The price recovery expected in some of Carter Holt Harvey’s (CHH) key products for the third quarter has not come to fruition, which may see the company down by almost NZ$30m. Paper prices are at the lowest for the year, with bleached kraft pulp at US$480 per tonne, Kraft Linerboard prices at US$425 per tonne and average Australian timber realisations are at AU$350 per tonne.

Continuation of prices and foreign exchange rates at or around current levels for the rest of the year indicates CHH’s previous forecast of NZ$283m will not be reached.

In addition, following the closing of the announced forest sale, approximately NZ$5m of earnings will be lost in the fourth quarter.

A spokesperson says CHH is working urgently on additional plans to mitigate the impact of these adverse price movements.

“The current market dynamics have proven difficult to predict and because of this uncertainty and the takeover process, the directors have decided that it is important to keep the market fully informed,” says the spokesperson.