International Paper and Fraser Paper announced a $50/ton increases on coated magazine papers in North America for June shipments.
However, no other coated paper producers joined in on this increase announcement. Most buyers do not think this increase will go into effect.
Tuesday, June 06, 2006
Summary of Uncoated Wood Free Market
Summary from Analist at Deutsche Bank-
* Another round of uncoated free sheet price hikes-
Over the last week, virtually all producers of cut-size uncoated free sheet paper have announced the third round of price increases in 2006. If successful, these increases will take the list price of 20lb cut-size paper (“copier paper”) to $940/ton. This is an increase of $145/ton from the $795/ton average price back in December, and we think prices could move even higher.
* The biggest issue has been supply reductions in the US and Canada.-
Over the past 18 months, producers have closed mills with a combined capacity of 1,355,000 tons, just under 9% of the North American supply base. Even with prices rallying, the closure process does not appear complete. IP & Boise are converting another 540,000 tons away from UFS within the next year. Moreover, the pending sale or merger of Weyerhaeuser's white paper business may result in further capacity rationalization.
* Other issues include rising costs and foreign exchange. -
All white paper mills are vulnerable to higher chemical, energy and transportation costs. However, for nonintegrated white paper mills, the cost pressure is especially acute. Nonintegrated mills rely on purchased pulp and are much more reliant on purchased energy, both of which are up sharply in the last few years. Finally, a weak US$ is now working against an increase in white paper imports from abroad.
* Another round of uncoated free sheet price hikes-
Over the last week, virtually all producers of cut-size uncoated free sheet paper have announced the third round of price increases in 2006. If successful, these increases will take the list price of 20lb cut-size paper (“copier paper”) to $940/ton. This is an increase of $145/ton from the $795/ton average price back in December, and we think prices could move even higher.
* The biggest issue has been supply reductions in the US and Canada.-
Over the past 18 months, producers have closed mills with a combined capacity of 1,355,000 tons, just under 9% of the North American supply base. Even with prices rallying, the closure process does not appear complete. IP & Boise are converting another 540,000 tons away from UFS within the next year. Moreover, the pending sale or merger of Weyerhaeuser's white paper business may result in further capacity rationalization.
* Other issues include rising costs and foreign exchange. -
All white paper mills are vulnerable to higher chemical, energy and transportation costs. However, for nonintegrated white paper mills, the cost pressure is especially acute. Nonintegrated mills rely on purchased pulp and are much more reliant on purchased energy, both of which are up sharply in the last few years. Finally, a weak US$ is now working against an increase in white paper imports from abroad.
Uncoated Papers remain in Demand
All the major producers have announced $60/ton price increase on copy papers for June. Cut-sized (8 1/2x11) pricing has lagged behind the rebound in roll stock pricing. USA supply reductions (mills taking production out of the market) and modestly better demand have helped dynamics. Also, Brazilian suppliers remain focused on improved local demand, not on raising exports to US.
Weyerhaeuser continues to look for a buyer - maybe International Paper, Boise or Domtar. This will add further confusion
to the market.
Come to Paper.com for all your uncoated requirments.
Weyerhaeuser continues to look for a buyer - maybe International Paper, Boise or Domtar. This will add further confusion
to the market.
Come to Paper.com for all your uncoated requirments.
Pulp Price increases might be Slowing
The market pulp producers announced a $30/ton increase for NBSK and it now appears many buyers are resisting this increase. The average price now paid for the NBSK is $705/ton - which is the highest level in 5 years.
Coated Paper still remains weak
The coated market (glossy magazine paper) continues to be in weak demand. The industry needs manufactures to curtail production just as the uncoated market has successfully done. Discounting is available for coated grades sold in rolls. Paper.com has over 18,000 items - many are coated papers.
Cascades sells its Merchant Group
Cascades, a large Canadian paper company, sold its merchant group known as Cascades Resources. This division was sold to Coast Paper which is a subsidiary of PaperlinX Ltd.
Newspaper Ciculation still on the Decline
The majority of USA newspapers report a decline in readership. The most recent period outlined a decline of 2.6%. Web companies such as Yahoo and Google are providing the information at a growing number -and - it's free. A residual effect includes a decline in paper demanded for the printing of newspapers. Many of these paper manufacturers are curtailing production or rebuilding machines to produce grades that are in demand. Most experts do not believe newspapers will see positive grow in the near term. Paper.com has newsprint available.
Wausau Paper Introduces new Digital Line
Wausau recently introduced a new line of Digital Papers called Exact Digital. The vendors, Kodak - NexPress 2100 and HP Indigo highly endorse this new sheet. Paper.com has Exact Digital available and ready for immediate shipment.
Wausau Paper Introduces new Digital Line
Wausau recently introduced a new line of Digital Papers called Exact Digital. The vendors, Kodak - NexPress 2100 and HP Indigo highly endorse this new sheet. Paper.com has Exact Digital available and ready for immediate shipment.
International Paper sells its Coated Division
International Paper announced it sold its coated paper division to Apollo Management for $1.4billion. The division had four mill locations - two in Maine, Michigan, and Minnesota. The mills produced 2 million tons of magazine and catalogue paper a year and 2005 revenue of $1.6billion.
Monday, May 01, 2006
Uncoated Price Increase .... again
Most of the industry is bracing for yet another price increase in June for Uncoated Woodfree papers. Many believe the copy papers will increase $60/ton ($3.00/cwt) and the roll and folio sheets will increase $40.00/ton ($2.00/cwt). The market demand appears to maintain a strong backlog and producer’s inventories have declined. The Weyerhaeuser announcement has created some fear; however, continued consolidation in the industry is needed
Market Pulp
Following from Deutsche Bank Market Research on Pulp-
MARKET PULP
Domestic pulp producers have announced $30-40/tonne price hikes for
May and June on NBSK; if implemented, list prices would go to
$720/tonne, the highest level in 10 years. Hardwood producers, led
by Lat. Am eucalyptus producers, are separately pursuing $20/tonne
hikes this month. BSK and BHK days/supply inventory both fell one
day in March to 28 and 35 days respectively. World shipments were
up 3.6% y/y in March, led by a surge in shipments outside of North
America, particularly on hardwood grades. GP has reportedly run-
down its NBHK inventories at Old Town, Maine, and Fraser Papers is
scheduled to close its NBHK mill May 6th. Tembec is the latest NBSK
producer to announce a mill closure; its 200K tpy Smooth Rock Falls
mill will close at the end of July.
MARKET PULP
Domestic pulp producers have announced $30-40/tonne price hikes for
May and June on NBSK; if implemented, list prices would go to
$720/tonne, the highest level in 10 years. Hardwood producers, led
by Lat. Am eucalyptus producers, are separately pursuing $20/tonne
hikes this month. BSK and BHK days/supply inventory both fell one
day in March to 28 and 35 days respectively. World shipments were
up 3.6% y/y in March, led by a surge in shipments outside of North
America, particularly on hardwood grades. GP has reportedly run-
down its NBHK inventories at Old Town, Maine, and Fraser Papers is
scheduled to close its NBHK mill May 6th. Tembec is the latest NBSK
producer to announce a mill closure; its 200K tpy Smooth Rock Falls
mill will close at the end of July.
Coated Board continues to Shrink
MeadWestvaco was the latest to announce removing production of 310,000 tpy of SBS capacity. Between Tembec, MeadWestvaco, and Domtar, almost 500,000 tons of capacity for this grade have been removed. Industry experts predict this grade will be in tight supply as a result and prices will increase.
Paper Industry continues to Plant Trees
The Paper Industry has planted more than three times the amount of trees it had harvested for the pulp and paper manufacture. Forests are growing - not disappearing. Today, there are more than 10 million more acres of forests is the USA than there were 15 years ago. Since 1965, the number of trees growing in USA has increased 39%.
Weyerhaeuser Reports alternatives to Fine Paper Business
The management team at Weyerhaeuser has announced it is considering alternatives to its fine paper business segment. The choices include a complete divesture of the uncoated paper assets. This is big news considering the dominant market position of this paper company.
Tuesday, April 18, 2006
Smart still operating as Chapter 11
Smart Paper continues to operate under the protection of chapter 11. The company closed the Wisconsin plant but continues to make paper in Hamilton, Ohio. Wachovia Capital Finance and CIT are assisting with the financing. Paper.com has all of Smart's paper products including cast coat / Kromekote, matte coated, and uncoated text and cover - in stock and ready for immediate delivery.
Pulp Prices contiue to Increase
The pulp producers have once again announced a price increase for market pulp. The recent announcement of $30/ton will advance the list price of NBSK to $690/ton. The markets are expected to stay tight with the announced closure of the pulp mills at Bowater and Weyerhaeuser and also the recent closure at Georgia Pacific and Fraser.
Internationa Paper shutters another machine
International Paper announced it will shut down a coated paper mill in Courtland, AL. The facility produced 922,000 tons per year of coated free sheet.
Monday, April 17, 2006
Paper Industry Experts Forecast US Paper Capacity Decline
Although many sectors within the paper industry appear to be doing very well in today’s climate, must agree that long-term trends will continue a downward capacity.
-Downward capacity trend begin in 2001 with many mills announcing manufacturing equipment curtailments
-2005 overall capacity reductions estimated at a negative 760,000tons - representing 45 machines permanently removed.
note, almost 7million tons was taken out of production at some point during year.
-2005 capacity 99.5million tons
-2005 US Newsprint (used in newspapers) declined by 865,000 tons - 13% - total of 5.76million tons
-2005 US printing and writing gained 0.7% to nearly 26million tons
-Capacity forecast to decline nearly 600,000tons over next 2 years
-2005 mechanical (groundwood) capacity grew 8% to 2.25million tons - most of increase came from conversion from newsprint machines
-2005 Coated Mechanical (magazine paper) capacity rose to over 5million tons or 2.3% increase.
Capacity will decline with the recent announcement of 2 machines shutting own.
-2005 uncoated free sheet declined to 13.5million tons. This sector is predicted to continue declining capacity.
-Tissue paper and Kraft paper continue to witness declining capacity
-Downward capacity trend begin in 2001 with many mills announcing manufacturing equipment curtailments
-2005 overall capacity reductions estimated at a negative 760,000tons - representing 45 machines permanently removed.
note, almost 7million tons was taken out of production at some point during year.
-2005 capacity 99.5million tons
-2005 US Newsprint (used in newspapers) declined by 865,000 tons - 13% - total of 5.76million tons
-2005 US printing and writing gained 0.7% to nearly 26million tons
-Capacity forecast to decline nearly 600,000tons over next 2 years
-2005 mechanical (groundwood) capacity grew 8% to 2.25million tons - most of increase came from conversion from newsprint machines
-2005 Coated Mechanical (magazine paper) capacity rose to over 5million tons or 2.3% increase.
Capacity will decline with the recent announcement of 2 machines shutting own.
-2005 uncoated free sheet declined to 13.5million tons. This sector is predicted to continue declining capacity.
-Tissue paper and Kraft paper continue to witness declining capacity
Annual Paper Meeting Held in New York City
The American Forest and paper Association (AF&PA) held their annual meeting April 9-13; following observations-
-First time in since 1995 that total paper and pulp production has dipped below 100million tons of capacity.
Basic concerns of industry continue to be
-Global competition; limited capacity spending on equipment (aging technology); high energy and labor (benefit) costs; capacity rationalization; and demands for short-term results for shareholders.
-Coated and uncoated free sheet markets continue to be strong ..... for now.
-Many older mills have 'shut down' equipment and thus capacity has been reduced
-Many of the off shore producers have curtailed shipments to USA
-Demand appears good - although the long-term trend is declining 2% per year.
-The Premium Text and Cover markets continue to suffer
-Market demand has continued to decline 10% per year
-No forecast for demand to shift to neutral nor increase
-High manufacturing costs continue to plague this sector
-Newsprint suppliers are doing well
-Demand has NOT increased, however, large trend to converting equipment over to high bright or coated; accordingly,
Newsprint capacity is decreased
-Board capacity continues to decline
-Linerboard will continue to decline, as well as recycled linerboard with several closures
-Containerboard capacity is stable due to capacity outages AND efficiencies on operating machines
-Corrugating Medium capacity will continue decline (forecast is down 2% 2006)
-First time in since 1995 that total paper and pulp production has dipped below 100million tons of capacity.
Basic concerns of industry continue to be
-Global competition; limited capacity spending on equipment (aging technology); high energy and labor (benefit) costs; capacity rationalization; and demands for short-term results for shareholders.
-Coated and uncoated free sheet markets continue to be strong ..... for now.
-Many older mills have 'shut down' equipment and thus capacity has been reduced
-Many of the off shore producers have curtailed shipments to USA
-Demand appears good - although the long-term trend is declining 2% per year.
-The Premium Text and Cover markets continue to suffer
-Market demand has continued to decline 10% per year
-No forecast for demand to shift to neutral nor increase
-High manufacturing costs continue to plague this sector
-Newsprint suppliers are doing well
-Demand has NOT increased, however, large trend to converting equipment over to high bright or coated; accordingly,
Newsprint capacity is decreased
-Board capacity continues to decline
-Linerboard will continue to decline, as well as recycled linerboard with several closures
-Containerboard capacity is stable due to capacity outages AND efficiencies on operating machines
-Corrugating Medium capacity will continue decline (forecast is down 2% 2006)
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