Michelle Gonzalez— 4th

Frank Grippo—12th

Brian McEnaney –27th

 

 

 

Reported in pulp& paper week

2003 Capacity Reductions

Uncoated Freesheet

Misota          180K   Tons

Curtis          13K    Tons

Domtar, VC       45K    Tons

Eastern Fine       35K    Tons

GP, Camas       65K    Tons

Glatfelter        40K    Tons

Weyerhauser, WA    90K    Tons

Weyerhauser, WI    32K    Tons

Total           575K   Tons

www.brownpaper.com — 800.221.4386

July  2004

Independence Day

Is JIT dead?

From the pages of Logistics Management

By James Cooke -- 6/1/2004

Just-in-time (JIT) inventory practices should be confined to the dust heap of history. That's the contention of a leading financial analyst and economist who believes that the just-in-time strategy has "outlived its usefulness."

Instead, manufacturers should begin stockpiling inventories as a hedge against rapidly rising commodity prices, suggests Donald Coxe, a global portfolio strategist with BMO Harris Investment Management in Chicago. "By running lean and mean, JIT is hurting companies," says Coxe, whose book, The New Reality of Wall Street, outlines his global investment outlook for the future.

Although slender inventories made sense two decades ago when commodity prices were in decline, that's no longer  the case, Coxe believes. Today, China's rapid growth as a manufacturing center is placing heavy demand for raw  materials on suppliers around the world. "We are in the  early stages of the biggest commodity boom in history, driven by China and India," he asserts. "We're going to add a half billion people to the world's middle class in the next 15 years. The squeeze on soy beans, natural grains, and coal will be monumental."

Coxe sees trouble brewing as worldwide demand for commodities remains high even as most companies have record-low inventories on hand. Equally worrisome is that China's voracious appetite for raw materials is pushing  up commodity prices, but the low-cost output from Chinese factories is forcing global manufacturers to hold down prices for finished goods.

"The price of raw materials is rising nine times faster than prices for finished goods," Coxe says. "Companies should be maintaining inventories at a time when they're replacing supplies at much higher prices."

Gene Hogge & John Wanner from IP visits BPC

BPC Visits Domtar Paper

Ben Saleeby has now joined every other male at BPC with his first HOLE IN ONE!

Congrats Ben!

Indeed, during the first five months of 2004, commodity prices have skyrocketed.   Purchasing reported that during the past 12 weeks alone, prices for steel scrap increased by 80 percent. Ethylene prices rose 30 percent, while lumber and nonferrous metals were up 26 percent and 22  percent, respectively. (Purchasing is owned by Reed Business Information, LM's parent company.)

Manufacturers can expect to pay higher prices for materials replenishment; thus tomorrow's purchases will cost more than today's stock.   Coxe, for one, does not  think that situation will change any time soon. In fact,  the analysis foresees no abatement in the run-up in commodity prices for the foreseeable future.

"The only commodity in oversupply right now," he says, "is political hot air."