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Feature: August shows poor performance

Following a lacklustre August, less than 1,300 tonnes separated the recovered paper consumption totals for the first eight months of this year and the corresponding period in 2004. The month also brought declines in the intake of recovered paper and in UK paper and board production, according to latest statistics from the Confederation of Paper Industries (CPI).

The August 2005 consumption of 366,616 tonnes was 3.5% lower than the 380,019 tonnes registered in the same month last year, despite the fact that the Class IV high grades total improved 9.4% from 59,332 tonnes to 64,884 tonnes and that consumption of Class I mixed grades edged 0.8% higher to 23,072 tonnes.

The overall decline was directly attributable to the higher volume Class II corrugated and kraft and Class III newspapers and magazines: consumption of the former fell by 10.7% from 168,489 tonnes in August 2004 to 150,498 tonnes in the eighth month of the current year while the latter saw its consumption slip 0.9% lower to 128,162 tonnes.

For the January-August period as a whole, recovered paper consumption was just 1,296 tonnes higher this year at 3.058 million tonnes. The performance of corrugated and kraft served to offset consumption gains elsewhere. Having totalled 1.396 million tonnes in the first eight months of 2004, consumption of corrugated and kraft was running 6.6% lower at 1.304 million tonnes by the end of August this year. The other cumulative totals were as follows: high grades up 8.5% to 516,215 tonnes; mixed grades up 4.9% to 209,602 tonnes; and newspapers and magazines up 4.3% to 1.028 million tonnes.

August's intake of recovered paper was 1.5% lower than in the same month last year at 364,246 tonnes, even though the newspapers and magazines total jumped 12.4% to 132,698 tonnes and the high grades tally climbed 12.2% to 65,061 tonnes. Once again, corrugated and kraft was the dominant factor, with the monthly intake sliding 16% from 169,700 tonnes in August 2004 to 142,603 tonnes in the corresponding month of this year. Intake of mixed grades was 1.3% lower at 23,884 tonnes.

Over the first eight months of this year, intake fell by just short of 40,000 to 3.024 million tonnes - the equivalent of a 1.3% decline. The corrugated and kraft total retreated 8.9% from 1.394 million tonnes to 1.269 million, whereas all the other classes of recovered paper posted increases. The cumulative mixed grades total advanced by 7% to 214,680 tonnes; high grades climbed 5.1% to 516,710 tonnes; and newspapers and magazines rose by 4.6% to 1.024 million tonnes.

Having fallen by 11.4% in July, UK mill stocks of recovered paper suffered a further 6% decline in August to below 100,000 tonnes. The total inventory ended the month on 95,138 tonnes, representing 1.1 weeks' supply at the prevailing rate of usage compared with 1.2 weeks at the conclusion of the previous month. At the same stage last year, stocks had stood at 134,946 tonnes - equivalent to 1.6 weeks' supply.

The upward trend in the Class I mixed grades inventory continued into August. Stocks increased by 13.3% during the course of the month to 8,701 tonnes to push up supply from 1.2 to 1.7 weeks. This compares with just 0.6 weeks at the end of April this year when mill stocks were down at 4,169 tonnes. Also on the increase in August were producer stocks of Class III newspapers and magazines, which followed up a 22.4% slump in July with a 7.7% improvement to 37,399 tonnes the following month. Supply at the prevailing rate of usage duly advanced from 1.1 to 1.3 weeks.

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