[BRIGHT INFO] Our Focus Pulp and Paper

Buyers report that wood pulp prices have slid to levels last seen in late 2005, triggering a surge in production cutbacks across North America as suppliers look to prop up pulp prices.





Commodity economists say that high production costs, low selling prices and a tighter credit market are squeezing the finances of many pulp suppliers, which are
reducing output in an effort to eliminate inventories in the face of slumping demand and price erosion.


Global market pulp producer stocks fell in February to 47 days of supply (measured as end-ofmonth inventory / 3-months rolling average shipments), down three days from January. The drop in inventory is explained by a moderate sequential rise in pulp shipments (+4%)


European consumer inventory plunged 73,000 tonnes in February to 856,000 tonnes, 198,000 tonnes below February 2008 and the lowest level we have on record. In days of consumption European consumer inventory remained at 23 days of consumption, 7 days below the 30 day 10-year average.

We believe for the long run Pulp and Paper Industry will improving. Pulp sales picked up from the third quarter, and the company also increased pulp exports. PPI Pulp & Paper Week reports that many industry contacts believe U.S. spot prices are approaching a bottom.

As we see pulp price on China and Europe looks stable. After we believe pulp and paper price reach the bottom we think INKP shares will interesting for medium investment. Strong IDR will give positive benefit for that share. INKP Chart (INKP:IJ)













Another Pulp and Paper Shares
(Bloomberg) -- Votorantim Celulose & Papel SA, which is taking over Aracruz Celulose SA to form the world’s biggest supplier to paper companies, was reiterated at “overweight” at Morgan Stanley on the prospect that it will reduce debt in the coming years and benefit from a recovery in pulp prices in 2010. VCP rose 5.9 percent to 14.60 reais






Pulp maker Empresas Copec SA











Clearwater Paper Corp. (CLW US) jumped a second day, climbing 6.4 percent to $8.46. The maker of pulp and paperboard was raised to “buy” from “neutral” by D.A. Davidson & Co.





[Personal Opinion ]
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