PAPER PRICING: Pulp Nonfiction
Market volatility equals a murky short-term forecast for paper prices.
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T<%2Fspan>rying%20to%20decipher%20paper%20pricing%20trends%20is%20like%20scrutinizing%20snowflakes—the%20closer%20you%20get,%20the%20more%20complex%20they%20seem.%20Still,%20there%20are%20a%20few%20key%20factors%20when%20considering%20the%20current%20economics%20of%20the%20paper%20business,%20which%20has%20been%20subject%20to%20unprecedented%20forces%20during%20and%20in%20the%20wake%20of%20the%20recent%20recession.<%2Fspan>%0D%0A%0D%0A%0D%0Ahttps%3A%2F%2Fwww.bookbusinessmag.com%2Farticle%2Fpulp-nonfiction%2F" target="_blank" class="email" data-post-id="3123" type="icon_link">
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"Groundwood is under pressure because a lot of the groundwood producers were also producing newsprint, and newsprint has tanked, so [these paper producers] are trying to convert newsprint mills to produce … groundwood book papers, which tends to flood that market," Miller says.
Groundwood as a grade is suffering from "terrible demand" in directories and newspaper inserts, once a core market, Mahlburg reports. The only thing holding the price up, he says, is a slim profit margin: If the price drops far enough, output capacity falls (because it ceases to be profitable to produce), leading to less supply.
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James Sturdivant
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