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- Date:
9/16/2009
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Major pulp producers have announced a $40 per metric ton price increase on both softwood and hardwood grades for September in key markets, said Mark Wilde, senior analyst at Deutsche Bank covering the Paper & Forest Products sector.
If implemented, NBSK price will rise to $770/mton in the U.S., $740/mton in Europe, and $640-650/mton in China.
Wilde said spot U.S. NBSK price rose to $585-615/mton, driven by lean inventories, continued strong demand in China, and a slight up-tick in U.S. demand.
However, Wilde cautions, supply is creeping back as Catalyst Paper, Domtar, and Fraser Paper have all announced pulp line restarts.
Coated Papers: Have Prices Reached a Bottom?
While list prices continue to decline in both coated groundwood (CGW) and coated freesheet (CFS) grades, reports suggest prices may have reached a bottom, Wilde said.
According to Wilde, July shipment data shows that the rate of decline in volumes is moderating and that the market is stabilizing. NewPage and Verso Paper have announced a $40/ton ($2/cwt) price hike on CFS grades. Global Paper Solutions and Sun Paper/Jin Rui Group have also announced a similar price hike for the US market.
NewPage has also announced a $20/ton ($1/cwt) price hike on CGW grades.
The price hike comes on the back of improvement in demand outlook, decline in merchant and mill inventories, and rise in input costs from higher pulp and energy prices, Wilde noted.
In the meantime, producers continue to take production downtime.
Containerboard and Kraft Paper
List prices in August for 42-lb Linerboard remained flat at $535-545/ton for the third consecutive month. This "list" price may overstate stability in the market.
Wilde believes that discounting continues on the fringes.
July box shipments regressed a bit after showing slight improvement in June, he added.
Most European producers have announced aggressive price hikes on unbleached kraftliner (EUR 50-60/ton) and recycled grades (EUR 60-100/ton), driven primarily by higher OCC costs, Wilde said.
North American kraft producers have announced a $40-50/ton price hike on the back of the recent strength in order backlogs, surge in OCC costs, capacity curtailments, and the recent weakening of the U.S. dollar.
Smurfit-Stone Container plans to shutdown its 745 tpd Ontonagon, Michigan, medium mill from mid-September. Wilde said he would not be surprised if Smurfit were to announce additional permanent moves at Matane, Quebec (corrugated medium) and Missoula, Montana (containerboard) in the coming weeks.
SOURCE:paperage.com