Another North American containerboard price increase is possible for this year, according to Mark Wilde, senior analyst at Deutsche Bank. "While there have been no formal announcements, we are increasingly convinced of the third price hike attempt in 2010," Wilde says, pointing out that hikes in January and April added $110/ton to domestic list prices.
Wilde notes that Industry fundamentals remain strong: box shipments +4.8% y/y in April, operating rate = 95%, domestic and offshore supplies are tight). The biggest question mark, he says, appears to be box pricing. Most European producers have announced a third price increase of EUR 50/metric ton on unbleached kraft linerboard, effective June 1. For U.S. exporters, strengthening of the dollar against the Euro will trim any benefit from the Euro price increase. OCC prices to China fell $10/ton this week and reports suggest that prices could fall another $30-$35/ton in coming weeks. Domestic OCC price fell $10/ton in May, according to Wilde.
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