Publication Papers Decline

Mills such as Verso (100,000tons) and NewPage (150,000tons) continue to take production of line to correct for weak demand. In spite of these efforts, publication paper prices (LWC) continue to decline (down an estimated $30-70/ton in December) and 2009 is not showing any encouraging signs. Magazine and catalog demand is weak, imported paper producers are more aggressive, advertising dollars are down, and the economy is not improving - all leading to a poor paper market as we enter 2009.
Note: NewPage will cut production by 150,000 tons system wide in the first quarter. Its mills have a total annual production capacity of approximately 4.5 million tons of paper, including approximately 3.3 million tons of coated paper, approximately 900,000 tons of uncoated paper and approximately 300,000 tons of specialty paper, according to its Web site. It is the largest coated paper manufacturer in North America, based on production capacity, with $4.7 billion in net sales.
Verso Papers is based in Memphis, Tennessee, and is a leading North American producer of coated papers, including coated groundwood and coated freesheet, and supercalendered and specialty products. Verso’s paper products are used primarily in media and marketing applications, including magazines, catalogs and commercial printing applications such as high-end advertising brochures, annual reports and direct-mail advertising . The company operates manufacturing facilities in Jay, Maine; Bucksport, Maine; Sartell, Minn.; and Quinnesec, Mich. These mills have a combined annual capacity of approximately 1.7 million tons of paper.