PORT TOWNSEND — Port Townsend Paper Corp.’s president voiced optimism in the company’s future Monday, with virtually all of the company’s boxmaking product lines “trending up” and product price increases taking hold.
“Overall, we are bullish about the foreseeable future,” said John Begley, in a conference call report of first-quarter financial results delivered Monday.
Begley, who was joined by Tim Leybold, chief financial officer, said the Port Townsend mill that employs about 320 in Jefferson County “continues to operate at rates at or near the 2005 record levels.”
He added that general economic conditions in the company’s western Canadian corrugated box markets “remain very strong.”
Begley said pulp production continues to experience favorable market conditions, and the company expects to remain “as demand for unbleached softwood pulp in Asian is strong with the continued growth of China’s economy.”
Energy sufficiency
With the Port Townsend mill 70 percent self-sufficient in generating its own energy, Begley said the increased cost of reprocessed fuel oil has had “significant negative effect on our profitability in the last six to nine months.”
The cost of reprocessed fuel oil used to produce energy at the mill rose about $17 a barrel, or almost 50 percent.
A wet winter caused extra moisture in waste wood “hog fuel,” Leybold reported, causing an 18 percent increase in the company’s use of that fuel.
That brought the company’s total energy cost during the first quarter of 2006 to $6.1 million — $1.8 million higher than the same period last year.
“In any event, we are aggressively looking at ways to reduce consumption of [reprocessed fuel oil] by evaluating alternative fuel sources, as well as more efficient ways to operate our boilers.”
