1982 lumber production the lowest in nearly 40 years

By Richard G. Reid Western Timber Association

I UMBER production in the LUnited States last year sank to its lowest level in modern times according to the annual lumber review prepared by Forest Industries magazine.

Combined hardwood and softwood production in 1982 was26.96 billion board feet. This was onlY 70.4o/o of the volume produced in the banner year of 1973 when the combined volume was 38.297 billon board feet.

This peak was followed bY the 1974-75 recession and then a recovery which kept production above the 37 billion board foot mark through 1979. However, that autumn the Federal Reserve tightened the screws on interest rates and there was a subsequent collapse in housing starts. The worst depression in the history of the lumber industry was on. One analyst found that never since 1926 had the price of lumber dropped so rapidly or for such a long period. The average-annual constant-dollar price of lumber dropped in each of four consecutive vears from 1979 to 1982.

Story at a Glance

1982's bad news numbers: worsl year for lumber Produc' tion since '45 not since'26 had lumber's price dropPed so fast, for so long . . constant dollar price ol lumber droPPed in each year f rom '79lo'82 some of the reasons behind the grim statistics.

Then in the late fall of 1982, lumber markets turned around almost as dramatically as they collapsed three years earlier. All of a sudden the war on inflation was declared won, and as interest rates came tumbling down, houses started popping up. Many producers were caught with low inventories both of lumber and logs. Prices for certain species and grades of lumber shot up as builders clamored for raw material for houses. The matter was complicated by the heavy snows which kept logging crews out of the woods and made it impossible to get log inventories built up. The situation had many mill managers reaching for the aspirin bottle.

The early 1983 spurt in the lumber