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increase somewhat. but demand for sawtimber, pulp and fiber boards will increase faster. Already, recent real price increases suggest some economic scarcity of hardwood timber, and the RPA assessment projects real hardwood sawtimber prices to almost double in a couple of decades. Although recent price increases exceeding l0Vo per year are unlikely to continue in the long run, the projections indicate that hardwood prices in the South still could rise up to 4Vo per year for a couple of decades, which is extraordinary. Imports and substitutes would tend to reduce these price appreciation rates, but relative scarcity will still prevail.

This trend is already in place. Between 1977 and 1986, southern average sawtimber prices remained almost constant while prices of other factors of production in the economy increased over 4Vo per year. The declining real hardwood price trend reflected a large and growing supply and a stable demand.

Between 1986 and 1993, however, hardwood stumpage prices increased an average of l2vo per year, while producer prices for other materials increased by less than 370 per year. This trend seems to reflect the relative scarcity of hardwood sawtimber.

While higher pulpwood demand and timber harvests could quickly lower favorable growth-to-removal ratios, environmental and social constraints on harvests could greatly reduce the actual inventory and the growth that can be used for wood products.

Over the next few decades, U.S. hardwood timber inventories should

We still have huge inventories of hardwoods in the U.S. While many are in wetlands, on steep slopes, in strips or urban areas, or ofpoor form or quality, the sheer volume alone can make up for some of these inaccessible trees. The inventories will continue to increase for a decade or so, as will the average tree size and volume per acre. This, coupled with improved hardwood processing technology in solid wood and pulpwood products, will make stands that currently seem unmerchantable more profitable.

Unless markedly more stringent envfuonmental regulations effectively stop timber harvesting on private lands, the large hardwood inventory base can help prevent the continuation of the substantial price increases seen in the last decade. Market forces combined with moderate environt;..;ntal protection measures can help us find the middle ground between abundance and scarcity-modest real price increases and adequate hardwood timber supplies in the future.

- Adapted from a Hardwood Research Bulletin summary of a paper presented by Dn Fred Cubbage, N.C. State University, at the National Hardwood Lumber Association's 1998 Hardwood Symposium.