Tuesday, 16 February 2010 10:00

The Thunder Bay Re-Start is Not Additional Capacity for AbitibiBowater

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Here is an update on the story Newsprint Machines Back in Operation

When the Thunder Bay PM #5 re-start was announced the company indicated that "Despite the announcement, we are not looking to increase our newsprint production in the market. Consequently, we will need to adjust our operations, but no firm plans have been finalized on that front".

My assumption based on that announcement, and other discussions, was that the company would eventually announce a capacity reduction similar to the 250,000 tonnes that re-started on February the 5th. That assumption has been confirmed.

Another assumption on my end was that, until an offsetting closure was announced and taken, AbitibiBowater would attempt to run the machines it had in operation at full capacity. That assumption was incorrect. Although AbitibiBowater does not announce rotating downtime, the company has, and will, take downtime to balance off the Thunder Bay production.

This clarification allows us to better understand the level of excess newsprint supply in the North American market. Nevertheless, by itself, this 250,000 tonnes (annualized) will not make much difference. There is still way too much overcapacity.

Read 3372 times Last modified on Wednesday, 04 March 2020 20:55