Coated freesheet mills are operating at full capacity, and the coated freesheet web price increase of $1.50/cwt for January 1 was fully implemented. Coated groundwood mills are operating at 70% of capacity; however, driven by rising freight and pulp costs, coated groundwood producers have announced a $2.00/cwt price increase for March 1, on all coated #4 and #5 grades. Newsprint mills are reporting full order books, and so the $40/tonne (45g) newsprint price increase was fully implemented…half on January 1 and half on February 1. Uncoated groundwood mills have announced a $40/ton price increase for all machine finish higher brightness grades for March 1. Coated freesheet sheetfed mills have announced an 8% price increase for March 1.
Norske Skog permanently idled PM 5 at its Saugbrugs mill in Norway on December 21, 2020. The paper machine was producing 100,000 tonnes/yr of supercalendered (SC) paper.
Paper Excellence (formerly Catalyst Paper) will cease producing machine finish high brightness br ands in February. This includes their Electrabrite and ElectraStar brands.
WestRock ’s internal online computer system was victim to a cyber attack on January 23 24, that affected the company’s operations and deliveries
Paper and board prices in China inc reased in January as pulp and recovered paper costs rose.
International Paper Q4 2020 results: adjusted operating earnings down 31.2% from year ago to $296 million Feb 4, 2021
Packaging Corp of America Q4 2020 results: sales flat at $1.7 billion, operating income down 45.8%
Resolute Forest Products preliminary Q4 2020 results: sa les up by $101 million year on year to $769 million Feb 4, 2021
Sappi shows financial recovery in Q1 2021 results. EBITDA improved progressively from a low of US$26m in Q3 2020 due to the impact of Covid 19 to US$98m for Q1 2021.
Wood Pulp Prices rose 3% in January and continue to rise. Current transactional pulp prices are 6% higher than they were at this time last year, and suppliers hav e already announced price increases in February and March.
Mill Costs are on the rise, including pulp and freight costs. Some m ills are seeking relief in the form of paper price increases in 2021.
National Load to Truck Ratio data shows a current ratio of 4.5 loads to each truck, up from 3.5 last month. 2020 caused a rise in truck volume, and specifically in the spot market; however, recent data suggests that the freight markets have slowed some. Source: DAT Freight & Analytics
Paper Grade Review
Coated grades – There are very few coated paper producers remaining in North America. As such, coated freesheet (CFS) mills are operating at 100% of capacity, while coated groundwood (CGW) mills are operating at about 70%. The CFS price increase in January was successfully implemented for rolls, and CFS producers have announced an 8-10% price increase on sheetfed brands for March 1. CGW mills are seeking a $2/cwt increase effective March 1, sparked by rising mill costs.
Uncoated freesheet grades (UFS) – Shipments for UFS offset rolls were down only 4% in 2020, while UFS cut-size grades were down by 25%. UFS markets were strengthened in late 2020 by election activity and the re-opening of schools in the fall; however, demand has since retreated and UFS mill operating rates are still below par. The UFS markets will improve when demand, which has been suppressed by the pandemic through the closure of offices and schools, returns. As pulp prices and mill costs continue to rise, we could see more capacity being converted or removed this year to bolster the UFS market and potentially increase prices later this year.
Uncoated groundwood grades (UGW including SC) – UGW demand fell by 24% in 2020, with supercalendered (SC) grades faring the worst…falling by 29%. UGW producers have announced a cost-driven $2.00/cwt ($40/ton) price increase for March 1, on all high brightness UGW grades, including uncoated freesheet alternatives. Industry analysts are predicting that SC prices will also rise later this year, dependent upon the success of the CGW price increases.
Newsprint grades – Newsprint producers have successfully implemented the $40/tonne (45g) price increase over January and February. Thus far in 2021, newsprint markets have fared better than could be expected. Mills are reporting market tightness and strong order books. As such, industry analysts are predicting a second round of newsprint price increases for Q2.