Nashua Buys Tec Print

Nashua Corporation, a manufacturer of labels and thermal and specialty papers based in Nashua, NH, USA, has announced its acquisition of 35 percent of the shares of Tec Print LLC, a minority-owned business enterprise located in Memphis, TN.

Tec Print is a minority owned printer of lottery tickets and labels. The company also has the capability of printing paper rolls, tickets, brochures, business cards, posters, and signs.

Paper.com has tags, tickets, and labels, in stock and ready for immediate delivery.

Pulp Price Still Increasing....again

Producers of market pulp appear to remain aggressive with price increases. All producers implemented a $30/mton price increase for NBSK for July yielding a 'list' price of $750/mton. The cost pressure on nonintegrated paper mills (mills that do not produce their own pulp) continues to mount. Stand by for yet another increase in the Fall.

Coated Free Prices firming up

Prices increased $50.00/ton on #3 - 60lbs rolls of coated paper in July. This grade is used for high-end magazines and catalogues for luxury items. Demand has been steady thus far in 2006, and supply has decreased due to equipment closures.
International Paper completed the sale of their coated division to Apollo Management Group.
Paper.com has coated paper in both rolls and sheets, available and ready for shipment.

Uncoated Offset Prices - Increase .... again

Cut size - Paper used for copiers and desk top printers; witnessed yet another price increase in June and one is in the 'air' for September - of $60.00/ton. Supply reductions and somewhat better demand yielded an increase in shipments of 2.5%. To further a tightening in market - Brazil is not exporting as much to USA - neither is Europe.
Weyerhaeuser just announced price increase for Offset and Opaque grades - effective with August shipment - $60.00/ton.
BTW. Strong rumor that either Boise or Domtar will merge with Weyerhaeuser.
Paper.com has all of Weyerhaeuser's paper grades in both rolls and sheets, available and ready for shipment.

Uncoated Woodfree Market

The North American Wood Free Market, paper used for copy paper, books, and desk top printers, witnessed a decline in demand of 12.8% from a peak of 14.8million tons in 1999. Demand last year was 12.9million tons. The main reason sited was electronic communication and the sudden spike in price for this grade of paper. Many producers shuttered equipment - most notable Weyerhaeuser in 2 mills 280,000 tpy Prince Albert, Sask and 155,000 tpy in Dryden, ON; Also, Domtar, Glatfelter, and SMART all closed down production.
Top 5 North American Producers
International Paper 3,570M tpy 24.6% mkt shr
Weyerhaeuser 2,650M tpy 18.3% mkt shr
Domtar 2,210M tpy 14.6% mkt shr
Boise Cascade 1,550M tpy 10.7% mkt shr
Glatfelter 755M tpy 5.2% mkt shr

Coated Free Sheet Market

The Coated Free Sheet Market, paper used for annual reports and high-end publications, is still suffering with poor demand, although the industry did announce a price increase earlier this year. The North American production capacity declined this year with many machines shuttered; such as 115,000 tons /Muskegon, MI (SAPPI); 170,000 tons /Pasadena, TX (Pasadena
Paper); 30,000 tons/Thunder Bay, ON (Cascade); 155,000 tons-Ottawa & Cornwall, ON (Domtar). To boot, several European manufactures also shut equipment down and USA ran at only 88% operating rate.
Top 5 North American Producers-
SAPPI 1,400M tpy 22.3% mkt shr
NewPage 1,280M tpy 20.4% mkt shr
International Paper 1,100M tpy 17.4% mkt shr
Stora Enso 915M tpy 14.5% mkt shr
Domtar 390M tpy 6.2% mkt shr

Coated Groundwood Market

The coated Groundwood paper grade - the paper used in magazines and catalogues, is still very depressed and deep discounts are often offered to buyers. North American production capacity for 2005 was 6.55million tpy and capacity is forecasted to decline to 6.25million this year. The USPS forecasted price increase for January will further hurt this market.
Top 5 producers in North American-
International Paper 1,160M tpy 18.9% mkt shr
NewPage 880M tpy 15.3% mkt shr
UPM 880M tpy 15.3% mkt shr
Bowater 865M tpy 14.0% mkt shr
Stora Enso 860M tpy 12.5% mkt shr

Smart Paper Still Operating as Bankrupt

SMART paper continues to operate under a chapter 11 status as we previously reported. Although the Ohio mill remains open, the Wisconsin mill has been shut down, hoping that CellMark will purchase and reopen. Fraser Paper, the operator that originally sold the Park Falls, Wisconsin mill to SMART is worried. They own a 40% stake in SMART ($75million) and $14million due them on pulp sales and asset rental. Fraser also made certain financial guarantees amounting to $8million when it sold the mill to SMART in 2005.

Shuttered Flambeau Paper Mill finds Buyer

The management group of CellMark recently announced their intent to purchase the Flambeau Paper mill in Wisconsin. This mill was shut down in March as a result of the current owner, SMART Paper, chapter 11 financial status. CellMark, together with Johnson Timber Company will buy the mill and CellMark would market the output. New mill will be called Flambeau River Papers. If successful, the mill would start back up in late this summer.

Uncoated Paper Producers looking at September Increase

The uncoated paper manufacturers are beginning to introduce to their end users the potential of a September price increase. The industry confirmed a price increase of $3.00/cwt - $60.00/ton for June and are forecasted to increase another $60.00/ton in September. The increase is justified due to increased pulp-energy-chemical costs; all important components to paper production. The market continues to be tight in supply and operating rates are in excess of 95%. Mills most likely
to benefit with increased prices include - International Paper; Weyerhaeuser, and Domtar.

Finch Paper up for Sale

The Board of Directors for Finch Paper has announced the decision to solicit offers to find a buyer for the mill. The board feels this is in the best interests of the shareholders to begin to evaluate potential offers for purchase of its paper mill and associated facilities.

International Paper sells Kraft Mill

International Paper announced the sale of its kraft paper business to Stone Arcade. The division was sold for $155million.

Pulp Pricce Still Increasing

NBSK market pulp pricing is now $725/ton in USA. This price has risen very aggressively since September when list price was $620/ton. Many producers are beginning to announce yet another increased of $20-30/ton for July shipments. Over 2million tons of market pulp production was curtailed during 2005. Clearly, this is a seller's market! Uncoated paper producers will most likely also announce an increase given this new cost pressure.

Typical Internet Buyer

Stats per Internet Retailer Magazine-
-2001-05 internet growth in sales 26%/year
-typical internet buyer 44yrs/female/$68,000household income/college edu/$360 ave order
-Over 100million USA adults have broadband at home
-2006F 175million USA adults will buy 'something' on line (up from 164million 2005A)
-This equates to 77% of adults
Paper.com has grown to include nearly 20,000 paper items. The site is available for paper purchases 24/7.

Top USA Paper Mills

Top North American Paper Mills, by total 2005 revenue are as follows-
1-International Paper $24.1billion 15,900,000 tpa
2-Weyerhaeuser Paper $22,630billion 13,900,000tpa
3-Georgia-Pacific $18,700billion 8,600,000tpa
4-Smurfit-Stone $8,400billion 8,190,000tpa
5-MeadWestvaco $6,170billion 3,560,000tpa
6-Boise Cascade $5,907billion 2,627,000tpa
7-Temple Inland $4,888billion 3,202,000tpa
8-Abitibi-Consolidated $4,568billion 6,100,000tpa
9-Domtar $4,249billion 3,144,000tpa
10-Sonoco $3,529billion 2,000,000tpa

National Envelope Acquires another Converter

National Envelope Company recently acquired Atlantic Envelope. This transaction gives National Envelope 6 more plants and end users such as FEDEX and Netflix. National Envelope now operates 22 USA plants.

Smart Paper Still in Chapter 11

The Smart Paper Mill, located in Hamilton, Ohio continues to run its operations under chapter 11. They recently announced the shut down of the Park Falls, WI mill (Smart purchased from Fraser FEB 2005). Smart Paper will be producing many of the grades manufactured in Wisconsin at its Ohio site.
Paper.com has the complete line of Smart Paper grades available and ready for immediate shipment.

Domtar Mill is Shut Down

The Domtar mill in Vangouver, BC has officially been shuttered. This mill produced 120,000 tpy of coated free sheet.

Magazine Ad Revenue Holds Steady in May 2006

Total magazine advertising revenue for the month of May increased 0.9%, closing at $2.2 billion, according to the Publishers Information Bureau. Ad pages fell 2.3% for the month, totaling 22,607. Year-to-date revenue for the category grew 3.6% over the same period in 2005, to $9.2 billion, while ad pages remained flat against the prior year at 94,358.
As goes magazine advertising pages ..... goes page count ... goes paper consumption.

Coated Paper Producers announce Price Increase

International Paper informed their customers that its coated and SC (Supercalendered) publications papers will increase by $2.00/cwt or $40/ton. To date, no other mill has matched this announcement on publication grades.
Other mills that announced a price increase on free sheet coated papers include SAPPI, Domtar, Appleton, and Stora Enso- all told their end users coated free sheet text and cover grades will increase by $2.00/cwt or $40/ton.
Paper.com has papers from all of these mills.