2010 Paper Prices Might Increase

The year 2009 was certainly a challenge for the pulp and paper industry – slow demand and constant pricing pressure. Paper prices experienced a steady fall for most of the year and now appear to be leveling off. Several producers, and Coy Paper Company, are forecasting a gradual price increase for most grades for 2010. Demand might only slightly rebound, but raw material costs such as pulp, chemicals, transportation and energy will increase. Inventory levels, both at the mill and the end user, are down and manufacturers continue to curtail supply and imports are down. Lastly, support such as the ‘black liquor’ credit is gone. Therefore, even if demand does not increase, there are plenty of other reasons for paper prices to rise.