Thank you operator. Good day everybody. Thanks for joining us on the call. As always, I'll take you through the investor presentation, calling out the page numbers as I move through the deck. I'm going to start on page three, which has some of the highlights for the quarter. I'm pleased to say that the recovery that we've experienced from the lows of COVID last year continued into this quarter, further improvement. There are still certain challenges related to COVID, which I'll talk a little bit more, but we continue the recovery, and I'm pleased with the progress. Firstly, a strong performance from the Packaging and Specialities, and then dissolving pulp continued to ramp up. What I would say on dissolving pulp is that prices improved significantly during the quarter. I just want to stress that there is a lag impact related to our contractual pricing, and much of that benefit will be felt in future quarters. The graphic papers in Europe continue to be under pressure. A lot of that was linked to COVID itself when the second wave came along and renewed lockdowns. Particularly in January and February, we saw demand softening a little bit once again, not back to the old levels of the middle of last year, but certainly a slowing of the growth. Subsequent to that, in March, we did see things starting to get a little bit better once again. We did have the challenges of shipping, which is not unique to our industry. It's cutting across many industries across the globe, and that caused some delays and some cancellations, and impacted our performance. I'm pleased to say that the new covenants for our debt were renegotiated, and those will commence from our Q1 2022 financial period. We have comfortable headroom incorporated into those new covenants, so pleased with that. Overall, the EBITDA was $112. That was up from $98 in the prior quarter. Moving to slide four, the earnings bridge quarter to last year. Last year we still made $131, that was still pre-COVID. Sales volumes down predominantly in graphics and predominantly in Europe. I've talked already about the slower recovery there. The price box is, you can see here, is close to zero, underneath that, dissolving pulp prices started ticking up. I've already mentioned that much of the benefit will come in the future, we started to see some benefit in this quarter. Packaging was down. This was specifically in Europe. It relates to a lot of that business is priced on an annual basis. At the time when the last set of prices were agreed, pulp prices were substantially lower. It's the impact of historically low prices. Obviously, subsequent to that, we've announced price increases, and we would expect them to go up going forward. Graphics, again, once again, down a little bit, but predominantly linked to COVID and once again, historically low pulp prices. We have announced price increases here as well. On the cost side, some of the higher pulp costs starting to come through. Fixed costs, some nice savings coming through. On the exchange rate, once again, netting off close to zero, but underneath that, sales revenue positive. The reason for that is that you have a bunch of your sales in Europe and out of South Africa, which are denominated in domestic currencies, which strengthened, obviously, against the dollar. Offsetting that is the fact that similarly, costs, those same costs in those regions get translated into dollars. Specifically in South Africa, obviously the rand has strengthened and that, in dollar terms, pushes up your cost curve, giving you the 112 EBITDA. Slide five has the product contribution. It's on a last 12-month basis. It's obviously distorted significantly because of COVID. It still has packaging as by far the largest. Obviously, in time, dissolving pulp will go back to what it was and beyond pre-COVID times. Graphic still has to make a recovery. At the moment, Graphics on sales volume represents about half of our volumes, but that's coming down all the time, and we would expect the growth in our growth segments to increase and increase their contribution overall. Slide six has the segmental volumes and margins and just talking about each. Briefly, Graphics, you can see sharp recovery initially after the first wave of COVID, coming back a little bit because of Europe's second wave. I would expect it to start recovering further as the vaccines take hold and Europe comes out of lockdowns. Packaging held up pretty well, and margins nicely as well. Once again, when we get the higher selling prices out of Europe, the margins will continue to be healthy. Dissolving Pulp, initial, obviously, nice recovery from the lows of COVID. Going backwards a little bit in this quarter, but that's purely because you've got the higher exchange rate, and the higher selling prices have not kicked in yet. Clearly, in Q3 and beyond, that line will go up sharply. Turning to Slide seven, the debt leverage, and you can see now it's peaked at the 6.5, and that's to be expected because now we're carrying the four quarters related to COVID. With the further improvement in profitability expected in the next quarter and beyond, the leverage ratio now will start to come down quite sharply. Slide eight has our maturity profile of our debt, and I think a lot of great work has been done here over the last few months, refinancing the 2023 bonds. We refinanced the securitization. Really all major maturities of now 2024 or beyond. It really looks good and gives us a clear runway as we continue our recovery. Slide nine has the CapEx, and similar to what we had in the last quarter, we're seeing CapEx this year of about $400. Bit higher than we initially said at the beginning of the year, just to remind you, that is currency related. There was a wee bit of a delay related to the Saiccor expansion, which was COVID related. I'll talk about that a little bit more now. Moving ahead, turning to the geographical segments. Firstly, in Europe on Slide 11. It's fair to say that Europe has lagged the rest of the world in terms of recovery. In terms of our markets, we obviously initially saw Asia starting to rebound and then North America and some of our other export markets, Europe has lagged the rest. It's specifically had an impact on Graphics. Although we've recovered, the second wave slowed that somewhat. We were forced to take 115,000 tons of downtime. Export markets, which I had spoken about in the previous quarter as lagging a little bit, they have now improved, and we are more upbeat about the prospects there. In fact, the logistical challenges that we had actually slowed some deliveries to those regions down a little bit. Otherwise, it could have been a little bit better. The paper selling prices were lower, as I talked about, because of the lower pulp prices. Overall, the markets for Graphics, coated woodfree and coated mechanical, are down about 20%, but it is progressively getting better. As I said, hopefully as the lockdowns are eased in Europe, that will continue to improve. In the packaging segment, paperboard demand was good and certain of the essential and health-related products was good. Other non-essential categories also impacted by the lockdowns. Costs up quarter-on-quarter. We're starting to obviously see the higher pulp prices. Just to remind everybody, our European business is about 55% pulp integrated. We have to buy pulp. Obviously, pulp costs are going up. We have to offset that by implementing selling price increases. They don't occur immediately. We have to take time to execute on them, but we would expect selling prices to go up to offset that. Moving to Slide 12. North America, a very good quarter. The performance improvement across the board. The U.S. economy has rebounded out of COVID, and our businesses continues to strengthen. Packaging volume's up 56% year-on-year, and quarter-on-quarter, an improvement. What I would call out to you is that, as you all know, we converted Somerset PM1 a couple of years back, and now we're basically full now on the packaging grade. Extremely successful for us. What it does mean is that you're not going to see that same pace of growth continue because obviously we don't have the same capacity to enable us to do that. On pulp DP prices going up. Similarly, BCTMP, which we sell out of our Matane mill, very favorable pricing and continuing to rise. That acquisition that we made now has been very successful for us, and with the pulp prices going up, the profitability continues to improve. Graphics was only 85% of last year, but what I would call out to you is that is related to the fact that we were transitioning from graphics to packaging. Our machines were completely full, very successful for us. Costs were negatively impacted by the delivery and logistics costs, and higher pulp prices coming through. Once again, we have implemented selling price increases, and we have been successful there. Slide 13, South Africa. Once again, very pleased with the performance. DP, obviously, we've talked about a couple of times, partially impacted by that oxygen issue that we talked about on the last quarter, 23,000 tons. Obviously, the higher selling prices will come through in future quarters. Packaging was very strong as well. I'm sure many of you have been reading about the higher fruit exports out of South Africa, and we obviously benefit from that. Some of the other smaller categories are impacted negatively that are focused in domestic markets, but those are not material. Our big segments are doing very well. Higher raw material costs starting to come through. Similarly, the higher freight that I referred to. Moving to the markets for our product segments. Firstly, slide 14, dissolving pulp. It's been a remarkable rise in prices and demand has been very strong. The prices surged to up $340 in the quarter. I would call out to everybody that that's obviously the starting price to the end price. The average will be somewhere between those numbers and our contractual pricing is based on averages. You can't expect our selling prices to go up $340 in the next quarter. It's the average. What is contributing to the positive? Well, huge restocking. A lot of capacity had come out. Inventory levels were low across the supply chain. We saw prices for alternative fibers rising, paper pulp pricing, everything very, very positive. At the moment, as we indicated in our results announcement, prices are $1,100 a ton. That's as high as we've seen in many years. I think to summarize, the short term still looks positive. The short-term factors continue to be positive. Even if you look beyond the short term at the next couple of years and the market balance, it's still positive. I said on the last results call that I don't expect the prices to remain at $1,100 forever. No. The prices will come back. At the time I said, probably somewhere in the 800s. Even at those levels, the margins are still good. Dissolving pulp was impacted by the oxygen, which I talked about. BCTMP, which is the pulp sold out of Matane. Like dissolving pulp has also surged the pricing and looking very good and production's been good at the moment there. Offsetting that somewhat is the logistical challenges that's caused delays out of our South African mills, in terms of exporting. Not worried about the volumes per se, it's just a timing difference. The exchange rate. Obviously, the rand has been stronger, that squeezes your margins a little bit. That was what you saw in the earlier graph. Turning to slide 15. Packaging, really, very strong in North America and South Africa at the moment. Europe, more challenging, volume demand is picking up and as we implement selling prices, we will start to see improvement in margins there. Once again, it's linked to COVID and as those lockdowns are eased, we're confident about that. Graphics. The progressive recovery we saw over the last few quarters did slow. I think there's a graph a little bit later, you'll see it kind of month- by- month out of Europe. You'll specifically see the impact of the second wave of lockdowns. The European market's down approximately 17%, and interestingly, the U.S. down 24%. What I would call out to you on both of these is substantial capacity came out of the market. In the U.S., it was more than 25%. Actually, the market is in balance. Europe continues the recovery. It's difficult to estimate exactly now what the haircut's going to be because of COVID, because we've still got some more recovery to occur. I've talked in previous quarters about perhaps about a 20%. It's starting to look like it may actually be a little bit less than that, if the markets can recover further as the full economy opens up. Specifically in Europe, the higher costs will impact in the short term, but we will implement selling price increases. Slide 17. I've touched on, it's been a successful quarter on the funding side. We refinanced our 2023 bonds with the 2028 bonds. Demand was very strong, which enabled us to get a very good rate of 3.625. We've renegotiated the new covenants. Really that smooths the path now, as we continue our recovery. I think a tremendous job done there. The CapEx at Saiccor is going well. We are substantially complete. A few things obviously still to be done. Some delays and some cost increases linked to COVID, predominantly. We're still confident of commencement in Q4. The CapEx numbers that I referred to are obviously in the CapEx schedule that was on an earlier slide. Just a couple of slides on the recovery itself. Specifically in slide 19. On the left side is the change in retail clothing sales out of the U.S. There's many different graphs we could have shown you out of other markets or even big retail sellers and the like. What they show is a rapid recovery. A little bit of a hiccup as the second wave came on, then renewed growth thereafter. The positive out of this is that the market has strongly recovered, but there's even still a little bit to go, as the final lockdowns are eased in the big markets. On the right-hand side, you have the dissolving pulp versus viscose pricing. We show you that just to show you the strong correlation. You can see viscose prices have risen rapidly. In the last few weeks, they've come back a little bit, but they're still at relatively high levels. Slide 20. We like to show you, just to put the dissolving pulp price evolution into perspective, the red lines has the average BCF prices, hardwood prices. Just looking at a couple of the numbers, you can see that the Q1 average jumped sharply into Q2. Then similarly, up to the $1,100 that it's currently. We are obviously one quarter in arrears. The nice pricing that occurred during Q2, we'll see in Q3. Similarly, obviously, if prices stay at these elevated levels, we'll see that benefit in Q4. Slide 21 just shows you the coated woodfree in U.S. and in Europe. You'll see that there was a rapid recovery after the lows of the middle of last year. A little bit of a pause in January and February, then renewed upwards sloping in March and hopefully beyond. Slide 22. Everybody's read about the delays, and it's not just affecting our industry, it's across many industries, and it was exacerbated by the whole Suez Canal situation. In all the major routes, big delays. What that's meant is that our South African exports and our European exports, there have been delays. In Europe specifically, it's actually meant we've had some cancellations. It has impacted on our performance. The challenges are still out there. Again, many people are talking about this, not just in our industry. We are hopeful that we'll start to catch up as we move through Q3. Slide 23 has our four pillars of our strategy. I've talked about it in the past, I don't intend going into any great detail in this discussion, but just to call out a couple of things. I mean, firstly, on sales growth, our focus is on growing our growth segments and in time, obviously reducing exposure to graphics in line with the market declines. Our financial health has come a long, long way in the course of the last few quarters from the lows of the middle of last year. I showed you some of the numbers earlier. Operational excellence naturally would be a focus of our attention. Efficiencies and costs for the savings targeted this year of $69. The Saiccor mill expansion will enable us to lower our costs further at our largest DP mill. Then at the bottom, enhancing trust. That's ultimately why we're in business with all our stakeholders. We're committed to Science Based Targets. We're following the Task Force on Climate-related Financial Disclosures recommendations, and we've got a rigorous supplier code of conduct looking at where all our raw materials come from. Slide 24 just summarizes the strategy. Just to repeat, in the short term, our focus is on the balance sheet, paying down the debt further, driving up the margin improvements, getting the earnings back to normalized levels. We will continue to do work on potential longer-term opportunities, but we're certainly not going to commit to any big CapEx at this point in time. We have to get our balance sheet back to where we want it to be. Slide 26. Sustainability is a big part of our strategy as you would expect, and obviously, with the Science Based Targets and the kind of climate change goals, and legislation that's coming out, it's a bigger part of our business moving forward. We just felt it was appropriate just to demonstrate our commitment to sustainable growth. One of the strong aspects is our certification of our forests, and that gives us a competitive advantage. The Science Based Targets, in time we'll go public with those, and that will have our emission targets for up to 2030. We're obviously committed to that. On the BBE side, tremendous work done. We have a level one contributor there, and that's all been certified. Thrilled with that progress. Turning to the outlook, on page 28. In summary, DP, very good. I've talked about it, very positive. The lag will come through, and profits will pick up. The packaging continues to be very strong in North America and South Africa. Europe lagging. As those selling price increases start to take effect, the margins will recover there. Graphics, again, I link it back to COVID, and I know that Europe has been lagging. Based on our experience in other parts of the world, as lockdowns are eased, we do expect recovery in time. It does take time to implement the selling price increases. The logistics challenges are still with us, but hopefully, those will start to be eased as we move forward. In terms of our earnings guidance, we're saying that Q3 will be a further improvement on Q2. However, Europe will be lower due to those rising pulp costs, and the fact that it takes a bit of time to implement selling price increases. Operator, that's me gone through the deck. I'm going to hand it back to you for questions. Thank you very much, sir. Ladies and gentlemen, at this time, if you'd like to ask a question, you're welcome to press star and then one on your touchscreen phone or the keypad on your screen. For the benefit of the participants who have joined via their HD web phone, please ensure that you grant your microphone permission to make yourself audible before accessing the question queue. If your question had been addressed and you wish to withdraw yourself from the queue, you're welcome to press star and then two to exit. Just a reminder, if you'd like to ask a question, you're welcome to press star and then one. The first question comes from James Twyman of Prescient Securities. Yes. Thank you very much. Thank you for the presentation. Could you just talk about Saiccor in terms of what sort of run rate it was running at last quarter, whether that's changing this quarter with oxygen problems? Whether in Q4, how quickly you can get up to the sort of flat-out rate that you would hope to be getting to, whether is it at the beginning of the quarter or the end of the quarter? Obviously, that's a big quarter for prices. Secondly, we've seen a coated fine paper price increase for April. Just wondering in May, whether you think you've seen any further increase and whether Specialities are seeing an increase too to reduce the squeeze you're seeing there. Thank you. Yeah. Thanks. Just in terms of dissolving pulp. Well, just one thing on the oxygen challenge. It didn't actually impact on Saiccor. It was actually the Ngodwana mill. In terms of Saiccor and run rate, we've got the big shut in this quarter. Because you've got the lag related to the shipping delays, the sales volumes for this quarter are pretty at normalized levels, close to Q2 levels. Obviously, beyond that, we'll complete the Saiccor project. Then there'll be a ramp-up period, then you'll start to get the higher volumes after the ramp-up period. I think in summary, James, to your question, the volumes should be reasonably in line with what you saw in the last quarter. The coated selling price increases, I'll give you an initial comment, and then I'm going to briefly pass you to Mike in North America and Marco in Europe, just to briefly talk about their experiences. We've announced, obviously, a series of price increases across our product categories. We've been pretty successful so far. Europe, a little bit slower. However, we are getting some traction. That's across, obviously, the graphics and in the packaging space. In the packaging space, it's a little bit more challenging because of these annual contracts, and Marco can just refer to you a little bit about the timing of when those contracts annualize. I'll go to Mike first. Mike, briefly, do you want to just talk about pricing? Sure, Steve. In North America, we've implemented price increases that went into effect May 1st on most of the grades across North America. We have not realized that latest price increase in this last quarter. Obviously, as Steve stated, some of our contracts do require implementation over time. It's not a cut and dry average the price increase across all the tons. We'll be implementing that price increase in to date with the assets full on coated freesheet, or excuse me, high operating rates in North America. We expect to realize the majority of that over the course of the remainder of the year. Great. Thanks, Mike. Marco? Yes, Steve. Similar to North America, we have announced our first round of price increases as well as of April, which we are realizing right now. This is the first quarter, fiscal quarter three that we will see price improvement. Momentum is building towards a second necessary price rise in June, July, and that's for both the mechanical publishing as well as for the commercial print wood free business. As said, with the recovery that we hope to see going forward, we're cautiously optimistic that that will support this second price rise in June and July. Thank you, Marco. James? Yeah, thank you very much. The data we've seen shows there was a 2% price increase in Europe in April. The implication is that you've achieved the same again in May, or is it better than that? How much is the total that you sort of are expecting to get in the next few months? Yeah, I think. Marco, I don't think you can talk to month-by-month, but just broadly. Yeah. The range we're looking at is somewhere between 3%-5% over a quarter. We will try to repeat that from June, July onwards. You need to take into account, as Steve was rightly saying, that some of the contracts run over multiple quarters, and we've got different phase outs of these six and sometimes 12-month quarters. There is some disturbance from contractual obligations that we have. Thank you very much. James, does that conclude your questions? Yes, thank you. Thank you. The next question comes from Mikael Doepel of UBS. Thank you. Good afternoon, gentlemen. Just starting off with the DWP markets and the demand trends that you see there, I'm wondering if you could talk a bit about that. What are the growth rates in the markets currently, and what's driving that? When I look at the retail coated sales, it's essentially only China that has recovered. Other regions are still down clearly. I'm just wondering if Xinjiang a major driver, and if so, do you expect any changes to that? If you could talk a bit about the demand trends you see in the market in terms of growth rates and the dynamics, that would be great. Yeah, you got to talk about the short term and the longer term. Obviously longer term, based on all our estimates, we consistently believe that the market will continue to grow at about 5% per annum. Obviously, in the short term, we've had the whole COVID impact. What happened last year was that everything just stopped. Viscose producers stopped producing. There was force majeure declared. Inventory levels right down the supply chain, all the way through to the retail side, dropped considerably. When lockdowns were initially eased, you had a major restocking going on. While you're right that the volumes of clothing sales are not back to pre-COVID levels, they're about 80% or so, that's still a substantial recovery. With inventories being so low, it just pushed up the demand for pulp. At the same time, on the supply side, obviously, you had temporary curtailments including ourselves. That meant that it took time for the supply side of the market to get going once again. That combined with the restocking, it drove up prices very sharply. Mohamed, do you just want to talk a little bit about the demand side and what you're experiencing at the moment? Yes, Steve. I would just add two points that the other part of the demand side is coming from strong growth in nonwovens, where the value of wood-based cellulosic fibers is a very good one, especially the biodegradability. Then two, as you highlighted, Steve, I think there's just been this huge restocking that has pulled through a lot of demand for viscose. Also you ended up in a situation up until very recently where the relative price position of viscose to cotton and polyester encouraged a greater usage of wood-based cellulosic fibers in the textile markets. Michael, just to. Right. Add to what we were saying. You are right that, obviously, textile and clothing sales are not at pre-COVID levels, but that gives us further comfort. The fact that there is still a little bit of a way to go for demand to get back to pre-COVID levels. That is going to help underpin pricing in the short term as we look forward. Mm-hmm. In terms of Xinjiang, has that been a major factor in the market or not? Sorry, you broke up there. In terms of what? In terms of the cotton production in Xinjiang in China, has that been a major factor in the market and the demand for VSF or not? Mohamed, did you want to talk about the cotton side of it in China? Yes. It certainly, I think, has influenced the sentiment, especially for the major retailers outside of China that relied on garments and textiles coming from China, and I think that did encourage a swing towards more viscose. Also, I think it encouraged a swing towards production of garments outside of China, which benefited places like Indonesia, for example, where there's a big production of viscose staple fiber. Right. Okay. That's clear. Just a follow-up on the supply side, mentioned briefly before. I guess there was a lot of the Chinese DWP capacity was more or less shut down last summer. Just wondering if that is now back on the stream and what you're seeing in terms of swing mills in the market. Maybe also you could talk a bit about the new capacity and what you expect the next couple of years. Just to get a feel for the supply side of the equation, if that has increased or changed in any way recently. Yeah. Looking at the supply side, you're right, there is a bunch of Chinese swing producers. What we've seen in recent months is that some of it has swung back. Not all of it, but some. At the same time, paper pulp prices are also rising significantly as well. There's probably no need necessarily in the short term for them to swing back. The second part of your question related to the new capacity coming on board. Obviously, we know about the two big projects in Brazil from Lenzing and RGE, we know they're both integrated suppliers. They're making it for their own use. In terms of market producers, we are not really aware of any other material projects planned for the next couple of years. Mohamed, anything you want to add there? Steve, just one comment. There was a public announcement by a company based in Finland where they made an announcement that they would be exiting the dissolving pulp supply into the viscose market. They're not a very big supplier of viscose grade pulp, but a meaningful supplier to some producers in China. That also should help provide some sort of offset in terms of supply. Okay. Well, that's very helpful. Thank you. Thank you. The next question comes from Brian Morgan of RMB Morgan Stanley. Hi, guys. Thanks very much. Just on your first phase of your strategy is the balance sheet management and the de-gearing. Could you just chat to us a little bit about that? Are you thinking about it on an absolute or a relative basis? DWP prices don't have to do much to de-gear the balance sheet pretty quickly, and then basically that first leg of the strategy is done. Related to that, are you thinking about the reinstating the dividend at some point? Yeah. On the leverage, our primary target is a leverage itself and we've always said that we want to get it below two. I think on this results call, last time I was asked about would you want to go below two, and certainly with the fact that we're in a cyclical business, it is likely that we would take it down further. Last time, we took it down to about 1.6 times and, obviously, the market turned. I suspect we would take it down further. Through the Saiccor, two would be our maximum that we would desire it to be. Dividends, I'll be honest, Brian, it's not something that we've contemplated at this stage. Our primary focus obviously was on recovering from COVID and getting our leverage and profitability back to normalized levels. You are right. If we can generate the profitability that we all think we can make in the next 12 or 18 months, the leverage goes down very, very fast. We would have to be confident that we can maintain that leverage ratio below our target before we would pay the dividend. That's fine. Just, you spoke about Stora Enso pulling out of the DWP market, supplying into the Chinese market. Does that mean that we could see a bit of a squeeze in the DWP spot market, with those viscose mills have to hit the spot market now to replace that DWP, do you think? Brian, what I would say is, it's certainly a positive. As you look at all the dynamics that are underway, there are a number of short-term positives and that adds to the positive. Obviously, on the negative side, a little bit is you've seen viscose prices come off a tiny amount in recent weeks. Broadly speaking, taking to the point you make, plus all the other positives and hopefully Europe coming out of lockdowns in the next month or two and retail sales picking up further, all of those give us cause to believe that in the short term, things continue to be very positive. Cool. Thanks very much. The next question comes from Tim Clark of SBG Securities. My apologies, we seem to have lost him there. Tim, if you are still online, you are welcome to queue in again. The next question comes from Wade Napier of Avior Capital Markets. Thanks for the call, guys. I'd just like it if you could give us a little more color on your pulp purchasing dynamics within the sort of graphic paper business. We've seen paper pulp prices, the index prices in particular, sort of shoot up in the last three months. I assume your sort of average pulp purchasing costs would not have reflected those index price moves yet. Can you maybe just give us a little bit of color as what your sort of average pulp cost maybe went up in this past quarter and potentially what you could see that increase be in the third quarter? Maybe just give us an indication on how much pulp you buy in a quarter. My estimate's around 200-220,000 tons of pulp, if that's correct. Yeah. On an annual basis, based on the current levels, we are approximately, and I'm rounding, it's approximately about 800,000 to 900,000 in Europe and 150 to 200 in North America. We don't give the specific pulp increases. Obviously, we buy on the market, so it is linked to market prices. You are correct that we haven't seen the full extent of the increase yet. Some of it came through in Q2, but like the rest of the pulp markets, will flow in this quarter. It's for that reason, we did call down Europe would be less than the current quarter, albeit that we are implementing selling price increases to offset the higher costs. My guidance to you would be, use the market prices as a proxy, and I've given you volumes. Okay, great. Then maybe just a follow-up question on the downtime taken at Europe. The 115,000 tons, could you potentially guide us with a split between woodfree and mechanical grades? Do you think that it may be necessary to sort of reconsider what your supply looks like at this point in time, potentially over the next 12 months? Sorry, I'm just filling out a schedule now just to give you that split. Wally, could you just give me a sec? It's approximately 80,000 as graphics. The balance is coated mechanical. The second part of your question, sorry, just repeat, please. Just considering your capacity at the moment, whether you think you may need to sort of take permanent capacity reductions potentially in the next 12 months or so. Look, it's a difficult question because our demand for graphics continues to pick up as things are eased and the lockdowns are eased. We don't want to take a decision too soon. We need to assess where this market is going to be as things normalize. I've no doubt there is a haircut. We initially, as you know, talked about a 20% haircut. We're actually starting to believe that it may be less than that. With all the capacity that's come out of the market, both in the U.S. and in Europe. Europe, I think it's about 18%, and in the U.S., it's over 25%. If the demand does continue to recover, and I'm talking specifically in Europe, then that may enable us to fill up our machines and we won't need to close capacity in the near future. It's still a risk because COVID is still with us. Great. Then maybe a final question on the strategy. You spoke quite positively about DWP markets and sort of talked about Lenzing and RGE, sort of their DWP capacity, really just integration and other than that, and coupled with Stora Enso leaving the market, you don't necessarily see much market supply coming on board. When do you think Sappi needs to sort of consider its next large investment in dissolving wood pulp capacity expansion? Would the board prioritize potentially a dividend, let's say, within the next two-three years ahead of potentially investing in a DWP expansion longer term? Because if we go back probably three or four years ago now, Sappi was quite close to pulling the trigger on a big DWP mill investment and pulp prices kind of ran away from the business at that point of time, and you kind of missed the boat. Would you not want to repeat that mistake again? How are you thinking about that? Yeah. Well, firstly, our priority in the short term is on the balance sheet and getting it down to the levels that we need it to be. As I've indicated earlier, once we're confident we can get it below those levels, we would consider resuming a dividend. In terms of prioritizing that against the pulp investment, that's a hypothetical question. We would obviously have to assess the markets at that point in time. As we sit here today, our priority would be on debt reduction and then on a resumption of dividends. Your comment is quite an interesting one about us making a mistake. If we were having this conversation six months ago, everybody would have been saying, "What a great decision not to invest in dissolving pulp a couple of years back." It is a cyclical business, and what's very important is we need to see through the Saiccor and make a rational decision based on what we believe will be normalized pricing and normalized returns. That's not our priority at the moment. Our priority at the moment is on debt reduction. I appreciate that. Thanks, Steve. The next question comes from Ross Krige of JP Morgan. Thanks, and good afternoon, everyone. Just a couple from me. Firstly, on graphic paper in Europe. It sounds like potentially the price hikes that you talk about in June and July could be premised on demand improving further. I just wanted to check if that's the correct read, maybe if you can, in commenting on that, talk a bit about where industry operating rates are in Europe. Secondly, just on dissolving pulp, just more a modeling question. If you could comment on what the average price was for actual dissolving pulp in the quarter versus BCTMP. Thanks. Yeah. On graphic paper, clearly, if demand is then it makes it easier to implement selling price increases. I would argue that, as demand continues to pick up and resume that upward path, it is going to make the implementation of the next selling price increase easier than the last one. Yes, I would confirm that. In terms of operating rates at the moment, bear in mind the numbers are going up. This is historical. At the moment for coated wood, industry operating rates are in the mid-80s. If that demand curve can get higher relative to what it was pre-COVID, if we can get operating rates back above 90, then the market's back in balance once again. Ross, just your last question, were you asking about the link of BCTMP prices to DWP? No, Steve. Sorry. We know the volumes, we know the revenue, for DWP segment. I'm just trying to work out what the actual realized price was for the BCTMP volumes versus dissolving pulp volumes. We don't specifically give that, Ross, what I would say is that BCTMP, on a relative basis, those prices are increasing by as much as dissolving pulp. You can almost think about it collectively. Okay. Thanks, Steve. Can I just follow up on the graphic side? I understand the logic. We're talking about a demand improvement that has not yet been realized. You talk about the fact that you expect demand to improve once vaccines roll out and Europe opens up. As we sit today, we're not seeing that. At this point in time, until we see that, is it fair to say that we shouldn't see those extra price hikes? Look, Ross, all I can say is that we look at this on a day-by-day basis. You can see from that one graph in the presentation, March was much better. We obviously know what happened in April. You're looking at it collectively for the quarter. January and February were tough, but March and April have been better. That's going to help us with our selling price increases. Okay, perfect. Thanks a lot, Steve. Understood. Thank you. The next question comes from Sean Ungerer of Chronux Research. Afternoon, guys. Thanks. A quick one from myself. In terms of, just to carry on or labor on Ross's point about, I guess, graphic paper demand in Europe. Obviously the exit run rate for March, still negative but obviously considerably improved. Can you maybe give a little bit more color on April or maybe order books for May, shall I say, versus what we compared it to last year? Just on current market conditions, obviously normally Q3 is seasonally weakest for Europe, but I think obviously like- for- like with COVID last year, that will distort things quite a bit. As we stand right now, will you guys be needing to take any commercial downtime in Europe? That's it. Thanks. Mm-hmm. I'll let Marco just add to what I say, but we're obviously measuring ourselves now against 2019 because the base of 2020 is completely distorted. Based on what we're seeing in the market, the recovery is now heading above 80% in the market. On top of that, obviously substantial capacity has come out. In terms of market balance, we're getting closer to, we always talk about getting it above 90%. Marco, do you just want to talk, and without giving too specific, but just generally about the order book in the last, you don't have to do it month by month, but just broadly on the last couple of months, how the order book's looking. Yeah, Steve, I think you make a very valid comment that comparing it to April last year is not the right comparison base, but to 2019. We're indeed seeing better numbers than we initially said. That was around the 20% mark, less than 2019. That seems to be slightly better. April, May, and June, the coming quarter, we see every week and thereby every month an uptick in absolute volumes. You're right that quarter three is usually not our strongest quarter. It certainly further supports the momentum that has been ongoing for the last two months. Maybe to add, Steve, that to the previous question, that part of the pulp price increases will still need to be absorbed in our variable costs. The increased demand, that certainly will support, but it is also the necessity of further increased variable cost in the coming quarter that makes the price rise so necessary. Sean? Hello, Sean, does that conclude your question? Sorry. Just in terms of, based on sort of current market conditions, is it fair to say that there's no downtime sort of required, commercial downtime that is? Yeah. Based on where we're currently standing, it will be substantially less than Q2 in Europe. We're still anticipating about I can't give a specific number, but it will be substantially less than Q2. Okay. Excellent. Thanks, Steve. Thank you. The next question comes from Bartek Pastwa of Schroders. Hello. Good afternoon. If I may sort of try to recapture maybe what's been said on your graphic papers and for you to sort of give some one-line color. With all you said and your input costs seem to be rallying really strongly and your price increase is only 3%-5%. Can we expect EBITDA section of your graphic papers? I'm looking at page 20 of your presentation. Would this current quarter sort of to be even positive or is this really dipping into negative for one quarter here? That's the first question. I've got another one as well. Are you talking specifically segmental or the region itself? Yes. Just looking at your page 20 where you break it down by segments. I've got another one on dissolving wood pulp, just to get the graphics out of the way first. No, we're not anticipating it to be negative, the graphics, no. Secondly, on dissolving wood pulp, just looking at that, the increase in prices is dramatic. That would suggest you would overshoot the prior kind of, probably above $100 million for your dissolving wood pulp in the quarter. Just looking at the difference in prices, but looking back to 2018 and 2019, similar volume, similar prices and you only made $80 million-$90 million on dissolving wood pulp. Has anything changed in the business since then so dramatically that, or am I doing something wrong with my rough calculations? Look, it obviously depends on the average prices. It takes time for the prices to pick up, and it's a quarterly in arrears. If the averages are the same, your logic holds true. Just to recap, earlier, and I said it in my presentation, that the prices moved up, it was about $340 a quarter. It's an average increase. You've got to, obviously, the average will come through in Q3, and then the balance in Q4. The other factor at play, obviously, as you look back on slide 20, is exchange rates. Obviously the rand in recent quarters has strengthened. That does offset some of the benefit. Okay. I guess that sums it up. Thank you then. Thanks, bye. Thank you. The final question comes from Warren Riley of Bateleur Capital. Hi, guys. Just a question on your South African packaging business. The volumes there at plus 28% look really strong. You do flag the strength in agriculture. Can you just talk to some of the other dynamics you're seeing there and perhaps some comment on current market conditions, if you're taking market share and tightness in the containerboard market? Just some more color overall there, please. Yeah, you're right. It's been very strong and I've got Alex here with me. Just so he can talk about the market in a little bit more detail. Yeah. Thanks, Steve. Certainly, agricultural growth is very strong on the back of exports. I think more demand for fruit in the world. Then certainly, I think the whole movement from plastics to a more green economy is driving a demand for packaging. We are seeing that certainly on the containerboard side. We have grown market share by roughly four percentage points in the virgin containerboard side. Okay. Thanks a lot. Thank you. Gentlemen, that was the final question. I'd like to hand it back to Mr. Stephen Binnie for closing comments. Thank you, operator. I just want to thank everybody for joining us on the call today, and we look forward to discussing our results at the end of Q3. Thank you.