<b>OCC Finding a Base</b>

As bleak as paper stock markets have been over the past several months, there seems to be a growing opinion that prices are starting to show some modest improvements.

There hasn’t been any wholesale upswing in price, although demand has begun to pick up ever so slightly in some regions. There continues to be talk about some renewed interest by Chinese mills to purchase more OCC, although there has been some talk that any uptick in demand will be short lived.

Domestically there doesn’t appear to be much strength for any upside movement, although there are some pockets of improvement coming from some regions. Downtime, however, continues to be problematic for many paper stock dealers. On the West Coast the high energy costs are adding to the woe and misery being seen by many paper and paperboard mills.

In California, there have been reports that Inland Paperboard & Packaging Inc.'s Ontario, Calif., linerboard mill will shut down for at least all of June because of high natural gas costs and weak market conditions, various recovered paper sources said.

There are other mills on the West Coast that are posing some difficulties for paper stock dealers. In the Northwest, labor problems with Weyerhaeuser at several of the company’s mills in Washington and Oregon have created some uncertainties.

Additionally, there have been some reports of other problems at a number of other paperboard mills on the West Coast that could reduce the OCC demand from some West Coast sources.

Other regions of the country are facing similar problems. However, despite continued problems with slack domestic production, there continues to be anecdotal evidence that there is more stabilizing taking place. A number of the board mills are looking to hold prices at their present level, despite the fact that run times are still greatly reduced.

One factor that is starting to take hold is the move by some collectors, especially companies more involved in the waste hauling segment of the business, to curtail OCC collection. As prices remain low, many vendors are finding it more beneficial to landfill the material instead of sourcing and processing the material.