II. Regional Timber Supply

During 1988, the combined timber harvest of Oregon and Washington was 15.7 billion board feet (this includes preliminary 1988 data for Washington). Of this total, 6.4 billion board feet was supplied from National Forest and BLM lands, 1.1 billion board feet was harvested from state lands, 487 million board feet was harvested from other public and Indian lands and 7.7 billion board feet was harvested from private lands. (See Figure 1.)

During 1988, 3.7 billion board feet of this 15.7 billion board feet harvested was exported as logs from the states of Oregon and Washington. Thus, log exports represented 24 percent of the total regional harvest in 1988.

Washington's 1988 total harvest was 7.0 billion board feet. Of this total, 1.5 billion board feet was harvested from National Forest lands, 826 million board feet from Washington's state-owned lands, 327 million board feet from other public and Indian lands and 4.4 billion board feet from private lands. (See Figure 2.)

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Of Washington's total harvest, 39 percent, or 2.7 billion board feet of logs were exported from the state in 1988. Approximately 500 million board feet of these log exports originated on state lands, with the remaining 2.2 billion board feet supplied from private and other non-federal lands. Therefore, of the total regional log export volume, Washington produced 73 percent. Log exports from Washington's state-owned lands accounted for 14 percent of the region's log exports and 7 percent of Washington's total timber harvest in 1988.

Oregon's 1988 total harvest was 8.6 billion board feet. 4.9 billion board feet was harvested from National Forest and BLM lands, 270 million board feet from Oregon State-owned lands, 160 million board feet from other public and Indian lands, and 3.3 billion board feet from private lands. See Figure 3.

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Private-3.3 (38%)

Federal-4.9 (57%)

Of Oregon's total harvest, 12 percent, or 1 billion board feet of logs were exported from the state in 1988. Approximately 100 million board feet of these log exports originated on state lands, with the remaining 900 million board feet supplied from private and other non-federal lands. Therefore, of the total regional log export volume, Oregon produced 27 percent. Log exports from state-owned lands in Oregon accounted for only 3 percent of the region's total log export volume and only 1 percent of Oregon's total timber harvest in 1988.

Clearly, log exports from state lands must be viewed in a very different context in each state. In Oregon, restricting these exports cannot begin to offset the reduced future harvests from the federal lands. However, in Washington, log exports from state-owned lands represent a significant part of the total forest products industry and restricting this trade will have a devastating impact on the state.

If log exports are examined in the context of total regional timber supply, they have consistently accounted for between 20 and 25 percent of the total harvest since the early 1970's. (See Figure 4.) Log exports are simply not the villain. Log exports have not accounted for the problems facing the industry, rather most people in the industry recognize that the real problem is the recent reduced harvests from the federal lands.

While it is necessary to understand log exports as a factor in overall forest products demand in the Northwest, it is even more important to understand what has happened to the total demand for Northwest forest products since the recession year low of 1982. Demand for forest products changes dramatically over the course of a typical business cycle. In 1982, for example, the harvest from all lands in Washington and Oregon was only 10.8 billion board feet (versus 15.7 billion board feet in 1988). Since then, the total demand for Northwest forest products has significantly rebounded. In Washington and Oregon, since 1982,:

lumber production for the U.S. domestic market has increased from 7.1 billion board feet to 10.5 billion board feet in 1988;

shipments of export lumber have increased from 888 million board
feet to 1.8 billion board feet;

plywood and veneer production has recovered from 6.3 billion
square feet in 1982, to 9.5 billion square feet today; and

log exports shipments from the two states have increased from 2.6
billion board feet to 3.7 billion board feet in 1988.

This increased demand for forest products demonstrates that producers in the Northwest have regained their competitiveness and are able to compete with the Southeast U.S., Canada, the USSR, New Zealand and Chile.

In the Northwest, all of these demands are being supplied by the combined output of the National Forest, Bureau of Land Management, state, industrial and non-industrial timberlands. It is the total supply that we should direct our attention toward, rather than attempting to restrict access to overseas markets or to interfere with competitive flows of raw material within the Northwest.

As our industry looks at timber supply trends in Northwest, there is a great deal of
uncertainty surrounding the amount of timber that will be sold from National
Forest lands during the decade of the 1990's and beyond. This is the result of the
combined effects of: 1) the National Environmental Policy Act of 1969; 2) the
Endangered Species Act of 1973; 3) the National Forest Management Act of 1976
(NFMA) and other federal laws and regulations that the Forest Service must
operate within.

If the current, draft, preferred NFMA alternatives are implemented, National Forest
timber harvests in Washington will drop from 1.5 billion board feet in 1988 to 1.1
billion board feet in future years. In Oregon's National Forests, the timber harvest
will drop from 3.5 billion board feet in 1988 to 3.0 billion board feet in the future.
(See Figure 5.) This expected reduction in National Forest timber sales will be
even greater if additional spotted owl habitat requirements are implemented.

Figure 6 summarizes the allocated uses of Washington and Oregon's National
Forest lands once the preferred NFMA plans are adopted. In Washington, fully 72
percent of the state's 8.7 million acres of National Forest land are already
withdrawn from timber production, or primarily devoted to non-timber production.
An additional 2 million acres of National Parks and National Monuments are
reserved exclusively for recreation and wilderness use.

In Oregon, 13 percent of the state's 16.2 million acres of National Forest land are
already withdrawn from timber production, or primarily devoted to non-timber
production, with an additional 200.000 acres in Crater Lake National Park
reserved exclusively for recreation and wilderness use.

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Reductions in the annual harvest from federal lands are largely the result of public policy decisions. They have nothing to do with the physical availability of merchantable timber or the growth capacity of the lands. Long-term, the timber growing capacity of the federal lands under intensive management could allow increases in annual harvest, even with additional land dedicated to non-timber

uses.

There is enough timber inventory and enough federally owned land area in the Northwest to satisfy both environmental and forest industry objectives if the Forest Service is allowed the latitude to manage the National Forest lands to the limits of its professional ability.

The environmental community wants protection of representative, old growth ecosystems, protection of endangered species and preservation of sufficient Wilderness areas to serve the needs of a growing U.S. population.

The forest industry needs assurance of a stable, predictable harvest from the region's National Forests, the ability to complete development of the National Forest road system, and the ability to have timber sale contracts awarded without fear of disruption due to appeals or litigation.

We believe that it is possible to satisfy both objectives if two conditions can be

met:

1)

The Forest Service must be allowed to make fundamental land
allocation decisions through the planning processes prescribed by
the National Forest Management Act and Forest Land Management
Planning Act. There must be an established acreage base
managed primarily for timber production.

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