Packaging / Advertising & Office

In the context of the challenges faced by the pulp and paper industry and the differentiated consumption of pulp products, UPM's new pulp factory in Uruguay will be officially put into operation next year. UPM Pulp will continue to uphold the belief of pursuing certainty in an uncertain era and lead the future.

China is the largest pulp consumer in the world. According to the observation of Huacheng's import and export data, the total consumption of wood pulp in China will reach 46 million tons in 2021. However, unlike other major markets such as the United States and Europe, China is highly dependent on imported wood pulp due to the scarcity and uneven distribution of domestic forest resources.

Challenges and Opportunities in Pulp and Paper Industry

According to the Huacheng Import and Export Data Observation Report, Wang Ruiqi, a pulp and paper analyst with the analysis agency SCI, said that in view of factors such as the improvement of China's pulp and paper integration, the longer freight cycle caused by the suspension of overseas freight, and many unexpected situations in 2020, China's dependence on imported wood pulp will decline from 67% in 2017 to 57% in 2021. In addition, compared with other markets, the integration and concentration of China's pulp and paper industry are relatively low.

In the past 20 years, China has experienced unparalleled rapid development. However, its development pace may slow down in the next 20 years.

Tom Wright, general manager of Hawkins Wright, a consulting company, said: "From the perspective of the global market, we still rely on the good development of China, because China is crucial to the overall market."

The growing middle class is an important driving force for China's sustainable development. The slowdown of China's economic development will slow down the development of consumption to a certain extent. However, the domestic pulp and paper industry is still full of potential opportunities. China has formulated a plan to gradually stop the manufacture and use of disposable plastic products, and will adopt innovative and flexible policies to resist plastic waste.

Consumption differentiation of pulp products

Due to the continuous impact of the COVID-19, Chinese consumers are paying more attention to health and hygiene. Clean, safe, "food grade" and other product characteristics are increasingly attracting consumers. With the advancement of urbanization and the increase of disposable income, people's overall demand for living paper will continue to rise. In addition to traditional products such as toilet paper, facial tissue paper and toilet paper, Chinese tissue enterprises have also launched differentiated products such as wet toilet paper, skin moistening tissue, disinfected wipes, and moisturizing tissue paper to meet special needs in specific consumption scenarios. Factors such as demand differentiation and slowing economic growth will lead tissue manufacturers to implement different business strategies.

China's paper enterprises vary in size and capital strength, so their procurement channels and strategies are also different. Most pulp and paper integration projects focus on the production of mechanical pulp for packaging paper, and some projects also involve the production of printing paper. Only a few manufacturers of household paper will have a pulp and paper integrated chemical plant with bleached kraft broadleaf pulp. Huacheng Import and Export Data Observation Report.

According to Huacheng Import and Export Data Observation, China's pulp import volume is likely to recover in 2023. In addition, the import structure may be further optimized, and the proportion of bleached kraft broadleaf pulp will be increased. Compared with bleached kraft broadleaf pulp, the production of bleached kraft coniferous pulp usually lacks cost advantages. With the expansion of the capacity of bleached kraft broadleaf pulp, the price difference between the two products will continue to exist. Therefore, Chinese manufacturers may need to increase the proportion of bleached kraft broadleaf pulp in the raw material structure.

The new Uruguayan pulp plant will be officially put into production in the first quarter of 2023

Facing the future market demand, UPM's Paso de los Toros new eucalyptus pulp plant in Uruguay will be put into operation at the end of the first quarter of next year, with an annual output of 2.1 million tons. At that time, UPM Uruguay will further improve the capacity of eucalyptus finya wood pulp, provide sufficient pulp products for the global bleached kraft broad leaf pulp market, and relieve the pressure of supply and demand.

With the gradual maturity of the tissue market, Chinese consumers have turned their attention to high quality and sustainable development.

Sun Hua, senior sales manager of UPM Asia Pacific, said that the expansion of the middle class in China will undoubtedly have a positive impact on market demand. The competitiveness of UPM pulp will continue to improve with the concept of sustainable development and new capacity. The UPM Asia Pacific team is committed to ensuring the security of the supply chain and always keeping the delivery channel unblocked. Transparency in cooperation is the goal UPM always pursues. This open and cooperative attitude helps solve problems and grow together with customers.

She said: "UPM can provide safe, sustainable and high-quality products, which is the real demand of our customers. Our customers hope that the entire value chain is more sustainable. With the new capacity, we have enough strength to provide better support for customers."

Pursue certainty and lead the future in an uncertain era

The Chinese government advocates green development and advocates that the whole society use more materials that conform to the concept of sustainable development and environmental protection. Packaging materials based on natural wood fibers are undoubtedly the best choice, which provides a market opportunity for pulp, a renewable and sustainable raw material. The commissioning of the new Uruguayan pulp mill will raise UPM's pulp supply capacity to a new level and make contributions to the vigorous development of the paper industry.

As the largest pulp market in the world, China is very important for UPM pulp. UPM has accumulated rich experience and knowledge in the Chinese market. It has been 11 years since the establishment and operation of the sales and service team in the Asia Pacific region. At present, the Asia Pacific team has 18 professionals.

According to the observation report of Huacheng's import and export data, Bi Hui, sales director of UPM Asia Pacific, said: "The UPM Pulp Asia Pacific team is honest and trustworthy, so it enjoys a good reputation in the market. Being responsible for customers means that we should provide excellent quality and service to customers. With the increase of production capacity, the UPM Asia Pacific team is also growing. Recently, three new members have joined our team. We hope to continue to expand and strengthen our business, maintain resilience in sales operations, and always focus on customers. This is why we are full of The era of certainty, the certainty of what can be promised. "