Paper

Many paperboard producers are looking to push through linerboard and corrugated medium price increases next month, while pulp producers are having good luck with several price increases for various types of market pulp. Higher pulp prices drive demand for pulp substitutes and deinking grades.

International Paper has announced plans to push through a price increase for printing and writing paper.

Other segments of the paper industry, including newsprint, linerboard, corrugated medium and tissue products, also are announcing plans to increase prices for their finished products. Time frames range from this month (February), to early in the spring.

All these increases are pointing to better than expected price increases for many paper stock grades, especially pulp substitutes and deinking grades.

Vendors throughout the country see demand holding firm, with little in the way of any softening during the first half of the year. One of the hottest grades continues to be sorted white ledger (SWL). Reports from throughout the country find demand remains strong, with both domestic and offshore orders helping to push demand for the grade.

While orders remain strong, there is growing concern that supply of the material is becoming more difficult, in  part due  to winter weather conditions in much of North America.

(FibreMarketNews.com is an electronic publication covering the paper stock markets and paper recycling industry.)

until the spring. Adding to the overall tightness in the market is the difficulty many vendors have in obtaining trucks on a regular basis. A number of vendors report having longer delays in obtaining vehicles to move material, causing some higher-priced buying by mills to compensate for these shortages.

Mill prices for SWL are topping the $300 a ton level offshore, with prices ranging from the high $200 a ton level at many domestic mills.

The continued strength in the grade is coming without much of the “panic buying” that spurred markets to record highs in 1995.

Benefiting from strength in the SWL market has been office pack grades. Demand is very strong for this grade, with indications prices are anywhere from $140 to $160 a ton at the mill, depending on the location. These prices continue to climb, with some vendors reporting some offshore orders surpassing the $200-a-ton level.

Another grade showing some strong upward pressure is coated book stock. The grade always has been one of the more volatile materials. With some sharply increased buying by some inconsistent buyers, as well as larger orders into Mexico, there appears to be more tightening in this grade.

Mexican buying was one of the first factors to spur the coated book market. Tissue mills, traditionally significant buyers of coated book, have been leading the charge for the grade. Supply is tight, and prices have been climbing in response.

Lower grades also are showing stability, with several grades showing strength. Although grades such as old corrugated, old news, and mixed paper are not showing the strong upside strength seen with higher grades, there continues to be better flow of material from most regions.

On the West Coast, strong offshore orders are helping firm up supply in the region. There are reports of strong buying of old corrugated, old newspapers and mixed paper to supply a large Chinese mill complex. Other mills are having to compete with this strong buying by purchasing more material to build up their inventories.