The Latin American forest products industry's credit quality remains on a positive track, still benefiting from rising margins stemming from production cost advantages, the firm worldwide demand for pulp, and the more regional demand for paper products. Increased production capacity in the region is expected for the next three years, especially from greenfield pulp projects in Brazil. However, Latin American producers are highly protected from potential supply imbalances due to their profitability in the high end of the global spectrum. The outlook is stable for the six Latin American companies Standard & Poor's Ratings Services rates in the sector, and four of them are investment grade. In September 2006, we assigned a new rating to Mexico-based Papeles Industriales de Michoacán...
Companies mentioned in this report are:
- International Paper Co.
- Celulosa Arauco y Constitucion S.A.
- Empresas CMPC S.A.
- Aracruz Celulose S.A.
- Klabin S.A.
- Stora Enso Oyj
- Bio Pappel Scribe S.A. de C.V.
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
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