Pulp & Paper News

RISI VIEWPOINT: BSK expansion projects — too much, too late?

BEDFORD, MA , May 30, 2014 (Viewpoint) - 

The past decade has seen new BHK (short fiber) market pulp lines queued up for construction like jets waiting for takeoff at a busy airport. At the same time there has been relatively little expansion activity on the BSK (long fiber) side of the industry. That appears to be changing, with significant BSK capacity expansion projects penciled in for possible startup in the 2016-2018 period. Some BSK suppliers are concerned that the planned expansions will swamp the BSK market as they start up and send operating rates sharply downward. That's a valid concern, especially in light of the rather tame outlook for trend demand growth for BSK pulp, given the well-known challenges that mobile electronic devices are posing to consumption of communication papers.

Our quick answer is that most of these BSK expansions (even in the Nordic region) are not a big surprise to us and don't-at least not yet-change our longer-term view of the demand/supply balance for market BSK pulp.

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