<B>Pulp Substitutes Falling Back</B>

Reports from throughout the country earmark the pulp substitute market as most likely to experience some retrenching of prices. The slip in the price for pulp substitutes can be partly attributed to the dip in market pulp prices this fall.

With a number of pulp producers planning on taking some capacity off line, there could be further price declines through the rest of this year. Hard whites envelopes and cuttings appear to be one of the biggest decliners lately, although a host of other grades have been seeing some downward pressure over the past several weeks.

Although there is likely to be softer markets for many pulp substitute grades through the end of this year there are plans by many pulp producers to push through a price increase early next year. If these mills are able to push through price increases by the first quarter of next year, pulp substitute prices will likely follow suit with stronger prices down the road.

While there may be further erosion in prices, there does appear to be signs that prices have started to stabilize.