December 3, 2017
December 3, 2017


SAN FRANCISCO , Jan. 4, 2011 (RISI) – Canfor Pulp informed customers across Asia that it would increase prices on northern bleached softwood kraft (NBSK) pulp by $10/tonne, effective Jan. 1 until further notice, RISI has learned.

A step in the right direction….

hi Kuppy, if 4 billion people can afford t-paper, what else can they afford ? (lots of other things, I presume). doesn’t all this paper have to be transported ? So, are there any overlooked values in the shipping area ?
– that said, are worldwide wages sufficiently high enough to afford t-paper in significant quantities ?
i can remember going to europe in ’82 and being told by people to carry around my own t-paper, not that nothing would be available but it wouldn’t be what i was used to !!!

4 billion people want all the stuff that you and me take for granted. In a decade, many of them will have the income needed to buy those goods. There will be serious commodity price increases for a very long time. You just need to figure out where the bottlenecks are and why someone should benefit.

What do you think the downside stock price risk is for Andean given where the business is today? I’m comfortable with estimtaing the upside but am struggling with how best to estimate the downside (assuming gold prices remain close to where they are today) as I don’t know what options they might have if they don’t get community approvals, if this is the biggest short term risk they face.

This is mining. Bad things can happen. The downside risk is a total washout. I don’t anticipate that, but you have to be realistic with yourself about the risks to an investment in mining and size the position accordingly.

Due to my sales in muni’s & real estate (rental apt), I’m sitting on quite a bit of cash. I was lucky enough to get out of both positions at a gain, taking advantage of the muni euphoria that took place late in 2010 (before Obama extended tax cuts).

I’m interested in your opinion as a safe-haven for some of this cash. I worry about the future of USD, and wonder whether diversifying in large gold miners i.e. NEM, GG, AEM, AUY (especially after most recent selloff) is “safer” than the risks associated with cash. Or perhaps it’d be more prudent to just buy GLD or physical gold?

Any insight is appreciated. I’d still have quite a bit of reserves (USD) left for opportunities that could arise in a sell-off or crash.

I can’t give personal advice.

For myself, I’m scared to death of USD which sometimes leads me to strange places looking for liquid assets that I can own. For now, I’m tempted to think that large cap miners are safer than many other options, but they sure are volatile as the last week has proven. This means that they need to be a bit more actively managed than a simple cash account. I still own plenty of gold and have looked further afield as well….

I was intrigued by how you came up with the idea to bet on a sector. I’m not quite convinced that the toilet paper usage will increase drastically though. I was born and grew up in Malaysia before I moved to the US. I was brought up using toilet paper. But I believe there are two categories of people when it comes to non-toilet paper users: the people who can’t afford toilet paper and the people who believe water is more hygienic than toilet paper. In Southeast Asia, Japan, Southern Europe, Middle East and some parts of South America, most households have bidets installed. For these households, toilet paper just won’t do. I doubt they will ever succumb to toilet paper unless there is no other choice.

At the other end of the spectrum are the people who can’t afford toilet paper as evidenced by the communal poo rag in the Chinese public restrooms. But if this is an economical choice, I suspect a poor-man version of the bidet (a hose hooked up to a tap) is more economical than toilet paper. The poor man’s bidet is very popular in public restrooms in Malaysia an Indonesia due to its economics and a culture similar to the Middle Easterners. Whether the economic benefit could persuade the Chinese to wash instead of wipe their asses is a different point worth pondering.

Having said that I don’t think it invalidates your argument that there is a perceivable supply-demand imbalance in the toilet paper industry. Even if the demand remains constant, the current shortage in supply will persist until more factories come online.

Figured I’d post this email as I found it interesting. Glad I created this site, I would never learn these sorts of things by just reading on the internet.

As a person who has lived in the US for many years and currently living in India we are still using the tissue in India. But many of our family friends do not use tissue. They have classy western style bathrooms in their home, but they dont use tissues. It is purely psychological. They think using water is a much cleaner way. I dont see them changing unless they go abroad and live for a while to change their habit. On the other hand diapers usage are becoming common. Middle class families started using it for their babies. There is bound to be a significant growth in diaper usage with growing middle class families. Also, more than half the population are young, so there should be more babies born in the coming years.

More great info. Maybe this idea just won’t have the same traction unless/until more people adopt tissue.

More of a comment.
On the topic of pulp, and wiping yourself with paper after doing the business, someone mentioned this: ” Second, even if something spurred such a mass change, can the plumbing in those countries handle it?”

I have lived in Latin America for 10 years now, and traveled throughout it. A large percentage of houses/apartments/restaurants etc do not have the capability of accepting toilet paper in the toilet.

This problem is solved simply by having a small little basket beside the toilet where the paper goes, and having a maid clean it out. In Latin America, once you get to lower middle class stage, you will have a maid.

I am not sure about China, but from what I read, india and indonesia are similar in this regard (having servants or domestic workers). Thus plumbing is not a big issue in this case.

For readers interested in plumbing constraints.

Might palladium be a sound alternative to silver? The chart look kind of “bubblish,” but the demand-supply equation is more promising than silver’s:
– Industrial demand is relatively inelastic to price, because China needs catalytic converters for its growing auto fleet. There are no cheap substitutes to palladium for this purpose.
– Investor demand not yet euphoric. PALL ETF only holds 848 million. There’s a similar sized ETF in London and somewhat larger long-term holdings in Zurich, but nothing like the world-wide visibility enjoyed by gold, silver, or even platinum. However, U.S. Palladium Eagle coins, to be minted this year, could stimulate additional demand.
– Supply is forecast to lag demand for the near future. Production is capital intensive, with long lead times, and only two major production areas. Norilsk’s production peaked a couple decades ago, and new investments will not increased output for years to come. South African producers have their own issues – electricity and water constraints, for example. Moreover, the key fact is that Norilsk’s palladium output is a byproduct of nickel production. Similarly, the Bushveld complex produces palladium in a relatively constant ratio to platinum. So in both cases production is not uniquely responsive to palladium prices.
– Inventories are the question mark. Russia’s inventories are a state secret, but the common wisdom among analysts is that the world has been consuming in excess of production since 1989, and the Russian inventories are nearly exhausted (admittedly, this sounds speculative).
– At current prices, recycled catalytic converters represent “inventory on wheels,” but U.S. and European recycling markets are already pretty efficient (Belgium’s Umicore, for example). China’s young car fleet doesn’t yet offer a deep source for recycled palladium.

Investments? Norilsk is tempting, with an inside track to supplying China with Nickel and Palladium (and now with direct shipping via the arctic route), but Putin and Russian opacity make me wary, so my investment here is small. Impala, Stillwater, and other miners have issues with costs (Norilsk just sold it’s investment in Stillwater). Anyway, you’ve taught me that mining is a lousy business. Recyclers are more appealing, and I own a little UMICORE, but it comes with Euro risk. Maybe Mr. Market will offer me a bargain over fears of a Euro break up. Meanwhile, a small, cheap, PM recycler would be a gem of a find. In the meantime, PALL offers an easy-to-manage investment, a hedge against Putin, and a store of value to protect against money printing. Based on the above, I plan to hold onto my PALL shares a while yet. What do you think? Does palladium offer the supply-demand-inventory-price criteria that silver lacks?

I think you just answered your own question. That’s a big quantity of data that you already have. I don’t know the details anywhere as closely as you do. It sounds like you’ve already done a lot of the work on this. I would just caution that it has made a huge move in the past few months. Wish I could be more helpful. Figured I should post this as other readers may get as much benefit from it as I have.