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Containerboard Stable during Slow Winter Months

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U.S. containerboard prices have remained stable during the seasonally slower winter months, reports Mark Wilde, senior analyst with Deutsche Bank. At the same time, he adds, domestic demand appears modestly positive.

OCC (old corrugated container) costs have stabilized at a relatively high level and have begun increasing. Fourth quarter export prices were a bit weaker-than-expected, but appear to be bottoming. "Although we're still forecasting a $40 - $45/ton y/y drop in domestic containerboard prices in FY12, recent data points make us a bit more positive on containerboard prices for FY12. If the trend continues, we may need to review our estimates not only for domestic prices not falling, but also for any potential of a price hike attempt," Wilde says

According to data released by AF&PA (Washington, D.C., USA), December production was up 0.8% y/y and the operating rate fell to 93.6% from 96.5% in November.


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