FOEX: Paper packaging prices in Europe down, as currency has small negative impact on benchmark; recovered paper inventories high
October 18, 2011
– Containerboard Europe – Cumulatively, the production of containerboards and other case-making materials remains at, or marginally above, 2010 volumes both in Europe and in North America. US corrugated box shipments fell by just 0.4% in September compared to year ago and inventories increased but remain still at low level historically. Falling fiber prices exert downside pressure also on the product prices. The maintenance and market-based downtime has increased but not enough to turn the price pressures down. The currency development had a small negative impact on the benchmark values as the Euro strengthened against both the USD and the weighted basket of the non-EMU currencies by 2.8% and 0.8%, respectively. All our packaging benchmark s headed further down. The PIX Kraftliner index fell by 1.59 euro, or by 0.3%, and closed at 564.40 EUR/ton. The PIX White-top Kraftliner index value retreated by 97 cents, or by 0.12%, and settled at 784.52 EUR/ton. Our PIX Testliner 2 index headed south by 6.27 euro, or by 1.3%, and closed at 478.49 EUR/ton. PIX Testliner 3 index moved down by as much as 10.04 euro, or by 2.2%, and closed at 451.06 EUR/ton. Finally, the PIX RB Fluting index value fell by 8.41 euro, or by 1.9%, to 439.53 EUR/ton.
Recovered paper Europe – Export prices to China and other Asia have been higher now than the mill prices in Europe, although they have declined a bit recently. Downtime has been taken at mills in Europe and RCP inventories are high. Based on last week’s data our OCC 1.04 index declined by 3.30 euro, or 2.3%, to 139.29 EUR/ton. The price differentials to containerboards shrank: against Testliner 2 by 2.97 euro to 339.20 EUR/ton, against Testliner 3 by 6.74 euro to 311.77 EUR/ton and against RB Fluting by 5.11 euro to 300.24 EUR/ton. Our PIX ONP/OMG 1.11 dd index lost 4.49 euro, or 2.66%, landing at 164.34 EUR/ton. As the PIX Newsprint benchmark declined less, the differential to PIX ONP/OMG 1.11 widened by 3.77 euro to 345.15 EUR/ton.