New RISI study ranks 18 North American pulp mills at high risk for closure

BOSTON, Jan. 6, 2005 - According to a new report from RISI, Paperloop's economic analysis group, 13% of mills in the northern U.S. and eastern Canada are at high risk for permanent closure.

The study, prompted by continued low average operating rates at U.S. pulp mills over the last three years, provides an analysis of changing market conditions and rates mills according to various risk factors for closure.

"Pulpwood markets in the U.S. South have already been affected by a protracted downturn," commented Keith Balter, vice president of analysis for Paperloop's Information Products Division. "However, 70% of the high-cost mills in North America are in the northern U.S. and eastern Canada, which has set the stage for a capacity consolidation in those regions."

Balter continued, "The report will be a valuable strategic planning tool for senior management and business analysts at any organization involved in pulpwood markets -- from timberland management organizations, integrated forest products companies and OSB producers to financial firms with investments in the sector."

The new study includes:

• A risk assessment of 108 integrated and market pulp mills in the region

• Softwood and hardwood consumption by mill

• A five-year forecast of pulpwood supply and demand for three sub-regions

• A history and five-year forecast of pulpwood prices

• An assessment of the impact of changes in the exchange rate

For more information on the study, "Northern Pulpwood: Adapting to Changing Markets," visit http://www.risinfo.com or call (781) 734-8934. A recent companion study focusing on the southern U.S., "Southern Pulpwood Markets: A New Reality" is also available.