Market Updates

Newsprint – Strong or Weak?

  |   Uncategorized

Since last Fall, some interesting fundamental have occurred in the newsprint market. Here’s a rough timeline of key events: Spurred by the shut-down of the Howe Sound mill (which created a supply/demand balance on the West Coast), all producers in that region announced increases that would effectively bump prices by $20/mt on 30# newsprint by January 1st. Howe Sound cited the west coast drought as the reason for the permanent closure. The increase went through, with little resistance from buyers, thus creating a price balance between the East and West Coast. That is, until… In a bit of a surprise...

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Resolute Announces Shut-down of Laurentide

  |   SC Grades

Resolute Forest Products announced it will permanently close it's Laurentide mill in Shawinigan, QC.   Laurentide produces approximately 210,000 tons/yr of SNC and SCB grades.  This would leave a big hole in capacity unless SCA producers fill the gap - but tonnage will be pre-made for the Fall season before Laurentide shuts.  Resolute cites high costs as the reason for the closure....

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FutureMark Announces Closure if Buyer Not Found

  |   Coated Freesheet, Coated Groundwood

FutureMark has announced the closure of it's 168,000 ton/yr Coated Recycled Paper plant in Alsip, IL if a buyer is not found.  The mill intends to make orders for 2 weeks before idling equipment.  FutureMark cited market conditions and energy costs as the reason.  We have seen a steep decrease in Coated Groundwood prices since last winter - as well as a steep drop in Demand.  Additionally, FutureMark wrestled with extremely high Natural Gas prices last winter....

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Packaging Merger

  |   Packaging, Special Announcements

The 2nd largest Uncoated Recycled Paperboard producer, Caraustar, has acquired Newark Group, the 3rd largest producer. The new company would have a 33% share of the market (Sonoco leads with 35%). Private Equity Firm H.I.G. Capital will own the combined company....

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Packaging Gaining Momentum

  |   Packaging

As we begin the second half of 2014, growth in packaging is gaining traction and is expected to enter 2015 on solid footing. Boxboard mills are running full, and operating rates approximate 92%. The pricing climate for both resin and fiber is positive and paper is increasing share of market versus plastic. Export activity is improving, and the only concern is the threat of a West Coast dock strike....

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Uncoated Freesheet Stability

  |   Uncoated Freesheet

There has been stability since the increase announcements caused by IP’s Courtland mill . Demand has softened a little, however, and there is some pressure on cutsize due to increased Imports. Overall increases that customers have paid since October of last year have been significant - although much less than the totals announced....

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Coated Freesheet Increase Implemented

  |   Coated Freesheet

Although Demand is viewed as somewhat soft, $1 to $2 of the proposed $2 June increase is currently be implemented for Coated Freesheet. A weak Catalog season could create pressure to reverse the increase, but progress this Fall towards a NewPage-Verso merger could bolster pricing in this segment. As noted previously, confidence is waning that Verso will avoid bankruptcy before a merger takes place....

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