MercoPress. South Atlantic News Agency

Cellulose at highest value in eleven years

The value of cellulose rose to 735 US dollars per ton this week, according to industry indicators, the highest price for cellulose since February 16th, 1996

The cellulose boom should guarantee a good year for producers throughout Latin America. A recent Standard & Poor's report says Latin American forestry companies will continue to benefit from new price rises and cheaper production costs in 2007. In Chile, companies Copec and CMPC are also benefiting from a production increases at Valdivia and Itata processing plants. This boom contrasts with the drop in value of other raw materials during the past few weeks. The copper is now valued in 2.51 US dollars a pound after dropping 0.40 cents in the London Metal Exchange during the last seven sessions. The value of oil has also fallen. On Tuesday it cost 55.64 US dollars a barrel and by Thursday it slid to 52 US dollars. This price fall is attributed to a lower demand for hydrocarbon derivatives, considered to be a side effect of the unusually high temperatures in the U.S. at this time of the year. Chilean financing evaluation company LarrainVial predicts that the cellulose's high value will not last long. Analyst André Bergoing said "the value will rise during the first semester this year, but an economic deceleration in Europe will have an impact in the material value towards the end of the year". Bergoing also said that the short-fibre cellulose value will remain stable during 2007. The analyst also predicts that the eucalyptus-based cellulose price will experience a stronger drop in the last months of the year. The Santiago Times