Market Pulp Price Heads Up, OCC Price Flat in March

March 31, 2011 - Market pulp producers have set $30 per metric ton price increases on both softwood and hardwood grades for April.

According to analysts at Deutsche Bank (DB), Domtar, Canfor Pulp and West Fraser have announced a $30/mton increase on NBSK, taking U.S. price to $1,020/mton, Europe = $1,010/mton, and China = $920-930/mton.

"Despite the one-day inventory rise in February, we think softwood demand is steady (February shipments +2.9% y/y) and the market appears balanced. We expect NBSK price increase to be implemented in April," said Mark Wilde, senior analyst covering the paper and forest products sector for DB.

Old Corrugated Containers

Domestic OCC price in March was essentially flat, up $2/ton to $158/ton. On a year-to-year basis, OCC is down 13.7%, DB said.

"The key driver will be Chinese demand in the coming months. Export OCC to China was down to $267-268/ton this week from $268-271/ton last week. Looking ahead, a combination of stronger Chinese demand (post-Chinese New Year) and constraints on Japanese OCC exports should lead to higher OCC prices in China," DB said in a written statement.

SOURCE: Deutsche Bank