<b>Downtime Plagues U.S. Board Industry</b>

Reflecting eroding prices for finished products, a number of paper companies announced plans to shutter machines and even whole mills. The move is an attempt to bring supply and demand for the hard-hit paperboard industry back into balance.

Over the past week Georgia-Pacific Corp. announced plans to indefinitely close one of its corrugated medium machines at its Toledo, Ore., board mill.

A spokeswoman for G-P said the company expects to shut the No. 2 paper machine at the Toledo facility by May 6. The spokeswoman says the machine, at full capacity, can produce around 650 tons per day of finished product.

The machine is not expected to be re-opened “until market demand warrants,” she adds. The machine had been operating in a “slowback” mode for the past several months.

Smurfit-Stone also announced that it is taking a number of its machines off line for an indefinite period of time. The company, which has taken a number of machines off line since last month, announced that many of these same machines will be idled indefinitely.

According to a spokeswoman for Smurfit-Stone, the decision to continue the shutdown of the Missoula, Montana, board mill is being attributed to the soaring energy costs.

Other mills slated to be shut for an extended period of time include machines in Carthage, Ind., Hodge, La., and Fernandina, Fla. With the exception of the Florida plant the other machines have been down since last month.

While these downtime continue to put pressure on the paper stock market, Weyerhaeuser is expected to have its expansion project in Valient, Okla., completed in the near future. This should help OCC markets in the Southwest.