Global Paper Consumption in 2012 to Fluctuate, Depending on Region

Dec. 27, 2011 - With 1.8% GDP-growth in the U.S. and 1.5% expansion in Western Europe, paper and paperboard consumption will show a fall in both key regions in 2011, said Finnish price indexing firm FOEX in its weekly review of the global paper industry.

"With U.S. GDP at, hopefully, 2% in 2012 but with a negative growth in Europe, the outlook for paper and paperboard demand is not good in 2012, even if the November numbers from the U.S. show that the losses have moderated, at least for one month. Major events, like the U.S. presidential elections and the Olympic Games will support advertising and the printed media, even if the slice for paper media will be only very thin," FOEX said in a written statement.

According to statistics from CEPIPRINT for November, estimated European demand for the total of wood-containing paper grades showed a 6.9% decline compared to November 2010 figures. Exports continued to do well with an 18% gain over November 2010.

Growth Outside of Industrialized Regions

While paper consumption and production continue to struggle in the industrialized world and while the structural changes in the printing and writing paper sector risk gradually spreading also into the emerging economies, total paper and paperboard production will continue to grow outside the industrialized countries, FOEX said.

With 7-8% GDP-growth in China and India, the number of people with sufficient income levels to consume paper is rapidly growing. This will not only support the demand for printing and writing papers, but especially in tissue and packaging products, FOEX noted.

The likely entry of Russia into WTO during next summer will also help to give the international trade another boost and, along with helping to sustain growth in packaging products, FOEX added.

In spite of the major problems threatening paper demand in the industrialized world and the slowdown of the demand growth rate in the group of emerging economies, the world paper and paperboard deliveries may still exceed 400 million tons for the first time in 2012, FOEX concluded.

FOEX Indexes Ltd. is a private, independent company, specialized in operating as a provider of audited, trade-marked pulp and paper price indexes. FOEX Indexes Ltd. is continuing the activity started by Finnish Options Exchange in 1996.

SOURCE: FOEX