U.S. Printing/Writing Paper Shipments end 2005 on Slight Downtrend

FROM paperloop.com - U.S. shipments of most of the major printing/writing paper grades at 24.58 million tons overall in 2005 were 441,000 tons or 1.8% lower than the 25.02 million tons reported in 2004, according the latest American Forest and Paper Association statistics.

Pulp Prices on the Increase

The American Forest and Paper Association reported that market pulp producers increased deliveries over 8% in December (compare to November). Spot prices for pulp are firming and reports outline clients with lowest prices witnessed an increase of $15/ton. Paper.com predicts the pulp market will soon announce a formal price increase of @$20/ton accross the board.

Newspapers still weak

Newspaper circulation, and thus paper consumption, continues to decline. The trends in newspaper readership mirror the increasing migration of advertising dollars to the web. Ironically, the newspapers that support a web have done well on the web segment of their business; however, with less people relying on the 'printed word' for advertisements and classified the paper used for newspapers has declined in demand.

Uncoated Market Firms UP!!

What a difference a new year makes. The producers of uncoated woodfree papers announced a price increase of $45/ton on rolls for this month, and just announced a price increase for the cut size (copy papers) effective for shipments in February. The markets have all suddenly become tight with supply.

More North American Paper Plants Close

Early reports are confirming that over 6.5million tons of paper manufacturing capacity has permanently been shuttered in North America, based on 2005 announcements. Most of these shut downs were producers in Canada. The industry continues to punish inefficient producers.

Newsprint Manufactures Attempt Price Increase

The North American producers of Newsprint (grade of paper used for printing most newspapers) have announced a price increase effective for February shipments. This increase was first announced by Abitibi-Consolidated, and the balance of the industry appears to be supporting this decision.

Energy Prices will Stay High

Crude oil prices soared last year amid strong demand and tight supplies, and could rise even higher in 2006 as the U.S. implements clean fuel rules and world energy needs remain strong. The Paper industry, a large consumer of energy, will certainly feel the cost pressures and continue to attempt price increases.

The 2005 average U.S. price for a barrel of crude oil was just under $57, a new record and an increase of 37% from the 2004 average price of just above $41. Despite expectations of tighter supply and high prices, experts at the U.S. Energy Information Administration say demand growth will remain resilient. Tougher U.S. sulfur requirements for gasoline and diesel could cut supplies as refiners shut plants to revamp units, and foreign suppliers find other markets with less stringent regulations, slashing U.S. imports.

Pulp Prices remain Stable

North America pulp pricing for NBSK (Northern Bleached Softwood Kraft) remained constant for the month of December. List price remained at $640/mt; however, NBHK (hardwood) declined $5/mt to $615. Many of the producers have announced a price increase for January of $20/mt. Many producers continue to be hurt with increased energy costs.

WS Packaging Purchases Narrow web Division of Renaissance Mark

WS Packaging Group purchased the narrow-web division of labelmaker Renaissance Mark on Dec. 1. The deal includes facilities in Fullerton, CA; Monterey, Mexico; Skokie, IL; and Scranton, PA.
"The Fullerton location will add to our growing West Coast presence and complement the recent acquisition of Ampersand Label in Garden Grove, CA," says WS chairman Terry Fulwiler. "Of special interest in this transaction is the Monterey, Mexico facility, which becomes the first international division within WS Packaging Group."
With its latest acquisition, WS Packaging now has 18 manufacturing plants with projected 2006 sales of more than $300 million.

International Paper Settles Lawsuits

International Paper Company, the worlds largest producer of paper, agreed to pay $18.7 million to settle lawsuits by customers that accused them of fixing prices on boxes and related paper.

NewPage Considers sale of Chillicothe, Ohio sites

NewPage Corp. has found a potential buyer for its two Chillicothe facilities. These plants produce uncoated freesheet paper at an integrated mill and coated paper at a converting facility.