13 Oct 2004

Paper markets improving

The market is showing clear signs of improvement, and paper prices are likely to rise substantially in the next year, said the president and CEO of Norske Skog, Jan Oksum, at a press briefing at the IFRA Expo for the newspaper industry in Amsterdam today.

Demand in Europe for standard and improved newsprint has increased by 5.5 percent so far in 2004, and growth in total deliveries from Europe for the same paper grades was 7.7 percent.
"The total production levels in Europe are now close to the levels reached in the peak year 2000. But prices are still low. That will change in the next year," said Oksum.
"We are recovering," he said. "The operating rate is high, and we think the fundamentals are there for a substantial price increase next year."
Oksum also gave background information about the new Hebei project in China, 280 km south of Beijing. It will be Norske Skog's second mill in China.
"It's on schedule, and will start production some time next summer," he said of the new mill, which will have the biggest newsprint machine in Asia. Pan Asia Paper, which is 50 percent owned by Norske Skog, is the only foreign owner of newsprint mills in the regulated paper industry in China.
China's demand is increasing by about 200 000 tonnes per year, which makes it "highly interesting to invest there further," said Oksum. "Norske Skog will continue to invest, and will continue to grow."
The presentation also touched on the company's long-term goals. "Everybody wants to be a world leader, but we want to be recognised as a world leader," he said. Doing that will involve the main strategic choices of being a low-cost producer, pursuing profitable growth and focusing on core business.
Also speaking at the press briefing was Jan Vincens Steen of Newspapers in Education. He presented information on the programmes NIE has organised to increase newspaper readership among young people across the globe, especially in developing countries and new democracies. Norske Skog is the main sponsor of NIE, having contributed NOK 13 million to the programme, which brings together publishers and editors, education authorities, teachers and students in a common effort to use the press in schools.
(Photo of Jan Oksum attached.)
Norske Skog
13 October 2004
Corporate Communication
For more information:
Senior Vice President Hanne Aaberg,
Corporate Communication
+47 913 51681

Jan Oksum