US Newsprint & Pulp Indexes (June 01, 2006)
June 1, 2006 By Pulp & Paper Canada
Supply management has kept inventories low and pricing outlook positive. In Europe, the overall performance in March volumes was predominantly positive. Newsprint and SC shipments, reported by CEPIPRI…
Supply management has kept inventories low and pricing outlook positive. In Europe, the overall performance in March volumes was predominantly positive. Newsprint and SC shipments, reported by CEPIPRINT, showed solid gains. In other uncoated mechanicals, the shipments were marginally down. In coated mechanicals, demand was estimated to be up by almost 5% for Q1. CEPIFINE’s numbers for woodfrees were also positive. In coated reels, Q1 demand was up over 6% from last year. In uncoated woodfrees, WE demand was up only just over 1% for Q1 and not at all for March, but the decrease in imports from outside and gains in exports in March helped the total deliveries to a 2.3% gain in March and to a 2.7% increase over Q1.
The pulp market has continued to tighten, especially for BSKP, as continuing capacity reductions remove supply volumes. Shipments remained strong for the month of March, however. In April, the price increase attempts have met with growing resistance in Asia, and although they have been largely successful, volumes are reported to have been smaller. Market pulp stocks in the supply chain were low entering April and during Q2 maintenance downtime is typically taken, which further reduces supply. Additional BSKP price increases of 30-40 USD/ton have been announced, either from May 1, or June 1.
In the North American pulp market, the supply/demand balance remains tight. Capacity closures continue to remove tonnage, most of it in BSKP. Further BSKP price increases have been announced, either from May 1 or June 1, by 30-40 USD/ton. During the first week of May, enough of those increases were also reported in prices to lift the average, even after the deduction of the top 10% and bottom 10% of the quotes, above the previous 690 USD/ton level. The PIX US NBSKP index moved up by 4.47 USD/ton, or by 694.47 UDS/ton.
Paper industry data is not available yet over April except for order books, which went up in Europe, but no more than their normal seasonal increase. The March statistics showed the US market reducing in growth, or declining in paper and paperboard shipments. Whilst a decline in newsprint demand was no surprise to anyone, shipments in other printing and writing grades and in packaging were below expectations. Supply management has kept inventories low and pricing outlook positive, however.
US newsprint for March showed a continuing demand decline. Newsprint consumption of dailies was down by 5% from March 2005. Inventories fell in March with lower operating rates. The latest price increase has apparently advanced in steps, as we continue to receive adjustments to price data. The PIX US Newsprint 30lb index gained by USD 1.49 or 0.23% to USD 638.27. The 27.7lb index moved similarly, and climbed by USD 1.54 or 0.23% to USD 681.65.
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