<B>ONP Business Holding Up</B>

The newsprint industry seems to be one of the few grades showing upward movement as of late. Finished product prices look to be holding their increase that came early this month.

The improvement continues to strengthen the market for the grade. Recent figures from the Canadian Pulp and Paper Association point to better than expected newsprint markets through the short term. The improved environment has helped keep old news afloat during a time when OCC seems to be finding increased difficulties.

The improvement in the old news market includes steady buying by offshore mills, principally in the Pacific Rim. Without any further erosion in price or demand the market for the grade will likely bounce around on the high side of OCC.

Along with ONP, another grade that appears to be holding up fairly well is coated book stock. The grade is often used as a whitening agent by mills looking for the clay coating. How long can the ONP market stay up while OCC remains in a depressed state is anyone's guess. Another positive sign for the ONP market has been the seasonal upswing in newsprint production.

Exporters have been noting that offshore mills are buying smaller loads of ONP. This could be a precursor of steady to stronger buying for the grade into next year.