666 



TIMBER RESOURCES FOR .AMERICA'S FUTURE 



FUTURE DEMAND AND SUPPLY 



The projections of future demand for timber and 

 the estimate of needed growth and inventory and 

 of projected growth and inventory are different 

 from all of the other data in the Timber Resource 

 Review. Their adequacy can be gaged only in 

 relation to the assumptions upon which they are 

 based. They are believed to be sufficiently pre- 

 cise for the purposes for which the,y are used. 

 However, these data or anj^ other system of pro- 

 jections cannot have the same reliability as mea- 

 surements of past economic growth or of quantity 

 of timber products demanded currently or in the 

 past. "We cannot ask about a statement con- 

 cerning the future, 'Is it true?' as we can ask 

 about one relating to some past event. All we 

 can ask, 'is it likely to be true?' meaning 'Are 

 there weighty grounds for accepting it?' The 

 answer to this question, no matter how strongly 

 supported by empirical study of the past, is 

 merely a matter of judgment that cannot be fully 

 tested." " 



Future Demand Closely Related to 

 Future Economic Expansion 



The projections of future demand for timber 

 are based chiefly on a general framework of pro- 

 jections indicating probable expansion cf the 

 Nation's economy in the forthcoming 20 and 45 

 years. The construction of those projections is 

 explained step by step in the section Future 

 Demand for Timber. 



The starting point is the Census Bureau's four 

 series of United States population projections 

 covering the period 1955 to 1975. These are 

 based on explicit assumptions regarding future 

 fertility rates, mortality rates, and net immigra- 

 tion. The same assumptions and method have 

 been used to extend the Bureau's series from 1975 

 to the year 2000. From those series of projections 

 (and extensions), two sets of estimates for 1975 

 and for 2000 population have been chosen. The 

 lower set of estimates for these two dates is some- 

 what below the midpoint between the two middle 

 series of projections; the upper set is the high 

 series. Reasons for not using the low series are 

 indicated in the section. 



From the selected estimates of future popula- 

 tion, the analyses proceed to derive corresponding 

 sets of estimates of the future labor force. Those 

 labor force figures, with due allowance for (a) 

 some decrease of participation by young persons 

 of school age and by elderly persons of retirement 

 age, (b) armed forces of about present size, (c) 

 unemployment not exceeding 4 percent of the fu- 



■" Kuznets, Simon. Concepts and Assvmptions in Long- 

 Range Projections of National Product. In v. 16, Long- 

 Range Economic Pro.iection, pp. 9-38. Natl. Bur. Econ. 

 Res. Princeton, N. J. 1954. 



ture labor force, (d) continuing reduction of aver- 

 age hours of work per j'ear by employed persons, 

 and (e) annual average increase of man-hour pro- 

 ductivity at rates somewhat lower than in recent 

 years, are the basis for projections of the Nation's 

 future outputs of all goods and services, or gross 

 national product. The gross national product 

 projections, in turn, are the basis for estimates of 

 future disposable personal income, and also for 

 projections of the inputs of nonfood-nonfuel raw 

 materials required to sustain such outputs. 



Within this general framework of anticipated 

 economic growth, three separate projections of 

 demand for timber products have been developed. 

 The first is based on the lower set of population 

 and gross national product projections; the second 

 is based on the upper set; the third projection of 

 demand for timber products is a modification of 

 the first, on the assumption that prices of timber 

 wdll rise to a substantially greater extent than 

 prices of competing materials. All three demand 

 projections assume continuation of trends in sub- 

 stitution of certain timber products for other tim- 

 ber products. But only the third assumes sub- 

 stantial net substitution of other nonfood-nonfuel 

 raw materials for timber products. 



The final steps in the timber-demand analj'ses 

 involve assumptions about future net imports of 

 timber products, and about future improvements 

 in timber utilization. With allowances for these 

 two factors, the analyses proceed to estimates of 

 future demand for live timber from the forests of 

 the United States. 



Wanting to know how its prelimitiary projec- 

 tions of national economic growth and of demand 

 for timber products would fare under critical 

 judgment, the Forest Service sought and obtained 

 independent appraisals of those projections by 

 several experienced economic analysts not con- 

 nected with the Service. Comments from some 

 other economic analjsts were volunteered and 

 have proved most helpful. 



Future Supply Data Involve 

 Additional Assumptions 



The estimates of future needed growth and 

 inventory rest mainly on the estimates of future 

 timber cut, but they also involve additional 

 assumptions. There is still much to be learned 

 about projecting growth on a nationwide basis. 

 Until more is learned, any long-range calculations 

 will have inherent in them the possibility of sub- 

 stantial error. Growth is a compounding value 

 and even small variations of growth rate can have 

 pyramiding effects which are hard to evaluate. 

 Furthermore, the task of relating timber cut pro- 

 jections, growth, and inventory to long-range 

 wood needs is complex; available methods are 

 crude; there is no way of making precise compari- 

 sons; and professional judgment, as well as 



