Paper Trader Europe
January
09
Paper Trader Europe A Monthly Monitor of the European Graphic Paper Markets • Financial crises hit paper demand and currencies heavily at year-end. The changes in demand have been similar to previous recessions, but the slowdown has been more rapid than ever before and the changes are immediate. However, we do not expect the market to worsen more from the levels we have seen in the fourth quarter of 2008. The German printers confidence index by BVDM continued at the same level as in November (the worst since 1991), but was not declining any more. • The market is split in half: buyers behave like there is no tomorrow and no paper will be used in Europe ever again and producers are behaving like the demand continues as during the upturn. The price negotiations are likely to be challenging. Customer inventories are decreasing throughout Europe despite the price increase attempts. At the same time producers are confident on pushing price increases through in all grades, with the exception of uncoated woodfree. Producers are fighting for survival: the common understanding is that the profitability was already at unacceptable levels (coated woodfree paper producer, Aconda Paper, filed for insolvency in December) and despite the expensive closures and temporary downtimes, there is still no other way - - prices need to increase. To keep the supply and demand in balance, companies announced temporary capacity cuts for December and early January. • Bad news from the US car industry, the Madoff fraud case and severe actions by the US Federal bank led the US dollar to depreciate against the euro back to 1.45 levels in midDecember, and at the time of writing, the EUR/USD stands at 1.35, still 8% above the November level. Rapid and severe currency changes make forecasting of net exports extremely difficult and might influence the tough price negotiations in the beginning of 2009. • For example: using the average 45g newsprint price (approximately US$800/tonne) in the USA as a benchmark to European price negotiations, markets indicated a level of Euro 640/tonne when EUR/USD was 1.25 and Euro 552/tonne when EUR/USD was 1.45. Newsprint producers will look more at the cost and profitability level rather than currencies when pushing up the prices, but certainly exchange rates will have an effect on net exports. • Because the European economy is lagging the US by some six months and is just entering recession, the Euro is likely to depreciate rather than appreciate against the US dollar. Paper demand is pre-cyclical and sooner or later the customers' inventories will be increased to match the real demand situation, and we will see a pickup happening this year. Will it happen as quickly as February or March? Only time will tell, but for sure the paper market will be improving toward the end of the year and showing positive figures in year-over-year levels by fourth quarter 2009 at the latest. We can predict a very challenging year and huge fluctuations in paper demand as well as further paper mill closures and perhaps consolidation of paper companies during 2009. To subscribe or contact client service, visit www.risiinfo.com
Paper Trader Europe - January 2009
Figure 1 Coated Paper Prices in Europe Euros Per Tonne 880 Coated Woodfree, Reels (100 gsm) 840
LWC Gravure (60 gsm)
800
760
720
680
640 J MM J S N J M M J S N J M M J S N J MM J S N J M M J S N J M M J S N J MM J S N 02 03 04 05 06 07 08
European Printing and Writing Papers Demand for printing and writing papers declined significantly in the fourth quarter of 2008. UPM and Mreal announced negative profit warnings on demand being lower than previously anticipated. SAPPI announced temporary downtime on 25% of its CWF capacity during December and January and is ready to extend this into the following months if necessary. UPM, Lecta, Burgo and M-real as well as Scheufelen have also commented on market related downtime. For all grades the decreasing advertising expenditures, weak consumer and industrial confidence and increasing unemployment will have negative effects on demand. The drop in demand is the worst in the fourth quarter of 2008 and first quarter of 2009, but should normalize once the worst panic reaction is over. According to CEPIprint, European SC-magazine (uncoated mechanical) paper demand fell by 5.9% in November, and while the 3-month average still shows 2.3%, once the December figures come in, the fourth quarter of 2008 is likely to come in 3% lower than fourth quarter 2007. SC demand will clearly drop less than the other grades, mostly because of the downgrading tendency: from the consumer's point of view, SC A+ grades are on par quality wise with LWC grades. The printers find SC papers more difficult to print, but publishers are searching for cheaper substitutions. SC demand has been good for a few years, so the base level is high to begin with, but the trend toward SC from LWC should allow further demand strength to continue. While demand is likely to drop in the next few months, it should only be by just a few percentage points. SC paper prices will increase from the beginning of 2009 more than they did in January 2008 and an increase of about Euro 40/tonne is likely. The market balance is good after several closures and downgrading effects, primarily UPM closing its Kymmene Kajaani mill in December and removing 370,000 tonnes of SC and improved newsprint capacity.
2
RISI
Paper Trader Europe - January 2009
Coated mechanical demand has been suffering the most among the European graphic paper grades. The CEPIprint 3-month average demand is down by 10.4% and the fourth quarter of 2008 is likely to be some 10% lower than year-ago. In addition to the weakening base demand, there are several reasons why LWC will be hit more than other grades: 1)
Downgrading effect: for customers seeking cheaper options, LWC will be replaced by SC and potentially also by CWF, which is still cheaper than LWC in Europe.
2)
Base effect: the end of 2007 and the beginning of 2008 were exceptionally good for LWC because of inventory build-up (before price increases) and accelerated advertising expenditures due to the Olympic Games and European Football Championships. There are no such events scheduled in 2009.
3)
Reverse inventory effect (which also affects most other grades): customers are emptying inventories, without regard for future price levels or current market balance.
The free fall in demand should stabilize by the end of the first quarter of 2009 or even earlier depending on the inventory changes. Producers are pushing for price increases, and while the situation may be challenging, permanent closures, temporary downtimes and producer discipline are likely to lead to a Euro 20/tonne price increase in continental Europe. The Holmen Wargon mill and PM 3 at Stora Enso's Kabel mill were closed in December, removing a total of 285,000 tonnes from the market. Coated woodfree demand may be more affected than other grades by the decreasing advertising expenditures, but it will benefit from being less expensive than LWC. Massive capacity closures (over 1.2 million tonnes from fourth quarter 2008 to first quarter 2009) will exceed the drop in demand and producers will seek a price increase of 8-12% for January. Meanwhile, some inventory build-up effect should keep the drop in demand smaller than for coated mechanical papers. The price difference between LWC and CWF is expected to normalize, which will lead to the drop in demand for CWF exceeding that of LWC by the end of the year. The CEPIfine 3-month average is down by 1.9%. Coated woodfree for the fourth quarter 2008 is expected to have fallen by 6%, while annual demand is assumed to have dropped about 3%. SAPPI closed its Maastricht PM 5 in December, removing 50,000 tonnes of capacity from the market. A further 900,000 tonnes of CWF capacity closures have been announced and we expect these to take place during the first quarter of 2009. SAPPI's acquisition of M-real's commercial printing division took place on December 31, 2008. SAPPI now controls about 26% of European CWF capacity and will use its power to push the prices up. The company has announced it will temporarily shut 25% of its capacity in December and January and is likely to keep the market tight until the major closures by M-real, Lecta and Arctic Paper are completed. Scheufelen and Burgo have also announced temporary capacity cuts. The companies are seeking 8-10% price increases for 2009, in addition to the estimated 3-4% increase that resulted from price increase initiatives in the fourth quarter 2008 as well. While producers will likely fall short of the 8-10% gains they are requesting, the cost pressures, capacity closures, and market downtime will inevitably lead to some further price gains in 2009. We estimate that coated woodfree prices will gain 5-6% in the first half of 2009, followed by another 4% increase in the second half of the year. In addition to previous filings by other companies, Spanish Aconda paper filed for insolvency in December 2008. Aconda has roughly 80,000 tonnes of CWF capacity, but production could continue if new financing can be found. Chinese coated woodfree inventories have increased after the Beijing Olympics, and while exports are likely to increase, current custom statistics show declining imports from China to Europe (down 29% in September). Freight costs from Asia to Europe have dropped to less than half of year-ago levels. We are RISI
3
Paper Trader Europe - January 2009
Figure 2 Uncoated Paper Prices in Europe Euros Per Tonne 870 Offset Reels (80 gsm)
830
SC Gravure (56 gsm) 790 750 710 670 630 590 550 J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N 02 03 04 05 06 07 08
likely to see some Chinese invasion of the European market, but not to a great extent because the European price level, including the currency fluctuations, is not the most prosperous for Chinese producers. Uncoated woodfree paper according to CEPIfine 3-month average is down only 3%, which is actually less than the year-to-date figure (-5.2%). Reasons for better development than the beginning of 2008 are consumer inventory build-up before planned closures of M-real and IP. Customer inventories must have been low, because the apparent consumption started coming down in September 2006 when the economy was still accelerating fast in Europe. Imports to Europe from overseas have been decreasing (3-month average - 10%) due to EUR/USD rate and prices being not favorable for importers.
Figure 3 European Mechanical Printing and Writing Operating Rates 100%
95%
90%
85% Uncoated
80%
Coated
Finnish Mill Lockout 75% 98
4
99
00
01
02
03
04
RISI
05
06
07
08
09
10
Paper Trader Europe - January 2009
Figure 4 European Woodfree Printing and Writing Paper Operating Rates 100% Uncoated 96%
Coated
92% 88% 84% 80%
Finnish Mill Lockout
76% 98
99
00
01
02
03
04
05
06
07
08
09
10
WFU demand (especially copy paper) will be hit the hardest by the increasing unemployment rate. Demand is likely to drop by 5% over the next twelve months. If the US dollar continues to weaken against the euro, net exports should continue at their current level or even increase when the Portucel Setubal machine starts up at the end of the summer. Uncoated woodfree paper prices continued declining in December throughout Europe by about 2%. Further capacity closures (we expect International Paper to close the 250,000 tonne Inveruerie mill) will be sufficient to stop the erosion, allowing prices to stabilize in the first half of 2009. The M-real New Thames (230,000 tonnes) mill stopped WFU production in December 2008. DS Smith acquired the mill and is in the process of shifting production to lightweight containerboard. Based on market information, UPM will continue the temporary downtime of the 200,000 tonne Nordland PM 2 until September - - the machine has been producing only uncoated woodfree in recent years. Positive price development will be difficult in 2009, and without further supply reductions and/or decent upturn in exports, downward price pressure could take hold in the second half of the year as the capacity from Portucel's new machine enters the market.
European Newsprint Swiss papermaker, Perlen, plans to invest in a new newsprint machine in Switzerland. The 360,000 tonne PM 7 should start up in the autumn of 2010 and is planned to produce both standard and improved newsprint. Perlen is planning to close its old 125,000 tonne PM 5. With the company likely to be able to fund the project, the machine is expected to be built. However, the additional 235,000 tonnes of newsprint capacity will not be supported by demand. Thus the industry will face a drop of 2% in their operating rates or, more likely, further closures of 200,000 tonnes of virgin fiber based newsprint before the machine starts. Palm's new 400,000 tonne newsprint machine in the UK will start up after the summer of 2009. Ecco Newsprint's machine is not likely to start up in 2009; although the company has not mothballed the project, the current financial crises makes financing extremely challenging. According to CEPIprint, the 3-month average demand is down by 4.9%, fourth quarter 2008 demand is likely to be down by about 5-6% and 2009 demand is expected to decline another 4.3%. Demand for daily newspapers has decreased less than during past downturns because the internet has already taken the majority of the classified advertisements away. The free newspapers, which are 100% dependent upon RISI
5
Paper Trader Europe - January 2009
Figure 5 Newsprint Prices, Europe vs. US 45gsm, Euros Per Tonne 680 640
Europe
US
600 560 520 480 440 400 J MM J S N J M M J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N 02 03 04 05 06 07 08
advertising expenditures, are facing hard times. We are likely to see several independent free newspapers disappear from the market and thus have a direct impact on newsprint consumption. Free newspapers that are owned and receiving editorial material from the big publishers (daily newspapers) should survive or even prosper (in terms of demand) as consumers will likely choose free newspapers over subscriptions. Free newspapers have a market share of around 30% (0-60%) of all European newspaper titles and are most common in Spain and Portugal. Newsprint producers are searching for a price increase of approximately Euro 100/tonne in 2009. Due to tremendous cost pressure and major capacity closures, the price increases are likely to succeed above the level of annual increases from 2005-2007. In addition, continental European prices were approximately $100 per tonne below North American prices in December, while prices in the UK were nearly $200 below North American prices, so imported tonnage will be pressured to increase their prices in Euro terms as well. The full Euro 100 might be difficult to reach, but increases of Euro 60-80/tonne are likely, price increases will be higher especially in the UK where prices are clearly below continental European levels. UPM finally closed the 270,000 tonne Kajaani newsprint machine for good in December; the machine had been idle since February 2008.
© Paper Trader Europe provides economic analysis of printing and writing paper markets and is edited by John Maine, Sampo Timonen and Kevin Conley. Subscriptions: Call +32.2.536.0757 (outside the USA & Canada) or 781.734.8900 (USA & Canada), email [email protected] or visit www.risiinfo.com. Subscriptions or client service: Call 866.271.8525 (USA & Canada) or +32.2.536.0747 or email [email protected]. Editorial offices: 4 Alfred Circle, Bedford, MA 01730-2340 USA. Copyright 2009 by RISI, Inc. All rights reserved. No part of this publication may be reproduced without the written permission of the copyright owner.
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RISI
Paper Trader Europe - January 2009
Table 1 Western European Graphic Paper Imports by Region of Origin Thousand Tonnes SEP 2007
OCT 2007
NOV 2007
DEC 2007
JAN 2008
FEB 2008
MAR 2008
APR 2008
MAY 2008
JUN 2008
JUL 2008
AUG 2008
SEP 2008
72 43 0 0 2 0 0 0
64 43 2 0 4 0 0 0
64 36 3 0 1 0 0 0
42 32 0 0 3 0 0 0
31 34 0 0 3 0 0 0
43 34 0 0 1 0 0 0
33 41 0 0 1 0 0 0
42 44 0 0 0 0 0 0
45 39 0 0 1 0 0 0
44 39 0 0 1 0 0 0
49 39 0 0 0 0 0 0
35 31 1 0 0 0 0 0
57 36 0 0 2 0 0 0
116
113
103
76
68
78
75
86
85
85
88
67
95
NEWSPRINT North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total
UNCOATED MECHANICAL North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others
5 3 0 0 1 0 0 0
6 2 0 0 1 0 0 0
4 2 0 0 1 0 0 0
6 1 0 0 1 0 0 0
8 3 0 0 1 0 0 0
2 3 0 0 2 0 0 0
10 3 0 0 2 0 0 0
2 4 0 0 3 0 0 0
7 3 0 0 2 0 0 0
7 2 0 0 2 0 0 0
4 3 0 0 1 0 0 0
6 4 0 0 2 0 0 0
4 5 0 0 2 0 0 0
Total
9
9
8
8
11
7
16
9
12
12
9
11
12
8 2 1 0 4 0 0 0
7 3 0 0 6 0 0 0
7 4 2 0 2 0 0 0
3 3 1 0 3 0 0 0
4 2 1 0 2 0 0 0
3 7 0 0 1 0 0 0
2 4 0 0 2 0 1 0
1 4 1 0 1 0 0 0
1 2 0 0 1 0 0 0
1 5 0 0 1 0 0 0
1 5 0 0 1 0 0 0
2 4 0 0 1 0 0 0
3 6 2 0 2 0 0 0
16
16
14
10
10
13
8
7
4
8
8
7
13
5 51 13 0 21 9 1 2
5 51 10 1 21 8 1 2
7 44 16 0 17 8 1 2
7 49 7 0 12 3 1 2
7 53 16 0 12 4 0 1
8 50 13 0 11 4 1 1
6 54 14 0 18 9 1 1
6 47 99 0 19 7 1 1
6 43 14 0 18 9 2 1
9 42 10 0 16 6 1 1
8 48 14 0 19 5 2 3
7 35 12 0 13 9 1 2
6 43 14 0 10 8 1 3
103
99
95
81
93
88
102
180
94
86
99
79
85
North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others
3 9 2 0 15 0 0 0
3 10 1 0 14 0 0 0
3 11 2 0 13 0 0 1
2 7 1 0 11 0 0 0
3 12 1 0 16 0 0 1
2 8 1 0 14 0 0 0
3 13 2 0 10 0 0 0
3 8 1 0 13 0 0 0
5 12 1 0 11 0 0 0
4 6 3 0 8 0 0 0
3 9 1 0 8 0 0 0
4 7 1 0 5 0 0 0
3 11 1 0 9 0 0 0
Total
30
29
31
21
32
25
28
25
28
21
21
17
24
COATED MECHANICAL North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total UNCOATED WOODFREE North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total COATED WOODFREE
RISI
7
Paper Trader Europe - January 2009
Table 2 Western European Graphic Paper Exports by Region of Destination Thousand Tonnes SEP 2007
OCT 2007
NOV 2007
DEC 2007
JAN 2008
FEB 2008
MAR 2008
APR 2008
MAY 2008
JUN 2008
JUL 2008
AUG 2008
SEP 2009
4 34 8 28 42 13 0 3
3 36 9 37 35 13 0 2
1 38 6 31 30 11 0 4
5 33 10 20 26 9 0 4
7 36 7 45 40 10 0 4
2 29 11 44 50 15 0 4
8 33 7 38 40 11 0 6
6 41 5 24 40 16 0 5
1 33 4 26 26 7 1 5
0 37 4 27 29 5 0 6
3 43 5 36 35 11 0 5
4 41 5 47 40 11 1 4
6 41 3 44 44 14 2 6
132
135
121
106
149
156
143
137
103
108
139
152
159
NEWSPRINT North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total
UNCOATED MECHANICAL (Finnish uncoated mechanical exports are RISI estimates) North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total
46 49 6 20 15 10 9 0
50 55 8 20 13 9 10 0
38 46 8 21 15 7 10 0
32 46 9 19 15 7 11 0
46 41 13 24 17 11 9 0
48 47 10 21 17 8 16 0
47 49 11 22 17 7 16 0
55 55 13 24 17 6 14 0
41 60 12 28 14 21 16 1
46 55 13 17 27 10 16 1
34 60 13 26 16 22 19 1
43 61 16 26 16 18 15 1
47 62 12 19 19 13 19 1
155
165
145
139
161
167
169
184
193
185
191
197
192
COATED MECHANICAL North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others
76 104 16 16 13 9 16 4
71 121 14 18 15 10 16 5
64 112 15 16 12 11 11 3
51 98 14 13 16 8 13 4
57 105 16 22 15 12 17 3
46 102 16 17 15 9 15 3
45 103 19 18 16 9 16 4
39 101 17 20 12 7 21 4
39 94 19 21 15 8 19 3
38 89 21 22 15 11 18 3
53 87 18 25 17 10 23 3
33 93 16 24 26 8 20 2
43 103 17 19 20 9 17 2
Total
254
268
244
218
250
224
229
221
217
217
236
222
230
7 47 6 31 16 16 4 3
11 66 9 32 18 18 5 4
10 63 7 31 14 20 4 4
13 51 5 26 16 13 4 4
10 65 6 29 16 23 5 4
7 63 5 25 18 13 3 4
8 56 6 14 13 15 4 3
12 62 6 17 14 21 4 3
7 60 6 25 15 19 4 4
7 56 5 28 16 14 5 3
9 57 6 29 18 15 5 3
12 54 7 37 13 14 4 4
9 52 8 25 13 15 5 3
130
162
152
132
159
138
119
139
141
134
144
144
130
58 84 36 31 36 22 8 3
75 94 46 32 34 24 9 4
64 87 35 33 26 21 5 4
56 60 34 29 27 20 7 3
56 74 40 50 29 16 9 3
61 66 41 50 29 16 6 2
55 73 37 44 29 17 6 3
58 78 35 40 36 16 8 4
58 76 38 38 36 18 8 3
58 68 41 44 36 19 12 4
59 67 39 37 35 18 12 3
45 73 46 36 37 21 11 4
55 81 38 31 24 20 9 3
278
319
274
237
276
273
264
275
274
281
270
272
261
UNCOATED WOODFREE North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total COATED WOODFREE North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total
8
RISI
Paper Trader Europe - January 2009
Table 3 Western European Mechanical Paper Prices Euros Per Tonne Delivered
NOV 2007
DEC 2007
JAN 2008
FEB 2008
MAR 2008
APR 2008
MAY 2008
JUN 2008
JUL 2008
AUG 2008
SEP 2008
OCT 2008
NOV 2008
DEC 2008
Germany
550
550
550
550
528
528
528
528
528
528
528
528
528
528
France
545
545
545
545
520
520
520
520
520
520
520
520
520
520
Italy
550
550
550
550
530
530
530
530
530
530
530
530
530
530
United Kingdom UK Pound
536
526
508
486
464
453
455
455
454
454
451
458
433
396
380
380
380
365
360
360
360
360
360
360
360
360
360
360
Germany
565
565
590
590
590
590
590
590
605
605
605
605
605
605
France
585
585
600
600
600
600
600
600
605
605
605
605
605
605
Italy
590
590
608
608
608
608
608
608
628
628
628
628
628
628
United Kingdom UK Pound
571 405
561 405
542 405
559 420
542 420
528 420
531 420
531 420
581 460
580 460
576 460
585 460
553 460
506 460
Germany
585
585
605
605
605
605
605
605
620
620
620
620
620
620
France
598
598
615
615
615
615
615
615
620
620
620
620
620
620
Italy
590
590
608
608
608
608
608
608
628
628
628
628
628
628
United Kingdom UK Pound
578 410
568 410
548 410
566 425
548 425
535 425
537 425
537 425
587 465
587 465
583 465
591 465
559 465
511 465
Germany
680
680
715
715
715
715
715
715
730
730
730
730
730
730
France
680
680
710
710
710
710
710
710
725
725
725
725
725
725
Italy
680
680
715
715
715
715
715
715
740
740
740
740
740
740
United Kingdom UK Pound
649
637
615
646
625
610
613
613
675
675
670
680
643
588
460
460
460
485
485
485
485
485
535
535
535
535
535
535
Newsprint Standard 45 gsm
Supercalendered Gravure 60 gsm
Supercalendered Gravure 56 gsm
Lightweight Coated Gravure 60 gsm
RISI
9
Paper Trader Europe - January 2009
Table 4 Western European Woodfree Paper Prices Euros Per Tonne Delivered NOV 2007
DEC 2007
JAN 2008
FEB 2008
MAR 2008
APR 2008
MAY 2008
JUN 2008
JUL 2008
AUG 2008
SEP 2008
OCT 2008
NOV 2008
DEC 2008
Germany
735
735
735
735
730
730
730
720
720
720
720
720
720
720
France
780
780
780
780
780
780
780
780
780
780
780
780
780
765
Italy
740
740
740
735
735
735
735
735
735
735
735
735
735
730
United Kingdom UK Pound
754 535
741 535
716 535
712 535
690 535
673 535
682 540
682 540
681 540
681 540
677 540
712 560
674 560
616 560
Germany
905
905
905
905
905
905
900
885
885
885
885
885
885
885
France
895
895
895
895
895
895
895
895
895
895
895
865
865
855
Italy
845
840
840
835
835
835
835
835
835
835
825
825
825
815
United Kingdom UK Pound
860 610
838 605
809 605
805 605
780 605
761 605
777 615
777 615
776 615
776 615
771 615
794 625
752 625
687 625
Germany
850
850
850
850
845
845
840
825
825
820
820
820
820
800
France
850
840
850
850
850
850
850
850
850
850
850
820
820
805
Italy
815
810
810
800
800
800
800
800
800
800
790
790
780
780
United Kingdom UK Pound
832 590
810 585
783 585
779 585
754 585
736 585
745 590
746 590
745 590
744 590
739 590
756 595
716 595
654 595
Germany
690
690
690
690
690
690
690
690
690
690
690
725
725
725
France
680
680
680
680
680
695
695
695
695
690
690
715
720
720
Italy
695
690
690
690
690
700
700
700
700
695
695
725
725
725
United Kingdom UK Pound
691
679
655
652
655
639
642
642
669
669
683
731
692
632
490
490
490
490
508
508
508
508
530
530
545
575
575
575
Germany
775
775
775
775
775
775
775
775
775
775
775
825
825
820
France
800
800
800
800
800
810
810
810
810
805
805
830
835
835
Italy
775
775
775
775
780
790
790
790
790
785
785
815
815
815
United Kingdom UK Pound
825
810
783
779
784
765
768
768
789
788
802
839
794
726
585
585
585
585
608
608
608
608
625
625
640
660
660
660
Uncoated Woodfree Offset Reels 80 gsm
A4 Cutsize B-Grade
A4 Cutsize C-Grade
Coated Woodfree Reels 100 gsm
Sheets 100 gsm
10
RISI
Paper Trader Europe - January 2009
Table 5 Western European Graphic Paper Price Forecast Euros Per Tonne 08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2006
2007
2008
2009
2010
521 -4.3
501 -3.8
501 -0.1
492 -1.7
536 8.9
551 2.9
552 0.1
552 0.1
523 6.0
547 4.7
503 -8.0
548 8.8
584 6.6
SC Gravure 60 gsm %CH
588 2.4
586 -0.2
605 3.2
601 -0.7
627 4.4
647 3.1
659 1.9
667 1.2
595 0.1
579 -2.7
595 2.8
650 9.2
689 6.0
SC Gravure 56 gsm %CH
599
598
617
612
639
661
674
681
608
592
606
664
704
2.0
-0.2
3.2
-0.7
4.4
3.4
1.9
1.2
0.1
-2.5
2.3
9.5
6.1
696
692
719
712
731
754
765
775
701
682
705
756
805
3.4
-0.6
3.9
-1.1
2.8
3.1
1.4
1.3
-0.1
-2.7
3.4
7.3
6.4
NEWSPRINT Standard 45 gsm %CH UNCOATED MECHANICAL
COATED MECHANICAL LWC Gravure 60 gsm %CH UNCOATED WOODFREE Offset Reels 80 gsm %CH
739
729
727
722
715
715
716
729
688
735
729
719
771
-1.7
-1.4
-0.3
-0.7
-0.9
-0.1
0.2
1.8
0.3
6.8
-0.9
-1.4
7.3
A4 Cutsize B Grade %CH
866
855
851
833
820
820
821
828
790
863
851
822
876
-1.7
-1.4
-0.4
-2.1
-1.5
0.0
0.2
0.7
3.5
9.2
-1.3
-3.4
6.5
A4 Cutsize C Grade %CH
823
810
805
782
767
767
768
774
738
821
805
769
820
-1.8
-1.6
-0.7
-2.8
-1.9
0.0
0.2
0.8
6.8
11.3
-1.9
-4.5
6.6
COATED WOODFREE Reels 100 gsm %CH
679
681
688
713
733
753
762
782
697
701
690
758
825
-1.4
0.3
0.9
3.7
2.8
2.7
1.1
2.7
-1.2
0.5
-1.4
9.7
8.9
Sheets 100 gsm %CH
784 -1.7
786 0.3
790 0.6
815 3.2
846 3.7
870 2.9
879 1.0
903 2.7
814 -2.2
815 0.1
794 -2.6
874 10.1
950 8.7
0.67 1.50
0.64 1.56
0.67 1.50
0.76 1.32
0.76 1.31
0.78 1.29
0.79 1.27
0.80 1.25
0.80 1.26
0.73 1.37
0.68 1.47
0.78 1.28
0.82 1.22
EXCHANGE RATE Euro/US$ US$/Euro
RISI
11
Paper Trader Europe - January 2009
Table 6 Western European Printing and Writing Paper Forecast Thousand Tonnes, Seasonally Adjusted 08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2006
2007
2008
2009
2010
7,769
7,755
7,739
7,702
7,649
7,640
7,663
7,693
7,470
7,666
7,741
7,661
7,798
2.7
-0.7
-0.8
-1.9
-2.7
-0.5
1.2
1.6
3.0
2.6
1.0
-1.0
1.8
Apparent Consumption %CH Not Seas Adj %CHYA
7,140
7,129
7,043
6,840
6,813
6,822
6,849
-1.7
-0.2
-1.2
-2.9
-0.4
0.1
0.4
7,266
7,214
6,774
6,897
6,934
6,904
6,588
-1.1
-2.7
-2.5
-5.8
-4.6
-4.3
-2.8
0.4
1.2
0.9
-3.0
-2.9
1.0
Net Exports Not Seas Adj
2,091
1,959
1,919
2,001
1,978
1,937
1,897
1,878
8,641
8,341
7,970
7,689
7,260
2,105
1,778
2,059
2,028
1,992
1,762
2,031
1,904
8,641
8,341
7,970
7,689
7,260
Production %CH Not Seas Adj %CHYA
9,231
9,088
8,962
8,840
8,791
8,759
8,745
8,742 37,423 37,370 36,121 35,038 34,883
-0.1
-1.5
-1.4
-1.4
-0.6
-0.4
-0.2
9,371
8,992
8,833
8,925
8,925
8,666
8,619
-1.2
-4.1
-3.9
-4.3
-4.8
-3.6
-2.4
10,055
9,986
9,876
9,743
9,531
9,404
9,330
-0.5
-0.7
-1.1
-1.4
-2.2
-1.3
-0.8
-0.2
0.3
-2.1
-2.8
-5.3
-0.9
0.92
0.91
0.91
0.91
0.92
0.93
0.94
0.94
0.90
0.92
0.91
0.93
0.94
2006
2007
Euro Area GDP Billion 00 Euro Annualized %CH
Capacity %CH Capacity Utilization
6,864 28,782 29,029 28,152 27,348 27,623 0.2
1.2
0.9
-3.0
-2.9
1.0
6,923 28,782 29,029 28,152 27,348 27,623
0.0
2.9
-0.1
-3.3
-3.0
-0.4
8,827 37,423 37,370 36,121 35,038 34,883 -1.1
2.9
-0.1
-3.3
-3.0
-0.4
9,310 41,680 40,800 39,660 37,575 37,250
Table 7 Western European Newsprint Forecast Thousand Tonnes, Seasonally Adjusted
Apparent Consumption %CH Not Seas Adj %CHYA Net Exports Not Seas Adj
08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2008
2009
2010
2,571
2,570
2,523
2,379
2,423
2,417
2,397
2,378 10,537 10,481 10,043
9,615
9,558
2.8
-0.1
-1.8
-5.7
1.9
-0.3
-0.8
2,523
2,600
2,508
2,412
2,377
2,445
2,382
-5.3
-3.2
-3.5
-4.8
-5.8
-6.0
-5.0
0.0
1.7
-0.5
-0.8
1.7
-0.5
-4.2
-4.3
-0.6
2,411 10,537 10,481 10,043
9,615
9,558
-4.2
-4.3
-0.6
81
62
81
133
110
107
116
121
366
247
357
454
487
133
-12
112
124
159
38
146
111
366
247
357
454
487
Production %CH Not Seas Adj %CHYA
2,652
2,632
2,604
2,512
2,533
2,524
2,513
0.2
-0.8
-1.1
-3.5
0.9
-0.4
-0.5
2,656
2,588
2,620
2,535
2,537
2,482
2,528
-1.9
-2.3
-3.0
-5.1
-4.5
-4.1
-3.5
Capacity %CH
2,751
2,721
2,699
2,684
2,668
2,654
2,649
-1.8
-1.1
-0.8
-0.5
-0.6
-0.5
-0.2
0.2
0.1
-0.6
-4.2
-2.1
0.7
0.96
0.97
0.96
0.94
0.95
0.95
0.95
0.94
0.96
0.95
0.96
0.95
0.94
Capacity Utilization
12
RISI
2,499 10,903 10,728 10,399 10,070 10,045 -0.5
2.5
-1.6
-3.1
-3.2
-0.2
2,522 10,903 10,728 10,399 10,070 10,045 -0.5
2.5
-1.6
-3.1
-3.2
-0.2
2,654 11,405 11,335 10,855 10,625 10,700
Paper Trader Europe - January 2009
Table 8 Western European Uncoated Mechanical Paper Forecast Thousand Tonnes, Seasonally Adjusted 08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2006
2007
2008
2009
2010
1,230
1,288
1,278
1,267
1,252
1,249
1,250
1,250
4,974
5,032
5,063
5,002
5,027
-3.3
4.7
-0.8
-0.8
-1.2
-0.2
0.0
0.0
5.0
1.2
0.6
-1.2
0.5
1,217
1,289
1,290
1,266
1,239
1,251
1,263
1,249
4,974
5,032
5,063
5,002
5,027
-2.0
3.0
1.7
-0.3
1.8
-3.0
-2.2
-1.3
5.0
1.2
0.6
-1.2
0.5
Net Exports Not Seas Adj
553
533
543
544
529
518
512
511
2,408
2,379
2,174
2,070
2,037
578
507
549
541
553
492
517
508
2,408
2,379
2,174
2,070
2,037
Production %CH Not Seas Adj %CHYA
1,784
1,821
1,821
1,812
1,781
1,768
1,762
1,761
7,382
7,411
7,237
7,072
7,063
-1.5
2.1
0.0
-0.5
-1.7
-0.7
-0.3
-0.1
11.5
0.4
-2.3
-2.3
-0.1
1,795
1,796
1,839
1,807
1,792
1,743
1,780
1,757
7,382
7,411
7,237
7,072
7,063
-4.8
-2.9
-1.7
0.1
-0.2
-3.0
-3.2
-2.8
11.5
0.4
-2.3
-2.3
-0.1
Capacity %CH
1,953
1,941
1,923
1,899
1,856
1,832
1,821
1,822
7,810
7,910
7,715
7,330
7,350
-0.8
-0.6
-0.9
-1.3
-2.3
-1.3
-0.6
0.1
5.3
1.3
-2.5
-5.0
0.3
0.91
0.94
0.95
0.95
0.96
0.96
0.97
0.97
0.95
0.94
0.94
0.96
0.96
Apparent Consumption %CH Not Seas Adj %CHYA
Capacity Utilization
Table 9 Western European Coated Mechanical Paper Forecast Thousand Tonnes, Seasonally Adjusted 08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2006
2007
2008
2009
2010
1,794
1,776
1,695
1,600
1,646
1,659
1,667
1,679
6,861
7,067
6,865
6,652
6,777
0.2
-1.0
-4.6
-5.6
2.9
0.8
0.5
0.7
0.6
3.0
-2.9
-3.1
1.9
1,806
1,746
1,642
1,670
1,656
1,631
1,614
1,751
6,861
7,067
6,865
6,652
6,777
2.6
0.2
-3.7
-10.1
-8.3
-6.6
-1.7
4.8
0.6
3.0
-2.9
-3.1
1.9
Net Exports Not Seas Adj
854
786
776
827
815
800
789
779
3,443
3,381
3,244
3,182
3,094
851
743
823
827
812
758
836
777
3,443
3,381
3,244
3,182
3,094
Production %CH Not Seas Adj %CHYA
2,648
2,561
2,471
2,428
2,461
2,459
2,457
2,458 10,304 10,448 10,108
9,834
9,871
0.9
-3.3
-3.5
-1.8
1.4
-0.1
-0.1
2,657
2,489
2,465
2,497
2,468
2,389
2,450
2.6
-2.4
-5.8
-7.3
-7.1
-4.0
-0.6
Capacity %CH
2,767
2,748
2,715
2,680
2,630
2,600
2,587
-0.4
-0.7
-1.2
-1.3
-1.9
-1.1
-0.5
0.1
-0.7
-3.0
-2.8
-4.6
0.2
0.96
0.93
0.91
0.91
0.94
0.95
0.95
0.95
0.89
0.93
0.93
0.95
0.95
Apparent Consumption %CH Not Seas Adj %CHYA
Capacity Utilization
RISI
0.0
-3.3
-2.7
0.4
2,527 10,304 10,448 10,108
9,834
9,871
-2.7
0.4
1.2
-1.3 -1.3
1.4 1.4
-3.3
2,588 11,570 11,225 10,910 10,405 10,430
13
Paper Trader Europe - January 2009
Table 10 Western European Uncoated Woodfree Paper Forecast Thousand Tonnes, Seasonally Adjusted
Apparent Consumption %CH Not Seas Adj %CHYA
08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2006
2007
2008
2009
2010
2,158
2,182
2,137
2,095
2,048
2,045
2,045
2,048
9,104
9,074
8,573
8,186
8,221
-2.5
1.1
-2.0
-2.0
-2.2
-0.2
0.0
0.1
0.1
-0.3
-5.5
-4.5
0.4
2,221
2,281
2,018
2,053
2,108
2,139
1,932
2,008
9,104
9,074
8,573
8,186
8,221
-5.7
-6.2
-4.8
-5.2
-5.1
-6.2
-4.3
-2.2
0.1
-0.3
-5.5
-4.5
0.4
Net Exports Not Seas Adj
56
33
63
65
67
69
70
74
236
145
216
280
352
51
-24
92
96
63
16
97
104
236
145
216
280
352
Production %CH Not Seas Adj %CHYA
2,214
2,214
2,200
2,160
2,115
2,114
2,115
2,122
9,340
9,219
8,788
8,467
8,573
-0.5
0.0
-0.6
-1.8
-2.1
-0.1
0.1
0.3
0.7
-1.3
-4.7
-3.7
1.3
2,272
2,257
2,110
2,149
2,171
2,155
2,029
2,112
9,340
9,219
8,788
8,467
8,573
-6.5
-5.9
-3.1
-2.9
-4.4
-4.5
-3.8
-1.7
0.7
-1.3
-4.7
-3.7
1.3
Capacity %CH
2,506
2,480
2,452
2,422
2,370
2,339
2,327
2,334 10,500 10,265
9,860
9,370
9,470
-1.1
-1.0
-1.1
-1.3
-2.1
-1.3
-0.5
0.3
-1.7
-2.2
-3.9
-5.0
1.1
0.88
0.89
0.90
0.89
0.89
0.90
0.91
0.91
0.89
0.90
0.89
0.90
0.91
Capacity Utilization
Table 11 Western European Coated Woodfree Paper Forecast Thousand Tonnes, Seasonally Adjusted 08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2006
2007
2008
2009
2010
1,957
1,884
1,933
1,877
1,866
1,869
1,886
1,888
7,843
7,855
7,651
7,508
7,599
-1.7
-3.8
2.6
-2.9
-0.6
0.1
0.9
0.1
0.8
0.2
-2.6
-1.9
1.2
2,022
1,898
1,824
1,908
1,928
1,882
1,780
1,918
7,843
7,855
7,651
7,508
7,599
1.9
-4.5
-1.9
-5.8
-4.6
-0.8
-2.4
0.6
0.8
0.2
-2.6
-1.9
1.2
Net Exports Not Seas Adj
627
607
537
564
568
550
525
513
2,554
2,437
2,336
2,157
1,777
625
552
595
564
566
497
582
513
2,554
2,437
2,336
2,157
1,777
Production %CH Not Seas Adj %CHYA
2,585
2,491
2,470
2,441
2,435
2,419
2,411
2,401 10,397 10,292
9,376
0.2
-3.6
-0.8
-1.2
-0.3
-0.7
-0.3
2,647
2,450
2,419
2,471
2,494
2,379
2,361
2.8
-4.9
-4.3
-5.4
-5.8
-2.9
-2.4
Capacity %CH
2,830
2,816
2,787
2,742
2,676
2,632
2,596
0.2
-0.5
-1.0
-1.6
-2.4
-1.6
-1.4
-1.1
0.1
-3.4
-2.0
-6.3
-4.5
0.91
0.88
0.89
0.89
0.91
0.92
0.93
0.94
0.88
0.90
0.89
0.92
0.94
Apparent Consumption %CH Not Seas Adj %CHYA
Capacity Utilization
14
RISI
9,987
9,665
-1.0
-3.0
-3.2
-3.0
2,431 10,397 10,292
9,987
9,665
9,376
-3.0
-3.2
-3.0
-0.4 -1.6
3.6 3.6
-1.0
2,566 11,800 11,400 11,175 10,470 10,000
09
Paper Trader Europe A Monthly Monitor of the European Graphic Paper Markets • Financial crises hit paper demand and currencies heavily at year-end. The changes in demand have been similar to previous recessions, but the slowdown has been more rapid than ever before and the changes are immediate. However, we do not expect the market to worsen more from the levels we have seen in the fourth quarter of 2008. The German printers confidence index by BVDM continued at the same level as in November (the worst since 1991), but was not declining any more. • The market is split in half: buyers behave like there is no tomorrow and no paper will be used in Europe ever again and producers are behaving like the demand continues as during the upturn. The price negotiations are likely to be challenging. Customer inventories are decreasing throughout Europe despite the price increase attempts. At the same time producers are confident on pushing price increases through in all grades, with the exception of uncoated woodfree. Producers are fighting for survival: the common understanding is that the profitability was already at unacceptable levels (coated woodfree paper producer, Aconda Paper, filed for insolvency in December) and despite the expensive closures and temporary downtimes, there is still no other way - - prices need to increase. To keep the supply and demand in balance, companies announced temporary capacity cuts for December and early January. • Bad news from the US car industry, the Madoff fraud case and severe actions by the US Federal bank led the US dollar to depreciate against the euro back to 1.45 levels in midDecember, and at the time of writing, the EUR/USD stands at 1.35, still 8% above the November level. Rapid and severe currency changes make forecasting of net exports extremely difficult and might influence the tough price negotiations in the beginning of 2009. • For example: using the average 45g newsprint price (approximately US$800/tonne) in the USA as a benchmark to European price negotiations, markets indicated a level of Euro 640/tonne when EUR/USD was 1.25 and Euro 552/tonne when EUR/USD was 1.45. Newsprint producers will look more at the cost and profitability level rather than currencies when pushing up the prices, but certainly exchange rates will have an effect on net exports. • Because the European economy is lagging the US by some six months and is just entering recession, the Euro is likely to depreciate rather than appreciate against the US dollar. Paper demand is pre-cyclical and sooner or later the customers' inventories will be increased to match the real demand situation, and we will see a pickup happening this year. Will it happen as quickly as February or March? Only time will tell, but for sure the paper market will be improving toward the end of the year and showing positive figures in year-over-year levels by fourth quarter 2009 at the latest. We can predict a very challenging year and huge fluctuations in paper demand as well as further paper mill closures and perhaps consolidation of paper companies during 2009. To subscribe or contact client service, visit www.risiinfo.com
Paper Trader Europe - January 2009
Figure 1 Coated Paper Prices in Europe Euros Per Tonne 880 Coated Woodfree, Reels (100 gsm) 840
LWC Gravure (60 gsm)
800
760
720
680
640 J MM J S N J M M J S N J M M J S N J MM J S N J M M J S N J M M J S N J MM J S N 02 03 04 05 06 07 08
European Printing and Writing Papers Demand for printing and writing papers declined significantly in the fourth quarter of 2008. UPM and Mreal announced negative profit warnings on demand being lower than previously anticipated. SAPPI announced temporary downtime on 25% of its CWF capacity during December and January and is ready to extend this into the following months if necessary. UPM, Lecta, Burgo and M-real as well as Scheufelen have also commented on market related downtime. For all grades the decreasing advertising expenditures, weak consumer and industrial confidence and increasing unemployment will have negative effects on demand. The drop in demand is the worst in the fourth quarter of 2008 and first quarter of 2009, but should normalize once the worst panic reaction is over. According to CEPIprint, European SC-magazine (uncoated mechanical) paper demand fell by 5.9% in November, and while the 3-month average still shows 2.3%, once the December figures come in, the fourth quarter of 2008 is likely to come in 3% lower than fourth quarter 2007. SC demand will clearly drop less than the other grades, mostly because of the downgrading tendency: from the consumer's point of view, SC A+ grades are on par quality wise with LWC grades. The printers find SC papers more difficult to print, but publishers are searching for cheaper substitutions. SC demand has been good for a few years, so the base level is high to begin with, but the trend toward SC from LWC should allow further demand strength to continue. While demand is likely to drop in the next few months, it should only be by just a few percentage points. SC paper prices will increase from the beginning of 2009 more than they did in January 2008 and an increase of about Euro 40/tonne is likely. The market balance is good after several closures and downgrading effects, primarily UPM closing its Kymmene Kajaani mill in December and removing 370,000 tonnes of SC and improved newsprint capacity.
2
RISI
Paper Trader Europe - January 2009
Coated mechanical demand has been suffering the most among the European graphic paper grades. The CEPIprint 3-month average demand is down by 10.4% and the fourth quarter of 2008 is likely to be some 10% lower than year-ago. In addition to the weakening base demand, there are several reasons why LWC will be hit more than other grades: 1)
Downgrading effect: for customers seeking cheaper options, LWC will be replaced by SC and potentially also by CWF, which is still cheaper than LWC in Europe.
2)
Base effect: the end of 2007 and the beginning of 2008 were exceptionally good for LWC because of inventory build-up (before price increases) and accelerated advertising expenditures due to the Olympic Games and European Football Championships. There are no such events scheduled in 2009.
3)
Reverse inventory effect (which also affects most other grades): customers are emptying inventories, without regard for future price levels or current market balance.
The free fall in demand should stabilize by the end of the first quarter of 2009 or even earlier depending on the inventory changes. Producers are pushing for price increases, and while the situation may be challenging, permanent closures, temporary downtimes and producer discipline are likely to lead to a Euro 20/tonne price increase in continental Europe. The Holmen Wargon mill and PM 3 at Stora Enso's Kabel mill were closed in December, removing a total of 285,000 tonnes from the market. Coated woodfree demand may be more affected than other grades by the decreasing advertising expenditures, but it will benefit from being less expensive than LWC. Massive capacity closures (over 1.2 million tonnes from fourth quarter 2008 to first quarter 2009) will exceed the drop in demand and producers will seek a price increase of 8-12% for January. Meanwhile, some inventory build-up effect should keep the drop in demand smaller than for coated mechanical papers. The price difference between LWC and CWF is expected to normalize, which will lead to the drop in demand for CWF exceeding that of LWC by the end of the year. The CEPIfine 3-month average is down by 1.9%. Coated woodfree for the fourth quarter 2008 is expected to have fallen by 6%, while annual demand is assumed to have dropped about 3%. SAPPI closed its Maastricht PM 5 in December, removing 50,000 tonnes of capacity from the market. A further 900,000 tonnes of CWF capacity closures have been announced and we expect these to take place during the first quarter of 2009. SAPPI's acquisition of M-real's commercial printing division took place on December 31, 2008. SAPPI now controls about 26% of European CWF capacity and will use its power to push the prices up. The company has announced it will temporarily shut 25% of its capacity in December and January and is likely to keep the market tight until the major closures by M-real, Lecta and Arctic Paper are completed. Scheufelen and Burgo have also announced temporary capacity cuts. The companies are seeking 8-10% price increases for 2009, in addition to the estimated 3-4% increase that resulted from price increase initiatives in the fourth quarter 2008 as well. While producers will likely fall short of the 8-10% gains they are requesting, the cost pressures, capacity closures, and market downtime will inevitably lead to some further price gains in 2009. We estimate that coated woodfree prices will gain 5-6% in the first half of 2009, followed by another 4% increase in the second half of the year. In addition to previous filings by other companies, Spanish Aconda paper filed for insolvency in December 2008. Aconda has roughly 80,000 tonnes of CWF capacity, but production could continue if new financing can be found. Chinese coated woodfree inventories have increased after the Beijing Olympics, and while exports are likely to increase, current custom statistics show declining imports from China to Europe (down 29% in September). Freight costs from Asia to Europe have dropped to less than half of year-ago levels. We are RISI
3
Paper Trader Europe - January 2009
Figure 2 Uncoated Paper Prices in Europe Euros Per Tonne 870 Offset Reels (80 gsm)
830
SC Gravure (56 gsm) 790 750 710 670 630 590 550 J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N 02 03 04 05 06 07 08
likely to see some Chinese invasion of the European market, but not to a great extent because the European price level, including the currency fluctuations, is not the most prosperous for Chinese producers. Uncoated woodfree paper according to CEPIfine 3-month average is down only 3%, which is actually less than the year-to-date figure (-5.2%). Reasons for better development than the beginning of 2008 are consumer inventory build-up before planned closures of M-real and IP. Customer inventories must have been low, because the apparent consumption started coming down in September 2006 when the economy was still accelerating fast in Europe. Imports to Europe from overseas have been decreasing (3-month average - 10%) due to EUR/USD rate and prices being not favorable for importers.
Figure 3 European Mechanical Printing and Writing Operating Rates 100%
95%
90%
85% Uncoated
80%
Coated
Finnish Mill Lockout 75% 98
4
99
00
01
02
03
04
RISI
05
06
07
08
09
10
Paper Trader Europe - January 2009
Figure 4 European Woodfree Printing and Writing Paper Operating Rates 100% Uncoated 96%
Coated
92% 88% 84% 80%
Finnish Mill Lockout
76% 98
99
00
01
02
03
04
05
06
07
08
09
10
WFU demand (especially copy paper) will be hit the hardest by the increasing unemployment rate. Demand is likely to drop by 5% over the next twelve months. If the US dollar continues to weaken against the euro, net exports should continue at their current level or even increase when the Portucel Setubal machine starts up at the end of the summer. Uncoated woodfree paper prices continued declining in December throughout Europe by about 2%. Further capacity closures (we expect International Paper to close the 250,000 tonne Inveruerie mill) will be sufficient to stop the erosion, allowing prices to stabilize in the first half of 2009. The M-real New Thames (230,000 tonnes) mill stopped WFU production in December 2008. DS Smith acquired the mill and is in the process of shifting production to lightweight containerboard. Based on market information, UPM will continue the temporary downtime of the 200,000 tonne Nordland PM 2 until September - - the machine has been producing only uncoated woodfree in recent years. Positive price development will be difficult in 2009, and without further supply reductions and/or decent upturn in exports, downward price pressure could take hold in the second half of the year as the capacity from Portucel's new machine enters the market.
European Newsprint Swiss papermaker, Perlen, plans to invest in a new newsprint machine in Switzerland. The 360,000 tonne PM 7 should start up in the autumn of 2010 and is planned to produce both standard and improved newsprint. Perlen is planning to close its old 125,000 tonne PM 5. With the company likely to be able to fund the project, the machine is expected to be built. However, the additional 235,000 tonnes of newsprint capacity will not be supported by demand. Thus the industry will face a drop of 2% in their operating rates or, more likely, further closures of 200,000 tonnes of virgin fiber based newsprint before the machine starts. Palm's new 400,000 tonne newsprint machine in the UK will start up after the summer of 2009. Ecco Newsprint's machine is not likely to start up in 2009; although the company has not mothballed the project, the current financial crises makes financing extremely challenging. According to CEPIprint, the 3-month average demand is down by 4.9%, fourth quarter 2008 demand is likely to be down by about 5-6% and 2009 demand is expected to decline another 4.3%. Demand for daily newspapers has decreased less than during past downturns because the internet has already taken the majority of the classified advertisements away. The free newspapers, which are 100% dependent upon RISI
5
Paper Trader Europe - January 2009
Figure 5 Newsprint Prices, Europe vs. US 45gsm, Euros Per Tonne 680 640
Europe
US
600 560 520 480 440 400 J MM J S N J M M J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N 02 03 04 05 06 07 08
advertising expenditures, are facing hard times. We are likely to see several independent free newspapers disappear from the market and thus have a direct impact on newsprint consumption. Free newspapers that are owned and receiving editorial material from the big publishers (daily newspapers) should survive or even prosper (in terms of demand) as consumers will likely choose free newspapers over subscriptions. Free newspapers have a market share of around 30% (0-60%) of all European newspaper titles and are most common in Spain and Portugal. Newsprint producers are searching for a price increase of approximately Euro 100/tonne in 2009. Due to tremendous cost pressure and major capacity closures, the price increases are likely to succeed above the level of annual increases from 2005-2007. In addition, continental European prices were approximately $100 per tonne below North American prices in December, while prices in the UK were nearly $200 below North American prices, so imported tonnage will be pressured to increase their prices in Euro terms as well. The full Euro 100 might be difficult to reach, but increases of Euro 60-80/tonne are likely, price increases will be higher especially in the UK where prices are clearly below continental European levels. UPM finally closed the 270,000 tonne Kajaani newsprint machine for good in December; the machine had been idle since February 2008.
© Paper Trader Europe provides economic analysis of printing and writing paper markets and is edited by John Maine, Sampo Timonen and Kevin Conley. Subscriptions: Call +32.2.536.0757 (outside the USA & Canada) or 781.734.8900 (USA & Canada), email [email protected] or visit www.risiinfo.com. Subscriptions or client service: Call 866.271.8525 (USA & Canada) or +32.2.536.0747 or email [email protected]. Editorial offices: 4 Alfred Circle, Bedford, MA 01730-2340 USA. Copyright 2009 by RISI, Inc. All rights reserved. No part of this publication may be reproduced without the written permission of the copyright owner.
DISCLAIMER OF WARRANTY Although RISI Inc. shall use its best efforts to provide accurate and reliable information, RISI Inc. does not warrant the accuracy thereof. RISI INC. MAKES NO WARRANTIES, EXPRESSED OR IMPLIED, AS TO THE RESULTS TO BE OBTAINED FROM THE USE OF ITS SERVICES AND MAKES NO WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. RISI INC. SUPPLIES ALL SERVICES ON AN “AS IS” BASIS. If notified of an error in its Services, RISI Inc. shall take reasonable steps to correct such an error.
6
RISI
Paper Trader Europe - January 2009
Table 1 Western European Graphic Paper Imports by Region of Origin Thousand Tonnes SEP 2007
OCT 2007
NOV 2007
DEC 2007
JAN 2008
FEB 2008
MAR 2008
APR 2008
MAY 2008
JUN 2008
JUL 2008
AUG 2008
SEP 2008
72 43 0 0 2 0 0 0
64 43 2 0 4 0 0 0
64 36 3 0 1 0 0 0
42 32 0 0 3 0 0 0
31 34 0 0 3 0 0 0
43 34 0 0 1 0 0 0
33 41 0 0 1 0 0 0
42 44 0 0 0 0 0 0
45 39 0 0 1 0 0 0
44 39 0 0 1 0 0 0
49 39 0 0 0 0 0 0
35 31 1 0 0 0 0 0
57 36 0 0 2 0 0 0
116
113
103
76
68
78
75
86
85
85
88
67
95
NEWSPRINT North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total
UNCOATED MECHANICAL North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others
5 3 0 0 1 0 0 0
6 2 0 0 1 0 0 0
4 2 0 0 1 0 0 0
6 1 0 0 1 0 0 0
8 3 0 0 1 0 0 0
2 3 0 0 2 0 0 0
10 3 0 0 2 0 0 0
2 4 0 0 3 0 0 0
7 3 0 0 2 0 0 0
7 2 0 0 2 0 0 0
4 3 0 0 1 0 0 0
6 4 0 0 2 0 0 0
4 5 0 0 2 0 0 0
Total
9
9
8
8
11
7
16
9
12
12
9
11
12
8 2 1 0 4 0 0 0
7 3 0 0 6 0 0 0
7 4 2 0 2 0 0 0
3 3 1 0 3 0 0 0
4 2 1 0 2 0 0 0
3 7 0 0 1 0 0 0
2 4 0 0 2 0 1 0
1 4 1 0 1 0 0 0
1 2 0 0 1 0 0 0
1 5 0 0 1 0 0 0
1 5 0 0 1 0 0 0
2 4 0 0 1 0 0 0
3 6 2 0 2 0 0 0
16
16
14
10
10
13
8
7
4
8
8
7
13
5 51 13 0 21 9 1 2
5 51 10 1 21 8 1 2
7 44 16 0 17 8 1 2
7 49 7 0 12 3 1 2
7 53 16 0 12 4 0 1
8 50 13 0 11 4 1 1
6 54 14 0 18 9 1 1
6 47 99 0 19 7 1 1
6 43 14 0 18 9 2 1
9 42 10 0 16 6 1 1
8 48 14 0 19 5 2 3
7 35 12 0 13 9 1 2
6 43 14 0 10 8 1 3
103
99
95
81
93
88
102
180
94
86
99
79
85
North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others
3 9 2 0 15 0 0 0
3 10 1 0 14 0 0 0
3 11 2 0 13 0 0 1
2 7 1 0 11 0 0 0
3 12 1 0 16 0 0 1
2 8 1 0 14 0 0 0
3 13 2 0 10 0 0 0
3 8 1 0 13 0 0 0
5 12 1 0 11 0 0 0
4 6 3 0 8 0 0 0
3 9 1 0 8 0 0 0
4 7 1 0 5 0 0 0
3 11 1 0 9 0 0 0
Total
30
29
31
21
32
25
28
25
28
21
21
17
24
COATED MECHANICAL North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total UNCOATED WOODFREE North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total COATED WOODFREE
RISI
7
Paper Trader Europe - January 2009
Table 2 Western European Graphic Paper Exports by Region of Destination Thousand Tonnes SEP 2007
OCT 2007
NOV 2007
DEC 2007
JAN 2008
FEB 2008
MAR 2008
APR 2008
MAY 2008
JUN 2008
JUL 2008
AUG 2008
SEP 2009
4 34 8 28 42 13 0 3
3 36 9 37 35 13 0 2
1 38 6 31 30 11 0 4
5 33 10 20 26 9 0 4
7 36 7 45 40 10 0 4
2 29 11 44 50 15 0 4
8 33 7 38 40 11 0 6
6 41 5 24 40 16 0 5
1 33 4 26 26 7 1 5
0 37 4 27 29 5 0 6
3 43 5 36 35 11 0 5
4 41 5 47 40 11 1 4
6 41 3 44 44 14 2 6
132
135
121
106
149
156
143
137
103
108
139
152
159
NEWSPRINT North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total
UNCOATED MECHANICAL (Finnish uncoated mechanical exports are RISI estimates) North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total
46 49 6 20 15 10 9 0
50 55 8 20 13 9 10 0
38 46 8 21 15 7 10 0
32 46 9 19 15 7 11 0
46 41 13 24 17 11 9 0
48 47 10 21 17 8 16 0
47 49 11 22 17 7 16 0
55 55 13 24 17 6 14 0
41 60 12 28 14 21 16 1
46 55 13 17 27 10 16 1
34 60 13 26 16 22 19 1
43 61 16 26 16 18 15 1
47 62 12 19 19 13 19 1
155
165
145
139
161
167
169
184
193
185
191
197
192
COATED MECHANICAL North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others
76 104 16 16 13 9 16 4
71 121 14 18 15 10 16 5
64 112 15 16 12 11 11 3
51 98 14 13 16 8 13 4
57 105 16 22 15 12 17 3
46 102 16 17 15 9 15 3
45 103 19 18 16 9 16 4
39 101 17 20 12 7 21 4
39 94 19 21 15 8 19 3
38 89 21 22 15 11 18 3
53 87 18 25 17 10 23 3
33 93 16 24 26 8 20 2
43 103 17 19 20 9 17 2
Total
254
268
244
218
250
224
229
221
217
217
236
222
230
7 47 6 31 16 16 4 3
11 66 9 32 18 18 5 4
10 63 7 31 14 20 4 4
13 51 5 26 16 13 4 4
10 65 6 29 16 23 5 4
7 63 5 25 18 13 3 4
8 56 6 14 13 15 4 3
12 62 6 17 14 21 4 3
7 60 6 25 15 19 4 4
7 56 5 28 16 14 5 3
9 57 6 29 18 15 5 3
12 54 7 37 13 14 4 4
9 52 8 25 13 15 5 3
130
162
152
132
159
138
119
139
141
134
144
144
130
58 84 36 31 36 22 8 3
75 94 46 32 34 24 9 4
64 87 35 33 26 21 5 4
56 60 34 29 27 20 7 3
56 74 40 50 29 16 9 3
61 66 41 50 29 16 6 2
55 73 37 44 29 17 6 3
58 78 35 40 36 16 8 4
58 76 38 38 36 18 8 3
58 68 41 44 36 19 12 4
59 67 39 37 35 18 12 3
45 73 46 36 37 21 11 4
55 81 38 31 24 20 9 3
278
319
274
237
276
273
264
275
274
281
270
272
261
UNCOATED WOODFREE North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total COATED WOODFREE North America Eastern Europe Latin America Middle East Far East Africa Oceania All Others Total
8
RISI
Paper Trader Europe - January 2009
Table 3 Western European Mechanical Paper Prices Euros Per Tonne Delivered
NOV 2007
DEC 2007
JAN 2008
FEB 2008
MAR 2008
APR 2008
MAY 2008
JUN 2008
JUL 2008
AUG 2008
SEP 2008
OCT 2008
NOV 2008
DEC 2008
Germany
550
550
550
550
528
528
528
528
528
528
528
528
528
528
France
545
545
545
545
520
520
520
520
520
520
520
520
520
520
Italy
550
550
550
550
530
530
530
530
530
530
530
530
530
530
United Kingdom UK Pound
536
526
508
486
464
453
455
455
454
454
451
458
433
396
380
380
380
365
360
360
360
360
360
360
360
360
360
360
Germany
565
565
590
590
590
590
590
590
605
605
605
605
605
605
France
585
585
600
600
600
600
600
600
605
605
605
605
605
605
Italy
590
590
608
608
608
608
608
608
628
628
628
628
628
628
United Kingdom UK Pound
571 405
561 405
542 405
559 420
542 420
528 420
531 420
531 420
581 460
580 460
576 460
585 460
553 460
506 460
Germany
585
585
605
605
605
605
605
605
620
620
620
620
620
620
France
598
598
615
615
615
615
615
615
620
620
620
620
620
620
Italy
590
590
608
608
608
608
608
608
628
628
628
628
628
628
United Kingdom UK Pound
578 410
568 410
548 410
566 425
548 425
535 425
537 425
537 425
587 465
587 465
583 465
591 465
559 465
511 465
Germany
680
680
715
715
715
715
715
715
730
730
730
730
730
730
France
680
680
710
710
710
710
710
710
725
725
725
725
725
725
Italy
680
680
715
715
715
715
715
715
740
740
740
740
740
740
United Kingdom UK Pound
649
637
615
646
625
610
613
613
675
675
670
680
643
588
460
460
460
485
485
485
485
485
535
535
535
535
535
535
Newsprint Standard 45 gsm
Supercalendered Gravure 60 gsm
Supercalendered Gravure 56 gsm
Lightweight Coated Gravure 60 gsm
RISI
9
Paper Trader Europe - January 2009
Table 4 Western European Woodfree Paper Prices Euros Per Tonne Delivered NOV 2007
DEC 2007
JAN 2008
FEB 2008
MAR 2008
APR 2008
MAY 2008
JUN 2008
JUL 2008
AUG 2008
SEP 2008
OCT 2008
NOV 2008
DEC 2008
Germany
735
735
735
735
730
730
730
720
720
720
720
720
720
720
France
780
780
780
780
780
780
780
780
780
780
780
780
780
765
Italy
740
740
740
735
735
735
735
735
735
735
735
735
735
730
United Kingdom UK Pound
754 535
741 535
716 535
712 535
690 535
673 535
682 540
682 540
681 540
681 540
677 540
712 560
674 560
616 560
Germany
905
905
905
905
905
905
900
885
885
885
885
885
885
885
France
895
895
895
895
895
895
895
895
895
895
895
865
865
855
Italy
845
840
840
835
835
835
835
835
835
835
825
825
825
815
United Kingdom UK Pound
860 610
838 605
809 605
805 605
780 605
761 605
777 615
777 615
776 615
776 615
771 615
794 625
752 625
687 625
Germany
850
850
850
850
845
845
840
825
825
820
820
820
820
800
France
850
840
850
850
850
850
850
850
850
850
850
820
820
805
Italy
815
810
810
800
800
800
800
800
800
800
790
790
780
780
United Kingdom UK Pound
832 590
810 585
783 585
779 585
754 585
736 585
745 590
746 590
745 590
744 590
739 590
756 595
716 595
654 595
Germany
690
690
690
690
690
690
690
690
690
690
690
725
725
725
France
680
680
680
680
680
695
695
695
695
690
690
715
720
720
Italy
695
690
690
690
690
700
700
700
700
695
695
725
725
725
United Kingdom UK Pound
691
679
655
652
655
639
642
642
669
669
683
731
692
632
490
490
490
490
508
508
508
508
530
530
545
575
575
575
Germany
775
775
775
775
775
775
775
775
775
775
775
825
825
820
France
800
800
800
800
800
810
810
810
810
805
805
830
835
835
Italy
775
775
775
775
780
790
790
790
790
785
785
815
815
815
United Kingdom UK Pound
825
810
783
779
784
765
768
768
789
788
802
839
794
726
585
585
585
585
608
608
608
608
625
625
640
660
660
660
Uncoated Woodfree Offset Reels 80 gsm
A4 Cutsize B-Grade
A4 Cutsize C-Grade
Coated Woodfree Reels 100 gsm
Sheets 100 gsm
10
RISI
Paper Trader Europe - January 2009
Table 5 Western European Graphic Paper Price Forecast Euros Per Tonne 08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2006
2007
2008
2009
2010
521 -4.3
501 -3.8
501 -0.1
492 -1.7
536 8.9
551 2.9
552 0.1
552 0.1
523 6.0
547 4.7
503 -8.0
548 8.8
584 6.6
SC Gravure 60 gsm %CH
588 2.4
586 -0.2
605 3.2
601 -0.7
627 4.4
647 3.1
659 1.9
667 1.2
595 0.1
579 -2.7
595 2.8
650 9.2
689 6.0
SC Gravure 56 gsm %CH
599
598
617
612
639
661
674
681
608
592
606
664
704
2.0
-0.2
3.2
-0.7
4.4
3.4
1.9
1.2
0.1
-2.5
2.3
9.5
6.1
696
692
719
712
731
754
765
775
701
682
705
756
805
3.4
-0.6
3.9
-1.1
2.8
3.1
1.4
1.3
-0.1
-2.7
3.4
7.3
6.4
NEWSPRINT Standard 45 gsm %CH UNCOATED MECHANICAL
COATED MECHANICAL LWC Gravure 60 gsm %CH UNCOATED WOODFREE Offset Reels 80 gsm %CH
739
729
727
722
715
715
716
729
688
735
729
719
771
-1.7
-1.4
-0.3
-0.7
-0.9
-0.1
0.2
1.8
0.3
6.8
-0.9
-1.4
7.3
A4 Cutsize B Grade %CH
866
855
851
833
820
820
821
828
790
863
851
822
876
-1.7
-1.4
-0.4
-2.1
-1.5
0.0
0.2
0.7
3.5
9.2
-1.3
-3.4
6.5
A4 Cutsize C Grade %CH
823
810
805
782
767
767
768
774
738
821
805
769
820
-1.8
-1.6
-0.7
-2.8
-1.9
0.0
0.2
0.8
6.8
11.3
-1.9
-4.5
6.6
COATED WOODFREE Reels 100 gsm %CH
679
681
688
713
733
753
762
782
697
701
690
758
825
-1.4
0.3
0.9
3.7
2.8
2.7
1.1
2.7
-1.2
0.5
-1.4
9.7
8.9
Sheets 100 gsm %CH
784 -1.7
786 0.3
790 0.6
815 3.2
846 3.7
870 2.9
879 1.0
903 2.7
814 -2.2
815 0.1
794 -2.6
874 10.1
950 8.7
0.67 1.50
0.64 1.56
0.67 1.50
0.76 1.32
0.76 1.31
0.78 1.29
0.79 1.27
0.80 1.25
0.80 1.26
0.73 1.37
0.68 1.47
0.78 1.28
0.82 1.22
EXCHANGE RATE Euro/US$ US$/Euro
RISI
11
Paper Trader Europe - January 2009
Table 6 Western European Printing and Writing Paper Forecast Thousand Tonnes, Seasonally Adjusted 08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2006
2007
2008
2009
2010
7,769
7,755
7,739
7,702
7,649
7,640
7,663
7,693
7,470
7,666
7,741
7,661
7,798
2.7
-0.7
-0.8
-1.9
-2.7
-0.5
1.2
1.6
3.0
2.6
1.0
-1.0
1.8
Apparent Consumption %CH Not Seas Adj %CHYA
7,140
7,129
7,043
6,840
6,813
6,822
6,849
-1.7
-0.2
-1.2
-2.9
-0.4
0.1
0.4
7,266
7,214
6,774
6,897
6,934
6,904
6,588
-1.1
-2.7
-2.5
-5.8
-4.6
-4.3
-2.8
0.4
1.2
0.9
-3.0
-2.9
1.0
Net Exports Not Seas Adj
2,091
1,959
1,919
2,001
1,978
1,937
1,897
1,878
8,641
8,341
7,970
7,689
7,260
2,105
1,778
2,059
2,028
1,992
1,762
2,031
1,904
8,641
8,341
7,970
7,689
7,260
Production %CH Not Seas Adj %CHYA
9,231
9,088
8,962
8,840
8,791
8,759
8,745
8,742 37,423 37,370 36,121 35,038 34,883
-0.1
-1.5
-1.4
-1.4
-0.6
-0.4
-0.2
9,371
8,992
8,833
8,925
8,925
8,666
8,619
-1.2
-4.1
-3.9
-4.3
-4.8
-3.6
-2.4
10,055
9,986
9,876
9,743
9,531
9,404
9,330
-0.5
-0.7
-1.1
-1.4
-2.2
-1.3
-0.8
-0.2
0.3
-2.1
-2.8
-5.3
-0.9
0.92
0.91
0.91
0.91
0.92
0.93
0.94
0.94
0.90
0.92
0.91
0.93
0.94
2006
2007
Euro Area GDP Billion 00 Euro Annualized %CH
Capacity %CH Capacity Utilization
6,864 28,782 29,029 28,152 27,348 27,623 0.2
1.2
0.9
-3.0
-2.9
1.0
6,923 28,782 29,029 28,152 27,348 27,623
0.0
2.9
-0.1
-3.3
-3.0
-0.4
8,827 37,423 37,370 36,121 35,038 34,883 -1.1
2.9
-0.1
-3.3
-3.0
-0.4
9,310 41,680 40,800 39,660 37,575 37,250
Table 7 Western European Newsprint Forecast Thousand Tonnes, Seasonally Adjusted
Apparent Consumption %CH Not Seas Adj %CHYA Net Exports Not Seas Adj
08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2008
2009
2010
2,571
2,570
2,523
2,379
2,423
2,417
2,397
2,378 10,537 10,481 10,043
9,615
9,558
2.8
-0.1
-1.8
-5.7
1.9
-0.3
-0.8
2,523
2,600
2,508
2,412
2,377
2,445
2,382
-5.3
-3.2
-3.5
-4.8
-5.8
-6.0
-5.0
0.0
1.7
-0.5
-0.8
1.7
-0.5
-4.2
-4.3
-0.6
2,411 10,537 10,481 10,043
9,615
9,558
-4.2
-4.3
-0.6
81
62
81
133
110
107
116
121
366
247
357
454
487
133
-12
112
124
159
38
146
111
366
247
357
454
487
Production %CH Not Seas Adj %CHYA
2,652
2,632
2,604
2,512
2,533
2,524
2,513
0.2
-0.8
-1.1
-3.5
0.9
-0.4
-0.5
2,656
2,588
2,620
2,535
2,537
2,482
2,528
-1.9
-2.3
-3.0
-5.1
-4.5
-4.1
-3.5
Capacity %CH
2,751
2,721
2,699
2,684
2,668
2,654
2,649
-1.8
-1.1
-0.8
-0.5
-0.6
-0.5
-0.2
0.2
0.1
-0.6
-4.2
-2.1
0.7
0.96
0.97
0.96
0.94
0.95
0.95
0.95
0.94
0.96
0.95
0.96
0.95
0.94
Capacity Utilization
12
RISI
2,499 10,903 10,728 10,399 10,070 10,045 -0.5
2.5
-1.6
-3.1
-3.2
-0.2
2,522 10,903 10,728 10,399 10,070 10,045 -0.5
2.5
-1.6
-3.1
-3.2
-0.2
2,654 11,405 11,335 10,855 10,625 10,700
Paper Trader Europe - January 2009
Table 8 Western European Uncoated Mechanical Paper Forecast Thousand Tonnes, Seasonally Adjusted 08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2006
2007
2008
2009
2010
1,230
1,288
1,278
1,267
1,252
1,249
1,250
1,250
4,974
5,032
5,063
5,002
5,027
-3.3
4.7
-0.8
-0.8
-1.2
-0.2
0.0
0.0
5.0
1.2
0.6
-1.2
0.5
1,217
1,289
1,290
1,266
1,239
1,251
1,263
1,249
4,974
5,032
5,063
5,002
5,027
-2.0
3.0
1.7
-0.3
1.8
-3.0
-2.2
-1.3
5.0
1.2
0.6
-1.2
0.5
Net Exports Not Seas Adj
553
533
543
544
529
518
512
511
2,408
2,379
2,174
2,070
2,037
578
507
549
541
553
492
517
508
2,408
2,379
2,174
2,070
2,037
Production %CH Not Seas Adj %CHYA
1,784
1,821
1,821
1,812
1,781
1,768
1,762
1,761
7,382
7,411
7,237
7,072
7,063
-1.5
2.1
0.0
-0.5
-1.7
-0.7
-0.3
-0.1
11.5
0.4
-2.3
-2.3
-0.1
1,795
1,796
1,839
1,807
1,792
1,743
1,780
1,757
7,382
7,411
7,237
7,072
7,063
-4.8
-2.9
-1.7
0.1
-0.2
-3.0
-3.2
-2.8
11.5
0.4
-2.3
-2.3
-0.1
Capacity %CH
1,953
1,941
1,923
1,899
1,856
1,832
1,821
1,822
7,810
7,910
7,715
7,330
7,350
-0.8
-0.6
-0.9
-1.3
-2.3
-1.3
-0.6
0.1
5.3
1.3
-2.5
-5.0
0.3
0.91
0.94
0.95
0.95
0.96
0.96
0.97
0.97
0.95
0.94
0.94
0.96
0.96
Apparent Consumption %CH Not Seas Adj %CHYA
Capacity Utilization
Table 9 Western European Coated Mechanical Paper Forecast Thousand Tonnes, Seasonally Adjusted 08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2006
2007
2008
2009
2010
1,794
1,776
1,695
1,600
1,646
1,659
1,667
1,679
6,861
7,067
6,865
6,652
6,777
0.2
-1.0
-4.6
-5.6
2.9
0.8
0.5
0.7
0.6
3.0
-2.9
-3.1
1.9
1,806
1,746
1,642
1,670
1,656
1,631
1,614
1,751
6,861
7,067
6,865
6,652
6,777
2.6
0.2
-3.7
-10.1
-8.3
-6.6
-1.7
4.8
0.6
3.0
-2.9
-3.1
1.9
Net Exports Not Seas Adj
854
786
776
827
815
800
789
779
3,443
3,381
3,244
3,182
3,094
851
743
823
827
812
758
836
777
3,443
3,381
3,244
3,182
3,094
Production %CH Not Seas Adj %CHYA
2,648
2,561
2,471
2,428
2,461
2,459
2,457
2,458 10,304 10,448 10,108
9,834
9,871
0.9
-3.3
-3.5
-1.8
1.4
-0.1
-0.1
2,657
2,489
2,465
2,497
2,468
2,389
2,450
2.6
-2.4
-5.8
-7.3
-7.1
-4.0
-0.6
Capacity %CH
2,767
2,748
2,715
2,680
2,630
2,600
2,587
-0.4
-0.7
-1.2
-1.3
-1.9
-1.1
-0.5
0.1
-0.7
-3.0
-2.8
-4.6
0.2
0.96
0.93
0.91
0.91
0.94
0.95
0.95
0.95
0.89
0.93
0.93
0.95
0.95
Apparent Consumption %CH Not Seas Adj %CHYA
Capacity Utilization
RISI
0.0
-3.3
-2.7
0.4
2,527 10,304 10,448 10,108
9,834
9,871
-2.7
0.4
1.2
-1.3 -1.3
1.4 1.4
-3.3
2,588 11,570 11,225 10,910 10,405 10,430
13
Paper Trader Europe - January 2009
Table 10 Western European Uncoated Woodfree Paper Forecast Thousand Tonnes, Seasonally Adjusted
Apparent Consumption %CH Not Seas Adj %CHYA
08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2006
2007
2008
2009
2010
2,158
2,182
2,137
2,095
2,048
2,045
2,045
2,048
9,104
9,074
8,573
8,186
8,221
-2.5
1.1
-2.0
-2.0
-2.2
-0.2
0.0
0.1
0.1
-0.3
-5.5
-4.5
0.4
2,221
2,281
2,018
2,053
2,108
2,139
1,932
2,008
9,104
9,074
8,573
8,186
8,221
-5.7
-6.2
-4.8
-5.2
-5.1
-6.2
-4.3
-2.2
0.1
-0.3
-5.5
-4.5
0.4
Net Exports Not Seas Adj
56
33
63
65
67
69
70
74
236
145
216
280
352
51
-24
92
96
63
16
97
104
236
145
216
280
352
Production %CH Not Seas Adj %CHYA
2,214
2,214
2,200
2,160
2,115
2,114
2,115
2,122
9,340
9,219
8,788
8,467
8,573
-0.5
0.0
-0.6
-1.8
-2.1
-0.1
0.1
0.3
0.7
-1.3
-4.7
-3.7
1.3
2,272
2,257
2,110
2,149
2,171
2,155
2,029
2,112
9,340
9,219
8,788
8,467
8,573
-6.5
-5.9
-3.1
-2.9
-4.4
-4.5
-3.8
-1.7
0.7
-1.3
-4.7
-3.7
1.3
Capacity %CH
2,506
2,480
2,452
2,422
2,370
2,339
2,327
2,334 10,500 10,265
9,860
9,370
9,470
-1.1
-1.0
-1.1
-1.3
-2.1
-1.3
-0.5
0.3
-1.7
-2.2
-3.9
-5.0
1.1
0.88
0.89
0.90
0.89
0.89
0.90
0.91
0.91
0.89
0.90
0.89
0.90
0.91
Capacity Utilization
Table 11 Western European Coated Woodfree Paper Forecast Thousand Tonnes, Seasonally Adjusted 08:I
08:II
08:III
08:IV
09:I
09:II
09:III
09:IV
2006
2007
2008
2009
2010
1,957
1,884
1,933
1,877
1,866
1,869
1,886
1,888
7,843
7,855
7,651
7,508
7,599
-1.7
-3.8
2.6
-2.9
-0.6
0.1
0.9
0.1
0.8
0.2
-2.6
-1.9
1.2
2,022
1,898
1,824
1,908
1,928
1,882
1,780
1,918
7,843
7,855
7,651
7,508
7,599
1.9
-4.5
-1.9
-5.8
-4.6
-0.8
-2.4
0.6
0.8
0.2
-2.6
-1.9
1.2
Net Exports Not Seas Adj
627
607
537
564
568
550
525
513
2,554
2,437
2,336
2,157
1,777
625
552
595
564
566
497
582
513
2,554
2,437
2,336
2,157
1,777
Production %CH Not Seas Adj %CHYA
2,585
2,491
2,470
2,441
2,435
2,419
2,411
2,401 10,397 10,292
9,376
0.2
-3.6
-0.8
-1.2
-0.3
-0.7
-0.3
2,647
2,450
2,419
2,471
2,494
2,379
2,361
2.8
-4.9
-4.3
-5.4
-5.8
-2.9
-2.4
Capacity %CH
2,830
2,816
2,787
2,742
2,676
2,632
2,596
0.2
-0.5
-1.0
-1.6
-2.4
-1.6
-1.4
-1.1
0.1
-3.4
-2.0
-6.3
-4.5
0.91
0.88
0.89
0.89
0.91
0.92
0.93
0.94
0.88
0.90
0.89
0.92
0.94
Apparent Consumption %CH Not Seas Adj %CHYA
Capacity Utilization
14
RISI
9,987
9,665
-1.0
-3.0
-3.2
-3.0
2,431 10,397 10,292
9,987
9,665
9,376
-3.0
-3.2
-3.0
-0.4 -1.6
3.6 3.6
-1.0
2,566 11,800 11,400 11,175 10,470 10,000
