Pulp prices on the fall again...
-----Original Message-----
From: Velez, Luis 
Sent: Monday, July 16, 2001 9:15 AM
To: Causholli, Monika
Subject: FW: Market Pulp Prices Continue to Fall; Goldman Sachs High
Yield Research; 7/16/01


Monika!!
Hot Update from GS
Luis Carlos

-----Original Message-----
From: Stivaletti, Joe [mailto:joe.stivaletti@gs.com]
Sent: Monday, July 16, 2001 8:47 AM
To: Stivaletti, Joe
Subject: Market Pulp Prices Continue to Fall; Goldman Sachs High Yield
Research; 7/16/01


Market Pulp Prices Continue to Fall; Goldman Sachs High Yield Research;
7/16/01

This week's issue of Pulp & Paper Week shows an NBSK pulp price of
$500/tonne, down from $540/tonne last month and $710/tonne at the beginning
of the year.  As we wrote about last week, demand for pulp continues to be
very soft, with Norscan shipments down a whopping 10.6% during the first six
months of 2001.  This ties to lower demand for paper products as a result of
general economic weakness.

Norscan stocks are still too high, totaling 1.781 million tonnes at the end
of June.  Although pulp inventories typically rise during the seasonally
slow months of July and August, we are optimistic that increased amounts of
producer downtime this summer will actually improve the inventory situation
somewhat.  Producers have already announced 550,000 tonnes of downtime for
the third quarter, which equates to 9% of Norscan quarterly capacity.  The
extent of Q3 downtime will determine how quickly the pulp market can
stabilize and when pulp prices can begin to reverse this slide.

Our forecast is for an average NBSK pulp price of $580/tonne in 2001, down
from $685/tonne in 2000.

Joe Stivaletti
Goldman, Sachs, & Co.
High Yield Research
85 Broad Street, 29th floor
New York, NY 10004
(212) 902-3299