FOEX: Paper packaging prices rise in Europe except brown kraftliner, affected by increased imports from overseas; recovered paper is tight with successful price increases, despite low exports to China
May 10, 2011
– Containerboard Europe – Packaging business has remained quite strong. In the US market, containerboard inventories at box plants decreased heavily in March and corrugated box shipments were quite strong. In Europe, recovered paper availability is tight and prices are very high at the moment. Price increase initiatives in recovered paper based grades and in white-top kraftliner have been largely successful. However brown kraftliner prices have been slipping due to increased imports from overseas. Last week, the exchange rate development had a positive impact on our benchmarks as Euro weakened by 2.5% against the USD and by about 0.4% against the non-EMU currency basket. The PIX Kraftliner index continued its way down by losing this time 96 cents, or 0.16%, landing at 591.01 EUR/ton. The PIX White-top Kraftliner index value went up by 20 cents, or by 0.03%, to 768.47 EUR/ton. All our recovered paper based packaging grades continued to gain. The PIX Testliner 2 index value increased by 33 cents, or by 0.07%, to 496.82 EUR/ton. PIX Testliner 3 index headed north by 3.12 EUR, or by 0.65%, settling at 484.36 EUR/ton. The PIX RB Fluting index increased by 2.87 EUR, or by 0.6%, to 470.41 EUR/ton.
Recovered paper Europe – The exports to China are rather low at the moment due to high price levels and low stocks in the European market. The Varel mill is down until mid-June due to rebuild reducing demand for OCC. The PIX OCC 1.04 dd price index ended up by 2.50 EUR, or by 1.6% to 161.47 EUR/ton. The differentials to containerboards prices developed to different directions: against Testliner 2 the gap narrowed by 2.17 EUR to 335.35 EUR/ton. Against Testliner 3, the differential increased by 62 cents to 322.89 EUR/ton. Against RB Fluting, it grew by 37 cents to 308.94 EUR/ton. Our PIX ONP/OMG 1.11 dd benchmark went up by 1.96 EUR, or by 1.17%, to 169.16 EUR/ton. As the PIX Newsprint index gained less, the differential to PIX ONP/OMG 1.11 narrowed by 1.83 EUR to 330.72 EUR/ton.