 per cent, compounded per year ; 

 lower grades No. 2 common and No. 3 common at a rate of about 4.9 per 

 cent, a year. This increase in the price of the lower grades should be 

 considered as one of the elements of increased value in plantations and 

 in young stands which contain a large proportion of poplar trees and 

 which are being managed as investments. Second growth trees of small 

 saw log size yield largely No. 2 common grade of lumber. The rate per 

 cent, of increase in the price of this grade during the past 10 years indi- 

 cates the probable rate of increase in the price of small sap trees during 

 the next 10 or 20 years. In 1903 this grade sold for $13 per 1,000 board 

 feet at Tennessee points. Under an operating cost of $12 per 1,000 board 

 feet this grade at that time had a stumpage value of $3 per 1,000 feet; 

 its stumpage value in 1913 under an operating cost of $12 per 1,000 board 

 feet is $5. The rate of increase in value during the decade was 5.2 per 

 cent a year. If this rate of increase in price continues for the next two 

 or three decades, and is considered in connection with the increase in the 

 value of stands and individual trees by growth and quality, there is an 



