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January 2008
Taking Stock
Last quarter, I reported that paper markets were tight. Well, thanks to continued capacity curtailment, the situation has gotten even more extreme. We are seeing significant shortages of coated groundwood paper (#4 and #5), and supply for coated and uncoated freesheet isn't much better. Not only are paper markets still tight, but I see them remaining this way throughout the balance of this year if not beyond.
Almost one year ago, in April 2007, the U.S. Department of Commerce (DOC) decided to impose penalty tariffs on imports of coated freesheet paper from China, South Korea, and Indonesia. Seven months later, the U.S. International Trade Commission (ITC), the independent federal agency responsible for investigating matters of trade, overruled this decision. This could be good news for the domestic coated freesheet market. Let me bring you up-to-speed on the issue.
Mill Round Up
NewPage has announced capacity reductions for coated groundwood and freesheet paper. The announcement represents the permanent elimination of four paper machines in an effort to create greater efficiency within NewPage’s new organization, having acquired Stora Enso North America. NewPage claims that despite these reductions, paper-making production will actually increase 3% to 8%.
Global papermaking powerhouse UPM-Kymmene has decided to permanently close its Miramichi paper mill in Canada, effectively eliminating 450,000 metric tons of magazine paper produced at the facility per year. UPM-Kymmene attributes the closures to a decrease in demand growth and the continued strengthening of the Canadian dollar in relation to the U.S. dollar.
Of Interest
GreenPrint Technologies has launched GreenPrint World, a new version of its paper-saving software available for free to home users worldwide. The company estimates that with widespread use, the software could save over 100 million trees and reduce greenhouse gasses by over 300 million tons globally.
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