The strength in the paper stock export market recently follows statistics over the first quarter that showed total exports of the material were down slightly from figures the same time last year.
According to the U.S. Commerce Department, exports over the first three months of the year are down a slight 0.8 percent from figures Jan.-March 2000. The decline came during the throes of a difficult market for the forest products industry.
Shipments to Canada, one of the largest end markets for recovered fiber, also declined over the first three months, according to Commerce Department figures. For the first three months, shipments dipped by 4.5 percent. Wholesale downtime at mills, especially newsprint mills, throughout Canada were the key reason for the drop.
For March, the most recently reported month, exports stands at 924,882 tons, a sharp increase from the previous month’s figure of 828,508 tons. Shipments to Canada for March also increased, from 182,628 tons in February to 195,238 tons in March.
While exports slumped the first quarter, exports over the past several months, more recent trends point to a much stronger export market. Strong buying by China has led the way. This region has been one of the better opportunities for many export oriented brokers.
Along with the increased movement offshore the past several months, the possibility of a strike at West Coast ports is creating greater interest in getting containers on the water before a strike take place.
At the present time, a strike possibility could take place by July 1. While many exporters feel that if a strike take place it will be short lived, the amount of material that moves off the large ports on the West Coast is substantial enough to create a ripple effect for many Asian mills.
While a short strike could take place, there also is a strong possibility that federal mediators could come in and prevent a strike from taking place. If this happens the flow of material will likely ease back slightly, although no one feels that demand will back off enough to drop prices.
While a strike may not occur, another concern could be the possibility of a work slowdown, which could reduce the flow of containers from the West Coast.