Market Pulp Prices Easing, Shipments Slowing

Aug. 11, 2011 - Market pulp prices have dropped sharply, down by about US$30 per ton after demand backed off a bit and an increase in production capacity softened the market.

Finland's price indexing firm, FOEX, listed the price for NBSK in the U.S. at 993.99 per ton, a $28 drop from Aug. 1.

“Market pulp shipments in general and softwood pulp shipments in particular have been weak to the North American market,” FOEX said in its weekly summary of the market.

The price of NBSK began its upward trek from $960/ton on March 1 to its 2011 high in mid-June of $1035/ton — a price that held for about 3 weeks.

According to Mark Wilde, Deutsche Bank's senior analyst covering the paper and forest products sector, pulp prices are easing in both softwood and hardwood grades.

“No major producer has yet announced August “list” price cuts for hardwood in the U.S. However, spot prices are off $20-30/metric ton in most grades,” Wilde said.

In Europe, Fibria has announced a $30/mton price cut on BEK. In softwood, producers have announced a $30/mton price cut for August.

In China, weak demand and rising inventories have pulled prices down. “Two other issues pressuring the market: ripples from a sharp decline in spot dissolving pulp prices and integrated papermakers selling more market pulp,” Wilde added.

SOURCE: FOEX and Deutsche Bank