Fitch: Worst over for North American paper industry

Fitch Ratings said trends point to modestly weakening financial metrics this year for the North American paper and forest products industry.

Fitch said that the industry seems better prepared and willing to take out excess capacities.

The export markets will not be able to compensate for a slowdown in North American demand that has been predicted for the second half of this year, Fitch said.

The agency expects second-quarter paper and packaging earnings to look good and be relatively better for lumber and panel producers. But third- and fourth-quarter earnings will match those of last year, the agency said.

Lumber and panel producers should exceed last year's second-half performance because they adjusted more quickly to a soft housing market and additional adjustments are expected, Fitch said.

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