STUMPAGK AND DISCOUNT gi 



States government under the homestead act, large areas were alien- 

 ated at the nominal price of two dollars and a half per acre under 

 the Timber and Stone act and by Commutation of homesteads, large 

 areas were given as land grants to railways, etc. Several of our 

 states, Florida, Oregon, Idaho, New Mexico and others sold lands, 

 given them by the government under various acts, at prices in no 

 way graded by the price of lumber. Even our lake states sold tim- 

 ber at give-away prices. In this way Michigan sold i l / 2 million 

 acres of land in the ten years ending 1910, at prices usually below 

 two dollars per acre and most of it below a dollar and a quarter, 

 and most of this land was bought for the timber. Large areas of 

 timberlands have been held by small owners, or owners financially 

 unable to exploit and market the materia.1 and in many cases, a lack 

 of market, transportation facilities, etc., prevented the owners from 

 doing anything with the timber. Aside from these personal factors 

 there has always been the great balance of demand and supply. Even 



today with more than fifty years cut in sight, of timber already ma- 

 tured, it is useless to estimate the value on a basis of immediate ex- 

 ploitation and present prices. 



To illustrate : assuming prices of lumber, mill run, to stay at 

 about $15 per M. feet, and cost of logging and milling to average 

 $10 per M. feet. ' Then the true value of stumpage should be $5 

 per M. feet average. 



But this is not true. The first year's cut is worth the $5, but 

 the second, third, etc. year's cut is not worth it. The stumpage cut 

 in the .tenth, twentieth or thirtieth year, at five per cent discount is 



5.00 5.00 5.00 



worth only - , - , - , or $3.10, $1.89 and $1.15 per M. feet. 

 1.62 2.65 4.32 



In keeping with these peculiar and unsettled conditions of stumpage 

 prices stumpage of pine in Minnesota brought $12 while in the 

 same year millions of better stumpage was bought in Oregon for 

 less than $i per M. feet. 



The man in Minnesota could use it at once and make money, 

 the man in Oregon bought it to hold and he had to hold, and may 

 lose money at it. 



Stumpage prices today vary not only for species but vary with 

 locality, with market, railway facilities, habit of the people of the 

 district, etc. Average figures for stumpage have little value, they 

 vary chiefly between $3 and $7, go as high as $20 and as low as $i, 

 and generally make from 10 to 30% of the value of the lumber at 

 the mill. 



