STUMPAGE VALUES 169 



prices up to their proper level to the benefit of the stumpage 

 owners. The same condition is secured when timber is 

 sold by a lumber company which is fully acquainted with its 

 value. 



The second factor is the controlling influence of transportation 

 and logging costs. Logging alone frequently requires a large 

 investment in railroads, flumes and equipment. It is often im- 

 possible for the owner of a small body of timber to market it, 

 except by means of the facilities owned by a lumber company. 

 The owner feels entitled to the stumpage value which results 

 from these increased transportation facilities. The lumberman 

 endeavors to secure the stumpage at the value which it had 

 before his improvements were constructed. When he is the 

 only purchaser, his price, rather than that desired by the 

 owners, is usually determined upon as the value of the 

 stumpage. 



The third factor is the element of time. Present prices of 

 finished lumber can under no circumstances determine present 

 stumpage prices absolutely. In the first place they do not 

 apply to present but to past stumpage values, and the value of 

 present stumpage will depend upon the price obtained when 

 its product, in turn, reaches the market ( n). 



But the period required to bring the timber from the stump 

 to the retailer, or even to the cars, is not the most important 

 element of time involved, and neither the discount factor nor 

 the speculative probability of a change in value for this short 

 period would have much influence on stumpage prices. A 

 more important fact is that large bodies of stumpage cannot 

 be logged at one time. The operation must extend over several 

 years. Therefore the prices finally received for this lumber will 

 not be this year's or next year's prices, but an average of many 

 years. Averages tend to eliminate annual fluctuations. Stump- 

 age values do not fall when lumber prices decline because the 

 owners of stumpage expect that before they have finished cutting, 

 these lumber prices will have risen again. 



171. Appraisals of Stumpage Value. An appraisal of 

 stumpage value requires: 



