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UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549

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FORM 10-Q

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(Mark One)

|/x/ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|--- | ---------------------------------------------------------------------------------------

For the quarterly period ended March 31, 2000

OR

|/ / | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|--- | ----------------------------------------------------------------------------------------

For the transition period from  to

Commission file number 0-24976

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CROWN PACIFIC PARTNERS, L.P.(Exact name of registrant as specified in its charter)

|Delaware(State or other jurisdiction of
incorporation or organization)                       |  | 93-1161833(I.R.S. Employer Identification No.)
|-------------------------------------------------------------------------------------------- |  | ----------------------------------------------
|121 SW Morrison Street,
Suite 1500, Portland, Oregon(Address of principal executive offices) |  | 97204(Zip Code)                               

Registrant's
telephone number, including area code:503-274-2300

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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes /x/  No / /

Indicate
the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date.

|Common Units |  | 30,410,906                   
|------------ |  | -----------------------------
|(Class)      |  | (Outstanding at May 12, 2000)

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## 

CROWN PACIFIC PARTNERS, L.P.   FORM 10-Q   INDEX

|                             |  |                                                                                       |  | Page
|---------------------------- |  | ------------------------------------------------------------------------------------- |  | ----
|PART IFINANCIAL INFORMATION |  |                                                                                      
|Item 1.                      |  | Financial Statements                                                                  |  |     
|                             |  | Consolidated Statement of IncomeQuarters Ended March 31, 2000 and 1999               |  | 2   
|                             |  | Consolidated Balance SheetMarch 31, 2000 and December 31, 1999                       |  | 3   
|                             |  | Consolidated Statement of Cash FlowsQuarters Ended March 31, 2000 and 1999           |  | 4   
|                             |  | Notes to Consolidated Financial Statements                                            |  | 5   
|Item 2.                      |  | Management's Discussion and Analysis of Financial Condition and Results of Operations |  | 9   
|Item 3.                      |  | Quantitative and Qualitative Disclosures About Market Risk                            |  | 14  
|PART IIOTHER INFORMATION    |  |                                                                                      
|Item 6.                      |  | Exhibits and Reports on Form 8-K                                                      |  | 15  
|Signatures                   |  | 16                                                                                   

1



## 

PART IFINANCIAL INFORMATION

Item 1. Financial Statements

Crown Pacific Partners, L.P.

Consolidated Statement of Income

(In thousands, except unit and per unit data)

(Unaudited)

|                                             |  | For the Quarter
Ended March 31,
|-------------------------------------------- |  | -------------------------------
|
|Revenues                                     |  | $                              
|Operating costs:                             |  |                                
|Cost of products sold                        |  |                                
|Selling, general and administrative expenses |  |                                
|                                             |  |                                
|Operating income                             |  |                                
|Interest expense                             |  |                                
|Amortization of debt issuance costs          |  |                                
|Other expense (income), net                  |  |                                
|                                             |  |                                
|Net income                                   |  | $                              
|                                             |  |                                
|Net income per unit                          |  | $                              
|                                             |  |                                
|Weighted average units outstanding           |  |                                
|                                             |  |                                

The
accompanying notes are an integral part of this financial statement

2



Crown Pacific Partners, L.P.

Consolidated Balance Sheet

(In thousands, except unit data)

|                                                                                                                     |  | March 31,
2000 |         | December 31, 1999
|-------------------------------------------------------------------------------------------------------------------- |  | -------------- | ------- | -----------------
|
|Assets                                                                                                              
|Current assets:                                                                                                      |  |                |         |                  
|Cash and cash equivalents                                                                                            |  | $              | 25,639  |                  
|Accounts receivable, net of allowances for doubtful accounts of $1,156 and $1,091                                    |  |                | 113,347 |                  
|Notes receivable                                                                                                     |  |                | 3,313   |                  
|Inventories                                                                                                          |  |                | 63,799  |                  
|Deposits on timber cutting contracts                                                                                 |  |                | 2,337   |                  
|Prepaid and other current assets                                                                                     |  |                | 1,931   |                  
|                                                                                                                     |  |                |         |                  
|Total current assets                                                                                                 |  |                | 210,366 |                  
|Property, plant and equipment, net of accumulated depreciation of $38,037 and $35,863                                |  |                | 61,367  |                  
|Timber, timberlands and roads, net                                                                                   |  |                | 634,163 |                  
|Intangible assets, net of accumulated amortization                                                                   |  |                | 34,386  |                  
|Other assets                                                                                                         |  |                | 23,723  |                  
|                                                                                                                     |  |                |         |                  
|Total assets                                                                                                         |  | $              | 964,005 |                  
|                                                                                                                     |  |                |         |                  
|Liabilities and Partners' Capital                                                                                   
|Current liabilities:                                                                                                 |  |                |         |                  
|Notes payable                                                                                                        |  | $              | 28,000  |                  
|Accounts payable                                                                                                     |  |                | 40,855  |                  
|Accrued expenses                                                                                                     |  |                | 24,638  |                  
|Accrued interest                                                                                                     |  |                | 13,460  |                  
|Current portion of long-term debt                                                                                    |  |                | 169     |                  
|                                                                                                                     |  |                |         |                  
|Total current liabilities                                                                                            |  |                | 107,122 |                  
|Long-term debt                                                                                                       |  |                | 656,081 |                  
|Other non-current liabilities                                                                                        |  |                | 1,637   |                  
|                                                                                                                     |  |                |         |                  
|                                                                                                                     |  |                | 764,840 |                  
|                                                                                                                     |  |                |         |                  
|Commitments and contingent liabilities                                                                               |  |                |         |                  
|Partners' capital:                                                                                                   |  |                |         |                  
|General partners                                                                                                     |  |                | 1,308   |                  
|Limited partners (30,410,906 and 30,301,248 units outstanding at March 31, 2000 and December 31, 1999, respectively) |  |                | 197,857 |                  
|                                                                                                                     |  |                |         |                  
|Total partners' capital                                                                                              |  |                | 199,165 |                  
|                                                                                                                     |  |                |         |                  
|Total liabilities and partners' capital                                                                              |  | $              | 964,005 |                  
|                                                                                                                     |  |                |         |                  

The
accompanying notes are an integral part of this financial statement

3



Crown Pacific Partners, L.P.

Consolidated Statement of Cash Flows

(In thousands)

(Unaudited)

|                                                                                              |  | For the Quarter
Ended March 31, |        
|--------------------------------------------------------------------------------------------- |  | ------------------------------- | -------
|
|Cash flows from operating activities:                                                         |  |                                 |        
|Net income                                                                                    |  | $                               | 8,263  
|Adjustments to reconcile net income to net cash provided by operating activities:             |  |                                 |        
|Depletion, depreciation and amortization                                                      |  |                                 | 15,061 
|Gain on sale of property                                                                      |  |                                 | (605   
|Net change in current assets and current liabilities, net of effects of business combination: |  |                                 |        
|Accounts and notes receivable                                                                 |  |                                 | (16,374
|Inventories                                                                                   |  |                                 | (6,791 
|Deposits on timber cutting contracts                                                          |  |                                 | (57    
|Prepaid and other current assets                                                              |  |                                 | 259    
|Accounts payable and accrued expenses                                                         |  |                                 | 2,808  
|                                                                                              |  |                                 |        
|Net cash provided by operating activities                                                     |  |                                 | 2,564  
|                                                                                              |  |                                 |        
|Cash flows from investing activities:                                                         |  |                                 |        
|Additions to timberlands                                                                      |  |                                 | (79,218
|Additions to timber cutting rights                                                            |  |                                 | (3,343 
|Additions to equipment                                                                        |  |                                 | (12,224
|Proceeds from sales of property                                                               |  |                                 | 439    
|Deposit on future asset sale                                                                  |  |                                 | 4,200  
|Principal payments received on notes                                                          |  |                                 | 586    
|Purchase of business                                                                          |  |                                 | (3,511 
|Other investing activities                                                                    |  |                                 | (960   
|                                                                                              |  |                                 |        
|Net cash used by investing activities                                                         |  |                                 | (94,031
|                                                                                              |  |                                 |        
|Cash flows from financing activities:                                                         |  |                                 |        
|Net increase in short-term borrowings                                                         |  |                                 | 28,000 
|Proceeds from issuance of long-term debt                                                      |  |                                 | 84,444 
|Repayments of long-term debt                                                                  |  |                                 | (729   
|Contributions of capital                                                                      |  |                                 | 980    
|Distributions to partners                                                                     |  |                                 | (17,481
|Debt and equity issuance costs                                                                |  |                                 |       
|Other financing activities                                                                    |  |                                 | 276    
|                                                                                              |  |                                 |        
|Net cash provided by financing activities                                                     |  |                                 | 95,490 
|                                                                                              |  |                                 |        
|Net increase in cash and cash equivalents                                                     |  |                                 | 4,023  
|Cash and cash equivalents at beginning of period                                              |  |                                 | 21,616 
|                                                                                              |  |                                 |        
|Cash and cash equivalents at end of period                                                    |  | $                               | 25,639 
|                                                                                              |  |                                 |        

The
accompanying notes are an integral part of this financial statement

4



CROWN PACIFIC PARTNERS, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per unit amounts or as otherwise indicated)

(Unaudited)

1: Organization and Basis of Presentation

Crown Pacific Partners, L.P. ("Crown Pacific" or the "Partnership"), a Delaware limited partnership, through its 99% owned subsidiary, Crown Pacific Limited
Partnership (the "Operating Partnership"), was formed in 1994 to acquire, own and operate timberlands and wood product manufacturing facilities located in the northwest United States. The
Partnership's business consists primarily of growing and harvesting timber for sale as logs in domestic and export markets and the manufacturing and selling of lumber and other wood products.

The
financial statements included in this Form 10-Q are unaudited and reflect the consolidated financial position, results of operations and cash flows of the
Partnership. These financial statements include all the accounts of the Partnership but do not contain all of the information required by generally accepted accounting principles to be included in a
full set of financial statements. The financial statements in the Partnership's 1999 annual report on Form 10-K, which includes a summary of significant accounting policies of the
Partnership, should be read in conjunction with this Form 10-Q. In the opinion of management, all material adjustments necessary to present fairly the results of operations for the
three-month periods ended March 31, 2000 and 1999 have been included. All such adjustments are of a normal and recurring nature and all significant intercompany transactions have been
eliminated. The results of operations for any interim period are not necessarily indicative of the results of operations for the entire year.

Net
income per unit was calculated using the weighted average number of common and subordinated units outstanding divided into net income, after adjusting for the General Partner
interest.The General Partner income allocation was $83 and $77 for the three months ended March 31, 2000 and 1999, respectively. There is no
significant difference between basic and diluted earnings per unit.

Note 2: Inventories

Inventories, consisting of lumber and logs, are stated at the lower of LIFO cost or market. Supplies and inventories maintained at
non-manufacturing locations are valued at the lower of average cost or market. Inventories consisted of the following:

|                        |  | March 31, 2000 |        | December 31, 1999
|----------------------- |  | -------------- | ------ | -----------------
|Lumber                  |  | $              | 11,341 |                  
|Logs                    |  |                | 16,353 |                  
|Supplies                |  |                | 3,451  |                  
|LIFO reserve            |  |                | 1,517  |                  
|                        |  |                |        |                  
|Manufacturing inventory |  |                | 32,662 |                  
|Wholesale products      |  |                | 31,137 |                  
|                        |  |                |        |                  
|Total                   |  | $              | 63,799 |                  
|                        |  |                |        |                  

Note 3: Timber, Timberlands and Roads

In the first quarter of each year, the Partnership performs an update of its timber inventory system. The update resulted in a net increase in depletion costs
for the first quarter of 2000 of

5



approximately
$0.2 million, or $0.01 per unit, and a net decrease in depletion costs for the first quarter of 1999 of approximately $0.2 million, or $0.01 per unit, with no impact on
cash flow.

Note 4: Supplemental Cash Flow Information

Supplemental disclosure of cash flow information is as follows:

|                                              |  | Three months ended
March 31,
|--------------------------------------------- |  | ----------------------------
|
|Cash paid during the period for interest      |  | $                           
|Business assets acquired with debt and equity |  |                             

Note 5: Acquisitions

On January 6, 2000 Crown Pacific acquired Cheshire Sales Company Inc. of Albuquerque, New Mexico for $5.5 million, consisting of
$3.7 million in cash, $1.2 million in Partnership units and $0.6 million in assumed debt. The acquisition was accounted for as a purchase. Pro forma results of operations are not
significantly different from actual results of operations for the first quarter of 2000 and 1999.

On
January 14, 2000 Crown Pacific acquired 91 thousand acres of timberland in Idaho from Plum Creek Timber Company for $73.4 million. The acquisition was financed
using the Partnership's Acquisition Line of Credit.

Note 6: Segment Reporting

The Partnership classifies its operations into three fundamental businesses: (1) Timberlands, consisting of the sale of logs to the Partnership's
manufacturing facilities and to third parties, and the sale of timber and timberlands to third parties; (2) Manufacturing, consisting of the manufacture of logs into lumber and the sale of
residual chips to pulp and paper mills; and (3) Wholesale Marketing, consisting of the trading of various forest products and distribution of lumber and panel products through the Partnership's
professional contractor service yards. Corporate and Other includes general corporate overhead and expenses (such as LIFO) not allocated to the segments and miscellaneous operations not significant
enough to be classified as a separate segment. The Partnership does not show assets by segment, as historic costs are not used by management to allocate resources or assess performance. Transfers
between segments are generally at prices which management believes reflect current market prices.

6



The
following summarizes the Partnership's segment information:

|                     |  | Three Months Ended
March 31, |        
|-------------------- |  | ---------------------------- | -------
|
|
|Timberlands:         |  |                              |        
|Trade                |  | $                            | 34,996 
|Intersegment         |  |                              | 63,434 
|                     |  |                              |        
|                     |  |                              | 98,430 
|Manufacturing:       |  |                              |        
|Trade                |  |                              | 67,935 
|Intersegment         |  |                              | 3,682  
|                     |  |                              |        
|                     |  |                              | 71,617 
|Wholesale Marketing: |  |                              |        
|Trade                |  |                              | 125,697
|Intersegment         |  |                              | 11,980 
|                     |  |                              |        
|                     |  |                              | 137,677
|Corporate and Other: |  |                              |        
|Trade                |  |                              | 3,095  
|Intersegment         |  |                              | 815    
|                     |  |                              |        
|                     |  |                              | 3,910  
|Total:               |  |                              |        
|Total Revenue        |  |                              | 311,634
|Less Intersegment    |  |                              | (79,911
|                     |  |                              |        
|Net Revenue          |  | $                            | 231,723
|                     |  |                              |        

|                    |  | Three Months Ended
March 31, |        
|------------------- |  | ---------------------------- | -------
|
|
|Timberlands         |  | $                            | 18,375 
|Manufacturing       |  |                              | 5,019  
|Wholesale           |  |                              | 4,630  
|Corporate and Other |  |                              | (5,817 
|                    |  |                              |        
|Operating Income    |  |                              | 22,207 
|Interest Expense    |  |                              | (14,126
|Other               |  |                              | 182    
|                    |  |                              |        
|Net Income          |  | $                            | 8,263  
|                    |  |                              |        

7



Note 7: Subsequent Events

On April 18, 2000, the Board of Control authorized the Partnership to make a distribution of $0.564 per unit. The total distribution will be
$17.5 million (including $355 to the General Partners) and will be paid on May 15, 2000 to unitholders of record on May 5, 2000.

8



## 

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

General

Crown Pacific's principal operations consist of the growing and harvesting of timber, the sale of logs and the processing and sale of lumber and other wood
products. The Partnership's ability to implement its business strategy over the long term and its results of operations depend upon a number of factors, many of which are beyond its control. These
factors include general industry conditions, domestic and international prices and supply and demand for logs, lumber and other wood products, seasonality and competition from other supplying regions
and substitute products. In March 2000, the Partnership announced that it retained an investment banking firm to explore strategic alternatives to enhance value for the Partnership's
unitholders, including the possible sale of the Partnership.

Forward-Looking Statements

Information contained in Item 2 and other sections of this report include forward-looking statements including statements regarding the Partnership's
expectations, hopes, beliefs, intentions or strategies regarding the future that are not purely historical, but are based on assumptions that in the future may prove not to be accurate. The
Partnership's business and prospects are subject to a number of risks, including the volatility of global timber and lumber prices and supplies, factors limiting harvesting of timber including
contractual obligations, governmental restrictions, weather and access limitations, as well as the substantial capital expenditures required to supply its operations.

Additional
factors that could affect future performance include environmental risks, operating risks normally associated with the timber industry, competition, government regulation
and economic changes in the regions where the Partnership's products are sold, including Southeast Asia and Japan. Other risk factors include the value of the U.S. dollar against foreign currencies
and the ability of the Partnership to implement its business strategy. These and other risks are described in the Partnership's registration statements and reports filed from time to time on forms
10-K, 8-K and 10-Q and reports to unitholders, which are available from the Partnership or the United States Securities and Exchange Commission.

Financial Condition

The Partnership's primary sources of liquidity have been cash provided by operating activities as well as debt and equity financings.

Cash
provided by operating activities was $2.6 million for the three-month period ended March 31, 2000 and resulted primarily from net income of $8.3 million, net
non-cash expenses of $14.5 million and an increase in accounts payable and accrued expenses of $2.8 million, offset by an increase in accounts and notes receivable of
$16.4 million and an increase in inventories of $6.8 million. Working capital decreased to $103.2 million at March 31, 2000 compared to $111.3 million at
December 31, 1999.

Net
cash used in investing activities of $94.0 million resulted primarily from the acquisition of 91 thousand acres of timberland in Idaho from Plum Creek Timber Company
for $73.4 million, the acquisition of Cheshire Sales Company, Inc. for $3.5 million and additions to timberlands, equipment and timber cutting rights of $15.6 million.

Net
cash provided by financing activities of $95.5 million resulted primarily from a $28.0 million net increase in short-term borrowings and
$83.7 million net increase in long-term debt, offset by distributions to partners of $17.5 million.

Cash
required to meet the Partnership's quarterly cash distributions (as required by the Partnership Agreement), to pay for capital expenditures and to satisfy interest and principal
payments on

9



indebtedness,
will be significant. Additions to property, plant and equipment totaled $12.2 million in the first quarter of 2000 and are expected to total approximately $37.0 million
during 2000. Additions to timber and timberland purchases are evaluated as opportunities arise and totaled $79.2 million in the first quarter of 2000. The Managing General Partner expects that
capital expenditures will be funded by a combination of any or all of the following: property sales, cash generated from operations, current funds or bank borrowings. The Partnership expects to make
cash distributions from its current funds and from cash generated by operating activities.

The
Partnership plans to spend approximately $20.0 million (included in the $37.0 million total above) in 2000 on a new small log line at its Gilchrist mill, which will
be funded with bank financing. In addition, the Partnership closed its acquisition of approximately 91 thousand acres of northern Idaho timberlands in January 2000 for
$73.4 million, which was funded with bank borrowings under the Partnership's acquisition facility.

The
Partnership has a $58 million revolving credit facility with a group of banks for working capital purposes and stand-by letters of credit that expire on
December 1, 2002. The revolving credit facility was increased by $2.0 million in January 2000 due to an additional bank joining the credit group. The credit facility bears a
floating rate and is unsecured. At March 31, 2000, the Partnership had $28.0 million outstanding under this facility.

The
Partnership has a revolving acquisition line of credit with a group of banks to provide for a $232 million three-year revolving line of credit for the
acquisition of additional timber, timberlands and related assets and capital expenditures. The acquisition line was increased by $8.0 million in January 2000 due to an additional bank
joining the credit group. The acquisition facility bears a floating rate of interest, is unsecured and expires December 1, 2002. At the end of the revolving period, the Partnership may elect to
convert any outstanding borrowings under this facility to a four-year term loan, requiring quarterly principal payments equal to 6.25% of the outstanding principal balance on the
conversion date. At March 31, 2000, the Partnership had $167.3 million outstanding under this facility, with a weighted average interest rate of 7.52%.

The
Partnership's 9.78%, 9.60%, 8.17% and 7.8% senior notes, issued in 1994, 1995, 1996 and 1998, respectively, are unsecured and require semi-annual interest payments
through 2018. These senior notes, with an aggregate $486 million principal amount, require the Partnership to make an aggregate principal payment of $37.5 million on December 1,
2002, and annual principal payments in various amounts from December 1, 2003 through 2018. The senior notes are redeemable prior to maturity, subject to a premium on redemption based on
interest rates of U.S. Treasury securities having a similar average maturity as the senior notes, plus 50 basis points.

C.P.
Air, a subsidiary of the Partnership borrowed $2.7 million in January 2000 to finance a new aircraft. The debt bears interest at 8.25%, is secured by the aircraft
and requires monthly payments of $26,000 including interest.

All
of the Partnership's senior note agreements and bank lines of credit contain certain restrictive covenants, including limitations on harvest levels, land sales, cash distributions
and the amount of future indebtedness. The Partnership was in compliance with such covenants at March 31, 2000.

Results of Operations

Three Months Ended March 31, 2000 compared to Three Months Ended March 31, 1999

General

Net revenues during the first quarter ended March 31, 2000 increased 34.5% to $231.7 million, from $172.3 million in the same quarter of
1999. The $59.4 million increase reflects improved sales from the Partnership's timberland, manufacturing and wholesale marketing operations.

10



Cost
of sales as a percentage of sales increased to 85.5% in the first quarter of 2000, compared to 83.1% in the same quarter of 1999. The increase is primarily the result of a larger
portion of the Partnership's revenue being derived from its wholesale operations, which operate at a lower margin, increased purchased log volume (which are typically higher cost than fee logs) and
lower property sales, which were only partially offset by increases in log and lumber sales and lower manufacturing costs.

Selling,
general and administrative expenses increased $2.4 million to $11.4 million in the first quarter of 2000, compared to $9.0 million in the first quarter
of 1999, primarily as a result of the growth of the wholesale operations, higher corporate overhead and costs incurred in relation to the Partnership's strategic initiative to improve unitholder
value. Selling, general and administrative expenses represented 4.9% of sales in the first quarter of 2000 and 5.2% of sales in the same quarter of 1999.

Interest
expense increased $2.0 million to $14.1 million in the first quarter of 2000, from $12.1 million in the same quarter of 1999. The increase is a result of
higher debt balances in the first quarter of 2000 due primarily to the purchase of the Plum Creek timberlands in the first quarter of 2000 for $73.4 million, which was financed using the
Partnership's Acquisition Line of Credit.

The
Partnership pays no significant income taxes and does not include a provision for income taxes in its financial statements.

Timberlands

Total external log sales, including property and stumpage sales, increased 5.7% to $35.0 million, or 15.1% of revenue in the first quarter of 2000,
compared to $33.1 million, or 19.2% of revenue in the first quarter of 1999. Internal sales of logs to manufacturing increased $24.0 million to $63.4 million in the first quarter
of 2000 from $39.4 million in the first quarter of 1999 as a result of increased demand and utilization at all of the Partnership's mills, particularly the Bonners Ferry, Idaho and Port
Angeles, Washington sawmills, and a transfer of internal ownership of log inventories to the sawmills from the tree farms.

Overall
operating income from timberlands, including property sales, increased 9.8% to $18.4 million in the first quarter of 2000 from $16.7 million in the first quarter
of 1999, primarily as a result of a 19.6% increase in log sales volume and a 6.7% decrease in average sales realizations compared to the first
quarter of 1999, which were partially offset by higher purchased log costs, increased administrative expenses and lower property sales income during the current quarter.

Domestic Log Sales

Average external domestic prices received for logs sold from the various tree farms, including stumpage but excluding pulpwood, were as follows:

|                   |  | Quarter Ended
March 31, |         |  |  
|------------------ |  | ----------------------- | ------- |  | -
|
|
|Olympic tree farm  |  | $                       | 468/MBF |  | $
|Oregon tree farm   |  | $                       | 500/MBF |  | $
|Inland tree farm   |  | $                       | 292/MBF |  | $
|Hamilton tree farm |  | $                       | 507/MBF |  | $
|Weighted average   |  | $                       | 376/MBF |  | $

Increases
at the Olympic, Oregon and Hamilton tree farms are primarily a result of higher market prices for delivered logs.

11



The
decrease at the Inland tree farm is a result of increased stumpage sales (which typically have lower realizations but higher margins), which were partially offset by higher market
prices for delivered logs.

Domestic
external log sales volumes increased 20.4% in the first quarter of 2000 to 75.1 million board feet (MMBF), compared to 62.4 MMBF in the same quarter of 1999, primarily
as a result of stumpage sales on the Inland and Oregon tree farms. The external volume from each of the Partnership's tree farms was as follows (in thousands of board feet (MBF)):

|                   |  | Quarter Ended
March 31, |  |        | 
|------------------ |  | ----------------------- |  | ------ | 
|
|
|Olympic tree farm  |  | 15,326                  |  | 23,114 | 
|Oregon tree farm   |  | 6,684                   |  | 1,752  | 
|Inland tree farm   |  | 42,790                  |  | 22,478 | 
|Hamilton tree farm |  | 10,347                  |  | 15,047 | 
|                   |  |                         |  |        | 
|Total              |  | 75,147                  |  | 62,391 | 
|                   |  |                         |  |        | 

Export Log Sales

Sales of logs to customers involved in exporting activities (included in total log sales above) were approximately $2.2 million, or 0.9% of sales in the
first quarter of 2000, compared to $2.0 million, or 1.2% of sales for the same quarter in 1999. Prices received for export logs increased 5.3% to $657/MBF while sales volumes increased 3.2% to
3,352 MMBF in the first quarter of 2000 from levels experienced in the same quarter of 1999. The increases in price and volume are primarily a result of increased demand and increased sales of higher
value Douglas-fir logs during the first quarter of 2000.

Property Sales

Revenue and operating income from property sales in the first quarter of 2000 were $1.1 million and $0.6 million, respectively, compared to
$2.7 million and $1.3 million, respectively in the first quarter of 1999. Continued sales and/or trades are expected as part of the Partnership's ongoing strategy of both capturing and
reinvesting the value of non-strategic timberlands.

Manufacturing

Sawmill sales, excluding sales of lumber products through the wholesale division, were $67.9 million, or 29.3% of sales in the first quarter of 2000,
compared to $55.3 million, or 32.1% of sales in the same quarter of 1999. The increased revenues reflect increased production and strong demand.

Operating
income from manufacturing increased 95.0% to $5.0 million in the first quarter of 2000 from $2.6 million in the first quarter of 1999. The increase is
primarily a result of a 20.0% increase in lumber
sales volume, a 4.2% increase in overall sales realizations and lower manufacturing costs.

12



Average
external prices received for lumber in the various regions were as follows:

|                 |  | Quarter Ended
March 31, |         |  |  
|---------------- |  | ----------------------- | ------- |  | -
|
|
|Oregon           |  | $                       | 608/MBF |  | $
|Inland           |  | $                       | 379/MBF |  | $
|Washington       |  | $                       | 319/MBF |  | $
|Weighted average |  | $                       | 445/MBF |  | $

The
increases are primarily the result of generally higher market pricing, particularly for low-end lumber grades manufactured at the Gilchrist, Oregon mill, improved
grade mixes and the sale of more dry lumber (than lower priced green lumber).

External
lumber sales volumes increased 20.2% in the first quarter of 2000 to 144.5 MMBF compared to 120.2 MMBF in the same period of 1999. External sales volumes from the various
regions were as follows (in MBF):

|           |  | Quarter Ended
March 31, |  |         | 
|---------- |  | ----------------------- |  | ------- | 
|
|
|Oregon     |  | 46,153                  |  | 44,324  | 
|Inland     |  | 62,865                  |  | 50,815  | 
|Washington |  | 35,502                  |  | 25,109  | 
|           |  |                         |  |         | 
|Total      |  | 144,520                 |  | 120,248 | 
|           |  |                         |  |         | 

The
increases are primarily the result of improved production and operating efficiencies, especially at the Bonners Ferry, Idaho and Port Angeles, Washington sawmills and declines in
inventory levels in certain regions. Sales volume in the Oregon region will be negatively impacted in the third quarter of 2000 as plans to revamp the Gilchrist sawmill and install a new small log
line are implemented. The Gilchrist project should be completed during fall 2000.

Wood
chip revenues accounted for 1.7% of sales in the first quarter of 2000, compared to 1.8% of sales in the same quarter of 1999. Residual wood chip prices remained flat at $68/BDU
in the first quarter of 2000 compared to the first quarter of 1999. Chip prices are expected to increase modestly during 2000 in response to improved pulp industry operating demand.

Wholesale Marketing

External revenues from sales by the Partnership's wholesale operations consisted of lumber and other wood products, most of which were not manufactured by the
Partnership, and totaled $125.7 million, or 54.2% of sales in the first quarter of 2000, compared to $80.2 million, or 46.5% of sales in the first quarter of 1999. Operating income from
wholesale operations increased 40.3% to $4.6 million in the first quarter of 2000 from $3.3 million in the first quarter of 1999. The increases in revenue and operating income are a
result of the acquisition of Desert Lumber in March 1999 and the acquisition of Cheshire Sales Company Inc. in January 2000, as well as continued growth at both the Eugene
Wholesale and Alliance Lumber operations.

New Accounting Pronouncements

In June 1999, the FASB issued Statement of Financial Accounting Standards No. 137, "Accounting for Derivative Instruments and Hedging Activities"
("SFAS 137"). SFAS 137 is an amendment to Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and

13



Hedging
Activities". SFAS 137 establishes accounting and reporting standards for all derivative instruments. SFAS 137 is effective for fiscal years beginning after June 15, 2000.
The Partnership does not currently have any derivative instruments and, accordingly, does not expect the adoption of SFAS 137 to have an impact on its financial position or results of
operations.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

The
Partnership's only financial instruments with market risk exposure are its variable rate lines of credit. At March 31, 2000, the Partnership had $195.3 million
outstanding under its lines of credit with a weighted average interest rate of 7.79%. A hypothetical 10 percent increase in interest rates to 8.57% would not have a material impact on the
Partnership's cash flows.

14



## 

PART IIOTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K

(a) The exhibits filed as part of this report are listed below and this list is intended to serve as the exhibit index:

|Exhibit No. and Description
|---------------------------
|10                         
|27                         

(b) Reports on Form 8-K:

There were no reports on Form 8-K filed during the quarter ended March 31, 2000.

15



## 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.

|Date: May 12, 2000 |  | CROWN PACIFIC PARTNERS, L.P.
|------------------ |  | ----------------------------
|                   |  | By:                         
|                   |  | By:                         

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