 |
| U.S. (000 tons) |
2001e |
2000 |
1999 |
| Shipments |
4,509 |
4,612 |
4,475 |
| Capacity |
4,766 |
4,656 |
4,639 |
| Utilization rate |
94.6 |
99.0 |
96.5 |
| Ave. price ($/ton)* |
877 |
920 |
829 |
| Imports |
1,407 |
1,407 |
1,237 |
| Exports |
413 |
360 |
370 |
| U.S. consumption |
5,503 |
5,659 |
5,342 |
| lb/capita |
39.5 |
40.9 |
39.0 |
| 000 tons/billion $ real GDP (1992) |
0.69 |
0.73 |
0.713 |
| Canada** |
| Shipments |
1,009 |
1,009 |
975 |
| Capacity |
1,063 |
1,063 |
983 |
| Utilization rate (%) |
n.a. |
98.9 |
96.1 |
| Exports |
n.a. |
n.a. |
n.a. |
| Imports |
n.a. |
n.a. |
n.a. |
| |
| e = estimate, p = preliminary, n.a. = not available. GDP = gross domestic product. *No. 5 40-lb offset. ** For coated mechanical. Sources: American Forest & Paper Assn, Pulp & Paper Products Council, Pulp & Paper Forecaster. |
| Company |
Annual capacity (000 tons) |
Market share (%) |
| 1. International Paper |
1,239 |
22.0 |
| 2. Stora Enso |
985 |
17.5 |
| 3. UPM-Kymmene |
965 |
17.1 |
| 4. Mead |
615 |
10.9 |
| 5. Bowater |
416 |
7.4 |
| 6. Curtis Papers* |
310 |
5.5 |
| 7. Weyerhaeuser |
220 |
3.9 |
| 8. Pacifica Papers** |
215 |
3.8 |
| 9. Kruger |
160 |
2.8 |
| 10. Great Northern Paper |
138 |
2.4 |
|
| North American capacity (2000): 5.82 million tons; U.S.: 4.76 million tons; Canada: 1.06 million tons. Capacity share of top 5 companies: 74.9%; Capacity share of top 10 companies: 93.4%. *Formerly Crown Vantage. **Norske Skog in deal to buy Pacifica in March 2001. |
|
|
GRADE AND USAGE. Almost half of U.S. coated groundwood shipments are used in commercial printing (catalogs, direct mail, Sunday newspaper supplements, advertising inserts, and directories), followed by magazines. Coated groundwood papers contain 10% or more mech-anical softwood pulp and are almost universally coated on both sides. They are typically lower brightness, less expensive and lighter weight than coated free-sheet. Primary classifications for coated groundwood papers are Nos. 4 and 5. No. 4 has both mechanical and chemical pulp, and a No. 5 has mostly mechanical.
No. 5 papers account for less than half of the total U.S. coated paper produced. Coated groundwood papers are commonly made in the 32-lb to 50-lb range (25 in. x 38 in.), although basis weights can run as low as 24-lb and as high as 70-lb. The most popular category is LWC or lightweight coated (32-lb to 40-lb), accounting for more than 80% of coated groundwood. Coating weight is approximately 30% of total sheet weight for LWC papers. Basis weights are declining as papermakers try to help publishers, direct marketers, and commercial printers save on postage and other weight-related costs.
About half of total 2000 U.S. coated paper shipments were groundwood grades. U.S. shipments of coated groundwood papers totaled 4.6 million tons in 2000, up 3% from 1999, according to the American Forest & Paper Assn. (AF&PA). For North America, coated groundwood demand totaled 5.36 million mtons, up 4.4% from 1999, according to the Pulp and Paper Products Council. Inventory ended 2000 at 194,000 mtons-up 27% from 1999.
CAPACITY. The top 10 producers control 93.4% of North American capacity. Inter-national Paper Co. (IP) became the largest producer of coated groundwood from its $8 billion acquisition of Champion Intl. last year. Stora Enso also acquired Consolidated Papers, the second largest coated groundwood producer in North America, for $4.8 billion last year. UPM Kymmene of Finland also grew, acquiring Repap. Two of the three largest coated groundwood companies in North America are based in Europe: Stora Enso and UPM Kymmene.
Total coated groundwood capacity should grow to 5.2 million tons, an in-crease of 3.4% per year from 2001 to 2003, according to AF&PA. The planned growth exceeds capacity growth of 0.5% in U.S. coated groundwood papers from 1991-2000. The capacity increase comes from several projects by Bowater Inc., the second largest newsprint producer in the world, and the fifth-largest coated groundwood producer in North America.
In 2001 and 2002, Bowater plans to convert 280,000 tons of newsprint capacity to coated groundwood at two Nuway coating plants in Benton Harbor, Mich., that use newsprint as a base stock, as well as in plants in the U.S. mid-South and mid-Atlantic regions. Bowater also plans to move another 140,000 mtpy from the Catawba, S.C., newsprint mill to Nuway.
Canadian coated groundwood capacity was forecasted to increase from 964,000 mtons this year to 974,000 mtons in 2003, an increase of 1%.
MARKETS/OUTLOOK. One $60/ton price increase on LWC paper No. 5 34-lb roto rolls in 2000 was implemented in the U.S., upping the price to $1,060-$1,100/ton. The price increase, occurring in March, held until January 2001, when prices dropped $10/ton.
On No. 4 50-lb groundwood rolls with 79 brightness, prices increased 6.4% in 2000 over 1999, ending the year at $950-$1,040/ton. However, in January 2001, the No. 4 50-lb price declined $10/ton. The U.S. market in 2000 vs. 1999 was impacted by additional coated groundwood imports (up 12% in 2000 and totaling 1.4 million tons), mostly from Canada, and reduced exports (down 5% and totaling 353,000 tons), principally to Asia.
Weaker pricing conditions were expected this year because of a slowed U.S. economy and plans for yet another 2001 postal rate increase impacting catalog companies. In addition, the jump in coated groundwood capacity planned in 2000-2002 could hurt prices if demand doesn't increase on a comparable term.
By Greg Rudder
Executive News Editor
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