Alexandria, VA (April 10, 2002) – What will happen to paper prices as the economy and print markets recover? Will they continue to stabilize or even fall as they did last year? Or will they spike as they did as the economy and print markets heated up in 1994 – 1995?
According to Dr. Ron Davis, chief economist for PIA, a trade association that represents over 13,000 companies in the manufacturing sector, "Most indicators point to continued stability or softness--at least for the short run. Printers' paper costs were down about one percent for 2001. As of January, printing and writing paper prices were down by 1.8 percent from January of 2001 based on government data."
U.S. paper production declined by 5.8 percent in 2001 after falling 2.5 percent in 2000. Overall, printing and writing paper prices declined in 2001.
Davis further stated "The wave of paper company mergers and acquisitions over the last few years is an attempt by paper companies to reduce over capacity in the paper industry. Although there has been some mill re-structuring there is still plenty of worldwide capacity coupled with a generally soft worldwide demand." Davis expects that," based on the current global paper supply demand, stable paper prices through the remainder of the year."
"However, paper markets may start to tighten in 2003 as economies in other parts of the world recover. We may see an alignment of growing economies throughout the world in 2003, which may result in rising paper prices," Davis cautions.
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