Industry
Reports
Deutsche Bank Reports Summaries
080428 Deutsche Bank Report - Dr. Paper's Pulse on Pricing
(4/28/08)
Deutsche Bank - Equity Research
* LUMBER
The Random Lengths composite price rose $7/mbf to
$262/mbf. Recent capacity withdrawals by Canfor & Simpson
have helped mkt dynamics. Can the momentum be sustained? News
of restarts and extra shifts are already emerging. This week's
price uptick was also driven by accelerating prices in the south
where a shortage of logs limited production of certain widths.
* NEWSPRINT
April prices for 30-lb newsprint rose $20/mton to
$660/mtons. The first 4 of 6 consecutive $20/mton price hikes
planned for the first half of the year were all implemented.
Implementation of the last 2 installments would take prices to
$700/mton by June. Trade sources are reporting that further
price moves may be ahead, but publishers are likely to be
increasingly resistant to further hikes. Newsprint decline is
getting worse as consumption @ US dailies -15.2% y/y in March
(-12.8% YTD). DB's annual "Montreal Summit" on June 17-18th
will include meetings w/ AbitibiBowater, Catalyst and Kruger.
* UNCOATED FREE SHEET
Uncoated free sheet prices continued to rise in April,
substantially completing the $60/ton price hike initiatives
announced for March. According to the trades, cut-size prices
rose $50/ton in March and another $10/ton in April. Offset
roll prices rose $30/ton in March and another $20 in April.
At the same time, demand appears to be easing. Shipments
declined 9.6% y/y in March. On supply side, more changes
would seem inevitable.
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