South American pulp producer Ence has announced a 6 (E10) per tonne price rise for its eucalyptus pulp, with effect from 1 December.

The rise takes the price from 296 to 302 per tonne, and effectively acts as a signal for other market producers.

So far there are no indications from the market that they will follow suit, but one source said he expected "it would only be a matter of time".

The pulp market is also expressing concerns at the fate of Enron, the crippled US energy trader, which has filed for Chapter 11 protection, in what could be one of the largest US bankruptcy cases.

Enrons financial derivatives business includes pulp and paper trading along with ownership of two newsprint mills, and part-ownership of another mill, all in the US and Canada.

The company has issued no statement about its pulp and paper activities, but a Canadian source said he believed the group could hold anything from 20,000 to 300,000 tonnes of market pulp.

"The big fear is that it will look to sell this and may flood the market as it seeks to raise cash," he said.

A large influx of pulp at a time when the market is volatile will apply further pressure to prices, and could lead to a pulp price slump.

Enron has a 28% ownership stake in Papier Masson, and owns outright Garden State Paper mill in New Jersey and the 350,000-tonne capacity Papiers Stadacona mill in Quebec.