3086 Chapter 25 



Pulp chip prices. — On the world market, prices of pulp chips for export 

 increased significantly during the 1970's (fig. 25-2). Overgaard (1978) found 

 that with the Japanese pulp and paper industry as the buyer, the value of exported 

 chips from Australia, New Zealand, and the U.S. West Coast were similar. Price 

 trends for the domestic markets of Sweden and the southern part of the U.S. 

 differed markedly. Swedish prices in 1977 were more than double those of the 

 southern United States, and have more than doubled every 3 years. During this 

 same period pulp chip prices in the southern United States increased only 45 

 percent (fig. 25-2). 



In the southern United States, prices for pulp chips and pulpwood have 

 increased slowly but steadily in response to inflation (fig. 25-2); hardwood, 

 however, has consistently cost less than southern pine. 



Data from V. A. Rudis of the southern Forest Experiment Station and C. C. 

 Hutchins, Jr. of the Southeastern Forest Experiment Station, U.S. Department 

 of Agriculture, Forest Service, indicate that prices for cordwood and residue 

 chips delivered to southern pulp mills (or fob rail siding) rose sharply in 1979 

 and continued to rise in 1980, as follows: 



Roundwood Chipped residues 



Year Hardwood Softwood Hardwood Softwood 



—DoUarsI standard cord --- Dollars/green ton 



MID-SOUTH STATES 



1970 16.94 18.81 6.69 7.13 



1971 17.34 19.12 6.70 7.63 



1972 18.56 20.80 7.18 7.79 



1973 21.32 23.84 8.44 8.50 



1974 25.32 28.24 9.73 11.12 



1975 25.71 28.71 10.04 11.76 



1976 26.50 29.76 10.21 12.39 



1977 28.10 31.42 10.93 13.46 



1978 30.35 33.15 12.28 14.66 



1979 .'... 33.92 40.09 15.02 18.37 



1980 36.69 43.31 15.69 21.08 



SOUTHEASTERN STATES 



1977 26.55 34.65 11.55 15.25 



1978 28. 15 36.25 12.00 15.90 



1979 30.40 40.65 13.05 17.15 



1980 32.90 43.90 15.00 19.80 



Hart (1980) noted that historically hardwood and softwood prices differ wide- 

 ly, for both standing timber and wood delivered to the mill; this difference, and 

 the typical higher yield of pulp from hardwoods make wood costs per ton of 

 pulpwood significandy less for hardwood than for softwood (table 25-5). 

 Softwood delivered costs of $38 per cord and hardwood delivered costs of $30 

 per cord, are equivalent to wood costs of $68.40 and $42.00 per bone-dry ton of 

 pulp, respectively — a $26.40 per ton advantage for hardwood. If the softwood 

 price goes to $44 per cord, a typical situation in many parts of the South in 1980, 

 the cost advantage is $37.20 per ton of pulp — a major incentive for hardwood 

 utilization (Hart 1980). 



