Paper mills had no choice but to give in to customers' demands. Excess supply and cheap waste paper put a lot of pressure on newsprint prices.
Newsprint prices are selling considerably lower on the French market as of 1 January. This is true for standard newsprint as well as improved newsprint grades.
A downturn in consumption in 2019 created excess supply on the newsprint markets across Europe and ruined capacity utlisation rates at many a paper mill. Besides the imbalance between supply and demand, the downward pressure on newsprint prices was exacerbated by continuously decreasing waste paper prices, e.g. deinking grades.
At the same time, cheap recovered paper prices have created some breathing room for certain paper companies, even though other production costs have risen, producers noted.
Due to low newsprint prices, a few respondents expect producers to speed up capacity management measures. The next location that will be affected is UPM's French 240,000 tpy newsprint mill Chapelle Darblay. However, more capacity closures would be necessary to bring supply and demand back into balance, according to some market insiders.
This article is an excerpt from EUWID's monthly report on the French newsprint market.
Find the EUWID Price Watch France for January 2020 in EUWID Pulp and Paper issue no 05/2020, which will be available to our e-paper and print subscribers as of 29 January 2020.
