Pulp and Paper Canada

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What’s New… (February 01, 2005)


February 1, 2005
By Pulp & Paper Canada

MILLS

MILLS

GOVERNMENT EXTENDS HELPING DOLLARS

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PORT ALICE, BC — The CBC recently reported a decision on behalf of the BC government to grant $50,000 to the community of Port Alice, on Vancouver Island. It is hoped the allotted sum will provide some comfort to the village that was turned upside down upon the closure of its pulp mill this fall.

Although the search is on for a possible buyer for the mill, the grant is expected to help tide over community members until an emptor is found.

AGREEMENT

WFP CASHES IN

DUNCAN, BC — Western Forest Products has struck an agreement with the BC Ministry of Forests. In March of 2003, the government set in motion a plan to abate harvesting rights in the province. The accord, concerning compensation to WFP for its truncated harvesting entitlements, falls under the Forestry Revitalization Act, or Bill 28.

In terms of indemnity, the company will be allotted over $16 million for the loss of 685, 216 cubic metres of annual cut and 827 hectares of timber licenses. WFP will also get an advance payment of $5 million for the improvements it made to crown land that forms part of the recouped area.

TRANSACTION

A SMART PURCHASE

HAMILTON, OH — SMART Papers is in the process of acquiring the pulp and papermaking operations in Park Falls, WI of Fraser Papers. The asset purchase agreement SMART signed also includes the acquisition of a 470,000 square foot converting, distribution and customer service facility in West Chicago, IL.

Three paper machines, a pulp and de-inking facility and printing paper brands are included in the transaction. Although the deal is subject to closing conditions, it is expected to close at the beginning of March 2005.

LAND

HISTORY COMES BACK TO BITE

Looming land claims might see Sappi lose a chunk of the plantations that feed its pulp and paper making operations. The company has already been notified of 17 land claims, representing 6% of the 400,000ha of plantations the group owns in South Africa.

“As one of the largest land owners in South Africa we anticipate that a substantial number of claims may affect land we own,” it was declared in the company’s annual report. The document went on to explain the company was still engaged in a process to determine the extent of possible claims by people who were dispossessed of their land rights, and how this in turn might affect the group.

Although 1998 stood as the deadline for land claims, CE Jonathan Leslie acknowledged the possibility of the existence of further claims the company might not yet be aware of.

According to Sappi, the claims are under investigation by the Regional Land Claims Commissioner and have been made under the Restitution of Land Rights Act. The act provides for the restoration of rights in land to people who were bereaved of their land rights after 1913, due to racial discrimination

SALE

DOMTAR DIVESTS

MONTREAL, QC — For $23.7 million, Domtar sold 42, 429 hectares of timberlands in upstate New York to the Lyme Timber Company and the Nature Conservancy. Domtar decided the property was no longer in concurrence with its land ownership objectives.

AWARD

HATS OFF TO SUZANO

SAO PAULO, BRAZIL — Suzano Bahia Sul Papel e Celulose S.A. is the recipient of Forest Stewardship Council Certification for the management of its 100,000 hectares of forest plantations in the Brazilian states of Bahia and Espirito Santo. Its industrial activities in Mucuri, Bahia, were also taken into account.

STATISTICS

NA PACKAGING

MONTREAL, QC — In November, North American containerboard demand showed improvement, increasing 4.7% over the corresponding month last year. North American containerboard production increased by 57,000 tonnes in November, or 2.1% compared to the same period in 2003. During the month, North American mills operated at 96% of their capacity, up from 93% reached a year ago. Inventories held at North American mills and box plants totaled 2.66 million tonnes at the end of November, an increase of 40,000 tonnes over the previous month and 178,000 compared to the same month last year.

In November, North American boxboard demand improved, growing 2.6%, while production was up 2.3% compared to the same month last year. Boxboard mills operated at 91% of their capacity, a five-point increase over the 86% registered in November 2003.

North American kraft paper demand increased in November, up 17.6% compared to the same month in 2003. North American production of kraft paper was up 16.5% for the month compared to 2003. Kraft paper producers shipped at 92% of their capacity in November, up from 83% reached in the same month last year. North American kraft paper inventories totaled 88,000 tonnes compared at the end of November, an increase of 13,000 tonnes over last month and a decline of 23,000 tonnes compared to the same month last year. At current shipping rates, it is estimated that producers held 15 days of supply at month end.

STATISTICS

NA NEWSPRINT

The Pulp and Paper Products Council confirmed that newsprint consumption in the U.S. fell 2% in November, with daily newspapers consuming 3.1% less newsprint. It is worth noting, however, that there was an additional Sunday in November 2003. So far this year, dailies’ consumption has declined by 1.4%.

In November, North American shipments managed to post a small increase of 0.4% thanks to a 12% rise in offshore deliveries. Shipments to Canada remained unchanged from a year ago, whereas sales to the U.S. decreased 2.8% due largely to consumers reducing their inventories. At the end of November, North American mill inventories also declined, shrinking by 34,000 tonnes from the preceding month to close at 312,000 tonnes.

SAFETY

SSCC SAFETY

CHICAGO, IL — Employees at Smurfit-Stone Container Corporation’s West Point VA containerboard mill worked 1.5 million hours without a lost-time accident or injury under Occupational Health and Safety Administration reporting guidelines. The mill employs more than 590 people.

STATISTICS

NA PRINTING AND WRITING PAPERS

MONTREAL, QC — The Pulp and Paper Products Council reported that North American demand for printing and writing papers posted robust gains in November, increasing 9.1% year-over-year. In the first 11 months of 2004, demand rose 4.3% compared with the same period last year. For the month of November, total shipments by North American producers gained 6.9% with domestic shipments, rising 7.4%, while exports fell 7.2%. Mill operating rates also increased to 89% from last year’s 86%, signaling a higher ratio of shipments to capacity. Mill inventories stood at 2.5 million tonnes, which is 71,000 tonnes more than the previous month, but 228,000 tonnes lower than they were in November 2003.

WEBSITE

PPA LAUNCHES SITE

WASHINGTON, DC — A new website dedicated to providing packaging decision makers with up to date information has been launched by the Paperboard Packaging Alliance. The site will be a resource for marketers, package designers, retailers and consumers. The site can be accessed at www.paperboardpackaging.org.

SALE

STAMFORD, CT — International Paper sold 1.1 million acres of forestlands in Maine and New Hampshire to GMO Renewable Resources, LLC, a private forest investment company. The deal totaled $250 million.

The two companies agreed to a long-term wood fibre supply agreement to continue the flow of wood fibre to IP’s Maine paper mills. The enterprises have also concurred to a long-term management contract by which IP’s subsidiary will provide forest management services to the Sustainable Forestry Initiative Standard.

PAPERCLIPS

It takes all sorts of paper

You never know w
hen a scrap of paper is going to come in handy. You might never guess that a scrap of toilet paper might save your life. Nevertheless, such was the case for Bolivian lawyer Reynaldo Peters, jailed in 1972 under a right-wing dictatorship for his membership in an opposition party. Peters used a snippet of discarded toilet tissue to compose a writ of habeas corpus seeking the examination of his case while in jail. He was able to sneak the illicit paper out of prison, with dirty laundry he sent home with his wife to be washed. A writ of habeas corpus stipulates that an individual held in custody be brought before a court and places the burden of proof on those holding the individual captive to prove his guilt. “I knew she would find it,” the India Daily reported Peters as saying of his wife’s discovery of the paper. According to Peters, the writ was subsequently published in the Bolivian press and as a result caught the attention of the Red Cross and international human rights groups, culminating in his eventual releases.

Peters was recently honoured by the Spanish Bar Association for his ‘ingenuity.’

Source: India Daily

AGREEMENT

VANCOUVER, BC — The Southern Railway of British Columbia has done well to team up with the pulp and paper industry. After fine-tuning the operation of a water-to-rail paper distribution partnership with NorskeCanada, the railway has witnessed more than 500% growth in its newsprint and specialty papers shipping business over the past five years.

In 1997, the SRY started working with NorskeCanada, which led to the consolidation of volume at an SRY-served origin distribution centre with access to multiple class one carriers. Known as Sylvan Distribution, the centre grew from 1,600 carloads per annum to 8,500 in 2004.

Products that come from four paper mills, located within a 100-mile radius supply the centre.


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