The ratings on Montreal, Que.-based pulp and paper producer Domtar Corp. reflect what Standard&Poor's Ratings Services view as the company's fair business risk profile and modest financial risk profile. Standard&Poor's believes that Domtar has a leading market position in the North American uncoated free sheet (UFS) market, a good cost profile, low leverage, and an opportunity to diversify through its personal care segment. These strengths are somewhat offset, in our opinion, by a steady decline in demand for UFS as well as volatile prices for commodity pulp. With about 38% of industry capacity, Domtar is the largest UFS manufacturer in North America, with 3.5 million short tons of capacity and 1.7 million metric tons of trade
