Containerboard Cools as Year-End Doldrums Approach
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In the North American containerboard arena, following recent price backtracking in August (taking linerboard from $680 to $640/ton), the near-term focus has shifted to defense, Wilde points out. The risk is that prices could begin to ease, he adds, "especially as we approach the seasonal doldrums around year-end. Our discussions with trade contacts suggest that the market appears to have a bit more slack than the August operating rate and inventory numbers would suggest. We are starting to hear some reports of ‘deals' being offered on ‘side rolls' and other products.
"Having past the seasonally high period of maintenance downtime (Q2) and with all the macro data pointing to an easing in rate of economic expansion, we think the industry will be forced to announce more downtime during the fourth quarter to keep inventories in balance. Domestic OCC prices continue to rise, reportedly as much as +$15/ton m/m," Wilde says.
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