Monday, March 15, 2010

Verso Joins in on Price Increase, Adds Supercalendered

Verso Paper told its customers today it was going along with the April 1 price increase on coated paper announced last week by NewPage and applying it to supercalendered papers as well.

The announcement from Verso, North America's #2 maker of coated paper, says the price for all coated freesheet, coated groundwood, and supercalendered grades will increase by $30 per ton ($1.50 per cwt.) Friday's announcement from NewPage, the market leader, did not mention SC papers.

Unprecedented increases in the price of market pulp (see BusinessWeek's excellent coverage) have paved the way for CFS prices to rise despite overcapacity. The idling of the St. Mary's supercalendered mill in Ontario, the Finnish port strike, and the Canadian loonie's move toward parity with the U.S. dollar may help firm up the SC market, which should not be affected much by the kraft-pulp shortage.

My guess is that CGW prices will move up slower than CFS or SC because producers seem especially reluctant to shut down machines in the face of declining demand. Judging by early results on the poll I posted Friday (in the right column, just under the first ad), there is no consensus in the marketplace yet about where CGW prices are headed.

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