Analyze Cost & Price Sensitivity of Mills and Machines
Understand the impact of consumption costs and changes in prices on mill and machine competitiveness. RISI's staff of experienced pulp, paper and wood products engineers can help you understand technical data and how to use it to better compete.
- Identify and evaluate primary costs, such as:
- Consumables: fiber, energy, chemicals
- Delivery cost
- Labor
- Materials: maintenance materials, operating supplies, machine clothing, contract maintenance, etc.
- Understand how restarts, rebuilds, closures, idles, and new capacity will impact the balance of supply and demand. In turn, you can evaluate how these changes will impact market prices.
Example: Analyze the consumption costs of European mills producing standard newsprint by creating a cost curve. In the cash cost curve below, each bar represents a mill's operational costs in relation to their capacity. You can easily see how low-cost mills have lower fiber and energy costs. This puts them at a cost advantage when compared with high cost mills which have high energy and fiber costs. You can run cost curves like this for a variety of supply-side markets to quickly compare mill costs. Once you identify the areas in which market leaders are cost competitive, you can further analyze their processes to understand how they keep costs low.
- Optimize production planning by anticipating and measuring changes in market conditions.
- Determine when to swing between grades and products based on costs and market prices. Monitor project announcements and news to stay abreast of changes in supply. Run models to identify which products will maximize profit based on anticipated changes.
- Analyze mill and machine sensitivity to changes in market prices, consumables prices, tax rates, capacity and exchange rates.
Example: Analyze how rising energy costs would impact Russian mills producing standard newsprint compared with their European counterparts. Compare existing market conditions with a model of how things would change if the cost of energy increased significantly for Russian mills. Russian mills are currently very cost competitive. But if their energy costs increased, they would move to the third or fourth quartile. This would greatly increase their sensitivity to market prices and, ultimately, their risk of closure.
Mill Viability Analysis & Risk Assessment
RISI's approach to market research is unique in that it draws from the most comprehensive source of data available for the Global Forest Products industry. This enables us to focus on your key research goals and to deliver unique market insights.
Our global team of economists, editors and engineers will work closely with you to deliver custom data and reports, such as mill viability analyses and risk assessments.
- Understand your mill's current cost position.
- Analyze how it will change according to forecasted market conditions.
- Changes in prices, supply and demand.
- Changes in price projections for key input variables.
- Receive in-depth consulting with RISI economists and analysts.
- Evaluate the outcome of special projects, M&A and capital investments.
For information about pricing, custom data, consulting projects or to schedule a 30 minute demonstration with a RISI Sales Representative, please complete the form below.
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Why Choose RISI Mill Intelligence
- Competitively Position Machines & Dryers
- Effectively Allocate Capital and Plan Cash Flows
- Measure the Impact of M&A Activity
- Analyze Cost & Price Sensitivity of Mills and Machines
- Mill Viability & Risk Assessment
- Use Cases
- Mill & Market Insight Methodology
- Our Global Team of Experts & Analysts
Industries Supported
- Forest Products Producers
- Packaging, Paper & Wood Products Buyers
- Suppliers to Forest Products Producers
- Financial Institutions