Gerald Chisholm has been in the paper business since 1966. He is currently senior VP-sales at Gould Paper Corp., a New York-based paper distributor. Chisholm discusses his outlook for paper pricing and advised buyers to lock in today's rates.
Media Business: What should b-to-b publishers be watching in the paper industry?
There's not really much for b-to-b publishers to be concerned about in the paper market except prices. Supply should not be a problem in the foreseeable future. There will be more mill closures, but they will only be the result of decreased demand.
MB: What's your outlook for the next six months?
There was an unex-pected coated paper increase announced in early April to take effect this month. We see this as an attempt on the part of the mills to stem the bleeding. The major coated mills continue to report big quarterly losses. Another Chapter 11 filing or merger of two large suppliers would not be a surprise. Prices may inch up some, but we don't see any big moves in the next six months.
MB: What's your advice for a paper buyer right now?
My best advice to the paper buyer would be to lock in today's pricing for as long as possible. There should always be a provision to provide for an adjustment in the event prices do go down. Also, make sure the paper you are using is appropriate for your end use and there are no savings in basis weight or grade you might have overlooked.