For predictive purposes and for understanding the relationship between the US market and Canadian newsprint producers an econometric model was built. In this study, a simultaneous-equation model was developed, which consisted of four equations, one each for the supply, export, consumption and price of newsprint. The period of 1955-1986 was covered by this model. The data for the years 1985 and 1986 were reserved to test the predictive power of the model. In fitting the four equations for the period of 1955 -1984, the coefficients of determination, the R -square values, between observed and predicted values were higher than 99 per cent. The test results of the forecasting power showed that there was no statistically significant difference between predicted and observed values at the 5 per cent level of significance. Sources of forecasting error are expressed as three partial inequality coefficients associated with bias, variance and covariance of predicted and observed values. The error could not be furt For predictive purposes and for understanding the relationship between the US market and Canadian newsprint producers an econometric model was built. Which consisted of four equations, one each for the supply, export, consumption and The period of 1955-1986 was covered by this model. The data for the years 1985 and 1986 were reserved to test the predictive power of the model. In fitting the four equations for the period of 1955- 1984, the coefficients of determination, the R-square values, between observed and predicted values ​​were higher than 99 per cent. The test results of the forecasting power showed that there was no not significant difference between predicted and observed values ​​at the 5 per cent level of significance. Sources of forecasting error are expressed as three partial inequality coefficients associated with bias, variance and covariance of predicted and observed values. The error could not be furt