(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, 



