Seeking stability - Paper - Brief Article

Recycling Today, Nov, 2002

After the roller coaster ride of this summer and early fall, most paper stock grades are settling into a comfortable price range. Old corrugated containers (OCC) seem near a balanced level, as price declines have eased. Movement still continues, despite sharp price drops earlier this fall.

Inventory levels at many board mills have been reduced over the past several quarters. With lower inventory levels, buying of OCC, mixed paper and other bulk grades is steadier.

Mixed paper markets are following a trend line similar to that of OCC. While this grade enjoyed much better pricing when OCC demand was soaring, its backslide has had a similar impact on mixed paper prices. Despite a slip in price, the grade, like many other post-consumer grades, shows steady movement.

A grade that has been improving over the past month has been old newspapers (ONP). Prices have solidified, and demand has improved in most regions of the country. The South has been benefiting from the startup of new consumers who are soaking up excess inventory through the region.

Higher prices for finished newsprint could be holding, which bodes well for ONP and old magazines.

(Additional news on paper markets, including breaking news and pricing is available at www.RecyclingToday.com.)

Paper

U.S. Producer Price Index/Mixed Paper

* Index based on 1982 average prices as 100

September     174.5
October       174.6
November      174.7
December      175.1

January '02   174.3
February      175.3
March         175.8
April         227.1
May           262.2
June          499.6
July          658.8
August        607.4
September     565.8

Source: U.S. Bureau of Labor Statistics

Note: Table made from bar graph.