By: Debra Garcia
With the exceptions of some operating rates and Canadian demand, North American newsprint statistics released last week by the Pulp and Paper Products Council (PPPC) indicate another bad year for the industry.
Key to the decline was a 7.3% year-over-year drop in newsprint consumption by U.S. dailies in December, bringing the year’s total to just over 7.5 million tonnes, off 5.4% from 2004. Total U.S. consumption was down a bit less, just 3.5% in December compared to a year ago, but for the year’s total of nearly 9.4 million tonnes, the decline was 5.1% from 2004.
Canadian demand was up this year, posting a 4.5% increase in December and up 1.3% for the year’s total of nearly 1.1 million tonnes. However, this failed to offset the 6.3% plunge in U.S. demand, to just less than 9.3 million tonnes. This brought total North American mill demand to a level of nearly 10.4 million tonnes for 2005, down 5.5% from 2004, according to PPPC statistics.
With demand declining, U.S daily newspapers were able to build inventories in December, ending the month with 21,000 tonnes more than at the end of November. This was the equivalent of two days of supply more than at the end of November 2005, but one day less than at year-end 2004.
North American mill inventories, however, dropped in December for all but stocks destined for the North American market, which grew by 10,000 tonnes during the month — although this was still 4,000 tonnes lower than a year ago, the PPPC reported.
Total North American mills inventories reached 315,000 tonnes at year-end 2005, down 7,000 tonnes from the end of November 2005 and down 13,000 tonnes from a year earlier.
Mill inventories were drawn down despite declining orders. Total North American shipments in December were off 3.0% compared to a year earlier, bringing the total shipments for the year to slightly less than 12.7 million tonnes, a year-over-year drop of 4.3%, according to PPPC data.
Domestic deliveries fell by 2.5% in December compared to a year ago, and ended 2005 at nearly 10.2 million tonnes, 5.4% below 2004.
Overseas shipments did not help much, dropping year-over-year by 5.5% in December and ending the year at just 0.3% above 2004. While deliveries to Japan were off 27.4% and Latin America was down 7.5%, shipments were up 6.4% to Western Europe and up 22.7% to non-Japan Asia, PPPC statistics indicated.
Total North American newsprint mill operating rates improved in December, to 96% versus 94% a year earlier. However, for all of 2005, they showed a 1% year-over-year decline to 95%.
The U.S. operating rate in December was 95%, which was just 1% higher than the Canadian rate. Canadian mills, however, managed to pull this up from just 92% last December, when U.S. mill ran at a relatively high 96%. For all of 2005, Canadian and U.S. mills both operated at 95%, which, compared to 2004, was 1% lower than the U.S. mill operating rate and 2% lower than the Canadian rate.