Posts Tagged ‘IndustryEdge’

  • Catalogues claim continued volume growth – Pulp & Paper Edge report

    We’ve heard from the Australian Catalogues Association that catalogues continue to grow in popularity and volume in Australia despite soft markets in other printing industry sectors, now that sentiment is being backed by the numbers, with industry bible, Pulp & Paper Edge, highlighting the growing volumes of catalogue paper stock entering the country. 

    The latest issue of Pulp & Paper Edge, published by IndustryEdge, reveals that continued catalogue volume growth in the local market is driving volume growth in coated mechanical papers in the country.

    Coated mechanical papers are separated into two main grades, the light-weight coated (LWC) and the medium coated (MWC) papers. According to the publication, coated mechanical paper growth in Australian is occurring for both sub-grades albeit the growth is slow.

    Pulp & Paper Edge suggests that the driver for modest growth in LWC consumption is increased use by retailers of catalogues and brochures even as other uses have declined.

    The publication says:

    In a changing communications world, where digital and electronic media paper appear to be supplanting paper and print, news of the growth in consumption of coated mechanical grade papers is often met with surprise. Of course, it is not the paper itself which is driving the demand. Rather, it is the end use to which coated mechanical grade papers are put, which is the driver.

    According to Pulp & Paper Edge, the volume of catalogues in Australia has risen by almost one billion over the past five or so years. In 2006-07, Australians received 7.4 billion catalogues. By 2011-12, that number had grown to 8.22 billion catalogues – with an average annual rate of growth of 2 per cent.

    According to IndustryEdge’s analysis of the figures, the implication is that, in general, catalogues now contain considerably more paper (and more pages) than they did previously.

    With retailer and advertiser margins being squeezed ever tighter and other printed media facing declines, Pulp & Paper Edge suggests seeming immunity of catalogue volume against this squeeze is due to catalogues’ track record. In short, catalogues are proven to work.

    In 2012, research conducted by Roy Morgan and reported by the Australian Catalogue Association demonstrated in 17 of 28 separate categories of goods and services, catalogues ranked in the top three influencers of consumer purchasing decisions. In fact, in the case of groceries, it was found that catalogues influenced 52 per cent of purchasing decisions.

    However, the publication also points out that, while the total volumes of catalogues in Australia is still on the rise, the total recorded value of the catalogues sector is in decline. In 2006-07 the total value of the sector was AU$1.6 billion. The value declined by an average of two per cent per year to $1.45 billion in 2011-12.

    Clearly, the declining cost of each catalogue represents a value for money proposition for the end user, even as they are growing in weight, number of pages and paper use. The publication suggests this is one of the major drivers for increased consumption of catalogues.

    To access the full report, click here.

  • Newsprint prices set to increase as demand slows – Pulp & Paper Edge report

    Global newsprint prices look set to increase as international demand for the medium declines, according to a report in the latest issue of industry bible, Pulp & Paper Edge. 

    The report, published this month by one of the leading providers of market analysis on the pulp and paper industry in Australasia, IndustryEdge, says that the decline of global appetite and demand for newsprint diminishes looks set to improve newsprint prices around the world.

    According to the report, the latest figures from the United States indicates that for March 2013 – compared with the same period in 2012 – demand for newsprint was down by 12.1 per cent, with newspaper driven demand down by 11.7 per cent and from commercial printers, down by 14.8 per cent.

    However, the falling demand could lead to greater value in the medium, with the world’s largest manufacturer of newsprint, Norske Skog, reporting that it expects newsprint price increases in the second half of 2013.

    This is based on significant capacity reductions of over 1 million tonnes which, for Norske Skog, could arrest some of its slide in profitability, most of which is attributed to lower prices.

    In the March quarter, Norske Skog reported operating earnings of NOK (Norwegian Krone) 174 million (AU$30 million), down by 54.8 per cent from the corresponding period in 2012.

    In Australia, total import volumes have remained relatively stable over the past year, averaging 23 ktpq (kilo-tonnes per quarter). However, imports declined rapidly from a high of 45.7 kt in the June quarter 2010, to just 20 kt in the December quarter 2011.

    The most recent quarter, March 2013, recorded almost the lowest quarterly imports on record.

    The report says prices are impacted by many factors, but near universal supply to demand imbalances are key amongst them.

    Discounts are offered when producers have too much supply and must reach out to a new or opportunistic market, without the advantages of proximity, relationship and service.

    According to the report this seems to be occurring regularly with imported newsprint in Australia. It is a situation that can only improve if capacity reductions are sufficiently deep to bring global supply and demand into closer alignment.

    To access the full report, click here.

  • Cut reams still coming in the back door – Pulp & Paper Edge

    The practice of importing cut-price volume office paper under the ‘no country declared’ (NCD) provisions to mask paper imports arriving from regions with questionable pulp harvesting practices – notably Indonesia – is not only continuing, but rising, according to the latest issue of industry bible, Pulp & Paper Edge.

    The previous decision by some of Australia’s largest office paper sellers to import cut-ream volumes under the NCD provisions immediately after announcing they would cease using Indonesian paper amid the local market’s environmental concerns coincided with a national spike in NCD imports, suggesting the Indonesian imports were continuing under a new guise.

    This month’s issue of Pulp & Paper Edge, the industry’s foremost authority on paper trends, indicates that the volume of NCD continues to rise, and suggests that the continuing usage of the NCD provisions of the Census & Statistics Act 1905, negatively impacts the Australian paper market, particularly domestic producers.

    The IndustryEdge Pulp & Paper Edge report states:

    As IndustryEdge has repeatedly commented, the continuation of imports under NCD arrangements is a deliberate attempt by one or more importers to hide Indonesian imports behind a veil of secrecy. Regardless of the reason for this secrecy, ultimately no good comes of it. The importer is always exposed and the trade prices can always be determined, though it takes longer than if transparency is applied.

    The report suggests that the use of NCD provisions could be due to the possibility that the importer is embarrassed about the source of their imports, or their competitively low prices points may be less than the cost of manufacture and they are attempting to hide what could be questionable pricing tactics.

    With NCD prices typically being lower than the prices of the bulk Chinese imports that have taken over from the bulk imports from Indonesia, it is conceivable that the current NCD imports could be direct from Indonesia.

    According to Pulp & Paper Edge, both the previous low priced Indonesian volumes hidden inside NCD and the current budget Chinese volumes are believed to have been imported for and by major branded organisations.

    The concurrence of declining prices and increasing NCD for imported cut reams and the subsequent Chinese volumes are explored in depth in an IndustryEdge Special Report, which is available from www.industryedge.com.au/publications.php

  • Mystery paper dumping hides behind 100-year law

    A Special Report from Industry Edge lifts the lid on how importers conceal the origin, production costs and environmental credentials of office paper brought into Australia.

    Paper Cuts – Critical Analysis of Copy Paper Imports into Australia shows how office paper (white A4 cut reams) may be dumped into the Australian market at prices below the cost of production. This undermines local production from Australian Paper and encourages unsustainable paper making practices.
    Importers use a century old trade law originally designed to protect local industry in order to mask the country of origin of hundreds of tonnes of office paper imports. Since September 2010 the provisions of the Census & Statistics Act 1905, have been used by unidentified importers to hide the country of origin of white cut office paper. According to the Special Report there is little doubt that the vast majority of the controversial imports have come from Indonesia.
    The use of the provisions directly followed a furore concerning the environmental practices of Indonesian paper mills. This caused major importers to declare they would no longer buy Indonesian paper. Trade figures show the declared tonnage of paper from Indonesian immediately dropped while the amount of office paper that entered Australia under the no country declared provision soared. The practice continued for at least 18 months and in nearly all cases the NCD paper was brought in at the lowest prices, raising suspicions it was being dumped.
    The authors make the point that Australia operates as one of the most open markets in the world. The use of such tactics not only hides the origin of paper imports but also frustrates the local producer, Australian Paper, from finding out if the practice violates trade law.
    “This Special Report into the import trade, in specific office papers, shows that allowing importers to hide the country of origin of the imports works against full, fair and free trade,” said Robert Eastment, Director of IndustryEdge (pictured).
    “Forensic trade analysis demonstrates that imports of office papers that most likely came from Indonesia were at ever cheaper prices as the volumes increased. The fact that the country of origin was hidden raises suspicions about possible trade manipulations and has made this trade quite controversial,” said Eastment.
    According to the Special Report, allowing importers to request their import data be masked makes trade scrutiny and transfer of information difficult. In some cases, concerns about dumping and the operation of inappropriate government subsidies that would breach World Trade Organisation standards cannot be pursued because of a lack of transparency.
    In the particular case of office papers from Indonesia, it is possible the masking of increased import volumes from Indonesia has been intended to avoid scrutiny of Indonesian supply, which is the subject of aggressive campaigns by environmental non-government organisations and is highly contentious in its own right.
    “We know the Australian Government is engaged in an ongoing review, with the International Trade Remedies Forum, of Australia’s international trade rules. This Special Report into selected office papers provides some of the evidence needed for a significant legal change to ensure that all imports are recorded for country of origin,” said Eastment.
    The Special Report is being released to coincide with the opening of the annual conference of the Australasian Pulp & Paper Industry Technical Association (Appita) in Melbourne. IndustryEdge Director and co-author of the Special Report, Tim Woods, will address the conference’s high level leadership sessions.
    The Special Report can be downloaded without charge from www.industryedge.com.au