Sawnwood Values and Species Effects on Quality: an Historical Perspective for British Columbia

Acknowledgments Funding for this publication was provided by the Canada-British Columbia Partnership Agreement on Forest Resource Development: FRDA II-a five year (1991-96) $200 million program cost-shared equally by the federal and provincial governments. This report has been reviewed by the B.C. Ministry of Forests and approved for distribution. Approval does not necessarily signify that the contents reflect the views and policies of the British Columbia Ministry of Forests or the Canadian Forest Service. Mention of trade names or commercial products does not constitute recommendation or endorsement for use. iii Summary A review of sawnwood price studies as well as the use of a new data set to calculate historical price changes and a wood quality index for B.C. and Canada is presented. The data are used to calculate average annual rates of real price change. A review of previous studies on historical price growth rates and projected future rates is also presented. The range of price growth rates reported may be used as a reference when conducting financial sensitivity analyses of silviculture activities. The volume weighted average of softwood prices in this analysis showed an average annual rate of increase of 0.53% in B.C. rates for the two respective time periods were 0.24% and-0.24%. The species showing the highest growth rate since 1926 was hemlock, growing at an average of 1.56% per year. Ponderosa pine had the largest fall with an average decrease of 0.32% per year. For the period beginning in 1965, six of the B.C. species and five of the Canadian species showed negative growth rates, compared to two and none over the 1926 to 1990 period. The highest rate in B.C. was 2.2% for Yellow Cypress. Lodgepole pine had the most significant decrease averaging-1.14% per year. As was the case in the previous period, hemlock had the highest rate in Canada. However, over this more recent time period its price growth rate was only 0.44%. Lodgepole pine decreased the most since 1965 with an average annual rate of change of-0.34%. Historical and projected price growth rates vary among studies. The variation may be attributed to the different time periods over which the rates are calculated, as well as the different products and regions on which they are based. Although there is variation in the expected rates of future price changes, there is consensus that prices will increase at a decreasing rates. This is true for almost every …