26 May 2009 23:59 [Source: ICIS news]
LONDON (ICIS news)--?xml:namespace>
However, most viewed this as a rollover, stating that the drops had occurred earlier in the first quarter.
“Everyone [producers] was happy to reduce margins in order to keep supply share,” one compactor said. This would become particularly important when now-idled manufacturers returned to the market, the compactor added.
Some demand had returned to the market, sources said, although oversupply had prevented price increases.
“There is some dynamism in the market. However, we don’t know if it’s restocking or underlying demand,” said one producer.
A compactor conversely said: “There is overcapacity in the market. The industry is in a bad shape.”
According to the compactor, a rising risk of default from its customers was preventing further demand increases.
“We have to be very careful,” the compactor said. “We prefer not to dispatch if there is too much risk [of customer default].”
($1 = €0.71)
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