Canadian Pulp Production, Shipments Slide

Both production and shipment of Canadian market pulp declined for June as the surge in downtime, along with a slowing economy, cut into overall demand for the product.

The most recent figures from the Pulp and Paper Products Council finds market pulp production in June at 634,000 metric tons, a 10 percent drop from figures the same time last year. The decline for the month brought the six-month production figure to 4.129 million metric tons, a 10 percent drop from figures the same time last year.

Reflecting the difficult time being experienced by Canadian pulp mills, the operating rate at pulp mills in the country stands at 79 percent of capacity for the month, compared to 88 percent the same time last year. For the first six months the average operating rate stands at 86 percent of capacity, compared to 95 percent the same time last year.

Along with the dip in production, the shipment of finished market pulp continued to decline. For June, the most recently concluded month, shipments reached 670,000 metric tons, a 12 percent drop from figures the same time last year. For the first six months shipments stand at 4.1 million metric tons, a 13 percent drop from last year.

All end markets for Canadian pulp posted declines for the month and year to date. The United States, the largest end market, posted a 25 percent drop for the month, as well as a 16 percent slide the first six months. Other regions and the results for the month and YTD are the following: Canada, down 9 percent in June and down 20 percent the first six months; Western Europe, down 10 percent for the month and down 6 percent the first six months; Japan, down 29 percent in June, down 18 percent the first six months; and other regions, up 21 percent for the month, down 9 percent the first six months.

One bit of promising news for the forest products industry has been the ability of pulp producers to reduce their inventory levels. At the end of June the inventory of stocks on hand stands at 828,000 metric tons, down from the past several months. However, reflecting on the still high oversupply situation, the inventory level is up significantly from last June’s inventory figure of 453,000 metric tons.