A Recovery in the Making
The prolonged slumber in paper stock markets could be coming to an end. As the magic eight ball always said, “All Signs Point to Yes.”
Moving into the summer months, a better market could be riding on the coattails of a vastly improved North American paper market. Even more promising is that while prices have been moving up for most paper stock grades, demand is not expected to abate anytime soon.
Sources throughout the country point out that many of the consuming mills throughout the United States are running with only a minimal amount of inventory on hand. Adding to the upbeat tone of the market has been the resurfacing of the Asian market.
The old corrugated market has been one of the biggest beneficiaries of improved conditions. Paper stock dealers throughout the U.S. report having no problem moving tonnage. In fact, a few point out that with market conditions the way they are they could move even greater amounts of OCC if they had the supply.
A combination of stronger than expected offshore orders and good domestic purchases helped push OCC prices up around $10 a ton in many parts of the country in May. Even more optimistic, some vendors are forecasting further price strengthening throughout the summer.
While OCC holds promise, some pulp substitute grades have posted as much as $20-a-ton price improvements.
(Fibre Market News is a bi-weekly publication covering the paper stock markets and paper recycling industry.)