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Capacities
Last year there was an increase of 1.6% in European capacity in the
mechanical publication paper sector. The figure is on a level with the growth
achieved in 2003, but down from the 3.4% and the 2.2% recorded respectively in
2004 and 2005. Looking at the individual paper sectors,
Newsprint capacity grew by 135,000 tonnes
last year, while SC Magazine expanded by 480,000
tonnes. Capacity in both the Uncoated Mechanical
and Coated Mechanical Reels areas moved in the
other direction, however, with reductions of 95,000 tonnes and 45,000 tonnes
respectively.
Considering the number of machine and mill closures that took place last year,
the modest rise in capacity development for the European region should come as
no surprise. CEPIPRINT records show that during the course of 2006, producers
removed approximately one million tonnes of mechanical paper capacity on an
annualised basis, slashing tonnage from Newsprint, Coated Mechanical Reels and
Uncoated Mechanical. Only SC Magazine remained untouched by the cutbacks,
although some closures are planned for 2007.
Average annual growth for the past 6 years came in at 2.8%/yr, in line with
the figure recorded in the 1990-2000 period. Uncoated Mechanical and Coated
Mechanical Reels may have experienced slower growth in recent years, but
Newsprint has expanded at a steady rate of 1.3%/yr in 2000-2006 against 0.8%/yr
in 1990-2000. Due to the capacity expansion in SC Magazine last year, the
sector’s average annual growth for 2000-2006 was up at 4.0%/yr, compared to
3.5%/yr in the previous decade.
 Mechanical Publication Papers: Capacity Summary
Deliveries
After a disappointing drop of -1.2% for deliveries in 2005, the mechanical
publication sector witnessed a return to healthier market conditions last year
with a rise of 3.3%. Total shipments came close to 27 million tonnes, an
improvement of almost 1 million tonnes over deliveries in 2005. Despite the
positive result, it is worth remembering that in 2005, there was a Finnish
strike and lockout in May and June. The action removed some 1.9 million tonnes
of the country’s annual graphic paper production, according to the Finnish
Forest Industries Federation (FFIF).
Last year, the European industry was recovering from the losses incurred as a
result of the 7 weeks of unplanned
downtime, which goes some way towards explaining the turnaround in deliveries
for the year.
Deliveries rose in three out of the four mechanical paper segments in 2006.
SC Magazine recorded the biggest boost to
shipments with an increase of over half a million tonnes against a loss of about
-100,000 tonnes in 2005. Newsprint came a
close second, with a rise of 373,000 tonnes (-208,000 tonnes in 2005).
Deliveries of Uncoated Mechanical climbed by
66,000 tonnes (-137,000 tonnes in 2005). On the other hand,
Coated Mechanical Reels failed to show an
improvement last year, turning in a loss of -90,000 tonnes in deliveries.
Mechanical Publication Papers: Total Deliveries Summary
Delivery-to-capacity balance
Last year saw a considerable reduction in excess capacity. Oversupply fell to
2.4 million tonnes, down from 2.8 million tonnes in 2005. The figure is still
not quite in line with the positive trend seen in 2003 and 2004, when
overcapacity fell from a peak of 3.7 million tonnes in 2002 to 2.5 million
tonnes and 1.8 million tonnes in the two following years. The delivery-to-capacity
balance improved to 92% in 2006 (90% in 2005). Again, it is worth recalling the
negative effect of the Finnish strike and lockout in 2005. Removing the impact
of labour dispute, CEPIPRINT estimated that the Western European balance for
mechanical papers would have been about 94% in 2005, which takes some of the
shine off the apparently improved figure in 2006.
 Mechanical Publication Papers
(D/C Balance)
Western European Exports
Annual growth in Western European exports reached 7% last year, showing a
strong turnaround from the previous result of -3.1% in 2005. Of course, the
reduced output from Finland in 2005 had a major impact on the tonnage available
to ship that year, while last year saw levels of availability return to a more
normal level.
SC Magazine saw the biggest growth in exports
last year, recording an increase of 333,000 tonnes. This was mainly due to new
capacity ramping up at
Stora Enso
making more paper available to ship. The Uncoated
Mechanical sector exported an additional 108,000 tonnes.
Newsprint (-51,000 tonnes) and
CMR (-4,000 tonnes) did not fare so well, however,
but in the case of Newsprint, the domestic market picked up to such an extent
that it reduced the tonnage available for shipping overseas.
Looking at annual averages, the mechanical paper sector has performed well in
terms of shipments overseas. There has been average growth of 10.6%/yr in
2000-2006, ahead of the 3.6% annual average increment seen in 1990-2000. All
paper segments have either improved or maintained their levels in the recent six
year period compared to the previous decade, apart from Uncoated Mechanical
which is running slightly behind, but still at a very fast pace.
Western European Capacities
Western European Deliveries
Western European Exports
Western European Exports
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