NBSK Hovering at Record Levels

More North American producers announced a $20/metric ton price hike on NBSK (northern bleached softwood kraft) pulps for June 1. If implemented, North American NBSK will rise to a record level of $1,040/metric ton, Wilde reports. According to PPPC, he adds, April pulp shipments were -15.0% m/m, but +3.3% y/y. The m/m decline was mostly due to lower shipments in China after a record March. Inventories rose by one day of supply (+2 on softwood, +1 on hardwood). In Europe, producers have set NBSK at $1,040/metric ton, +$30/metric ton m/m. However, a strong euro has limited margin gains for euro-based mills.

Meanwhile, Asian prices remain under pressure. In China, trade contacts suggest that local NBSK prices have fallen ˜$70 - $80/metric ton from May's $920 - $930/metric ton list price level in recent weeks, Wilde continues. Fall-out of higher pulp prices? he asks. With paper demand sluggish, producers may find it difficult to raise paper prices, forcing non-integrated P&W mills to curtail/shutdown production. Last week's news that Grays Harbor Paper is closing is one such example, Wilde explains.

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