Canfor Pulp Products announced on Thursday that it anticipates the trend of record high global pulp producer inventories to persist, making pulp markets challenging in the coming years.
High Inventories and Weak Demand
According to the company, the global softwood kraft pulp markets are expected to face ongoing challenges throughout the third quarter of 2023. This is primarily due to the projected continuation of high global pulp producer inventory levels combined with weak global demand, especially for paper and writing grades. Consequently, the company had to curtail the production at its Northwood pulp mill in July for approximately one week, resulting in an estimated reduction of 10,000 metric tons of NBSK pulp.
Maintenance Outage at Northwood Plant and 3Q Earnings Forecast
The company also highlighted that the results for the third quarter will reflect a scheduled maintenance outage at the Northwood plant in September. This outage is expected to result in a reduction of 25,000 metric tons of NBSK pulp production. Additionally, higher associated maintenance costs and lower projected shipment volume will impact the earnings for the period.