N.A. Coated Groundwood Turning Corner

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The market direction for North American coated groundwood grades appears to be turning, aided by better volume comparison and supply cuts, according to Wilde. Domtar's recent announcement that it will shutter its Columbus, Miss., USA, mill and sell the inventory and brands to NewPage will trim North American LWC supply by 4.5%, he adds. Preliminary March shipment data show significant signs of improvement (+33.9% y/y, +18.1% m/m). "However, we caution that much of the gain owes to a 'lapping' of weak numbers from March 2009 (- 40.5% y/y). The North American industry is apt to see further restructuring in 2010 as European players have been re-assessing their NA operations. There are also a number of 'orphan' LWC mills that could change hands," Wilde says.