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. 



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