According to Terrence Kavanagh, president of
Tembec’s Pulp Group, "The pulp and paper market fundamentals are strong as
demonstrated by high operating rates which are in excess of 95%. However, we
are experiencing a 'ripple effect' caused by a combination of factors ranging
from a weak Euro, some over- exuberance in the market and flattening demand. To
compensate, our intention is to curtail production as required to maintain our
normal inventory levels".
Tembec Inc. produces around 2.1 million
metric tons of market pulp a year. The curtailment is estimated to remove
between 40,000-60,000 metric tons of pulp from the market, roughly 2-3 percent
of the company’s total output.
A spokesman for Tembec said the company has
yet to determine what mills will be affected by the shutdown. Including two French
facilities Tembec is in the process of acquiring the company has a total of 10
facilities worldwide.
Downtime is expected to be complete by the
end of the calendar year.
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