| |
| FORECAST (000 tons) |
| U.S. |
1997r |
1998 |
1999e |
| Shipments |
2,056 |
2,062 |
2,067 |
| Capacity |
2,221 |
2,201 |
2,182 |
| Utilization rate, % |
92.5 |
93.6 |
94.7 |
| Imports |
3,244 |
2,571 |
2,431 |
| Exports |
165 |
162 |
214 |
| Apparent consumption |
5,135 |
4,471 |
4,284 |
| lb/capita |
37.5 |
32.9 |
31.8 |
| 000 tons/billion$ |
0.65 |
0.59 |
0.58 |
| real GDP 1992 |
|
|
|
| Canada |
|
|
|
| Shipments |
3,045 |
2,846 |
2,752 |
| Capacity |
3,502 |
3,293 |
2,993 |
| Exports |
n.a. |
2,554 |
2,469 |
| Imports |
n.a. |
74 |
55 |
| Utilization rate, % |
86.9 |
86.4 |
91.9 |
Sources: AF&PA, CPPA.
Estimates from Pulp & Paper Forecaster
e= estimate; p= preliminary; r=revised |
| TOP N. AMERICAN PRODUCERS |
| Rank Company |
Annual capacity• (000 mtons) |
Market share (%) |
| 1. Abitibi-Consolidated |
| 1,690 |
29.5% |
| 2. Pacifica Papers |
495 |
8.6 |
| 3. Bowater |
430 |
7.5 |
| 4. Alliance |
381 |
6.7 |
| 5. Stora Port Hawkesbury |
300 |
5.2 |
| 6. Kruger1 |
286 |
5.0 |
| 7. Fletcher Challenge Can. |
255 |
4.5 |
| 8. Daishowa (N. America) |
250 |
4.4 |
| 9. Consolidated (LSPI) |
240 |
4.2 |
| 10. Madison Paper |
228 |
4.0 |
| Total top 10 |
| 4,555 |
79.6% |
| 11. Uniforet |
221 |
3.9% |
| 12. St. Marys |
210 |
3.7 |
| 13. Irving |
198 |
3.5 |
| 14. Donohue |
165 |
2.9 |
| 15. Fort James |
150 |
2.6 |
| 16. Smurfit Newsprint |
71 |
1.2 |
Market share of top five companies: 57.5 % Market share of top ten companies: 79.6 % 1999 North American capacity: 5.7 million mtons
1. Includes Manistique and Disley Papers
• Capacity shown on equity ownership basis.
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GRADE STRUCTURE. Uncoated groundwood papers (also known as groundwood specialties) are higher-value grades than newsprint, but less costly than free-sheet. By definition, uncoated groundwood grades contain more than 10% mechanical pulp and varying proportions of chemical pulp and fillers. They are used in a variety of printed products, such as telephone books, catalogs, advertising inserts, Sunday newspaper magazines, direct mail flyers, business forms, and paperback books.
Typically, most uncoated groundwood papers are a step up from newsprint in both quality and price, with higher brightness levels and smoother surfaces. Several of the grades, such as machine-finish (MF) offset and rotonews, are marketed as cost-effective, slightly higher-quality substitutes for newsprint. In the case of supercalendered papers, they are a lower-cost alternative to lightweight coated (LWC) groundwood paper. Supercalendering and soft calendering add a glossy surface to make a paper (grades SC-A+, SC-A, SC-B, SC-C, and soft-nip) that competes with LWC for some business. Brightness levels range from 62 to 72 Elrepho, compared to 56 to 62 for standard newsprint and 68 to 84 for LWC. Basis weights range from 20 to 45 lbs. Mills with newsprint machines often make some uncoated groundwood specialties, and some newsprint machines have been converted to sole production of the paper.
PRODUCTION/CAPACITY. The startup of a new machine at Stora Enso North America’s mill in Port Hawkesbury, N.S., was an important event for both the uncoated and coated groundwood markets. With an eventual capacity of 385,000 tpy (it is expected to produce just over 300,000 in 1999), the machine is the biggest SC maker in the world. The company says it has the capability to produce SC-A+ which is comparable to LWC. In another major announcement, Alliance Forest Products Inc. said it will build a new 152,000 mtpy machine to make soft-nip at its Donnacona, Que., mill. The net capacity gain will be 62,000 mtpy when two smaller machines are shut.
According to industry associations, U.S. capacity to make uncoated groundwood will increase by 62,000 tons during 1999 through 2001. Virtually all the growth can be attributed to planned capacity swings from newsprint to uncoated groundwood. In Canada, more than 800,000 tons will be added in the three years, included the aforementioned Stora and Alliance products.
U.S. groundwood paper shipments in 1998 slipped slightly—0.2% in 1998 to 2.06 million tons. Canadian shipments grew by 3.4% to 2.84 million tons.
U.S. exports dropped dramatically in 1998 by more than 20% and are not expected to recover much this year.
MARKET OUTLOOK. After surging last fall due to a strike at Abitibi-Consolidated Corp. mills, prices for uncoated groundwood weakened after the mills went back online and the supply line filled. During the first part of this year, conditions continued to deteriorate, largely in sympathy with the newsprint market. By summer, however, they appeared to have stabilized, and the recently announced October newsprint price hike could help support uncoated groundwood prices in the fall or winter.
—By Joyce Routson Executive News Editor
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