The packaging paper market, which has continued to decline, seems to have turned around since August: not only has the downward trend of paper prices stabilized, but some paper mills have also issued price increase letters recently, but due to factors such as market weakness, they can only test price increases slightly. single sided coated paper

On the other hand, more than half of August, the new round of price hikes jointly launched by cultural paper companies in early August was ultimately difficult to overcome the weak market demand, and the implementation of orders from paper mills was hindered. However, under the premise of high costs, the prices of paper mills will continue to be firm.

“August is the turning point of the off-peak season. Although the demand has increased month-on-month, the increase is limited. It is expected that the market supply and demand of the paper industry will still compete in August.” Zhuo Chuang Information analyst Xu Ling told the “Securities Daily” reporter. single pe coated paper cup paper

Looking at the future of the paper industry, the latest research report of Everbright Securities believes that at present, the short-term pulp at the cost side will remain high and fluctuated, and it is expected that there may be an inflection point in the fourth quarter; the overseas economy on the demand side is recovering, the demand is strong, and the domestic demand is also expected to improve.

Market supply and demand is still a game

From August 1 to now, the packaging paper (corrugated and containerboard) market has finally stabilized after a sharp downturn in July. Especially as some large-scale paper mills have started to shut down for maintenance in accordance with the previously issued shutdown letter, and the upstream waste paper prices have stopped falling and rebounded, the market has started a “range sorting” mode. raw paper cup

The data shows that the market price of corrugated and containerboard paper fell significantly in July. Leading enterprises lowered paper prices for many times, and small and medium-sized paper mills followed suit, with a cumulative reduction of 100/ton to 300/ton. The reporter noticed that after entering August, as some downstream packaging factories began to replenish inventory in an appropriate amount, and the order volume of paper factories in some areas increased compared with the previous period, some paper factories recently began to increase the ex-factory price of base paper. It’s just that the price increase is not large, mostly 30/ton to 50/ton, which means the test is obvious.

“Because paper prices continue to fall, many small and medium-sized paper mills are on the verge of profit or loss or have already lost money. In addition, the waste paper market has recently rebounded in an all-round way, and the cost of raw materials for paper mills has risen. This is the reason why packaging paper mills are more willing to support prices recently.” Shandong Mr. Zhou, the person in charge of a packaging paper factory in Zibo, told reporters that the market is still in the off-season, and the demand has not turned strong. The slight increase in paper prices is also a response to testing downstream packaging companies. raw paper 8oz for cup

Xu Ling introduced to reporters that although large-scale paper mills have implemented maintenance plans one after another, and the output is expected to decrease month-on-month, the initial market inventory in early August was relatively large, and additional production capacity was released in August, the overall supply pressure still exists. And August is the transition month between the low and peak seasons of corrugated and containerboard paper. Under the circumstance that the demand has not been boosted, the game between supply and demand remains, and the market may fluctuate mainly.

The same game of supply and demand is also evident in the cultural paper market. Since August 1, cultural paper companies have launched a new round of price increases by 200/ton. However, the market demand is weak, the trading volume is sluggish, and the implementation of paper factory orders is hindered. The situation that such a letter of price increase is difficult to implement has occurred many times in the context of the overall weak demand in the cultural paper industry in the first half of this year. raw materials for paper cups 4 oz

After entering the third quarter, a round of price hikes by cultural paper companies in July was favored by some publishing orders. At that time, the price implementation of paper mills was relatively optimistic. However, since August entered the traditional off-season of cultural paper, publishing and printing orders entered the final stage, social orders continued to be poor, and most market distributors also reported weak demand, so this round of price increases was weak, production and sales were generally inverted, and the printing factories basically All maintain just-in-demand purchases. “In the short term, the game situation between the upstream and downstream of the cultural paper market is prominent, and some industry players are returning funds, and the market price may go down.” Zhang Yan said.

Pulp prices are expected to usher in an inflection point

The semi-annual report of the paper industry is about to be disclosed. According to the data of Oriental Fortune Choice, as of now, 8 of the 22 A-share listed companies in the paper industry in the Shenwan industry have disclosed their performance forecasts, and 6 of them are expected to have a sharp decline in performance. , 2 companies are expected to lose money for the first time. The dilemma that the industry is in a low period in the first half of the year is evident. raw materials for making paper cups

The recent market conditions of the aforementioned packaging paper industry and cultural paper industry also show that the paper industry is still facing a lot of pressure from the contradiction between supply and demand since it entered the third quarter. So when will the industry get out of the slump? When will the turning point come?

“In general, the cyclical fluctuations in the profitability of the paper industry are driven by the difference between paper prices and raw materials.” The latest research report of Everbright Securities pointed out. During the interview, a number of industry analysts also believed that, in order to realize the reversal of the predicament in the industry, on the one hand, it depends on the trend of pulp prices, and more importantly, on the recovery of demand.

From the perspective of the current supply and demand pattern and competition pattern of the paper industry, Everbright Securities analyzed that the demand side is recovering both domestically and abroad. In comparison, overseas demand is recovering significantly, driving the consumption of paper products to increase. Among them, the Middle East and The demand in Southeast Asia is particularly strong, and overseas supply is obviously insufficient. Domestic leading manufacturers have increased their export efforts, and the year-on-year growth rate of my country’s paper exports has continued to increase. raw material for paper cup plate

Chenming Paper previously stated in its performance forecast that in the first half of the year, the company was seizing the opportunity of insufficient supply in overseas markets and striving to develop the international market. Bohui Paper, which is also accelerating the development of the international market, also said that the proportion of the company’s export sales has continued to increase.

Regarding the subsequent recovery of domestic demand, Everbright Securities believes that although the overall domestic demand is weak due to the impact of the epidemic, it is expected to improve in the future. In terms of sub-sectors, the demand for cultural paper is weak, and the overall demand for corrugated and containerboard paper has not yet recovered. The downstream demand for white cardboard and specialty paper is relatively good. printed paper material

Regarding the follow-up trend of the cost side, many institutions have judged that the short-term pulp price will remain high and volatile, but it is expected that an inflection point may occur in the fourth quarter. It is understood that the current production and sales of major pulp mills around the world have recovered, and the new production capacity is advancing as planned. It is expected that the supply of pulp will gradually increase from the third quarter of 2022. Everbright Securities pointed out that in the downward cycle of pulp prices, the profitability of the leading bulk paper will be significantly repaired. pe coated paper for cups