Study Group: Council Members Knowledgeable about Tissue Paper

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India's Paper Market Poised To Expand

November 22, 2009

Analysis by:Dave Hillman, Independent Consultant,

Analysis of:Cheap paper imports from China hurting Indian agro-forestry sector | www.financialexpress.com

India has the world's largest middle class - 250+ million. This group is the major consumers of UFS and grades.Their paper industry is ancient - some machines 100 years old - small and slow.These machines are tolerant of the soft/week wheat straw and rice straw pulps.Huge new world-class size paper machines are already on order - 438" wide running 4500 fpm. These very demanding machines cannot run with rice and wheat straw pulps. India must import quality market pulps -BEK, Acacia, etc.

Tasmanian BEK Market Pulp Mill Back On Track

November 17, 2009

Analysis by:Dave Hillman, Independent Consultant,

Analysis of:GUNNS SAYS IN TALKS WITH SODRA ABOUT BELL BAY PULP MILL PROJECT | www.paperage.com

Four years after the initial announcement this mill is finally showing signs of becoming a reality. Financial markets have improved and now underwriting the US$1.7 billion project is no longer such a challenge.Having Sodra as a joint-venture partner proved to be the catalyst.This mill will produce 1.1 million mt of Bleached Eucalytpus market pulp for India, China and other SE Asia countries. This is most welcome in light of the new paper machines being installed.

Domtar Follows IP Lead In Reducing UCF Overcapacity

October 25, 2009

Analysis by:Dave Hillman, Independent Consultant,

Analysis of:Domtar To Convert Plymouth, NC Mill To 100% Fluff Pulp | www.paperage.com

Domtar has made a positive strategic move to reduce its UCF (uncoated freesheet) capacity at a time when this paper grade is shrinking. At the same time it is increasing its position as a Fluff Pulp producer - a market that many estimate is growing 6-7%/year.The Plymouth mill will, by the 4Q of 2010 be producing 444,000mt/year of Fluff PulpThey will reduce UCF production by 210,000. This follows IP announced shut down of their Franklin, VA mill which produces 600,000st/year.

IP Leads In Capacity Reduction

October 23, 2009

Analysis by:Dave Hillman, Independent Consultant,

Analysis of:International Paper to Shut Down Three Mills | www.paperage.com

IP has said there is excess capacity in both containerboard and uncoated freesheet (UFS). Now they've made a significant move to correct this situation by shutting down 3 papermills. plus one large machine in Oklahoma.Containerboard capacity was reduced by 2.1 million mt. Uncoated Freesheet by 600,000tpy. Coated paperboard (SBS) by 140,000 typy.The mills are located in Franklin, VA, Albany,Oregon, Pineville, LA and the one paper machine in Valliant, OK

Woodchips: a global commodity with a bright future.

October 9, 2009

Analysis by:Dave Hillman, Independent Consultant,

Analysis of:Global Trade of Wood Chips Down 26% in 2009 | www.paperage.com

WRI has published an excellent overview of the global aspect of wood chips as a strategic benefit to those pulp mills in countries where forest resources are limited.Even though tonnage shipped is down 28% in 2009 the benefits assure this business of growing substantially as economies get back to normal.As market pulp prices increase and energy becomes more expensive, it will prove beneficial for all pulp mills to maximize production-in many cases from purchased chips, especially softwood.

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