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Diminishing quantities of appearance grade lumber and rising price premiums for it have accompanied the transitionfrom old-growth to young-growth timber. The pricepremiums for better grades are an incentive forproducers to undertake investments to increase the yield of those higher valuedproducts. Price premiums, however, arealsoan incentive forusers tosubstitute lowergrades, lowerpricedspecies, ornonwood materials for these higherpriced appearance grades. Thispossibiliry may cast doubt on the pemnce of the price premiums associated with appearance grode lumber. The real price premiums paid for appearance grades of lumberfrom January 1989 through October 1995 were substantial and quite stable during a widely fluctuating softwood lumber market. We found little or no evidence to suggest that these premiums are either "temporary" or are in decline. Although care is required in extrapolating these findings overfuture long time horizons typically required forsilvicultural investments in wood quality changes, the results of this study may help forest managers better understand the possible magnitude of real price premiums to use in evaluating those investments. West. J. Appl. For. 14(2):73-79. TO better meet the wood quality needs of the wood process- price premiums for higher grades of appearance grade soft- ing industry, foresters in the Pacific Northwest are currently wood lumber will likely be sustained with an increase in assessing whether intensive silvicultural treatments such as second-growth timber. thinning and pruningrepresent a viable economic strategy for producing increased volumes of higher valued clearwood Clearwood and Wood Quality lumber. Recent research indicates that intensive forest man- agement is probably the best method for improving the Manufacturers of secondary softwood forest products in

Clearwood Quality and Softwood Lumber Prices: What's the Real Premium?