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| PRIMA Trend Tracking Seminar 2005 |
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The PRIMA Trend Tracking Seminar, held on September 5 in Stockholm, again was a valuable source of information for professionals in the forest-based industries - financial analysts, market analysts and marketing people. Delegates heard the latest updates on how the paper and related markets are expected to develop.
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Frank Leerkotte, Managing Director of Cepifine and Chairman of PRIMA, welcomed delegates to Stockholm on 5th September, wishing them a successful and profitable Seminar.
He then introduced Martin Glass, Director of paper market forecasting company, EMGE, who introduced and chaired the Seminar, as well as making the first of the presentations proper. His speech looked at The Importance Of Trend Tracking, and he explained that with so much information available today, overall understanding of market developments is better than ever before. At the same time, he also noted the importance of having the right level of focus, understanding how individual influences interact with each other and knowing how much one actually needs to know. For an overview of the global market picture for Printing & Writing Papers, he reminded PRIMA members that they can see the headline worldwide figures from the EMGE Global Monthly Monitor on the PRIMA website every month.
Next up at the speaker´s rostrum was Jörgen Appelgren, Chief Economist for Nordea in Sweden, with a presentation entitled "Recovery with Risks". He expects solid global economic growth, although there were several caveats. Oil prices, house price correction, household debt and the US current account deficit are the main risks, but other issues also include economic consequences from Hurricane Katrina, which he expects to last for several months, as well as continued poor growth from Western Europes three largest economies. Generally, he expects oil prices to fall again, global inflation to pose no problem and global economic growth to continue, although the aforementioned risks remain.
Vanessa Eke, Managing Director of Nielsen Media Research UK and AdEx International UK, looked at Advertising in her presentation. She presented a breakdown of Western European advertising markets by country and medium, as well as listing the high-growth markets during the past three years. (The only large market that saw high advertising expenditure growth in the first half of this year was Spain, with +13% growth). Examining the UK market, she noted that internet advertising is growing rapidly, that advertising in the press has plateaued and that volumes of direct marketing are falling, due to improved targeting.
Roger Wright, Managing Director of Hawkins Wright, UK, presented his Outlook for Market Pulp. With paper demand growth weak in the major markets (North America, Western Europe and Japan) over the past four years or so, Wright pointed out that most of the growth in bleached chemical pulp demand since 1999 has come from China and the rest of non-Japan Asia. Compared with average per annum growth of +3% from 1994-2004, Wright forecasts pulp demand growth of +2.1% pa up to 2009 (with much new paper capacity coming on stream in China). With capacity, particularly of hardwood pulp, expected to grow faster than demand, he forecast pulp operating rates of 90% or lower up to 2009, no pricing power for producers and restructuring in the pulp industry.
The afternoon session was devoted to trends in the paper and packaging markets, and the first presentation was by Voytek Sylwestrowicz, an Economist in European Graphic Papers with RISI, Belgium. His presentation focused on newsprint and uncoated woodfree papers. For newsprint, he said the outlook is a shrinking North American market, a maturing Western European market, continuing strong growth in Asia (but not Japan), as well as growth in Eastern Europe. In Uncoated Woodfrees, he forecast that 2005-2007 would see no growth in North American demand, and that most growth would come from China, non-China Asia and other developing economies.
Luigi Astengo, European Direct Sales Manager for Burgo, Italy, presented a paper on the Publication Papers market. European circulation and advertising spending conditions are weak, he noted, and although a recovery is underway, there is now increased competition from other media, but he also predicted that print advertising will continue to have an important role in the medium term. Specifically, he forecast that growth in demand for Coated Mechanical Reels in Western Europe would slow to +2.9% pa for 2004-2007, compared with +4.1% pa for 1994-2004. However, growth in MWC and in Eastern Europe should be stronger than that, he noted. Capacity should grow more slowly than demand, resulting in rising shipment/capacity rates in the near future, reaching 95% in 2007. For supercalendered paper (SC), he forecasts that demand growth for 2004-2007 will slow to +1.8% pa, compared with +4.1% pa for 1994-2004. Capacity growth, meanwhile, will be higher, keeping shipments/capacity rates below 90%, Astengo predicted.
Harald Blaha, Market Research, Mondi Business Paper, Austria, examined the Office Papers market. In the main cut-size applications - Work in Progress, Reading, Distribution and Archiving - he said focus groups show remarkably similar consumption patterns across a range of countries, with no substitution expected in Work in Progress or Reading, although moderate substitution is forecast in Distribution and Archiving applications. Other demand drivers are the number of users of cut-size (the main driver, going forward) and the amount of cut-size used per PC in developing countries. Blaha forecast cut-size demand growth per annum for 2003-2015 of +1% in North America, +4% in Western Europe, +9% in Eastern Europe, +12% in the Asia-Pacific region and +7% in Latin America. Blaha also examined the issues involved with creating value from different paper channels, from colour printing and from branding.
The final presentation was by Peta Conn, Head of Packaging Research at Euromonitor, UK, who examined Global Paper Packaging Trends. She mentioned key global trends including the Asia-Pacific region driving growth in line with a move from unpackaged to packaged products; growth also in other emerging markets of Eastern Europe and Latin America; increased competition to paper from plastics in the mature markets of Australasia and North America (especially in confectionery and dairy products); plus healthy growth in Western Europe, much of which is coming from Spain and Turkey. She forecast global demand growth for paper packaging of +1.3% in 2005, +1.5% in 2006, +1.4% in 2007 and +1.4% in 2008.
Following the Seminar, the vast majority of delegates stayed on to enjoy the Dinner and Jazz Evening, which were generously sponsored by CellMark and Opticom, and for which PRIMA expresses its warm thanks.
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information about speakers
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information on our partners
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Martin Glass - chairman and introduction on the importance of Trend Tracking
Harald Blaha (Mondi Business Papers) on office papers
Roger Wright (Hawkins Wright) shared his expertise on market pulp with the audience
Vanessa Eke (Nielsen Media Research) on advertising markets
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