FORM  10-Q





                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

[  X  ]        QUARTERLY  REPORT  PURSUANT  TO  SECTION  13  OR  15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2001

                                       OR

[     ]       TRANSITION  REPORT  PURSUANT  TO  SECTION  13  OR  15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                FOR THE TRANSITION PERIOD FROM _______ TO _______

                         COMMISSION FILE NO.: 000-09409

                            MERCER INTERNATIONAL INC.
             (Exact name of Registrant as specified in its charter)


               WASHINGTON                         91-6087550
     (State  or  other  jurisdiction          (I.R.S.  Employer
     of  incorporation  or  organization)     Identification  No.)

          GIESSHUBELSTRASSE  15,  ZURICH,  SWITZERLAND      CH  8045
          (Address  of  principal  executive  offices)     (Zip  Code)

                                 41(1) 201 7710
              (Registrant's telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding  12  months  (or  for such shorter period that the Registrant was
required  to  file  such  reports),  and  (2)  has  been  subject to such filing
requirements  for  the  past  90  days.   YES   X      NO
                                              ----        ----

The  Registrant  had  16,794,899 shares of beneficial interest outstanding as at
May  14,  2001.



<PAGE>
                         PART I.  FINANCIAL INFORMATION
                                  ---------------------

ITEM  1.     FINANCIAL  STATEMENTS




                            MERCER INTERNATIONAL INC.

                        CONSOLIDATED FINANCIAL STATEMENTS

                    FOR THE THREE MONTHS ENDED MARCH 31, 2001

     (UNAUDITED)

<PAGE>
<TABLE>
<CAPTION>

                           MERCER  INTERNATIONAL  INC.

                           CONSOLIDATED BALANCE SHEETS
                   AS AT MARCH 31, 2001 AND DECEMBER 31, 2000
                                   (UNAUDITED)
                             (DOLLARS IN THOUSANDS)


                                        MARCH 31,    DECEMBER 31,
                                          2001           2000
                                       -----------  --------------
          ASSETS
<S>                                    <C>          <C>
Current Assets
  Cash and cash equivalents            $   12,417   $      18,496
  Investments                               5,735           5,320
  Receivables                              37,623          46,088
  Inventories                              20,158          19,977
  Prepaid and other                         2,624           3,000
                                       -----------  --------------
    Total current assets                   78,557          92,881

Long-Term Assets
  Cash restricted                          21,652          25,150
  Properties                              244,797         265,607
  Investments                               6,334           6,101
  Notes receivable                          4,296           4,296
  Deferred income tax                       9,070           9,624
                                       -----------  --------------
                                          286,149         310,778
                                       -----------  --------------
                                       $  364,706   $     403,659
                                       ===========  ==============

          LIABILITIES
Current Liabilities
  Accounts payable and accrued
   expenses                            $   37,186   $      37,058
  Pulp mill renovation costs payable          181           1,146
  Note payable                                584             839
  Debt                                     10,786          27,173
                                       -----------  --------------
    Total current liabilities              48,737          66,216

Long-Term Liabilities
  Debt                                    189,783         208,315
  Other                                     3,129           3,721
                                       -----------  --------------
                                          192,912         212,036
                                       -----------  --------------
    Total liabilities                     241,649         278,252

          SHAREHOLDERS' EQUITY
Shares of beneficial interest              99,995          99,995
Retained earnings                          93,273          88,698
Accumulated other comprehensive loss      (70,211)        (63,286)
                                       -----------  --------------
                                          123,057         125,407
                                       -----------  --------------
                                       $  364,706   $     403,659
                                       ===========  ==============
</TABLE>





   The accompanying notes are an integral part of these financial statements.

<PAGE>
<TABLE>
<CAPTION>

                           MERCER  INTERNATIONAL  INC.

             CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
                 FOR THREE MONTHS ENDED MARCH 31, 2001 AND 2000
                                   (UNAUDITED)
              (DOLLARS IN THOUSANDS, EXCEPT FOR EARNINGS PER SHARE)




                                          2001      2000
                                         -------  --------
<S>                                      <C>      <C>
Revenues
  Sales                                  $52,366  $55,243
  Other                                    3,630      517
                                         -------  --------
                                          55,996   55,760
Expenses
  Cost of sales                           41,977   48,892
  General and administrative               5,900    1,688
  Interest expense                         3,544    4,132
                                         -------  --------
                                          51,421   54,712
                                         -------  --------

Income before income taxes                 4,575    1,048
Income taxes (recovery)                        -      (23)
                                         -------  --------

Net income                                 4,575    1,071

Retained earnings, beginning of period    88,698   59,224
                                         -------  --------

Retained earnings, end of period         $93,273  $60,295
                                         =======  ========

Earnings per share
  Basic                                  $  0.27  $  0.06
                                         =======  ========
  Diluted                                $  0.27  $  0.06
                                         =======  ========

</TABLE>



   The accompanying notes are an integral part of these financial statements.

<PAGE>
<TABLE>
<CAPTION>

                           MERCER  INTERNATIONAL  INC.

                      STATEMENTS  OF  COMPREHENSIVE  INCOME
                 FOR THREE MONTHS ENDED MARCH 31, 2001 AND 2000
                                   (UNAUDITED)
                             (DOLLARS IN THOUSANDS)



                                              2001      2000
                                            --------  --------

<S>                                         <C>       <C>
Net income                                  $ 4,575   $ 1,071

Other comprehensive income (loss):
  Foreign currency translation adjustments   (7,968)   (5,852)
  Unrealized gain (loss) on securities        1,043       (15)
                                            --------  --------

  Other comprehensive loss                   (6,925)   (5,867)
                                            --------  --------

Total comprehensive loss                    $(2,350)  $(4,796)
                                            ========  ========
</TABLE>



   The accompanying notes are an integral part of these financial statements.

<PAGE>
<TABLE>
<CAPTION>

                           MERCER  INTERNATIONAL  INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THREE MONTHS ENDED MARCH 31, 2001 AND 2000
                                   (UNAUDITED)
                             (DOLLARS IN THOUSANDS)



                                                         2001       2000
                                                       ---------  ---------
<S>                                                    <C>        <C>
Cash Flows from Operating Activities:
  Net income                                           $  4,575   $  1,071
  Adjustments to reconcile net income from
  operations to cash
    Depreciation and amortization                         5,346      6,690

  Changes in current assets and liabilities
   Investments                                             (771)       181
   Inventories                                           (1,534)     2,184
   Receivables                                            6,545      4,124
   Accounts payable and accrued expenses                  2,152      3,136
   Other                                                    187        (74)
                                                       ---------  ---------
    Net cash provided by operating activities            16,500     17,312

Cash Flows from Investing Activities:
  Purchase of fixed assets, net of investment grants     (1,407)    18,682
                                                       ---------  ---------
    Net cash (used in) provided by investing activities  (1,407)    18,682

Cash Flows from Financing Activities:
  Cash restricted                                         1,976          -
  Increase in indebtedness                                    -      6,053
  Decrease in indebtedness                              (21,271)        (3)
  Decrease in pulp mill conversion costs payable           (934)   (25,750)
                                                       ---------  ---------
    Net cash used in financing activities               (20,229)   (19,700)

Effect of exchange rate changes on cash and
cash equivalents                                           (943)    (1,343)
                                                       ---------  ---------

Net (decrease) increase in cash and cash equivalents     (6,079)    14,951

Cash and cash equivalents, beginning of period           18,496      1,722
                                                       ---------  ---------
Cash and cash equivalents, end of period               $ 12,417   $ 16,673
                                                       =========  =========

</TABLE>



   The accompanying notes are an integral part of these financial statements.

<PAGE>
                            MERCER INTERNATIONAL INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      FOR THREE MONTHS ENDED MARCH 31, 2001
                                   (UNAUDITED)

NOTE  1.     BASIS  OF  PRESENTATION

The  interim  period  consolidated financial statements contained herein include
the  accounts of Mercer International Inc. and its subsidiaries (the "Company").

The  interim  period consolidated financial statements have been prepared by the
Company  pursuant  to  the  rules  and  regulations  of  the U.S. Securities and
Exchange  Commission  (the  "SEC").  Certain information and footnote disclosure
normally  included in financial statements prepared in accordance with generally
accepted  accounting  principles have been condensed or omitted pursuant to such
SEC rules and regulations.  The interim period consolidated financial statements
should  be  read together with the audited consolidated financial statements and
accompanying  notes  included in the Company's latest annual report on Form 10-K
for  the fiscal year ended December 31, 2000. In the opinion of the Company, the
unaudited  consolidated  financial  statements  contained  herein  contain  all
adjustments  necessary to present a fair statement of the results of the interim
periods  presented.

NOTE  2.     EARNINGS  PER  SHARE

Basic  earnings  per  share  is  computed by dividing income available to common
shareholders  by  the  weighted  average  number  of shares outstanding during a
period.  Diluted  earnings per share takes into consideration shares outstanding
(computed  under basic earnings per share) and potentially dilutive shares.  The
weighted  average  number  of shares outstanding for the purposes of calculating
basic  earnings  per  share  was  16,874,899 and 16,715,399 for the three months
ended  March  31,  2001  and 2000, respectively.  The weighted average number of
shares  outstanding  for  the purposes of calculating diluted earnings per share
was  17,218,749  and  16,992,883  for  the three months ended March 31, 2001 and
2000,  respectively.

NOTE  3.     ACCOUNTING  FOR  DERIVATIVE  INSTRUMENTS  AND  HEDGING  ACTIVITIES

Statement  of  Financial  Accounting Standards ("SFAS") No. 133, "Accounting for
Derivative  Instruments  and  Hedging  Activities",  established  accounting and
reporting standards for derivative instruments and hedging activities.  SFAS No.
133  was  amended  by  SFAS  No. 137, "Accounting for Derivative Instruments and
Hedging  Activities - Deferral of the Effective Date of FASB Statement No. 133",
which  deferred  the  implementation  date of SFAS 133 to fiscal years beginning
after  June  15,  2000.  Retroactive  application  is  prohibited.

The  Company  adopts SFAS No. 133 effective from January 1, 2001. All derivative
instruments  are  measured  at  fair  value and reported in the balance sheet as
assets  or  liabilities. Accounting for gains and losses depends on the intended
use of the derivative instrument. Gains and losses on derivative instruments not


<PAGE>


designated  as  hedging  instruments are recognized in earnings in the period of
the  change  in  fair  value.  Accounting  for  gains  and  losses on derivative
instruments  designated as hedging instruments depends on the type of hedge, and
such  gains  and losses are recognized in either earnings or other comprehensive
income.

NOTE  4.     BUSINESS  SEGMENT  INFORMATION

The  Company  operates  in two reportable business segments: pulp and paper. The
segments  are  managed  separately  because  each  business  requires  different
production  and  marketing  strategies.

Summarized  financial  information  concerning  the  segments  is  shown  in the
following  table:
<TABLE>
<CAPTION>



                                                  PULP     PAPER    TOTAL
                                                --------  -------  -------
<S>                                             <C>       <C>      <C>
THREE MONTHS ENDED MARCH 31, 2001
Sales to external customers. . . . . . . . . .  $36,591   $15,775  $52,366
Intersegment net sales . . . . . . . . . . . .    1,702         -    1,702
Segment profit . . . . . . . . . . . . . . . .    5,513        69    5,582

Reconciliation of profit:
 Total profit for reportable segments. . . . .                     $ 5,582
 Elimination of intersegment profits . . . . .                         269
 Unallocated amounts, other corporate expenses                      (1,276)
                                                                   -------

   Consolidated income before income taxes . .                     $ 4,575
                                                                   =======

THREE MONTHS ENDED MARCH 31, 2000
Sales to external customers. . . . . . . . . .  $32,286   $22,957  $55,243
Intersegment net sales . . . . . . . . . . . .      133         -      133
Segment profit . . . . . . . . . . . . . . . .      898     1,165    2,063

Reconciliation of profit:
 Total profit for reportable segments. . . . .                     $ 2,063
 Elimination of intersegment profits . . . . .                           -
 Unallocated amounts, other corporate expenses                      (1,015)
                                                                   -------

   Consolidated income before income taxes . .                     $ 1,048
                                                                   =======
</TABLE>





<PAGE>
ITEM  2.     MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL
             CONDITION  AND  RESULTS  OF  OPERATIONS

Mercer  International  Inc.  is  a pulp and paper company and its operations are
primarily  located  in  Germany.  The  following  discussion and analysis of the
results  of  operations  and  financial  condition  of the Company for the three
months  ended March 31, 2001 should be read in conjunction with the consolidated
financial  statements  and  related  notes  included  elsewhere  herein. In this
document:  (i)  unless  the  context otherwise requires, the "Company" refers to
Mercer International Inc. and its subsidiaries; and (ii) a "tonne" is one metric
ton  or  2,204.6  pounds.

Based  upon  period  average  exchange  rates,  the  U.S.  dollar appreciated by
approximately  7.0%  against the deutschmark in the three months ended March 31,
2001,  compared  to  the  same  period  of  2000.

RESULTS  OF  OPERATIONS  -  THREE  MONTHS  ENDED  MARCH  31,  2001

The  following  table  sets  forth  selected  sales data for the Company for the
periods  indicated:

<TABLE>
<CAPTION>



                            THREE MONTHS ENDED MARCH 31,
                           ------------------------------
                                  2001       2000
                                ---------  --------
                                    (UNAUDITED)
                                  (IN THOUSANDS)
<S>                             <C>        <C>
SALES BY PRODUCT CLASS
Packaging papers(1)             $       -  $  5,205
Specialty papers                    9,797     8,495
Printing papers(2)                  5,978     9,257
Pulp                               36,591    32,286
                                ---------  --------
Total(3)                        $  52,366  $ 55,243
                                =========  ========
SALES BY GEOGRAPHIC AREA
Germany                         $  26,328  $ 22,799
European Union(4)                  16,939    19,467
Eastern Europe and other            9,099    12,977
                                ---------  --------
Total(3)                        $  52,366  $ 55,243
                                =========  ========
SALES BY VOLUME                       (TONNES)
Packaging papers(1)                     -    17,717
Specialty papers                   11,044    10,658
Printing papers(2)                  7,049    13,489
Pulp                               61,742    58,311
                                ---------  --------
Total(3)                           79,835   100,175
                                =========  ========
</TABLE>


(1)     The  Company sold its packaging paper mill in Trebsen, Germany effective
        June  2000.
(2)     The Company sold its printing paper mill in Hainsberg, Germany effective
        November  2000.
(3)     Excluding  intercompany  sales.
(4)     Not  including  Germany.


<PAGE>


In  the  three  months ended March 31, 2001, revenues increased by approximately
0.4%  to  $56.0  million  from $55.8 million in the three months ended March 31,
2000,  primarily  as  a  result of higher pulp sales in the current period.  The
increase  in  revenues in the current period was partially offset by lower paper
sales.  In  the  three  months  ended  March  31,  2001, pulp and paper revenues
decreased  by  approximately 5.2% from the comparable period of 2000, on a 13.3%
increase  in  pulp  sales  and  a  31.3%  decrease  in  paper  sales.

Pulp  sales  in the three months ended March 31, 2001 increased to $36.6 million
from  $32.3  million  in  the comparable period of 2000. The Company completed a
project  in  late  1999  to convert the Company's pulp mill to the production of
kraft  pulp  and  increase its annual production capacity to 280,000 tonnes (the
"Conversion Project").  The pulp mill ramped up production in early 2000 and has
operated  in excess of 90% of capacity since the beginning of the second quarter
of 2000.  List prices for kraft pulp in Europe decreased from approximately $710
per  tonne  at  the end of 2000 to approximately $650 per tonne during the first
quarter  of  2001  and  approximately  $600  per  tonne  during  April  2001.

Paper  sales in the three months ended March 31, 2001 decreased to $15.8 million
from  $23.0 million in the comparable period of 2000.  Sales of specialty papers
increased  in the three months ended March 31, 2001 compared to the three months
ended  March  31,  2000  as  a  result of increased sales prices, while sales of
printing  papers  declined  as  a  result  of the sale of the Company's recycled
printing  paper mill in Hainsberg, Germany effective November 2000.  The Company
did  not  sell any packaging papers during the first quarter of 2001 as a result
of the sale of its packaging paper mill in Trebsen, Germany effective June 2000,
compared  to  $5.2  million  during the first quarter of 2000. On average, paper
prices  realized  by  the  Company  in  the  three  months  ended March 31, 2001
increased  by approximately 59% compared to the same period in 2000, with higher
prices  for  both  specialty  and  printing  papers.

Expenses  decreased  to  $51.4  million in the three months ended March 31, 2001
from $54.7 million in the comparable period of 2000, primarily as a result of an
improvement  in  pulp  production  efficiency  due  to  the  ramping-up  of pulp
production in early 2000 and a decrease in the production of paper products as a
result of the sale of two of the Company's paper mills in 2000.  On average, the
Company's  unit  fibre costs for pulp production in the three months ended March
31,  2001  increased  by  approximately 14% compared to the same period in 2000.
Prices for waste paper, which currently comprises approximately 25% of the fibre
for  the  Company's  paper mills, also increased in the three months ended March
31,  2001,  compared  to  the  same  period  of  2000.

General  and administrative expenses were $5.9 million in the three months ended
March  31, 2001, compared to $5.7 million in the three months ended December 31,
2000  and  $1.7  million  in  the  three  months ended March 31, 2000.  Interest
expense  in the three months ended March 31, 2001 decreased to $3.5 million from
$4.1  million  in  the comparable period of 2000, primarily as a result of lower
indebtedness during the quarter and a continuing depreciation of the deutschmark
relative  to  the  U.S.  dollar.


<PAGE>


For  the  three  months ended March 31, 2001, the Company reported net income of
$4.6  million,  or  $0.27  per share, compared to net income of $1.1 million, or
$0.06  per  share,  in  the  comparable  period  of  2000.

LIQUIDITY  AND  CAPITAL  RESOURCES

The  following  table  is a summary of selected financial information concerning
the  Company  for  the  periods  indicated:
<TABLE>
<CAPTION>



                                          AS AT              AS AT
                                      MARCH 31, 2001   DECEMBER 31, 2000
                                     ----------------  ------------------
                                                 (UNAUDITED)
                                               (IN THOUSANDS)

<S>                                  <C>               <C>
FINANCIAL POSITION
Working capital . . . . . . . . . .  $         29,820  $           26,665
Property, plant and equipment (net)           244,797             265,607
Total assets. . . . . . . . . . . .           364,706             403,659
Long-term debt. . . . . . . . . . .           189,783             208,315
Shareholders' equity. . . . . . . .           123,057             125,407
</TABLE>



At  March  31,  2001,  the  Company's  cash  and cash equivalents totalled $12.4
million, a net decrease of $6.1 million from $18.5 million at December 31, 2000.
At  March 31, 2001, the Company had short-term trading securities totalling $5.7
million,  compared  to  $5.3  million  at  December  31,  2000.

OPERATING  ACTIVITIES

Operating  activities  provided  cash of $16.5 million in the three months ended
March  31,  2001,  compared  to  $17.3  million  in  the same period in 2000.  A
decrease  in  receivables  provided  cash of $6.5 million in the current period,
compared  to  $4.1  million  in  the comparative period of 2000.  An increase in
accounts payable and accrued expenses provided cash of $2.2 million in the three
months  ended March 31, 2001, compared to $3.1 million in the three months ended
March  31,  2000.  Higher  inventories  used  cash  of $1.5 million in the three
months  ended  March  31,  2001, compared to lower inventories providing cash of
$2.2  million  in  the  three  months  ended  March  31, 2000.  Net purchases of
investment  securities used cash of $0.8 million in the three months ended March
31,  2001, compared to net sales of investment securities providing cash of $0.2
million  in  the  comparative  period  of  2000.

INVESTING  ACTIVITIES

Investing  activities in the three months ended March 31, 2001 used cash of $1.4
million, consisting of capital expenditures on properties, compared to providing
cash  of  $18.7  million  in  the  three  months  ended  March  31,  2000.

The  Company  completed  the  Conversion  Project  in late 1999.  The Conversion
Project  was  financed through a combination of borrowings under a project loan,
non-refundable  governmental  grants, governmental assistance and guarantees for
long-term  project  financing  and  an  equity  investment  by  the  Company.


<PAGE>


The  Company  is continuing to review its paper operations to define a long-term
core  competency in respect of products produced in order that future investment
may  be  directed  towards  that  segment.

FINANCING  ACTIVITIES

Financing  activities used cash of $20.2 million in the three months ended March
31,  2001,  primarily  as a result of a decrease in indebtedness relating to the
Conversion  Project.  Financing  activities  used  cash  of $19.7 million in the
three  months  ended  March  31,  2000.

The  depreciation of the deutschmark against the U.S. dollar in the three months
ended March 31, 2001 resulted in an unrealized foreign exchange translation loss
of $0.9 million on cash and cash equivalents, which is included in the Company's
statement  of  comprehensive  income  and  does  not  affect  the  Company's net
earnings.  See  "Foreign  Currency".

Effective  January  2000,  the Company agreed, subject to certain conditions, to
acquire  a  controlling  interest  in  a  "greenfield"  project to construct and
operate  a  550,000-tonne  softwood  kraft  pulp  mill to be located at Stendal,
Germany  (the  "Stendal  Project").  In 2001, the Company agreed to increase its
ultimate  ownership  position in the Stendal  Project  to 57.5%.  The  Company's
participation  in  the  Stendal  Project  is  subject  to,  among  other things,
completion of due diligence and the Stendal Project itself is subject to,  among
other  things, financing.  The Stendal  Project  is currently  estimated to cost
approximately DM 1,600.0 million (or  $823.3  million)  and  to  be completed in
2004. Financing for the Stendal Project  is  expected  to  come from the project
partners, government  financing, project  financing  and  outside  capital.  See
"Stendal  Pulp  Mill  Project Uncertainties".

Other  than  the  agreement  relating to the Stendal Project, the Company had no
material  commitments  to acquire assets or operating businesses as at March 31,
2001.  The  Company anticipates that there will be acquisitions of businesses or
commitments  to  projects  in  the  future.  To  achieve  its long-term goals of
expanding  its  asset  and  earnings  base through mergers and acquisitions, the
Company  will  require  substantial  capital resources.  The necessary resources
will  be  generated  from  cash  flow  from  operations, cash on hand, borrowing
against  its  assets  and/or  the  sale  of  assets.

FOREIGN  CURRENCY

Substantially  all  of  the  Company's operations are conducted in international
markets  and  its consolidated financial results are subject to foreign currency
exchange rate fluctuations, in particular, those in Germany.  The Company's pulp
and  paper  products  are  principally  sold  in  deutschmarks  and  euros  and
approximately  99% of the Company's revenues are denominated in deutschmarks and
euros.  The  value  of  the  euro  is  fixed  at  1.95583  deutschmarks.


<PAGE>


The  Company  translates foreign assets and liabilities into U.S. dollars at the
rate  of  exchange  on  the  balance  sheet  date.  Revenues  and  expenses  are
translated  at  the  average  rate  of  exchange  prevailing  during the period.
Unrealized gains or losses from these translations are recorded as shareholders'
equity  on the Company's balance sheet and do not affect the net earnings of the
Company.

Since  substantially  all of the Company's revenues are received in deutschmarks
and  euros,  the  financial  position  of the Company for any given period, when
reported  in  U.S.  dollars, can be significantly affected by the exchange rates
for deutschmarks prevailing during that period.  In the three months ended March
31,  2001,  the depreciation of the deutschmark against the U.S. dollar resulted
in  a  net  $8.0 million foreign exchange translation loss and, as a result, the
cumulative  foreign  exchange  translation  loss increased from $56.3 million at
December  31,  2000  to  $64.3  million  at  March  31,  2001.

The average and period end exchange rates for the deutschmark to the U.S. dollar
for  the  periods  indicated  are  as  follows:

<TABLE>
<CAPTION>



                           QUARTER ENDED               QUARTER ENDED
                          MARCH 31, 2001              MARCH 31, 2000
                          --------------              --------------
                    PERIOD END    PERIOD AVERAGE  PERIOD END  PERIOD AVERAGE
                  --------------  --------------  ----------  --------------
<S>               <C>             <C>             <C>         <C>
RATE OF EXCHANGE
Deutschmark               2.2248          2.1213      2.0434          1.9823
</TABLE>


Based  upon the period average exchange rate in the three months ended March 31,
2001,  the  U.S.  dollar  increased  by  approximately 1.9% in value against the
deutschmark  since  December  31,  2000.

CYCLICAL  NATURE  OF  BUSINESS;  COMPETITIVE  POSITION

The  pulp and paper business is cyclical in nature and markets for the Company's
principal  products are characterized by periods of supply and demand imbalance,
which  in turn affects product prices. The markets for pulp and paper are highly
competitive  and  sensitive  to cyclical changes in industry capacity and in the
economy,  both  of  which can have a significant influence on selling prices and
the  earnings  of  the  Company.  Demand  for  pulp  and  paper  products  has
historically  been  determined  by  the  level  of  economic growth and has been
closely  tied  to  overall  business  activity.  The competitive position of the
Company  is  influenced by the availability and quality of raw materials (fibre)
and  its  experience  in  relation to other producers with respect to inflation,
energy,  transportation,  labour  costs  and  productivity.


<PAGE>


STENDAL  PULP  MILL  PROJECT  UNCERTAINTIES

The  Company's  participation  in  the  Stendal  Project  is  subject to certain
conditions,  including  completion  of  its  due  diligence  and entering into a
shareholders'  agreement.  In addition, the Stendal Project itself is subject to
various risks and uncertainties customary to large "greenfield" projects of this
nature  which  may  result  in  the  Stendal Project not proceeding as currently
planned,  or  at  all,  such  as  availability and cost of materials and labour,
construction  delays,  cost  overruns,  weather  conditions,  governmental
regulations, availability of adequate financing, increases in long-term interest
rates  and  increases in taxes and other governmental fees.  The Stendal Project
will  also  be  subject  to  extensive and complex regulations and environmental
compliance  which  may  result  in  delays,  in  the  project company and/or its
shareholders,  including  the  Company,  incurring substantial costs in relation
thereto  or  in  the  Stendal  Project  being  amended or not proceeding at all.

The  implementation  of the Stendal Project is currently expected to commence in
the first  quarter of 2002 and be  completed in 2004.  However, there  can be no
assurance that the Stendal Project will proceed as currently planned, or at all.

FORWARD-LOOKING  STATEMENTS

Statements  in  this  report,  to  the  extent  they are not based on historical
events,  constitute  forward-looking  statements.  Forward-looking  statements
include,  without  limitation,  statements  regarding  the  outlook  for  future
operations, forecasts of future costs and expenditures, the evaluation of market
conditions, the outcome of legal proceedings, the adequacy of reserves, or other
business  plans.  Investors  are  cautioned  that forward-looking statements are
subject  to  an inherent risk that actual results may vary materially from those
described  herein.  Factors  that  may  result  in such variance, in addition to
those  accompanying  the forward-looking statements, include changes in interest
rates,  commodity prices, and other economic conditions; actions by competitors;
changing  weather  conditions and other natural phenomena; actions by government
authorities;  uncertainties  associated  with  legal  proceedings; technological
development;  future decisions by management in response to changing conditions;
and  misjudgments  in  the  course  of  preparing  forward-looking  statements.

ITEM  3.     QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT
             MARKET  RISK

The  Company  is exposed to market risks from changes in interest rates, foreign
currency  exchange  rates  and  equity  prices  which  may affect its results of
operations  and  financial  condition.  The  Company manages these risks through
internal risk management policies.  The Company also uses derivative instruments
in regard to its exposure to interest rate, currency and pulp price risks.   The
derivative instruments are not designated as hedging instruments and the purpose
of  the  derivative  activity  is speculative in nature, as management uses such
tools either to augment the Company's potential gains or to reduce the Company's
potential losses, depending on management's perception of future economic events
and  developments.  If  any  of  the  variety  of instruments and strategies the
Company  utilizes  are not effective, the Company may incur losses.  Many of the
Company's  strategies are based on historical trading patterns and correlations.
However,  these strategies may not be fully effective in all market environments
or  against  all  types  of risks. Unexpected market developments may affect the
Company's  risk  management  strategies  during  this  time,  and  unanticipated
developments  could  impact  the  Company's  risk  management  strategies in the
future.


<PAGE>


As  at  March 31, 2001, no derivative contract had been executed with respect to
pulp  prices.  The Company may enter into short-term forward contracts to manage
its  exposure  to  currency  and  interest  rate  risks.

Any  change  in  the  fair  value  of  derivative instruments is included in the
determination  of  earnings.

Reference is made to the Company's annual report on Form 10-K for the year ended
December  31,  2000  for  additional  information  concerning  market  risk.


<PAGE>
                           PART II.  OTHER INFORMATION
                                     -----------------

ITEM  1.     LEGAL  PROCEEDINGS

The  Company  is  subject to routine litigation incidental to its business.  The
Company  does  not  believe  that  the  outcome  of  such litigation will have a
material  adverse  effect  on  its  business  or  financial  condition.

ITEM  6.     EXHIBITS  AND  REPORTS  ON  FORM  8-K

(a)          EXHIBITS

None.

(b)          REPORTS  ON  FORM  8-K

The Company filed the following report on Form 8-K with respect to the indicated
items  during  the  three  months  ended  March  31,  2001:

Form  8-K  dated  January  23,  2001:
     Item  5.  Other  Events
     Item  7.  Financial  Statements  and  Exhibits


<PAGE>
                                   SIGNATURES

Pursuant  to  the  requirements  of  the  Securities  Exchange  Act of 1934, the
Registrant  has  duly  caused  this  report  to  be  signed on its behalf by the
undersigned,  thereunto  duly  authorized.


     MERCER  INTERNATIONAL  INC.


     By:  /s/  R.  Ian  Rigg
          ------------------
          R.  Ian  Rigg
          Vice  President  and  Chief  Financial  Officer


Date:  May  14,  2001