Pulp&Power ready to Rock&Roll! Q4 better than I expected. Now it's a new year and we are Reset. The recovery boiler 5 at Northwood (lower&upper furnace) is now rebuilt. That's behind us, that messy start/stop 2020, and the current year is incredibly nice. After one year of pandemic, we now know that our pulp is resilient, an essential furnish to packaging and tissue producers, and the world now uses more of them (e-com, work-from-home, fibre is green). Demand has grown even with writing papers down.
Sales are now china 60%, usa 25%, canada&row 15%
2020 avg china list price was USD $588 and is now $840 and trending higher
2020 avg usa list price was USD $1139 and is now $1300 and trending higher
There is barely maintenance until Q4 and lots of woodchips inventory with the lumber mills running full tilt.
Balance sheet remains super strong with a minimal debt of 43M.
No dividend, no buyback... they will need warehouse to stash the cash ;-)
To be fair, one trend working against us in 2021 is the $CAD at 0.80 va $USD.
Verso, Suzano, WestFraser, Resolute...
They're are all hiking pulp $100 from monday March 1
https://twitter.com/BryanSmithRISI/status/1364688730305351681
https://twitter.com/FastmarketsRISI/status/1364579667370512386
https://twitter.com/FastmarketsRISI/status/1364365760697688064
https://twitter.com/FastmarketsRISI/status/1363998347779006472
Our management like to "modest" any improvements in inventories and pricing... but the way I see "tight" and "surging" and "record" may be needed soon in their lexicon!
Good luck to us patient shareholders.