Paper Supplement -- Welcome

Changing markets dictate changing strategies

Paper stock markets have been like a roller coaster over the past several years. From the highest of highs to the lowest of lows, markets have gone through more changes than the industry has seen over the preceding years combined.

Moving toward the end of the year (as well as the millenium), paper stock markets appear to be in better shape than they have been in a long time. Prices are strong and demand continues to improve. Finished product producers report better demand for most finished products, leading some to express confidence that prices will sustain their growth.

While price and demand continue to swell, Asian economies are slowly returning to fiscal health. This bodes well for the domestic paper recycling industry, which relies on the Asian market for a significant amount of its business. Latin America also continues to grow as a more lucrative market for paper stock dealers. Mexico is already well entrenched as a growing end market for recovered fiber. Further south, opportunities in Central and South America continue to grow.

At the same time, many waste management firms seem to be putting to rest their move into the recyclables collection side of the business. The much publicized economic problems with Waste Management only reinforces the problems many of these waste management companies have had integrating their recycling divisions into the rest of their company operations.

Trying to read all these dynamics creates a great deal of uncertainty. Will waste management companies jump back into the recyclables processing business as markets improve? What will the implications of the mergers that have been taking place in the paper production side of the business be? Have Asian economies recovered enough that paper stock dealers can once again see strong, steady buying?

These questions and others likely weigh upon the minds of many paper stock dealers and brokers. What all of this means to paper stock dealers in the United States is the opportunity to stretch their market range. Already some enterprising paper stock dealers are taking advantage of the shifting markets to grow their businesses. Investing now for the future seems to be the mantra for many vendors who aim to grow their businesses over the next several years.