Freight Rates Continue to Increase

LOGISTICS MAGAZINE just forecasted that shipping costs would continue to increase throughout most of 2005. Most shippers currently are paying truckload fuel surcharges exceeding 10% of the base rate. Air, Ocean, and Rail rates were stable for first quarter of 2005 but forecasted to continue the rise witnessed in 2004. The most aggressive increases are believed to come from the LTL (Less than full truck load) carriers. During 2004, this segment charged increases over 9% for shipments under 500 pounds. Truck drivers are at the mercy of fuel prices!

Stora-Enso Reports on Paper market

Stora - Enso, the world's largest papermaker, reported that demand for most paper grades is good in both Europe and USA. Higher pricing has helped all manufactures profitability. The group also stated that price increases WILL continue
because of increased cost pressures. Stora Enso felt the coated paper market would witness more aggressive price
increases than the uncoated sector.

2004 Paper Capacity Information

The American Forest and Paper Association is beginning to release data for 2004
-Total US Paper and Paperboard capacity was 100million tons
-Forecast over next 3 years (2005-07) is for slight increase
-0.3% per year
-Compare to 2.2% / year during the 1990's
-Number of permanent mill shut downs
-Fell to 13 in 2002
-12 in 2003
-7 in 2004
-Machine closures
-40 in 2002
-39 in 2003
-21 in 2004
Concerns continue to be
-Competition from China and Europe
-Plastics
-Inefficient equipment - limited CAPEX
-Higher raw material costs - fiber, energy, freight

MeadWestvaco and International Paper Show Profit

Both International Paper (North America's largest paper manufacture) and MeadWestvaco(one of the largest coated magazine paper manufacture) reported improved profits for first quarter. International Paper's profit nearly doubled, assisted by a 13% increase in the price of uncoated book, envelope, and copy paper prices. MeadWestvaco sited their improvement as a result of increased pricing for magazine papers. Both mills announced that prices will continue to increase to offset the cost pressures from raw materials such as fiber, power, chemicals, and freight.

Applications for Synthetic Paper...

Yupo synthetic paper has been around for a long time in the commercial world and here is the most useful page in their site describing which synthetic paper is appropriate for which application:
Applications for Yupo synthetic paper



But, did you know that this polypropylene paper is PERFECT for watercolors?

Yes, its true. Art paper experts at paper powerhouse Legion Paper in New York confirm that you can paint watercolors on Yupo synthetic papers and that the pads are selling briskly to the art market. While traditional watercolor papers soak up the inks these synthetic papers are super smooth to the touch and do not look like watercolor papers available from traditional watercolor paper manufactueres such as (Rising, Strathmore, Aquarelle, Lanaquarelle...)

Who Sells the Most Paper in the USA...

This Just just in:

Headline: OP superstores grab majority of paper sales
Source: OPI
Date: 07 Apr 05

7 April 2005 – Newton (MA): The vast majority of small paper buyers buy their paper from the top three OP superstores - Staples, Office Depot and OfficeMax - a new survey has revealed.

In a study conducted by Lyra Research among paper buyers from businesses of up to 99 employees, three-quarters of respondents were found to purchase their paper from the ‘big three’.

Staples is the most popular channel, said Lyra, followed by Depot and then ’Max. The next most popular source is the mass-market retail/warehouse club channel, it said, with 11 per cent of respondents reporting that they buy their paper from Wal-Mart, Sam’s Club or Costco.

Next on the list came Boise Office Solutions and Xpedx with 2 per cent; and Corporate Express with 1 per cent.

End of article.

Next, go to this article dating from 2001:

OPI Online: Special Publications

Even though this article dates from 2001 it is a fascinating look at the office products industry. This article is basically the "cliff notes" version of the industry conference in which United Stationers, Corporate Express and other important office products dealers talked about the changing landscape of selling office products.

Since 2001 the fundamentals have not changed but we've seen even greater consolidation in the distribution of office products and paper companies and fewer independent operators. No wonder Boise bought OfficeMax.

In many respects Paper.com is the anti-Staples. Paper.com exists is because it is impossible to buy more than a few dozen different kinds of paper at the typical office supply warehouse. Paper merchants are just not capable of selling in small quantities. So, Paper.com was created to respond to the need for a great variety of papers available in small quantities.

Biggest Producers of Uncoated Papers

The five largest manufactures of Uncoated Printing and Writing grades in the USA are
International Paper 25% of market or 4million tons
Weyerhaeuser 19.5% of Market or 3million tons
Domtar 14.1% of market or 2.2million tons
Boise Cascade 10% of market or 1.5million tons
Georgia Pacific 7% of market or 1.1million tons

Uncoated Paper Market Segments

Uncoated printing and writing market can be divided into three major segments
-Copy Paper (also, known as cut-size) approx 5.5million tons produced/year
-Printing and Converting Paper (Offset, Envelope, Forms, Tablet) approx. 6.1million tons produced/year
-Text, Cover, Carbonless, Tag (special finish, colors, heavy weight) approx 1.6million tons produced / year

NCR Carbonless is recommended by Hewlett Packard

NCR Paper brand Xero/Form II (carried by www.paper.com) is the first carbonless paper that HP recommends for use on their LaserJet printers. This cost effective sheet is stocked in many sizes and collations on the paper.com site. Hewlett Packard endorses this grade because it provides advanced toner adhesion for clearer imaging and contributes to overall productivity. HP and NCR also report fewer jams, misfeeds, and turnovers.

News On Manufacturers - recap

>Mohawk / International Paper
-Mohawk Paper Mill will purchase the Fine Papers Unit from International Paper.
-Sites include the Hamilton, Ohio paper mill, the Saybrook, Ohio converting facility, and the Westfield, Mass mill.
- Brands include Strathmore®, Brite Hue®, Via®, and Beckett® brands.
-The Fine Papers business produces approximately 65,000 tons per year.
-This will effectively double Mohawk’s capacity.
>SPIN-OFF GOES PUBLIC
-Neenah Paper Inc., completed spin-off from Kimberly-Clark
-Neenah Paper core grades include premium Writing, Text and Cover business.
-Also, Technical Paper, durable, saturated and coated base papers; and, a Canadian pulp business.
>Appleton / CTI
CTI Paper USA announced the acquisition of the Currency and Jazz grade lines and trademarks from Appleton.
>Fraser Papers / SMART Papers
SMART Papers LLC to acquire Fraser Papers’ paper operations in Park Falls, Wisconsin.
-The purchase agreement includes a 470,000 square foot converting, distribution and customer service facility in West Chicago, Ill
>MeadWestvaco Sells Paper Unit
-MeadWestvaco Corp. has agreed to sell its paper business for $2.3billion.
Division sold to Cerberus Capital Management LP,
>International Paper continues to sell assets
International Paper will sell its Industrial Papers Business to Kohlberg & Company, LLC for $180MM.
-The sale includes two paper mills in Wisconsin, the Akrosil converting business and the Thilmany Packaging business.
-The business produces products like release liner for self-adhesive labels, paper for
microwave popcorn bags, refrigerated dough & potato chip canisters and other products.
>FiberMark still in Bankruptcy Status
FiberMark, the manufacture of filter, school/office, and wallpaper grades withdrew its bankruptcy-restructuring plan after failing to gain support of any of the creditors.
>Stora delays rebuild of No. 64 machine in Wisconsin
- Postponed the rebuild of the No. 64 machine in Whiting, WI.,
- Company has begun the rebuild of its No. 26 machine at Biron, WI.

Market Pulp

Northern Bleached Softwood Kraft (NBSK) list price is still holding steady at $680/mton - following February's increase of $30/mton. Also, March hikes on hardwood grades have gone in successfully, with northern hardwood pulp raising by $20/mton. There are further hikes of $20-30/mton on hardwood grades proposed for late April – early May, but NBSK prices are expected to remain flat. February shipments fell 0.8%YTD, but inventory days of supply fell from 34 to 32, as the market remains tight. Higher woodfree paper production volumes, switches from hardwood to softwood production, chip shortages, closures of some pulp mills have increased tightness in the hardwood market and now leads to Bleached Hardwood Kraft BHK price increase announcements. The spot prices for recovered paper are up in Asia.

Uncoated Free Sheet post $60/ton price increase; International Paper curtails Production

Most producers announced a March $60/ton hike on cut size (copier) and offset rolls. However, prices have been under pressure all quarter – transaction paper prices are down $10/ton and $15/ton in rolls and cut size, respectively. As previously noted, raw material costs are all rising - it's hard to believe uncoated white paper prices sliding too far.
Meanwhile, International Paper announced plans to curtail 120,000 tons of capacity from the market by the end of April – idling two machines.

Who Makes Digital Printers?

The Digital paper market is enjoying excellent growth and serves customers interested in personalized printing.
It is reported that the USA may now have over 1100 digital printers. Top of the line printers include Xerox iGen3,
HP Indigo, NexPress, Xeikon and Canon CLC.
The majority of the end uses are for direct mail, brochures, posters, and business cards - all applications that require
variable, personalized information on each piece of printed material.

Digital Papers see BIG Growth

Steady expansion of the digital (on demand) printers, and paper, has been reported. Current levels of ‘cut-size’ digital paper are now 6.2million tons a year and predicted to grow to over 8million by 2008. Many of Paper.com's papers
are specially designed for this market and are available in quantities as small as a 500 sheet package.
The right paper is important for successful reproduction. Properties such as brightness, smoothness, and formation all are very important.
Many new sheet sizes to compliment our 8 1/2 X 11" and 8 1/2X14" stock are becoming available. These new sizes include 14.33 X 20.5" ; 11X17" ; and 18X12". We market several digital grades offered by such mills as Domtar, International Paper, MeadWestvaco, Neenah, Smart, and Xerox. These are considered the leaders in this dynamic market.

It's Official International Paper sold Paper Mills

International Paper, North America's Largest paper maker, agreed to sell its Fine Paper Business to Mohawk Paper Mills for $65million. The deal will close early in the second quarter.
This division includes uncoated text, writing, cover and artist papers. The mills include Hamilton, Ohio (65,000tons); and converting locations in Saybrook, Ohio and Westfield, Mass. The sale means Mohawk will market Strathmore, Brite Hue, Via, and Beckett. Paper.com proudly distributes all these grades and will enjoy non interupted service.

International Paper continues to progress with selling the Industrial Paper unit to Kohlberg & Co. Current terms include mills in DePere and Kaukauna, Wisconsin for $180million.