Filed under: Dissolving Pulp

Pulp Production Worldwide

by on Apr 11th, 2011

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Though at this time last year, analysts were questioning the viability of wood pulp, the overall worldwide market is growing according to a new article published on Business Insider.

“Global pulp production in the second half of 2010 was higher than many has anticipated,” wrote Hakan Ekstron, the President of Wood Resources International LLC. “The total production of…market pulp last year reached an estimated 45 million tons, which was about seven per cent more than was produced in 2009.

A big reason for this increased demand is dissolving pulp – a product used primarily in the creation of rayon – which is breathing new life into pulp mills around the world.

“It’s a great time to own a pulp mill,” said David Elstone, analyst at Equity Research Associates, in an article published last week by The Vancouver Sun.

Except for a brief pause in 2010, prices have continues up since coming off the bottom in 2009, Elstone said.
The reinvigorated market is largely due in part to what The Vancouver Sun called “a remarkable chain of events.”

“Freak storms in 2010 wiped out cotton crops in Pakistan and Australia, cotton prices took off,” the paper wrote. “That pushed up demand for rayon [and that] rising demand is supporting high pulp prices.”

As a result, the pulp sector – particularly in Canada – is in the middle of an unprecedented bull market.

Last year, Vancouver-owned specialty paper manufacturer Fortress Paper Ltd. became one of the first Canadian companies to grab the bull by the horns, so to speak, by converting a near defunct pulp mill in Thurso, Quebec into a dissolving pulp production facility.

SOURCES:
Business Insider: “Wood Costs For Global Pulp Industry Skyrocket”
The Vancouver Sun: “Rising Prices A Boon For Workers Who Bought Mill”
BC Business Online: “Top 100 Public Companies In BC”

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