THE OUTLOOK FOR TIMBER DEMANDS 



Approximately Stable Relative 

 Prices of Timber Products Assumed 



In projecting demands for timber it has been 

 assumed that future price trends for timber 

 products between 1962 and 2000 will not differ 

 significantly from price trends for competing 

 materials, and that future "price induced" sub- 

 stitution between competing materials and timber 

 products consequently will be limited. Implicit 

 in this price assumption are the further assump- 

 tions (a) that adequate stumpage supplies will 

 be available throughout the projection period to 

 supply the projected demands for timber products, 

 and (b) that technological progress in the forest 

 industries will keep pace with that in industries 

 producing competing materials. 



Factors other than prices of competing materials 

 also will undoubtedly continue to have a signifi- 

 cant impact on the mix of raw materials consumed 

 in the U.S. economy. Relative costs of installa- 

 tion and maintenance of alternative materials in 

 housing or nonresidential construction, for exam- 

 ple, have an influence on materials use. Factors 

 such as changes in consumer preferences, changes 

 in construction required by increasing urbaniza- 

 tion, or the development of new products and new 

 technology likewise may be expected to affect 

 both the absolute level and the relative use of 

 timber products and competing materials. In 

 following sections dealing with specific uses of 

 timber products an attempt has been made to 

 allow for such nonprice factors, as well as materials 

 prices, in projecting demands for lumber and other 

 wood products. 



Relative prices of lumber, i.e., actual prices in 

 relation to average prices of all commodities, were 

 fairly stable during the period from 1920 to World 

 War II (fig. 3). During the boom years of the 

 1940's and the early 1950's demand-supply rela- 

 tionships for lumber and standing timber led to 

 an accelerated rise in lumber prices, all time peaks 

 in stumpage prices, and high levels of operating 

 profits in the industry. By 1962, however, 

 lumber prices had receded to a level about 15 

 percent below the postwar peak. In projecting 

 demands it has been assumed that relative prices 

 of lumber during the projection period would be 

 within the range of prices prevailing during the 

 1950's. 



It is of course possible that relative lumber 

 prices will in fact show further increases in the 

 future, especially near the end of the projection 

 period when projected timber supplies will be of 

 smaller size and poorer quality than currently 

 available. Substantial and continued improve- 

 ments in productivity in the lumber industry will 

 be necessary to achieve stability of relative prices. 



744-350 O — ^65 2 



PRICES OF TIMBER PRODUCTS 



(Relative To Prices Of All Commodities) 



150 



Lumber 







 150 



o 

 o 



II 



100 







X 



-a 



c 



50 



O) 



a. 









 150 



■Paper 



Stumpage 



1930 1940 



Figure 3 



1950 



1960 



