MONTREAL, Que. — Fleets hauling newsprint may face a bumpy road with North American newspaper publishers heading into a melee with paper producers.
Waning advertising dollars due to the meltdown of the U.S. economy have left publishers fighting for cheaper rates.
The big producers, such as Montreal-based Abitibi-Consolidated for example, are getting US$575 per metric tonne of newsprint. That’s substantially lower than the $595 they were charging during the tail end of 2000.
One veteran analyst insists tax cuts and lower interest rates are badly needed before next spring to prop up the industry or paper producers may be forced by their customers to cut prices even lower.
Gannet and other leading U.S. publishers say newsprint should go well below $500 because of falling demand.