Norscan stock levels stood at 1.6m tonnes in August, a rise for the second consecutive month.

Pulp stocks have historically risen by between 65,000 and 70,000 tonnes on average, but this latest figure has been put down to slow demand and high operating rates.

Credit Lyonnais Securities Europe analyst Christian Georges said the recent raw material price rises seen by the market would be short-lived.

"Pulp prices have benefited from production curtailment at market producers, which has not reflected the underlying low demand and on-going currency devaluation," he said.

Georges said the weakening US dollar had reduced the cost competitiveness of European exports and thrown a harsh light on the high selling price enjoyed by European producers.

Despite the rise, one pulp producer said the feeling was that this would not force the market into any dramatic price cuts.

The bulk of the rise was in Northern Bleached Softwood Kraft (NBSK) pulp. Although some producers felt this could apply pressure to pricing levels, they said the NBSK rise would be taken into consideration in the next round of downtime.

Industry analysts are also continuing to monitor for any positive signs of improvement in both the US and European markets.

Story by Andy Scott