Sweden's Södra announces March 1 price increase for NBSK pulp in Europe, to US$940/tonne

LOS ANGELES , February 26, 2014 () – Citing “strong global markets and solid demand,” Södra Cell AB in Sweden today announced that it will increase its March 1 northern bleached softwood kraft (NBSK) list price in Europe to US$940/tonne.

This is the first known March 1 price announcement for Europe.

(Canfor Pulp LP had announced a $940/tonne price for Dec. 1, which was not supported by the market, but the company said this is still its announced price.)

Södra’s announcement today did not specify the amount of its increase. Its last formal price announcement was when it said it would keep its NBSK price flat in Europe in December, at $920/tonne.

Södra did not formally announce an increase for February, while some other producers, starting with Mercer International Inc., announced a price of $930tonne.

Several producers had announced a Nov. 1 price of $920/tonne, up $20/tonne, which was being slowly phased in. In January the price had mostly reached the $910-$920/tonne range.

It has gone up some more in February, though how much isn’t clear quite yet; producers said they would be negotiating February pricing this week.

Södra’s three market pulp mills in Sweden, in Mönsterås, Värö and Mörrum, have a total capacity of 1.6 million tonnes/year.

Yesterday Södra announced a $610 million project to increase the capacity of the Värö mill, which produces NBSK, to 700,000 tonnes/year from 425,000 tonnes/year, with completion targeted for the third quarter of 2016.

On Aug. 25, the company permanently shut its unprofitable 400,000 tonnes/year market pulp mill in Tofte, Norway, after failing to find a suitable buyer. The mill produced about 350,000 tonnes/year of NBSK and about 50,000 tonnes/year of bleached hardwood kraft pulp.

In January, Södra sold its 130,000 tonnes/year Folla chemi-thermomechanical pulp (CTMP) mill in Follafoss, Norway, which had been closed since November 2012, to Mayr-Meinhof Karton AG of Austria, which restarted it on Sept. 2 for integrated use.

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