PAPER CLIPS

Pulp & Paper, Oct 2004

BRIEF NEWS AND REVIEWS FROM AROUND THE INDUSTRY

* AF&PA pres./CEO W. Henson Moore said he agreed with a U.S. government decision recently to not pursue unfair trade practices against China related to China's management of its currency. "Given the discussions between the U.S. and Chinese government-which will continue in Washington-we determined that filing the 301 at this time was not necessary and would not be useful," Moore said. However, companies who are part of the association "feel strongly that China is manipulating its currency by deliberately undervaluing the yuan against the dollar, which unfairly has made U.S. forest products less competitive in China, and at the same time made Chinese products more competitive in the U.S. market," he said.

* The AF&PA called on the U.S. Congress to pass the JOBS legislation that repeals the Foreign Sales Corporation/Extraterritorial Income export tax provision. That export tax incentive has resulted in retaliatory tariffs imposed by the European Union against U.S. products. "If Congress doesn't act before they leave, the tariffs will likely continue to increase (from 11%) to 17%," the AF&PA's Moore said.

* G-P plans to eliminate 40 positions at its Port Hudson, La., uncoated free-sheet and tissue mill, a company official said. Twelve recent hires were laid off, and the remaining positions will be eliminated through attrition, the contact said. The layoffs won't impact production at the mill. High energy costs were a contributing factor in the decision.

* Domtar's Windsor, Ont., pulp and paper mill, which hasn't sold northern bleached hardwood kraft (NBHK) on the open market since June, was expected to return to the market in September, a contact said. The mill, which has capacity to produce 393,000 mtpy of NBHK with an estimated 94,000 mtpy for open market, previously wasn't expected to sell any output for the remainder of the year.

* High-end specialty cellulose producers have been running their southern U.S. mills at capacity due to higher demand and last summer's closure of International Paper's Natchez, Miss., mill last summer. Prices of wood-based dissolving pulp, however, are expected to remain stable for the balance of the year after rising in January with expiration of annual contracts.

* Waysau-Mosinee Paper Corp. has changed its name to Wausau Paper, as part of an initiative to create unified brand recognition across its three business segments-fine printing and writing papers, technical specialty papers, and towel and tissue products. The company's NYSE ticker symbol changed to WPP.

* Attorneys are seeking class-action status for a lawsuit alleging dioxin contamination by Abitibi-Consolidated's Lufkin, Texas, newsprint and supercalendered paper mill. The mill ceased production indefinitely Dec. 2003. More than 5,000 lakeside property owners could be represented if the suit is certified as a class action.

* Stockton Pacific Enterprises Inc. employees agreed to a 15% pay cut for the remainder of 2004 to help offset recently declining prices and improve the firm's cash flow, contacts told Pulp & Paper Week. In a letter to employees, CEO Steve Fleischer blamed the 200,000mtpy mill's financial difficulties on a $60/tonne drop in its pulp prices as well as $30 million in debt.

* Bay State Paper Co.'s shut Boston, Mass., recycled Containerboard mill may reopen, possibly with new owner Canusa Corp., according to the Boston Globe. The mill was closed in April when Bay State Paper filed for Ch. 11 bankruptcy protection.

* Missota Paper is close to announcing a buyer for its 180,000-tpy nonintegrated uncoated free-sheet mill in Brainerd, Minn., a company official confirmed recently. The company has been looking for a buyer or strategic partner since indefinitely shutting down its 108,000tpy No. 6 machine on Nov. 1, 2003, due to depressed market conditions.

* Smurfit-Stone Container will pay $950,000 and install pollution-control equipment at its 870,000-tpy linerboard and corrugating medium mill in West Point, Va., to settle alleged violations of federal and state air pollution control laws. In the release, the government said the mill, formerly owned by Stone Container Corp., allegedly violated the federal Clean Air Act and Virginia's Air Pollution Control Law.