================================================================================


                                  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, 2002

                                       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.)


                  SCHUTZENGASSE 32, ZURICH, SWITZERLAND, 8001
                              (Address of Office)

                                41 (43) 344 7070
              (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  15,  2002.


================================================================================


<PAGE>


                         PART I.  FINANCIAL INFORMATION
                                  ---------------------

ITEM  1.  FINANCIAL  STATEMENTS



                            MERCER INTERNATIONAL INC.

                        CONSOLIDATED FINANCIAL STATEMENTS

                    FOR THE THREE MONTHS ENDED MARCH 31, 2002

                                  (UNAUDITED)


                                        2


<PAGE>


                            MERCER INTERNATIONAL INC.
                          CONSOLIDATED BALANCE SHEETS
                   AS AT MARCH 31, 2002 AND DECEMBER 31, 2001
                                  (UNAUDITED)
                              (EUROS IN THOUSANDS)


<TABLE>
<CAPTION>

                                                  MARCH 31,   DECEMBER 31,
                                                     2002         2001
                                                  ---------   ------------
<S>                                               <C>             <C>
                               ASSETS

Current Assets
  Cash and cash equivalents                      E   5,644    E    11,741
  Investments                                        3,811          4,549
  Receivables                                       50,347         47,892
  Inventories                                       24,074         25,062
  Prepaid and other                                  3,264          3,968
                                                 ---------    -----------
    Total current assets                            87,140         93,212

Long-Term Assets
  Cash restricted                                   34,156         33,388
  Properties                                       270,949        278,617
  Investments                                        9,612          8,598
  Notes receivable                                   5,572          5,475
  Deferred income tax                               10,327         10,303
                                                 ---------    -----------
                                                   330,616        336,381
                                                 ---------    -----------
                                                 E 417,756    E   429,593
                                                 =========    ===========

                              LIABILITIES

Current Liabilities
  Accounts payable and accrued expenses          E  51,496    E    51,916
  Notes payable                                      7,568          7,392
  Debt                                              17,264         18,360
                                                 ---------    -----------
    Total current liabilities                       76,328         77,668

Long-Term Liabilities
  Debt                                             209,777        216,871
  Other                                              3,241          3,441
                                                 ---------    -----------
                                                   213,018        220,312
                                                 ---------    -----------
    Total liabilities                              289,346        297,980

                           SHAREHOLDERS' EQUITY

Shares of beneficial interest                       76,722         76,722
Retained earnings                                   53,722         59,111
Accumulated other comprehensive loss                (2,034)        (4,220)
                                                 ---------    -----------
                                                   128,410        131,613
                                                 ---------    -----------
                                                 E 417,756    E   429,593
                                                 =========    ===========

</TABLE>


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


                                        3


<PAGE>


                            MERCER INTERNATIONAL INC.

              CONSOLIDATED STATEMENTS OF LOSS AND RETAINED EARNINGS
                 FOR THREE MONTHS ENDED MARCH 31, 2002 AND 2001
                                   (UNAUDITED)
               (EUROS IN THOUSANDS, EXCEPT FOR EARNINGS PER SHARE)


<TABLE>
<CAPTION>

                                                    2002         2001
                                                 ---------     ---------
<S>                                              <C>          <C>
Revenues
  Sales                                          E  59,207     E  56,796
  Transportation                                     1,416         1,295
  Other                                              3,664         2,642
                                                 ---------     ---------
                                                    64,287        60,733
Expenses
  Cost of pulp and paper                            53,919        44,424
  Transportation                                     1,042         1,104
  General and administrative                         6,630         3,861
  Interest expense                                   4,018         3,844
  Loss on foreign currency derivative contracts      4,067         2,538
                                                 ---------     ---------
                                                    69,676        55,771
                                                 ---------     ---------

Net (loss) income                                   (5,389)        4,962

Retained earnings, beginning of period              59,111        61,934
                                                 ---------     ---------

Retained earnings, end of period                 E  53,722     E  66,896
                                                 =========     =========

Earnings per share
  Basic                                          E   (0.32)    E    0.29
                                                 =========     =========
  Diluted                                        E   (0.32)    E    0.29
                                                 =========     =========

</TABLE>


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


                                        4


<PAGE>


                            MERCER INTERNATIONAL INC.

                       STATEMENTS OF COMPREHENSIVE INCOME
                 FOR THREE MONTHS ENDED MARCH 31, 2002 AND 2001
                                   (UNAUDITED)
                              (EUROS IN THOUSANDS)

<TABLE>
<CAPTION>

                                                     2002           2001
                                                  ---------      ---------
<S>                                               <C>            <C>

Net (loss) income                                 E  (5,389)     E   4,962

Other comprehensive income:
  Foreign currency translation adjustments            1,327            841
  Unrealized gain on securities                         859            679
                                                  ---------      ---------

  Other comprehensive income                          2,186          1,520
                                                  ---------      ---------

Total comprehensive (loss) income                 E  (3,203)     E   6,482
                                                  =========      =========

</TABLE>


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


                                        5


<PAGE>


                            MERCER INTERNATIONAL INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THREE MONTHS ENDED MARCH 31, 2002 AND 2001
                                   (UNAUDITED)
                              (EUROS IN THOUSANDS)


<TABLE>
<CAPTION>

                                                        2002           2001
                                                     ----------      ---------
<S>                                                 <C>             <C>
Cash Flows from Operating Activities:
  Net (loss) income                                  E   (5,389)     E   4,962
  Adjustments to reconcile net (loss)
   income from operations to cash
    Depreciation and amortization                         6,769          5,798

  Changes in current assets and liabilities
    Investments                                           1,785           (836)
    Inventories                                           1,041         (1,664)
    Receivables                                          (1,374)         7,099
    Accounts payable and accrued expenses                (1,045)         1,321
    Other                                                   470            203
                                                     ---------       ---------
      Net cash provided by operating activities           2,257         16,883

Cash Flows from Investing Activities:
  Sales (Purchases) of fixed assets,
    net of investment grants                                773         (1,526)
                                                     ----------      ---------
      Net cash provided by (used in)
        investing activities                                773         (1,526)

Cash Flows from Financing Activities:
  Cash restricted                                          (768)         2,143
  Increase in indebtedness                                1,021              -
  Decrease in indebtedness                               (9,371)       (23,071)
                                                     ----------      ---------
      Net cash used in financing activities              (9,118)       (20,928)

Effect of exchange rate changes on cash and
  cash equivalents                                           (9)             4
                                                     ----------      ---------

Net decrease in cash and cash equivalents                (6,097)        (5,567)

Cash and cash equivalents,
  beginning of period                                    11,741         19,691
                                                     ----------      ---------
Cash and cash equivalents,
  end of period                                      E    5,644      E  14,124
                                                     ==========      =========

</TABLE>


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


                                        6


<PAGE>


                            MERCER INTERNATIONAL INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      FOR THREE MONTHS ENDED MARCH 31, 2002
                                   (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 accounting
principles  generally  accepted  in  the  United  States  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,  2001.  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.  Reporting  Currency
--------  -------------------

Effective  January  1, 2002, the Company changed its reporting currency from the
U.S.  dollar  to  the  Euro. The reason for this change is because a significant
majority  of  the  Company's business transactions are originally denominated in
Euros.  The  Company's  functional  currency  and reporting currency are now the
same.  Prior  years' financial statements had been reported in U.S. dollars, but
have  been  restated  into  Euros  using  the guidance of Statement of Financial
Accounting  Standards  No.  52,  "Foreign  Currency  Translation"  ("SFAS  52").
Therefore,  the financial statements for prior years depict the same trends that
the  previous  financial  statements  presented  in  U.S.  dollars  show.

The Euro was initially implemented by the European Community on January 1, 1999.
By adopting the Euro as the Company's reporting currency, most of the cumulative
foreign  currency  translation losses were eliminated from the Company's balance
sheets  and most of the foreign currency translation losses were eliminated from
the  statements  of comprehensive income.  Prior to the restatement, at December
31,  2001,  there  was a cumulative foreign currency translation loss of $64,016
(in  thousands  of U.S. dollars) included as part of shareholders' equity in the
balance sheet.  In conjunction with the restatement, the majority of this amount
was  eliminated.  During  the  three  months  ended  March 31, 2001, there was a
foreign  currency  translation  loss  of  $7,968  (in thousands of U.S. dollars)
included  as  part  of  comprehensive  income  (loss).  In  conjunction with the
restatement,  the  majority  of  this  amount  was  eliminated.

For periods prior to 1999, when the Company's functional currency was the German
deutschmark, the financial statements were restated using a fixed rate of 0.5113
Euros  to  each  deutschmark.  As a result of using the fixed exchange rate, the
Company's  consolidated  financial  statements  for  those  periods  may  not be
comparable  to  the  financial  statements  of  companies  from  other countries
reporting  in  the  Euro.


                                        7


<PAGE>


Note  3.  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 for the three months ended March 31,
2002  and 2001, respectively.  The weighted average number of shares outstanding
for  the  purposes  of calculating diluted earnings per share was 16,874,899 and
17,218,749  for  the  three  months ended March 31, 2002 and 2001, respectively.

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
                                              ---------     ---------   --------
                                                 (Euros in thousands)
<S>                                           <C>          <C>        <C>
Three Months Ended March 31, 2002
---------------------------------
Sales to external customers                   E  33,633    E  25,574   E  59,207
Intersegment net sales                            1,401            -       1,401
Segment profit (loss)                            (5,867)       2,780      (3,087)

Reconciliation of loss:
  Total loss for reportable segments                                   E  (3,087)
  Elimination of intersegment profits                                        377
  Unallocated amounts, other corporate expenses                           (2,679)
                                                                       ---------

      Consolidated loss before income taxes                            E  (5,389)
                                                                       =========

Three Months Ended March 31, 2001
---------------------------------
Sales to external customers                   E  39,686    E  17,110   E  56,796
Intersegment net sales                            1,846            -       1,846
Segment profit                                    5,979           75       6,054

Reconciliation of profit:
  Total profit for reportable segments                                 E   6,054
  Elimination of intersegment profits                                        292
  Unallocated amounts, other corporate expenses                           (1,384)
                                                                       ---------

      Consolidated income before income taxes                          E   4,962
                                                                       =========

</TABLE>


                                        8

<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  and  Switzerland.  The following discussion and
analysis of the results of operations and financial condition of the Company for
the  three  months  ended  March 31, 2002 should be read in conjunction with the
consolidated  financial  statements and related notes included in this quarterly
report, as  well as the Company's most recent annual report on Form 10-K for the
fiscal  year ended December 31, 2001 filed with the U.S. Securities and Exchange
Commission.  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.

Effective  January  1, 2002, the Company changed its reporting currency from the
U.S.  dollar  to  the  Euro, as a significant majority of the Company's business
transactions  are  originally  denominated in Euros.  As a result, the Company's
financial  statements  for  prior  periods included herein have been restated to
Euros,  but  depict the same trends as previously shown.  The Company translates
foreign  assets  and  liabilities  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.  The period end and period average exchange rates
for  the U.S. dollar to the Euro for the three month period ended March 31, 2002
were  1.1480  and  1.1403,  respectively.  See  Note  2  to  the  interim period
consolidated  financial  statements  included  in  this  quarterly  report.

RESULTS  OF  OPERATIONS  -  Three  Months  Ended  March  31,  2002
-----------------------     --------------------------------------

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


<TABLE>
<CAPTION>

                                               THREE  MONTHS  ENDED  MARCH  31,
                                              ----------------------------------
                                                2002                      2001
                                              --------                  --------
<S>                                           <C>                       <C>
                                                          (unaudited)
                                                    (Euros  in  thousands)
SALES  BY  PRODUCT  CLASS
Specialty  papers(1)                          E  20,437                 E  10,626
Printing  papers                                  5,137                     6,484
Pulp                                             33,633                    39,686
                                              ---------                 ---------
Total(2)                                      E  59,207                 E  56,796
                                              =========                 =========

SALES  BY  GEOGRAPHIC  AREA
Germany                                       E  24,369                 E  28,555
European  Union(3)                               17,768                    18,372
Eastern  Europe  and  other                      17,070                     9,869
                                              ---------                 ---------
Total(2)                                      E  59,207                 E  56,796
                                              =========                 =========

SALES  BY  VOLUME                                           (tonnes)
Specialty  papers(1)                             16,438                    11,044
Printing  papers                                  6,114                     7,049
Pulp                                             73,498                    61,742
                                              ---------                 ---------
Total(2)                                         96,050                    79,835
                                              =========                 =========

</TABLE>

-------------
(1)  The  Company  acquired its specialty paper mill in Landqart, Switzerland
     in  December  2001.  These  amounts  include  the  results  from  the
     Landqart  mill  as  of  January  1,  2002.
(2)  Excluding  intercompany  sales.
(3)  Not  including  Germany.


                                        9


<PAGE>


In  the  three  months ended March 31, 2002, revenues increased by approximately
5.9% to Euro 64.3 million from Euro 60.7 million in the three months ended March
31, 2001, primarily as a result of increased sales of specialty papers resulting
from  the  acquisition  of  the  paper mill in Landqart, Switzerland in December
2001.  In  the  three  months  ended  March  31,  2002,  pulp and paper revenues
increased  by  approximately 4.2% from the comparable period of 2001, on a 15.3%
decrease  in  pulp  sales  and  a  49.5%  increase  in  paper  sales.

Pulp  sales  in  the  three  months  ended March 31, 2002 decreased to Euro 33.6
million  from  Euro  39.7  million  in  the comparable period of 2001, as global
economic weakness and high producer inventory levels lead to a marked decline in
prices.  List  prices for kraft pulp in Europe decreased from approximately Euro
755  (U.S.  $710)  per  tonne at the end of 2000 to approximately Euro 528 (U.S.
$470)  per  tonne at the end of 2001 and approximately Euro 505 (U.S. $440)  per
tonne  at  the  end  of  the  first  quarter  of  2002.

Paper  sales  in  the  three  months ended March 31, 2002 increased to Euro 25.6
million  from  Euro  17.1  million  in  the comparable period of 2001.  Sales of
specialty papers in the three months ended March 31, 2002 increased to Euro 20.4
million  from  Euro  10.6 million in the three months ended March 31, 2001, as a
result  of the acquisition of the Landqart mill.  On average, prices realized by
the  Company  in  the  three  months  ended  March 31, 2002 for specialty papers
increased  by  approximately  29.2%  and  for  printing  papers  decreased  by
approximately  8.7%,  compared  to  the  same  period  in  2001.

Expenses increased to Euro 69.7 million in the three months ended March 31, 2002
from  Euro  55.8 million in the comparable period of 2001, primarily as a result
of  the inclusion of the results of the Landqart mill. On average, the Company's
unit  fibre  costs  for pulp production in the three months ended March 31, 2002
decreased  by  approximately  8.0%,  compared  to the same period in 2001.  As a
result of the acquisition of the Landqart mill, waste paper no longer represents
a  significant  portion  of  the  fibre  used  at  the  Company's  paper  mills.

General  and  administrative expenses increased to Euro 6.6 million in the three
months  ended  March  31,  2002  from Euro 3.9 million in the three months ended
March  31,  2001, primarily due to increased administrative expenses as a result
of  the  acquisition  of the Landqart mill and an increase in professional fees,
costs  and  expenses.  Interest expense in the three months ended March 31, 2002
increased  to Euro 4.0 million from Euro 3.8 million in the comparable period of
2001,  primarily  as  a  result  of  the  acquisition of the Landqart mill.  The
Company  recorded  a loss of Euro 4.1 million on its foreign currency derivative
contracts  in the three months ended March 31, 2002.  See "Item 3.  Quantitative
and  Qualitative  Disclosures About Market Risk" for information with respect to
foreign  currency  derivatives.

For  the  three  months ended March 31, 2002, the Company reported a net loss of
Euro  5.4 million, or Euro 0.32 per share on a basic and diluted basis, compared
to net income of Euro 5.0 million, or Euro 0.29 per share on a basic and diluted
basis,  in  the  comparable  period  of  2001.


                                       10


<PAGE>


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, 2002      DECEMBER 31, 2001
                                         --------------      -----------------
                                                    (unaudited)
                                                (Euros in thousands)
<S>                                      <C>                 <C>
FINANCIAL POSITION
Working capital                          E       10,812          E   15,544
Property, plant and equipment (net)             270,949             278,617
Total assets                                    417,756             429,593
Long-term debt                                  209,777             216,871
Shareholders' equity                            128,410             131,613

</TABLE>

At  March  31,  2002,  the Company's cash and cash equivalents totalled Euro 5.6
million,  a  net decrease of Euro 6.1 million from Euro 11.7 million at December
31,  2001.  At  March  31,  2002,  the Company had short-term trading securities
totalling  Euro  3.8 million, compared to Euro 4.5 million at December 31, 2001.

Operating  Activities
---------------------

Operating activities provided cash of Euro 2.3 million in the three months ended
March  31,  2002,  compared to Euro 16.9 million in the same period in 2001.  An
increase  in  receivables  used  cash of Euro 1.4 million in the current period,
compared  to a decrease in receivables providing cash of Euro 7.1 million in the
comparative period of 2001.  A decrease in accounts payable and accrued expenses
used cash of Euro 1.0 million in the three months ended March 31, 2002, compared
to  an  increase in accounts payable and accrued expenses providing cash of Euro
1.3 million in the three months ended March 31, 2001. Lower inventories provided
cash  of  Euro 1.0 million in the three months ended March 31, 2002, compared to
higher  inventories  using  cash  of  Euro 1.7 million in the three months ended
March  31,  2001.  Net  sales of investment securities provided cash of Euro 1.8
million  in  the three months ended March 31, 2002, compared to net purchases of
investment  securities  using cash of Euro 0.8 million in the comparative period
of  2001.

Investing  Activities
---------------------

Investing  activities  in the three months ended March 31, 2002 provided cash of
Euro 0.8 million, which consisted primarily of net sales of properties, compared
to  using  cash  of  Euro  1.5 million in the three months ended March 31, 2001.

The Company completed a major capital project to convert its Rosenthal pulp mill
from  the  production  of  sulphite  pulp to kraft pulp, increase  capacity  and
improve  operations  (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.


                                       11


<PAGE>


Financing  Activities
---------------------

Financing  activities  used  cash  of Euro 9.1 million in the three months ended
March  31,  2002,  primarily as a result of the reduction of indebtedness during
the period, including the repayment of Euro 6.2 million of indebtedness incurred
in  connection  with  the Conversion Project.  Financing activities used cash of
Euro  20.9  million  in  the  three  months ended March 31, 2001, primarily as a
result  of  the  reduction  of  indebtedness  during  the  period.

Effective  January  2000,  the Company agreed, subject to certain conditions, to
acquire an 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,  a  shareholder  removed  itself  from the Stendal Project
pursuant to a corporate reorganization and its pro rata share of the project was
redistributed  among the remaining shareholders for a nominal amount.  Given the
increase  in the Company's participation in the Stendal Project, pursuant to the
terms  of the subscription agreement, the Company's participation in the Stendal
Project  will  increase  to  approximately  57%.  The  increase  in ownership is
subject  to  certain  conditions,  including  the  entering  into  of  a  formal
shareholders'  agreement  and the completion of financing in connection with the
project.  The  Stendal  Project  has  received  the  necessary  permits  for the
construction  of  the Stendal Mill as well as commitments for German federal and
state  grants  and  subsidies,  as  well as a financing commitment letter from a
German  bank.  The  Company  is  in the process of trying to complete definitive
agreements  relating  to  the commitment letter.  In addition, financing for the
project  is  expected  to  come  from third party contributions.  The Company is
currently  in  the  process  of  determining  the  proportionate  financing
contributions  in  connection  with the Stendal Project.  The Stendal Project is
currently estimated to cost approximately Euro 884.2 million and to be completed
in  2004.  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,
2002,  although  it is considering a number of initiatives relating to potential
acquisitions  and  joint ventures both in Europe and North America.  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,  issuances  of securities and/or borrowing against
and/or  the  sale  of  assets.

Foreign  Currency
-----------------

Effective  January  1, 2002, the Company changed its reporting currency from the
U.S.  dollar  to  the  Euro  as a significant majority of the Company's business
transactions  are  originally  denominated in Euros.  By adopting the Euro, most
cumulative  foreign  currency translation losses of the Company were eliminated.
However, the Company holds certain assets and liabilities in U.S. dollars, Swiss
francs and, to a lesser extent, in Canadian dollars.  Accordingly, the Company's
consolidated  financial  results  are  subject to foreign currency exchange rate
fluctuations.


                                       12


<PAGE>


The  Company translates U.S. dollar, Swiss franc and Canadian dollar denominated
assets  and  liabilities into Euros at the rate of exchange on the balance sheet
date.  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.

The  Company's cumulative foreign exchange translation gain decreased marginally
from  Euro  1.3  million  at  December 31, 2001 to Euro 1.2 million at March 31,
2002.

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


<TABLE>
<CAPTION>

                          QUARTER  ENDED                 QUARTER  ENDED
                         MARCH  31,  2002               MARCH  31,  2001
                  -----------------------------    -----------------------------
                  PERIOD END     PERIOD AVERAGE    PERIOD END     PERIOD AVERAGE
                  ----------     --------------    ----------     --------------
<S>               <C>            <C>               <C>            <C>
Rate  of
  Exchange
Euro                  1.1480         1.1403            1.1375         1.0846

</TABLE>


Based  upon the period average exchange rate in the three months ended March 31,
2002,  the U.S. dollar increased by approximately 1.6% in value against the Euro
since  December  31,  2001.

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.

Stendal  Pulp  Mill  Project  Uncertainties
-------------------------------------------

The  Company's  participation  in  the  Stendal  Project  is  subject to certain
conditions,  including  the  completion  of financing.  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, including the 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  is  also 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
2002  and  be  completed  in  2004.  However, there can be no assurance that the
Stendal  Project  will  proceed  as  currently  planned,  or  at  all.


                                       13


<PAGE>


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.  As a result of the change in the Company's
reporting  currency  from  the U.S. dollar to the Euro, the Company is no longer
sensitive to foreign currency exchange rate fluctuations in connection with cash
restricted.  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.

In  December  2000,  the  Company entered into U.S. dollar/Euro foreign currency
forward  rate  swaps  to  manage  its risk exposure with respect to in aggregate
approximately  Euro  223.3  million  of  the  principal  amount of its long-term
indebtedness.  The current nominal amount outstanding at March 31, 2002 was Euro
211.1  million  and a fair value loss of Euro 4.1 million on these contracts was
recognized  in  the  three months ended March 31, 2002.  A currency gain of Euro
0.2  million  was  recognized  when loan repayments were made under the currency
swap  contracts  during  the  current period.  The Company expects that the fair
value  of  the  currency  swap  contracts will continue to fluctuate until their
maturity.


                                       14


<PAGE>

During the second quarter of 2001, the Company entered into two U.S. dollar/Euro
forward  contracts  in  the aggregate amount of approximately Euro 22.4 million,
maturing in the second quarter of 2002. A fair value loss of Euro 0.2 million on
these  contracts  was  recognized  in  the  three  months  ended March 31, 2002.

As  at  March 31, 2002, no derivative contract had been executed with respect to
pulp  prices.

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,  2001  for  additional  information  concerning  market  risk.


                                       15


<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

          None.


                                       16


<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  15,  2002


                                       17