Packaging / Advertising & Office

Since August, many paper-making companies have issued price increase letters many times, announcing an increase in the ex-factory price of corrugated paper. Why did the price of paper suddenly rise? What is the current market for corrugated paper?

Cost continues to rise, corrugated paper price increases 4 times in 20 days

Li Zonghui, the person in charge of a paper company in Shandong, told reporters that since August this year, the corrugated paper produced by them has raised prices four times in a row in less than 20 days. The ex-factory price per ton rose directly from 3680 yuan to nearly 4,000 yuan.

Li Zonghui, assistant to the general manager of a paper-making enterprise in Shandong Province: Since August, the price of corrugated paper has continued to rise, and it is now between RMB 3,850 and RMB 4,000.

The person in charge of a number of paper-making companies told reporters that the rise in the price of domestic waste paper raw materials this year is one of the main factors driving up the price of corrugated paper. With the implementation of a comprehensive ban on the import of solid waste, starting from January 1 this year, paper companies’ waste paper import quotas have also been cleared, which has made domestic waste paper increasingly tense.

Li Zonghui, assistant to the general manager of a paper-making enterprise in Shandong Province: The country used to have 15 to 20 million tons of foreign waste paper entering the country every year. With such a huge gap, domestic demand for waste paper has shown a rapid upward trend this year.

Statistics show that the current national average price of AA-grade corrugated paper in China is about 3,870 yuan per ton, a year-on-year increase of about 15%. Even so, most of the heads of paper companies told reporters that life is not easy.

Wang Lianshui, chairman of a paper-making company in Dezhou, Shandong: The profit margin this year is very small, almost none. Compared with the beginning of the year, it has risen by more than 600 yuan per ton.

In order to cope with the rising cost of raw materials, this year many paper companies began to transfer the cardboard scraps produced by downstream packaging plants to the company directly through the waste paper packing station, and further release production capacity through technical upgrades and other means. Industry insiders pointed out that in August, paper companies intensively issued price increase letters. On the one hand, they hoped to ease cost pressure by raising prices, and on the other hand, they were also tentatively raising prices before the peak season.

Liu Hui, an analyst at Zhuochuang Information Paper: From a long-term perspective, the fourth quarter is still a peak consumption season in the traditional sense. In addition, the supply of domestic waste yellowboard this year will continue to be tight, which will also support paper prices. Corrugated container board is expected in the fourth quarter. The paper price market will be based on a narrow range of upward fluctuations as the main tone.

Paper price downward conduction packaging companies are facing challenges

In our daily life, a large number of express cartons, packing boxes, etc. are made of corrugated paper. What is the impact of the continuous increase in the price of corrugated paper on downstream packaging companies? What about the current market conditions of packaging companies?

In a packaging factory in Shandong, the person in charge Ying Wenjun is understanding the market situation of corrugated paper. At this time last year, his factory had to maintain at least 35 to 40 days of corrugated paper inventory, but now, his inventory period is less than 15 days.

Ying Wenjun, general manager of a paper product packaging company in Shandong: At present, we are still holding a wait-and-see attitude. The entire terminal market is a bit sluggish, affected by factors such as the epidemic and sea export orders.

The reporter is holding a finished carton produced by a packaging factory. Usually, the packaging factory will determine how many grams of base paper to use according to the brand's index requirements for compression resistance and burst resistance. For example, the box in the hands of the reporter is about three layers thick. The person in charge told the reporter that about 60% of the increase in the cost of raw paper this year has been transmitted to downstream companies.

Ying Wenjun, general manager of a paper product packaging company in Shandong: General customers have a linkage price mechanism with us, and we will bear the price increase of less than 10% of the corrugated paper price. Recently, the cost of corrugated paper has been increased by about 15%, of which about 9% to 10% are absorbed by customers.

Heads of some packaging companies told reporters that after entering the second half of the year, production costs have risen further, and the profitability of companies has been squeezed.

Wang Jun, chairman of a paper product packaging company in Shaoxing, Zhejiang: Increasing prices downstream cannot fully cover the cost increase. Costs will continue to grow in the second half of the year.

Feng Yan, Director of Information Business of Paper Unix: It may only be a short-term impact for packaging processors, and there may be a price transmission time difference. The companies that need to buy cartons and cartons are the ones that will bear the largest share of the increase.

Fill the gap in raw materials, papermaking companies guarantee supply through multiple channels

At present, waste paper accounts for about 55% of my country's papermaking raw materials. Facing the shortage of waste paper raw materials, the entire industry chain has also accelerated the pace of searching for alternative raw materials.

In a paper company in Shandong, the person in charge told reporters that the company had started to explore alternatives to waste paper two years ago, and after constant attempts, it finally found a more suitable alternative to reed.

Li Zonghui, assistant to the general manager of a papermaking enterprise in Shandong Province: The price of national waste is about 2,600 yuan per ton, and the current purchase price of reed is about 700 yuan per ton. The final pulp cost is almost the same as the price of waste paper after rising prices. Not much.

Industry insiders pointed out that in the future, the level of cascade utilization of domestic waste paper should be further improved, resource potential should be tapped, and the raw material demand of the papermaking industry chain should be ensured through multiple channels.

Zhao Zhendong, vice chairman of Shandong Paper Industry Association: try to ensure the supply of raw materials through as many channels as possible. If the production capacity of homemade wood pulp is increased, investment costs will definitely increase. The stability of the supply of raw materials.

Industry insiders told reporters that waste paper cannot be imported, but pulp can be imported. Since the beginning of this year, many paper companies have increased their overseas investment and built pulp production lines.

According to statistics from the General Administration of Customs, my country imported 1.31 million tons of recycled fiber pulp from January to July this year, an increase of 23% over the same period last year. The average price also increased from US$308 per ton to US$389 per ton, an increase of 26%.