Paper Packaging Market Weekly: Cultural Paper Prices Hold Flat as Packaging Paper Trends Diverge

The light industry manufacturing sector strengthened this week, with its index gaining 2.37% and beating the broader market by 1.06 percentage points. The papermaking sub-sector rose 1.06%, lagging the broader market by 0.25 percentage points. The CSI 300 Index increased 1.31% for the week, while the Shenwan light industry manufacturing index advanced 2.37%, ranking 7th among the 28 Shenwan first-level industries—a relatively strong position. Within second-level industries, papermaking climbed 1.06%, underperforming the market by 0.25 percentage points. Among the four major light industry sub-sectors, weekly gains were led by cultural and recreational products, packaging and printing, furniture and papermaking, which rose 3.53%, 2.89%, 2.49% and 1.06%, respectively.

Industry chain data watch

On the raw material side, domestic waste paper delivered prices (tax excluded) edged up, while imported waste paper prices held steady. Export quotations for hardwood pulp and softwood pulp were unchanged, though spot prices moved lower; dissolving pulp prices stayed flat. Domestic waste paper delivered prices (tax excluded) rose by RMB 16/tonne this week, while CIF prices for US waste, European waste and Japanese waste OCC at major Southeast Asian ports remained unchanged. Hardwood pulp and softwood pulp export prices were stable; hardwood pulp spot prices fell by RMB 13/tonne and softwood pulp spot prices dropped by RMB 50/tonne. In late September 2021, combined wood pulp inventory at China's three major ports stood at 1.73 million tonnes, down 0.9% month on month. Dissolving pulp prices were unchanged this week.

Among finished paper products, cultural paper prices were flat this week, while packaging paper prices diverged. According to tax-inclusive average market prices from Sublime China Information, offset paper and coated paper prices remained stable, white card paper prices dropped by RMB 37/tonne, and the average ex-works price of containerboard increased by RMB 33/tonne.

Profitability improved for cultural paper but showed mixed trends for packaging paper. Using the price spread between finished paper and raw materials as a profitability gauge, offset paper and coated paper profitability rose by about RMB 11-18/tonne from the previous week, white card paper profitability fell by about RMB 25-28/tonne, and waste-paper-based paper products saw profitability increase by about RMB 34-38/tonne.

On inventories and output, finished product inventories of machine-made paper and paperboard fell 0.4% month on month in August 2021. Cumulative output of machine-made paper and paperboard in January-August 2021 reached 90.21 million tonnes, up 13.6% year on year. After excluding price factors, estimated finished product inventories in the machine-made paper and paperboard manufacturing industry rose 3.7% year on year and declined 0.4% month on month in August 2021. For trade, cumulative paper and paperboard imports in January-August 2021 increased 8.3% year on year, while cumulative exports rose 6.0% year on year.

Risks: slower macroeconomic growth; overseas projects progressing below expectations.

Source: China Packaging Network (pack.cn). Original link: http://news.pack.cn/show-378432.html