TIMBER DEPLETION, PRICES, EXPORTS, AND OWNERSHIP. 



55 



1905 



AvfrafffSe//'nffPr/'c& 

 Gross Profit 



AyerageSet/ingPr/ce. 



Operating 'Expense 



AverageSe/l/tigPrice 

 Gro 3 S Prof/I' 



Afe f Profit 



-/7C<? 



Gross Pro ft 



19/9 



r-. ,, , 



Dof/ars per- M feer. 



Amount Percent 

 OfSa/es 



cd 



-ted 



$28.92 



or-> ecf 



'-ecf 



/ 2.6O 



Ht 33. fO 

 5.77 

 3.72 



/ 2.05 



>.2O 

 6./Z 

 3.76 

 2.36 



J 9. 7/ 

 /O.7/ 

 P O *. 



n / 



20. 26 



7. BO* 



* 7.76 



'inYesf/nesil: 



21.94 

 /3 34 





TO 



2O 25 SO 



6O 



FIG. 21. Comparative average selling prices, all classes of lumber sold, gross profits, to tal operating expenses, and net profits for country 



retail lumber yards in Nebraska, for years 1905, 1910, 1915, and 1920. 



generally throughout the northern portion of the Middle West, 

 in which the company operates retail yards, deferred purchases 

 in order to buy on the company's list or to await similar reduc- 

 tions throughout the trade. 



A statement issued about the same time by the president of 

 another group of companies contained the following : 



We regard the present prices of lath as detrimental to the best inter- 

 ests of all branches of the trade and not defensible either on the basis 

 of production and distribution cost or on the basis of a fair market 

 value. 



PRICE CONTROL. 



Neither time nor facilities were available to investigate the 

 extent, if any, to which prices since the armistice have been 

 subject to artificial control. It is believed, however, that the 

 data presented are fairly conclusive in indicating that during 

 the last half of 1939 and the first months of 1920 no control of 

 prices was necessary to lift prices. 



SOME SPECIFIC EFFECTS OF REGIONAL DEPLETION 

 ON PRICES. 



Regional forest exhaustion, with constantly increasing dis- 

 tance between forest and market, gives rise to many accessory 

 conditions vitally affecting the price of lumber to the con- 

 sumer. Among the more important are : 



Opportunities for speculation in lumber prices by both 

 producers and distributors tend to increase as the distance be- 

 tween forest and market becomes greater and as a species of 

 lumber becomes scarcer. During the 8 or 10 months preceding 

 March, 1920, much speculation entered the trade in markets far 

 removed from the producing regions. The common use of the 

 reconsignment privilege, for example, by which cars of lumber 

 are shipped prior to sale, the shipper or wholesaler, as the case 



may be, relying upon favorable sale while the lumber is in 

 transit or when it reaches a consignment point, was a fruitful 

 source of speculation. These cars were often held for bid prices 

 and served to intensify the auction market and to lift prices. 



During the past year demurrage charges on transit cars 

 amounting to $100 and $200 per car were not uncommon. The 

 records of transit cars at the Minnesota transfer alone show 

 that during the period October, 1919, to March, 1920, 3,000 cars 



CITY TRADE. 



Average of 3 Companies 



Wholesale Price 

 (F.o.B. Mill) 



Transportation 



Operating Expense 



Net Profit 

 (includes interest] 



> 10 



Dollars Per M Ft. 



Wholesale Price 

 (F.O.B. Mill) 



Transportation 



Operating Expense 



Net Profit 

 (tnc/udes interest) 



A Representative Firm 



20 3O 



Do liars Per M Ft. 



FIG. 22. Comparison of the essential cost factors In the retail 

 price of lumber, Kansas City. 



