Chapter III: Forestry and the Forest (2)

"On nearly all of the lands included in this type the ground is now but partly and insufficiently stocked with young timber, the areas of forest are constantly becoming more accessible to markets, and there is every indication of a strong future demand at greatly increased prices. On nearly every tract, a second cut can be made within thirty years. All marking under present sales should be done strictly with reference to two points:

"1. Stocking the cut-over land as fully as possible with sugar and yellow pine.

"2. Securing a second cut within thirty years.

"All cutting should be done under the 'selection system,' which requires a careful choice of the individual trees to be removed. Fixed diameter limits and the leaving of any specified number of seed trees per acre can be very largely disregarded.

"The condition of every sugar and yellow pine on the sale area should be studied closely to determine whether that tree will be merchantable thirty years hence, by which time a second cut is probable. As a rule the trees which will remain merchantable for another thirty years should be left. Suppressed and crowded trees which cannot develop should be removed. Under this system of marking, ordinarily about one-half of the present stand of merchantable pine would be left uncut. Will it pay?

"On areas where practically all of the pine is over-matured and would be cut under the rule given above, a sufficient stand must be left to reseed thoroughly the cut-over land. This requires not less than four full seed-bearing trees, at least 25 inches in diameter, per acre. The strongest and thriftiest trees available should be selected for this purpose, but not less than the number specified must be left even if every tree will be a total loss before a second cut is possible.

"Extensive areas of pine timber which are not yet fully mature should be excluded from the sale. On patches or small areas of immature pine, which it is not practicable to exclude from the sale, cutting should be very light, limited to one-third or less of the largest trees, or omitted altogether.

"No attempt to discriminate sharply between sugar and yellow pine should be made, as both trees are almost equally desirable. Where a choice is necessary, sugar pine should be favored on moist situations, as in canyons, moist pockets, or benches and on northerly exposures. Yellow pine should be favored on dry situations, including exposed ridges and southern exposures.

"Fir and incense cedar should be marked, as a rule, to as low a diameter as these trees are merchantable in order to reduce the proportion of these species in coming reproduction. It is essential, however, that no large openings be made in the present stand since the exposed ground is in danger of reverting to chaparral or of becoming so dry from evaporation that no reproduction will follow cutting. Where the stand of pine is insufficient to reseed thoroughly and protect the cut-over area, enough sound, thrifty fir and cedar should be left to form a fairly even cover with openings less than a quarter of an acre in size.'"

The under current of all opinion upon sugar pine up to date is that reproduction will not be very successful unless enough growth to shelter the seedlings remains after logging. Where the fire risk permits, the same end may be furthered by leaving the tops scattered on the ground.

Little experimenting has been done in planting sugar pine, but there are many indications that except where conditions strongly favor natural reproduction it will be resorted to eventually if any particular attempt is made to get this species. Leaving large seed trees is not only expensive, but rather uncertain, because heavy seed years are several years apart and squirrels consume a large portion of an ordinary crop. Transplants which have received nursery shelter until past the greatest danger of drying out should prove most successful on heavily-cut south slopes.

REDWOOD (_Sequoia sempervirens_)

Although probably the most rapid-growing of all American commercial trees and also of high market standing, redwood has been little studied by foresters. The layman is still more confused by its many peculiarities. Growing to a size of 20 feet in diameter and 350 feet high, reaching an age of well over 1,000 years and seldom reproducing by means of seed, it is not surprising that it was long regarded as ill-adapted to second crop management. Although observing that suckers sprout from the stumps with great rapidity, the lumberman generally regarded these mushroom growths as abnormal and temporary, and believed his virgin timber to be the finally-vanishing remnant of a prehistoric species unsuited to present-day conditions.

It was next discovered that the suckering habit is no new one, indeed that the majority of the present stand, however old, began as sprouts from roots or stumps of its predecessors. This is evident from the circular arrangement of several trees around the spot where their parent stood. These old sprouts were of very slow growth, for they were shaded by a forest of extreme density. As seedlings they could have neither germinated nor grown, but as suckers they were kept alive by the parent until light supply became available through their increasing height or through thinning of the forest. Under such conditions centuries were required to produce large trees.

The owner of today, by cutting down the old stand, gives the suckers conditions hitherto unknown to the redwood. The vigor and susceptibility to the aid of light, which originally was necessary in the sprout growth to perpetuate the species at all, now respond to entire freedom and light in an astonishing manner. Even after severe slashing fires char the stumps, the latter throw out clusters of sprouts which grow several feet a year. Logging works 30 or 40 years old have come up to trees nearly 100 feet high. Naturally such timber has a heavy percentage of sapwood and is soft and brittle, but it is already suitable for piling, box lumber and like purposes and improves constantly.

Since reproduction by seed does not enter into the problem, financial possibilities depend almost wholly on the nature of the original stand. There are many types of redwood forest, pure and mixed, flat and slope. If the old trees are few to the acre, the sprout clusters will be so far apart that excess of side light will produce clumps of swell-butted, short limby trees, of little use for lumber; that is, unless there is also a seedling growth of fir or other species to fill the blanks and bring up the density. Where such a nurse growth is to be counted on, or where the redwood trees are small and close together, ideal conditions for a certain, rapid and well formed second crop exist.

The thinner the original redwood stand, the greater the effort necessary at the time of logging to obtain the required density. The leaving of seed trees of other species, with as many as possible small trees of both redwood and other species and the maximum protection of all from fire, should then be the means employed. On some tracts the proportion of redwood will not warrant this effort; on some it is not even required. The question of whether it pays to hold redwood land is therefore almost wholly local, but when conditions are favorable it can be answered affirmatively, because of the extremely rapid growth, with less doubt than of almost any other species.

There is some tendency to over-production of sprouts by redwood stumps. Removal of the excess with an ax, saving those closest to the ground and not over-thinning to the extent of reducing the density conducive to height growth and shedding of low branches, improves the chances of those remaining.

SEEDING AND PLANTING

SEED SUPPLY

It has been shown in a previous chapter that the owner of deforested land who desires to secure a second crop may find it necessary or cheaper to adopt artificial measures wholly or in part instead of depending upon natural reproduction. These measures may be of two kinds--direct seeding, in which the seed is sown where the trees are to stand permanently, and the planting of trees grown in nurseries.

Whether artificial reforestation is accomplished by means of sowing seed or planting trees, the first requisite is a supply of tree seed of the desired species and of good quality. Unfortunately for the timber owner who wishes to enter upon extensive seeding operations, the business of collecting and preparing forest tree seed for market has received but little attention from old-established seed firms, and it is not always possible to purchase the species and quantity desired. Moreover, the prices charged are often excessive.

In the Pacific Northwest, however, the demand for seed of Douglas fir and Sitka spruce has led to the establishment of a considerable trade in these species, and at reasonable prices, so that where these species are to be used, or only small quantities of other species, the timber owner will probably find it to his advantage to purchase the seed rather than to attempt collecting it himself. Douglas fir seed is quoted at $1.40 to $2.00 per pound and Sitka spruce seed at $2.25 to $3.00.

In purchasing seed it is common practice to specify that it shall be of the new crop, because tree seed kept in ordinary storage loses its vitality materially. When properly stored in air-tight receptacles, however, as is now done by some seed dealers, it will retain its germinative power for several years with only slight depreciation. Moreover, fresh seed, if improperly treated, may be of very poor quality, so that the age of the seed is of little value in the determination of its worth and the only sure method of ascertaining this is by means of germination or cutting tests. The latter method is the quickest and most simple and consists of cutting open a number of the seeds and ascertaining the per cent whose kernel is sound, plump and moist. Seed of good average quality should contain not more than 25-30 per cent of infertile seed.

When seed cannot be purchased, it is necessary to collect. Since no species of coniferous trees bear abundant crops of seed each year and often several seasons will elapse between good crops, it is necessary to gather sufficient seed when the supply is abundant to provide for succeeding years when the crop is apt to be a failure.

The seed ripens in the fall, usually during August or September, and the cones should be collected at that time. Pines require two years in which to mature the seed; that is, the cones are not fully formed and the seed ripe until the second fall after the fertilization of the flowers in the spring. Most of the other important conifers ripen their seed in the fall of the same season. Shortly after the seed is ripe, the cones open and allow it to disseminate, consequently they must be gathered before this occurs.

The cones are gathered either by climbing the trees and cutting them off from the branches, by picking from the tops of felled trees, or by robbing squirrels' hoards. Where squirrels are abundant in the forest, the last method is the cheapest. Climbing trees is practiced only where the trees are small. When this method is employed, the workmen should be equipped with linemen's belts and climbers. Picking from felled trees is readily carried on except where dense underbrush interferes, as is the case in the ordinary Douglas fir forest.

Trees growing in the open, with large crowns extending down the greater part of the bole, bear cones more abundantly than trees in dense forests, and for this reason collecting from scattered open growths can be done more cheaply than on logging areas. Often large quantities of cones can be purchased from settlers who will collect and deliver them at central points at a stipulated price. When this method is employed, however, frequent examination of the cones should be made to ascertain that they contain the full number of seed, for often opened cones from which a part or all of the seed has been disseminated will be offered for sale. Insect larvæ also often destroy a large proportion of the seed, particularly when the crop is light and care should be taken that the cones purchased are not infested. The prices paid for cones vary from 25 cents to 50 cents per sack for the larger cones, like yellow and white pine, and 50 cents to $1.00 for Douglas fir and spruce, depending upon the abundance of the crop.

After the cones are gathered the seed must be extracted and cleaned. Where climatic conditions in the fall of the year will permit air-drying, the cones may be spread out on sheets or blankets where they will be exposed to the sun and wind. Under this treatment they will open in from 3 to 6 days, depending upon the weather and the species. Where bad weather will interfere with air-drying, the cones must be dried undercover by artificial heat. This is the method usually employed by professional seed collectors, and where large quantities of cones are to be treated each year special dry houses are constructed and fitted with elaborate drying apparatus. The work can be done most cheaply with such an establishment, but for the ordinary timber owner who expects to collect seed only occasionally, a makeshift dry-house which will answer the purpose can be fitted up inexpensively in any unused building. The essential features are shelves or trays 4 feet wide arranged around the walls of the room, one above the other and separated about 8 inches apart, and a heating stove placed in the center of the room. The shelves may be made of burlap stretched tight, or, better still, of wire screening of 1-1/2 inch or 3/4-inch mesh.

After being subjected to a temperature not exceeding 110° Fahr. for from 24 to 48 hours, the cones will open, allowing the seed to fall out when shaken or pounded. The seed when separated from the cones is then mixed with a coarse gravel in about the proportion of 4 to 1 and churned to remove the wings. Finally, all foreign matter is removed by screening and hollow seed blown out by passing it through an ordinary fanning mill.

SEEDING VERSUS PLANTING

The selection of the method of reforestation to employ, whether direct seeding or planting, depends primarily upon the character of the area to be restocked. Direct seeding is usually considerably cheaper when the results are satisfactory, but only on the more favorable sites where moisture and soil conditions are right is there any assurance of success. Even in such cases partial or total destruction of the seed often results from birds and rodents. In exposed situations where the soil is shallow, or where because of climatic conditions soil dries out several inches deep during the growing season, the seed may not germinate at all, or the young seedlings may be killed before they have time to send their roots down to the permanent moisture level. In such situations, planting is the only reliable method. If the plant material is of the proper kind and the work well done, satisfactory results are almost certain to follow. Direct seeding is a much more rapid method than planting, and where extensive areas are to be restocked within a short period and seed is abundant, the work can be completed quickly. On the other hand, this method is wasteful of seed because a large proportion fails to germinate and the young seedlings often succumb to adverse conditions, so that where seed is scarce or its cost high, planting is the more practical method.

Because planting is the most reliable method it has been the one most largely employed in extensive operations, both here and in most European counties, but thorough tests are now being made of direct seeding and under proper conditions it promises to be fairly satisfactory. The Douglas fir region west of the Cascade Mountains offers the most favorable conditions for direct seeding and except on badly exposed south slopes, or where the growth of brush is exceedingly dense, it is believed this method will prove a satisfactory one for the timber owner to employ.

In the yellow pine regions conditions are not so satisfactory for direct seeding, since this tree occurs largely in a region of deficient rainfall. However, natural reproduction is abundant throughout many portions of this type, and it is probable that direct seeding will prove fairly successful if the proper methods are employed and if forest conditions have not been too greatly disturbed. That some method of successfully employing direct seeding with yellow pine be found is greatly to be desired, since yellow pine seedlings do not withstand transplanting well, but there is need for careful experimentation before extensive seeding operations in this type by private timber owners would be justifiable.

Western white pine, it is believed, will be easy to reproduce in most of its native situations by direct seeding, though the greater scarcity of its seed and the fact that it will be more subject to destruction by birds and rodents because of its larger size may make planting the more practical method.

Trees for planting can either be purchased from commercial nurserymen or grown in nurseries established for that purpose near the planting site. When only a few thousand trees are needed it is cheaper to purchase them, but when extensive operations are contemplated, covering hundreds of acres in which millions of trees will be needed, it is far preferable for the owner to grow the trees in his own nursery. Some initial outlay for the establishment of the nursery will be necessary and a practical nurseryman should be employed, but the saving in the cost of the trees will fully compensate for these.

One, two and three year old trees, the latter once transplanted, are usually employed in planting, the older trees being used for the less favorable sites. In planting they are placed in rows equidistant apart, the spacing varying from 4 to 12 feet, with a general average of about 6 feet. The work may be done either in the fall after growth has ceased or in the spring before growth commences.

The cost of planting, of course, will vary greatly with the age of the trees, the number planted per acre and the accessibility and character of the planting site. With young trees and wide spacing, the cost may be as low as $6.00 per acre, while in more unfavorable situations where older plants are used and planting is more laborious it may be as high as $16.00. A fair average, however, for those areas which a timber owner would be most likely to plant up is about $8.00 to $10.00 per acre.

In direct seeding, several different methods may be employed, such as broadcasting over the entire area with or without previous preparation of the soil, sowing in strips, or sowing in seed spots; but observation and experiment have shown that it is necessary for seed such as Douglas fir, yellow pine and western white pine to come in close contact with the mineral soil in order that it may germinate and the seedlings live; consequently only those methods should be used which will accomplish this. Where the area has been burned over previous to sowing and the mineral soil laid bare, broadcast seeding may be employed. Where the ground will permit the use of a harrow good results are obtainable by scarifying the soil in strips about 10 feet apart and sowing the seed in these strips. On unburned areas covered with a dense growth of fern, salal, moss, grass, or other plants, this covering must be removed by the seed spot method. This consists in removing the ground cover with a grub hoe or mattock in spots of varying diameter (6 inches to 3 feet) and of various distances apart (6 to 15 feet), and sowing the seed in these spots. The advantages of this method are that a minimum amount of seed is used; the ground can be prepared and the seed covered to whatever extent is desirable, and the soil pressed down. This method is believed to be the one best suited to the greatest variety of sites.

The amount of seed used per acre will, of course, vary with the species and the method used, and the quality of the seed. The following table indicates the approximate quantity of seed of good average quality required per acre for three different methods, the average cost when collected in fairly large quantities, and the number of seed per pound:

No. pounds required per acre.
No. seed Cost per Broadcast, Seedspots
Species. per lb. pound. entire area. Strips. 6' apart.
Douglas fir 42,000 $1.50 2 - 3 1/2 - 1 1/2 - 3/4
Yellow pine 8,000 .50 10 - 12 2 - 2-1/2 1-1/2 - 2
Western white pine 14,000 .75 6 - 8 1-1/2 - 1-3/4 1 - 1-1/2

The total cost, too, will vary widely, not only because of the different quantities of seed used but also because of the great extent to which the methods are varied to suit the conditions occurring upon the area. Simple broadcasting without any preparation or treatment of the soil will not exceed 20 cents to 25 cents per acre for labor; harrowing and sowing in strips, 85 cents to $1.10 per acre, and sowing in seedspots, $2.00 to $5.00 per acre. Upon this basis the total cost per acre will approximate the figures given in the table below:

Broadcast over Seedspots, Species. entire area. Strips. 6' apart. Douglas fir $3.20-4.75 $1.00-2.60 $2.75-6.00 Yellow pine 5.20-6.25 1.85-2.35 2.75-6.00 Western white pine 4.70-6.25 2.00-2.40 2.75-6.00

RATE OF GROWTH AND PROBABLE RETURNS

Of all factors in calculating the financial possibilities of second forest crops, the growth to be expected is the easiest to determine with fair accuracy. Future stumpage value, tax burden and fire risk are all subject to uncertain influences, but the approximate yield of a given species under given natural conditions will be the same in the future that it is now. To predict it requires only study of existing stands without being misled by the influence of conditions which will not be repeated.

On the other hand, an immense amount of misinformation is circulated because of superficial observation. Enthusiasts discovering individual trees which have made prodigious growth, or even fairly extensive stands on fertile soil with heavy rainfall, will compute sawlog yields at 40 or 50 years which are much too optimistic for general application. Others, remembering some stand they have seen in unfavorable localities, or noting shade-suppressed trees which will not be paralleled after the virgin forest is removed, are unduly discouraged. It is most essential that yield tables be made by trained observers who know how to reach the true average, and that the figures either actually come from the region to which they are to be applied or are accompanied by a systematic analysis of climatic and other conditions which permits intelligent comparison.

In calculating another yield on cut-over land, the system for an even-aged new growth, such as will follow clean cutting of Douglas fir, for example, is quite different from that necessary if the cutting amounts only to selection of the merchantable trees and leaves a fair stand of smaller ones. In the latter case, yield tables based on average acreage production are of little use because so much depends upon the character of the stand which remains on the tract in question. Here the basis must be the rate of growth of the average individual tree. An estimate by the number in each present diameter class may be made of the trees which will escape logging, showing, let us say for example, about five trees of each diameter from 6 to 12 inches, or thirty-five in all which are over 6 inches. If the growth study indicates that in 20 years there will have been added 6 inches in diameter we can estimate a crop of five trees each of classes extending from 12 to 18 inches. Actually the process will not be so simple, for the different aged trees will not grow with equal rapidity, and several other factors must be reckoned with, but the general principle is to apply rate of growth knowledge to the material on hand, and study of this material is essential.

For predicting even-aged crops resulting from entire restocking, the acquisition of necessary basic information is as difficult, or more so, but its application is far simpler. That the ground will be fully stocked by natural or artificial means must be assumed, but we can also assume that the result will be influenced only by normal locality conditions and not by accidental condition of the present forest. Therefore we use a yield table and not a growth table. This can be made by actual measurement of existing second growth stands of different ages, which proves not only the growth rate but also the number of trees which the natural shade-thinning process results in at different periods of the forest life. The chief danger of inaccuracy in such information lies in basing it on insufficient measurements or in applying it where soil or moisture conditions are greatly different. The latter error can be guarded against, however, by use of growth figures taken in conjunction with it. For example, if a yield table showing 25,000 feet to the acre at 50 years from seed is accompanied by one showing that the average stand it represents is 125 high at 50 years and its average 50-year-tree is 14 inches in diameter, little investigation is necessary to determine whether in any given locality the growth falls far above or below that.

An attempt to reproduce here any considerable number of growth and yield tables would be of doubtful use without more space than is allowed to explain how they are made and used. There are many technicalities, both mathematical and silvicultural, and unfortunately most of the available figures for the Northwest, obtained by the Forest Service, have not been generalized enough for wide popular value. This is particularly true of yield tables which necessarily require assuming standards of merchantability. While the best western white pine table assumes that by the time a new crop is cut 7-inch white pine will be salable, the best fir table was worked upon a 12-inch diameter basis. Obviously this would show an unfairly greater yield of a pine forest containing trees between 7 and 12 inches and be very misleading in calculating financial results at the same age and stumpage rates; yet without the original data there is no way of reducing both tables to the same basis. As an example, however, to indicate how the financial possibilities of second growth can be arrived at if a systematic study is made, let us take the Douglas fir figures referred to.

DOUGLAS FIR

These are exceedingly reliable. Measurements were taken by the Forest Service of practically pure fir on about 400 areas in thirty-five different age stands from 10 to 140 years old, ranging along the western Cascade foothills from the Canadian line to central Oregon. Since reforestation investment is likely to be confined mainly to the more promising opportunities, only such growth was measured as gave an average representation of the better class of the two should all the general territory covered be graded in two quality classes of all around ability to produce forests. On the other hand, care was taken not to represent the maximum of the better class, data being taken only from permanent forest land and not from rich potential agricultural land which might show unfairly rapid forest growth. The average areas were actually measured and the number, age, form, diameter growth, height growth, board foot contents, etc., of all the trees on them were accurately determined. Trees 12 inches in diameter 4-1/2 feet from the ground were considered merchantable, and it was assumed they could be used to 8 inches in the top. From this data were prepared tables and diagrams showing the average development of trees and stands under fairly favorable conditions in the region west of the Cascades.

This gave the following yield per acre:

Age of Stand. Feet, B. M. Age of Stand. Feet, B. M.
40 12,400 90 70,200
50 28,000 100 79,800
60 41,000 110 90,300
70 51,700 120 101,500
80 61,100 130 113,000

Let us see how these figures can be used in answering the primary question of the prospective timber-grower: "Will it pay to hold my cut-over land for a second crop?"

Obviously no certain answer can be printed here, not only because no uniform stumpage prices or carrying charges can be predicted but also because individuals may differ as to what profit is necessary to make the investment "pay," so it will be necessary to analyze the situation so each may select the premises which suit his own case and judgment. The investment made by the holder of cut-over land is of two kinds; that represented by the land which otherwise he might sell, putting the proceeds at work in some other business, and the annual carrying charges which otherwise he might also invest differently. The sum obtainable by investing the money available by sale after logging, adding to it yearly the sum required for fire prevention and taxes, and compounding both at a satisfactory interest for the entire period, is practically the cost of holding the tract for any given number of years. By calculating this cost upon a basis of one acre, and dividing it by the yield board measure which the same period will produce, the cost per thousand feet of growing a second crop is arrived at.

Against this may be set the gross return from the same expected yield at any given stumpage rate. The yield at the end of a 50-year investment will not be that of a 50-year forest, however, for although the carrying cost begins at once, the new forest requires a few years to become established. No exact figure can be set for this, for some seed will sprout the first year and some blank spaces may persist several years, but in the tables to follow five years has been allowed for an average. Consequently, instead of calculating on a 28 M yield as the return at the end of 50 years, as indicated in the yield table on the preceding page, the 45-year yield of 20-1/2 M is used, and similarly for the other periods of 60, 70 and 80 years. These four rotations only will be considered here, for in less than 50 years second growth will probably be too small to be cut at the highest profit, while after 80 years the investment compounds so heavily as to make it improbable that increasing stumpage values will compensate.

Three interest rates have been used in the first table to follow: 4, 5 and 6 per cent, compound. Forest calculations at lower rates are often seen, but it is not believed that less than 5 per cent will be satisfactory to private owners and many will insist on 6 per cent. The fair standard is what the owner can make in other business today, and since he can reinvest his income in the same business, it is reasonable to figure at a compound rate. A few examples are given to show how similar calculations may be made with any set of investment and stumpage factors which appeal to individual judgment. The second table, prepared from the first, shows at a glance the price that must be received for Douglas fir to make it pay either 5 or 6 per cent compound interest under a range of sixty different conditions of original investment and annual cost.

It should be borne in mind that, although present land value is made a charge, the value of the land at the time of harvest is not considered. This value is certain to increase greatly in the long periods involved. Taxation charges will be against it as well as against the timber. Indeed much land is now held without any regard to possible second growth. It should be assumed therefore that any profit in forest investment shown will be _increased_ by the sum obtainable for the land at the end of the same period.

Cost per M of growing Cost per M of growing
Douglas fir resulting Douglas fir resulting
from every $1 per acre from every 1 cent per acre
originally invested. of annual carrying charge.
--------At the end of--------- --------At the end of---------
50 60 70 80 50 60 70 80
Years. Years. Years. Years. Years. Years. Years. Years.
At 4% $ .35 $ .30 $ .33 $ .41 $ .074 $ .068 $ .078 $ .098
At 5% .56 .53 .65 .88 .102 .101 .126 .172
At 6% .90 .94 1.27 1.87 .142 .152 .208 .309

Example 1: With land worth $2.50 an acre at present, and an estimated carrying charge of 3 cents a year for protection and 20 cents per taxes, what stumpage price for a 50-year crop will pay 5 per cent compound interest? 6 per cent?

5% 6%
2-1/2 X .56 = $1.40 2-1/2 X .90 = $2.25
23 X .102 = 2.35 23 X .142 = 3.27
----- -----
$3.75 $5.52

Example 2: With land worth $5 an acre at present, and stumpage estimated to reach $7.00 in 60 years, what is the maximum annual carrying charge per acre which can be paid during this period and permit a 5 per cent return? A 6 per cent return?

5% 6%
Gross return = $7.00 Gross return = $7.00
5 X .53 = 2.65 5 X .94 = 4.70
----- -----
$4.35/.101 = 43c $2.30/.152 = 15c

Example 3: Assuming that stumpage will be worth $6.00 in 50 years, and that public enlightenment will keep the annual fire and tax charge from exceeding 20 cents, what price obtainable for cut-over land today, made to earn 5 per cent compound interest in some other business, is as profitable as keeping the land for a second crop? If other business would earn 6 per cent?

5% 6%
Gross return = $6.00 Gross return = $6.00
20 X .102 = 2.04 20 X .142 = 2.84
----- -----
$3.06/.56 = $7.07 $3.16/.90 = $3.51

FUTURE STUMPAGE PRICES NECESSARY TO MAKE DOUGLAS FIR SECOND CROP PAY EITHER 5 OR 6% COMPOUND INTEREST ON INVESTMENT.

Maximum Original Investment $7.50 an Acre. Maximum Annual Carrying Charge 30c an Acre.

------------Cost per M Feet-----------
Taxes and 50 year 60 year 70 year 80 year
Original protection rotation rotation rotation rotation
investment paid yearly (20.5 M (35 M. (46.6 M (56.5 M
per acre. per acre. per A.) per A.) per A.) per A.)
(cents)
- - 10 $2.40 $2.35 $2.90 $3.90
| | 15 2.95 2.85 3.50 4.80
| $2.50 < 20 3.45 3.35 4.15 5.65
| | 25 3.95 3.85 4.75 6.50
| - 30 4.45 4.35 5.40 7.35
|
| - 10 3.80 3.65 4.50 6.10
5% | | 15 4.35 4.20 5.15 6.95
Compound < 5.00 < 20 4.85 4.70 5.75 7.80
Interest | | 25 5.35 5.20 6.40 8.70
| - 30 5.85 5.70 7.05 9.55
|
| - 10 5.20 5.00 6.15 8.30
| | 15 5.75 5.50 6.75 9.20
| 7.50 < 20 6.25 6.00 7.40 10.05
| | 25 6.75 6.50 8.00 10.00
- - 30 7.25 7.00 8.65 11.75

- - 10 3.65 3.85 5.25 7.75
| | 15 4.40 4.65 6.30 9.30
| 2.50 < 20 5.10 5.40 7.35 10.85
| | 25 5.80 6.15 8.35 12.35
| - 30 6.50 6.90 9.40 13.90
|
| - 10 5.90 6.20 8.45 12.45
6% | | 15 6.65 7.80 9.45 14.00
Compound < 5.00 < 20 7.35 7.75 10.50 15.50
Interest | | 25 8.05 8.50 11.55 17.05
| - 30 8.75 9.25 12.60 18.60
|
| - 10 8.15 8.55 11.60 17.10
| | 15 8.90 9.35 12.65 18.65
| 7.50 < 20 9.60 10.10 13.70 20.20
| | 25 10.30 10.85 14.70 21.75
- - 30 11.00 11.60 15.75 23.30

These tables bring out a number of very interesting primary facts:

1. The rate of interest demanded of the investment is one of the most important factors. This is because such long terms are involved. The charges compound with prodigious rapidity toward the last. In any other business paying 6 per cent, compound, the maximum investment per acre given in the preceding table, that of a land value of $7.50 and a 30-cent annual charge for 80 years, would earn $1,317. A 75-year forest then harvestable should have 56-1/2 M to the acre, but this would have to bring over $25 per M to pay as well. On the other hand, the same deposits earning 4 per cent would only amount to $338 in the same period which would be equaled by timber at $6 per M.

2. For similar reasons, the length of time before cutting has much to do with profit or loss. The compounding of carrying charges eventually outstrips the production of material to a degree which can be offset only by the most rapid rise of stumpage values.

3. The greater the investment, the more marked the above effect and consequently the tendency to market an inferior product. A 60-year rotation is indicated by a majority of the conditions shown.

4. A comparatively slight increase in annual tax or fire charges may make the difference between profit and loss. Roughly, stumpage must bring $1 per M more to compensate for each 10 cents an acre for taxes at 5 per cent or for 7 cents at 6 per cent.

5. If the land is salable for $5 an acre or more it cannot be made to pay 6 per cent compound interest under the most favorable conditions, unless the stumpage received exceeds $6. At $5 stumpage and with reasonable taxation it will pay 5 per cent if it escapes fire.

6. Thirty cents an acre is apparently about the maximum annual carrying charge which will permit a 6 per cent profit, even with very high stumpage prices. Consequently, while present taxes on cut-over land are seldom prohibitive, there must be reasonable certainty that excessive increase will not occur.

The carrying charges shown in the second table cover both fire protection and taxes, as by reading the 15-cent line to include a 10-cent tax and a 5-cent fire patrol. The investment charge may be used to represent sale value only, or sale value plus any expense incurred at time of logging in order to secure reproduction, such as leaving salable material in seed trees, or planting. If desired, any owner may make a similar calculation on any other valuation better fitting his own situation. The table is not intended for universal use but merely as an illustration of how forest calculations may be made.

WHITE PINE

Too much space would be required to give a similar table for all western species, even were as good yield figures available. Roughly speaking, however, western white pine, under conditions thoroughly favorable to it, may be expected to make as good a yield as Douglas fir, and the above fir table will not be far off for it. A probably higher stumpage value should offset any lesser production.

HEMLOCK

Western hemlock is of somewhat, but not much, slower growth when coming in on open land as an even-aged stand. No yield table based on the same merchantable standards as the fir table quoted has been prepared, but the following is fairly safe to include all trees 14 inches in diameter used to 12 inches in the top: At 50 years, 2 M per acre; at 60 years, 22 M; at 70 years, 33 M; at 80 years, 40 M. The absence of a 40-year figure, and the sudden jump between 50 and 60 years, is because very few hemlock trees reach 14 inches at 50 years, but a large number of 12 and 13-inch trees pass into that class during the ten years following. Any yield figures for an even-aged forest show a similar jump at the point where the stand as a whole reaches the determined minimum merchantable size. For the same reason these hemlock figures are not very far less promising than those given for fir, for at corresponding ages the latter include 12 and 13-inch trees and all trees are considered merchantable to a top diameter of 8 inches.

SPRUCE

Since no systematic study of Sitka spruce second growth has been made, it can only be predicted from knowledge of its habits that while in favorable situation it will yield as heavily as Douglas fir, in other localities its growth in early life is slower and less regular, making it less likely to produce a good crop before the carrying charges become burdensome. If this proves true, taxation rates and land values will be extremely important factors, offset to some degree by a smaller fire hazard and the probability of high stumpage.

REDWOOD

For redwood we also lack good figures for any considerable range of conditions and ages, for redwood growth which followed burns does not exist and there are no very old cuttings. Government studies on the northern California coast prove conclusively, however, that this is our most rapid growing native commercial tree. In thirty years, in fair soil, it will produce a tree of 16 inches diameter, 80 feet high, and some existing 45-year stands run 20 to 30 inches on the stump and about 100 feet high. Reckoning 14-inch trees as merchantable, to be used to 10 inches in the tops, a 25 to 30-year second growth after logging near Crescent City was found to have 2-1/2 M feet to the acre and the future increase should be very rapid. There is little question of the profit of growing redwood, provided the difficulties described elsewhere of getting a dense crop started are overcome.

PROFITABLE THINNINGS

In addition to the yield of saw timber to be expected when the second crop reaches manufacturing size, there will be a market in many cases for material obtained by thinning. It is perfectly fair to compound for the remainder of the rotation any net profit so obtained and to set it against the carrying charges. In many cases it will go far to turn an apparently losing investment into a very profitable one. Moreover, the proper thinning of growing stands not only utilizes material which would otherwise die and be lost before the main harvest, but actually improves the quality of the first yield.

In obtaining the figures previously quoted the Forest Service found that the average Douglas fir stand at 40 years contains 410 living trees, most of them between 6 and 15 inches in diameter. At 60 years there are but 265 trees, 145 having died and decayed in the 20-year interval which were suitable for ties or other small timber products. The remaining trees would have been improved by thinning to prevent this loss, for the greatest diameter growth is made when the stand is open, and the ideal is to have just the density which will get the greatest wood production and still result in proper pruning and clearing of the trees.

Commenting along this line Mr. T. T. Munger, who conducted the investigation, says:

"That thinnings are silviculturally practicable and financially profitable in the Pacific Northwest has been demonstrated. In the vicinity of Cottage Grove, Oregon, many fully stocked even-aged Douglas fir stands now about 50 years old, most of them forming a part of ranches. Many of these stands have been cut over in the last 10 years and all the material then large enough for piling or mine timber cut out. This removed about 20 per cent of the stand. At the present time many of these same stands now contain much material valuable for small piles, ties and mine timber, yet the crown canopy is as dense and the trees as close and fine quality as though no cutting had ever been done in the stand. In fact, some of the 50-year old stands have already been cut over a second time, and each time with decided profit to the owner and no damage to the forest. From one 10-acre block of second growth now 50 years old, situated 7 miles from the railroad, already 32,000 feet of mining timber and about 100 50-foot piles have been taken out, yet the stand is now in good condition, and in a few years more of the smaller trees can be removed without infringing on the yield of the final crop. The material from these thinnings was worth at the railroad about $80 per acre."

CONCLUSIONS

Throughout the preceding pages on the financial promise of timber-growing in the West, the attempt has been not to give conclusions but to state certain known facts regarding tree growth and indicate how these may be used in arriving at conclusions based largely upon the conditions and judgment of the individual owner. In many cases they will do little more than suggest further investigation necessary. The Western Forestry & Conservation Association and, doubtless, the District Foresters for the Forest Service, will be glad to discuss such work and assist if possible.

There are, however, several conservative deductions to be made:

1. The Pacific coast states contain large areas having species and climatic conditions peculiarly favorable for forest-growing as a business. The rapidity and quantity of yield insure profit under conditions which would be prohibitive elsewhere.

2. In many cases, perhaps in most, a second crop can be started with little initial expense.

3. There is much land of no value for any other purpose.

4. Even if the owner does not care to hold his land long enough for another crop, or if he is prevented from doing so at some future time by excessive taxation or other prohibition, its disposal value will be greater if it bears young forest growth than if it does not.

5. Stumpage values are certain to advance greatly and their advance will be governed largely by these factors:

a. Speculative influence necessarily accompanying the lessening of the nation's and the world's timber supply.

b. The carrying charges of fire prevention and taxation imposed by the community upon virgin timber, which, since they represent an investment which must be recouped, will either be added in the long run to the price of stumpage exactly in the measure of their severity and so transferred to the consumer, or result in rapid cutting and consequently raise the speculative value of that which escapes cutting. (This the consumer will pay also.)

c. The quantity of new timber grown.

6. It is probable that future demand for timber will reimburse the cost of growing it, be this cost high or low _within reasonable limits_.

7. This does not mean, however, that the timberland owner will or can generally engage in the business when the cost is excessive. While he could probably make a good profit eventually, such an investment is too heavy and prolonged to be inviting; besides there is the possibility of entire loss by fire. He will naturally compare it with other investments having less disadvantages. For example, since conditions which discourage the growing of new competing forests tend for this very reason to enhance the value of existing forests, he might invest further in the latter instead, with equal ultimate profit and with easier access to his money at any time.

8. Consequently the growing of timber is promising to the private owner only when the investment can be borne easily. Since it has three forms--land value, fire protection, and taxation--all must be moderate or, if one or more is high, the rest must be low.

9. With the fire hazard great at present, and taxation so uncertain as to require allowing for its being excessive, the initial investment must be insignificant.

10. This confines it to land of low sale value and precludes much expense to insure the second crop.

11. To secure the perpetuation of forests on the scale essential to public welfare, the public must provide the private owner better fire protection and an equitable taxation system. _Or else it must purchase sufficient cut-over land and engage in forestry itself, bearing the cost and taking the risk._

12. Nevertheless there are several practical exceptions to the somewhat unfavorable situation theoretically outlined above:

(a) Many owners are warranted in holding cut-over land for some time, if not indefinitely, because of the upward trend of land values generally. Unless clearly most useful for agriculture, such land will be made more valuable by a growth of young timber. However indefinite the profit of encouraging this growth and protecting it from fire may be if the present sale value and taxes are computed against such outlay, _the two latter charges are being carried anyway_ and are the most important ones. Merely that it cannot be proved that they can be more than offset is no reason for not trying to compensate as far as possible at slight further expense. While this may not often permit any great effort to reforest, it will usually warrant protection of the natural new growth that will follow if given a chance.

(b) Many owners would prefer to have their milling business continue indefinitely. If such have or can purchase virgin timber to carry them 50 years or more they may do well to grow a log supply to come into use at that time, even if they would not do so merely as a stumpage investment.

(c) It is highly probable that history will repeat itself in the United States, especially in the Pacific coast states where every other condition is so favorable to making forestry a great benefit to the community, and that fire and tax discouragements will be removed as soon as the public realizes the situation. The owner who anticipates this and gets his crop started first will be the first to profit from it, and since it is the compounding toward the latter end of the rotation which now appears serious, the chances are that he will not have a heavy burden before relief of this kind arrives.

(d) Every owner of virgin timber which he expects to hold uncut for 10 years or more should consider reforestation of adjacent cut-over land in the light of fire protection also. It is the inflammable, sun-dried, brake-covered openings, yearly increasing in extent, which constitute his greatest fire menace. The conversion of these into green young growth, too dense for fern and salal and destructible only by the hottest crown fires, is the best protection he can give mature timber surrounded by them. Some additional expense for a few years to accomplish this will usually be cheaper and safer than the patrol otherwise required for an indefinite period.

(e) Advance in value of the land itself, realizable when the second crop is cut, will in many cases be great enough to make an otherwise unpromising reforestation investment profitable.

HARDWOOD EXPERIMENTS

In the foregoing pages consideration has been given to the growing of native coniferous species only. There is a field, however, yet to be entered into by the timber grower in the Pacific Northwest, which gives promise of good returns. This is the growing of eastern hardwoods. As is well known, the supply of native hardwoods in this region is deficient and those occurring are of poor quality. The demand for staple hardwoods is constant, and at present can be filled only through importation from the East. Moreover, the manufacturing industry in the Pacific Northwest is as yet only in its infancy, and as this industry becomes of greater importance in the future, the demand for hardwood lumber is bound to increase. This increase in demand, coupled with the rapidly diminishing supply in the East, seems certain to create a condition under which it will be profitable to grow hardwoods commercially.

That eastern species will thrive under forest conditions in this region has not, of course, been demonstrated, but the great variety of species planted successfully as shade trees in towns and cities, and in many instances by settlers in the mountains and farming districts, together with the marked success of various fruits introduced here, would tend to indicate their adaptability to the climate. In many respects the climate along the coast of Oregon and Washington is similar to that found throughout the great hardwood region of the Southern Appalachian mountains.