Packaging / Advertising & Office

According to the observation report on the import and export data of Huacheng, on October 10 and 11, paper enterprises in many places announced that the price of their base paper was increased by 50 yuan/ton, involving white board paper, corrugated paper and other paper types. With the arrival of this round of price increase letter, some paper enterprises have carried out two consecutive rounds of price increase since the end of September, with a cumulative increase of 100 yuan/ton or more.

"In the third quarter, the whiteboard market showed a stepwise downward trend, with more and more paper mills being shut down for maintenance, the downstream terminal demand continued to be weak, the contradiction between supply and demand remained in the market, and the paper price was not sufficiently motivated to rise." Pan Jingwen, an analyst with Zhuochuang Information, said.

October is an important time node for the paper and paper packaging industry to turn from the off-season to the peak season. Some industry analysts pointed out that the market demand may increase to a large extent, which is conducive to the rise of paper prices. Papermaking enterprises, especially listed paper enterprises, had a firm attitude towards price fixing in the fourth quarter, which also provided impetus for the price rise of raw paper. Huacheng Import and Export Data Observation Report.

Is the price increase a real recovery or a test

The price increase plan issued by the leading paper enterprise Jiulong Paper at the end of September was implemented on October 10, and the price of some paper varieties in its six major bases increased by 50 to 100 yuan/ton. At the same time, several paper enterprises in South China have also announced that since October 10 and 11, the price of finished white board and corrugated paper will be increased by 50 yuan/ton on the basis of the original supply price.

Previously, several paper enterprises, including Sun Paper and Chongqing Liwen Toilet Paper, also announced that the prices of packaging paper, household paper and specialty paper under the company had increased by varying degrees, with the highest increase of 600 yuan/ton.

In this regard, the person in charge of a paper packaging enterprise in Zibo, Shandong, said that the fourth quarter was indeed the time when the demand in the industry was the strongest in a year. Since this year, due to multiple factors, the terminal consumption demand has been weak, bringing great pressure to the packaging industry. Although it is unknown whether the demand in the traditional peak season in the fourth quarter can really "flourish", the industry generally has expectations, Huacheng Import and Export Data Observation reported.

"If the demand recovers, we really need to replenish the stock in advance." The person in charge said so.

Since this year, the papermaking industry has faced an unfavorable situation of high upstream costs and weak downstream demand. The role of price transmission mechanism is difficult to play, and the profit space of papermaking enterprises has been squeezed. In particular, since the third quarter, taking the whiteboard market as an example, the overall operating level of the market has declined significantly, and the price of the whiteboard has also shown a downward trend in a stepwise manner.

According to the observation report of Huacheng's import and export data, the monitoring data of Zhuochuang Information shows that the output of whiteboard production enterprises in the third quarter decreased by 20.36% compared with the second quarter, 22.08% lower than the same period last year; The operating load rate decreased by 12.06 percentage points compared with the second quarter and 21.27 percentage points compared with the same period last year. "In the third quarter, the large-scale paper mills continued to shut down for maintenance, and some production lines of white board gradually switched to white paperboard, which reduced the spot supply in the market." Pan Jingwen said.

Although the supply is reduced, the demand is always poor, and the downstream packaging and printing plants are not enthusiastic about replenishment, so the inventory pressure of the paper mill has not been significantly relieved. According to the data of Zhuochuang Information, the average price of the whiteboard market in the third quarter of 2022 will be about 4848.75 yuan/ton, down 10.51% month on month and 15.23% year on year.

Be optimistic about the performance of listed paper enterprises in the second half of the year

After the third quarter's ladder like decline, this round of price increase by paper enterprises after the National Day holiday is regarded as the price fixing behavior of the fourth quarter by the industry.

Some insiders believe that the traditional peak season on the demand side is approaching, especially the "Double 11", "Double 12" e-commerce shopping festivals and New Year's Day and other holidays. The market demand will indeed rise significantly compared with other months.

"The demand side has increased steadily, and the paper mill has a strong desire to pull up. The dealers and the downstream may supplement the stock one after another." Pan Jingwen said.

From the supply perspective, many paper enterprises in the industry announced downtime for maintenance in the third quarter. After a series of inventory adjustment, the inventory level of major paper enterprises decreased significantly, which is conducive to easing the contradiction between supply and demand of base paper, and also conducive to raising the price of base paper.

Galaxy Securities believes that leading paper enterprises frequently shut down in the third quarter to reduce the supply of finished paper, driving the improvement of the supply and demand pattern of the industry; At the same time, a number of paper enterprises issued price increase letters, and the price of finished paper is expected to be boosted to improve profitability, and the performance of listed paper enterprises in the second half of the year is expected to continue to repair.

It was also analyzed by insiders that paper enterprises, especially listed paper enterprises, would like to achieve good results in the fourth quarter, adding highlights to the company's financial statements. Therefore, the paper enterprises will be more firm in their attitude of price fixing in the fourth quarter.

As for the trend of the whiteboard market in the fourth quarter, Pan Jingwen believes that it may show a slight upward trend. "The price of white board paper market rose slightly in October. With the approaching of the Spring Festival in November and December, the enthusiasm of dealers to stock up may be improved, and the paper price may show an upward trend of shock."

Speaking of the prediction of the trend of corrugated paper in the fourth quarter, Li Li, an analyst of Zhuochuang Information, said that the corrugated paper market first rose and then stabilized in October. From November to December, the demand side is expected to be better, which is conducive to the rise of paper prices. However, in consideration of the uncertainty of new production capacity, changes in energy costs, and changes in paper mill operations and inventory, paper prices may move up slightly.

Chenming Paper believes that due to the continuing turbulence in the international situation, it is not expected that the energy price will decline significantly, the overseas supply side will not improve significantly, and the export market will probably continue. Huacheng Import and Export Data Observation Report.