Packaging / Advertising & Office

A few days ago, Yueyang Forest Paper announced that it is expected to achieve a net profit attributable to the parent company of 604 million to 644 million yuan in 2022, with a year-on-year increase of 102.63% to 116.05%. Yueyang forest paper staff told reporters that with the decline of pulp prices, the reduction of shipping costs, the optimization of domestic epidemic prevention policies, and the active resumption of work and classes, it is expected that both cultural and industrial paper will have a "boom" market in 2023. Chenming Paper, Shanying International and other interviewees also expressed similar views and held a positive attitude towards the market of paper industry in 2023. Huacheng Import and Export Data Observation Report.

The collective performance of paper companies was under pressure last year

On January 30, Chenming Paper Co., Ltd., a leading paper company, released a performance forecast. It is expected to achieve a profit of 290 million to 330 million yuan in 2022, down 86.12% to 84.21% year on year. Chenming Paper said that during the reporting period, due to the impact of the epidemic, the domestic market demand was insufficient, and the sales of machine-made paper fell year-on-year, affecting the performance of benefits. At the same time, affected by the price rise of wood chips, chemicals, raw coal and other raw materials and energy, the production cost rose significantly year on year, resulting in a year-on-year decline in gross profit margin. The company said that with the gradual recovery of domestic demand in 2023 and the effective control of the cost side, the company's profitability is expected to be effectively improved. Huacheng Import and Export Data Observation Report.

Shanying International also released a performance forecast recently. It is estimated that the loss in 2022 will be 2.245 billion yuan, mainly due to the decrease in the gross profit rate of main business and the impairment of goodwill of about 1.5 billion yuan. Shanying International said that from the perspective of cost, the supply gap caused by the ban on waste promoted the continuous price increase of domestic waste.

Minfeng Special Paper recently announced that it is expected to make a profit of 12.6 million to 17.5 million yuan in 2022, a year-on-year decrease of 78.39% to 69.99%. Minfeng Te Paper said that during the reporting period, the prices of wood pulp and coal, the main raw and auxiliary materials of the company, have been at a high level, resulting in a large year-on-year increase in operating costs and a year-on-year decline in the gross profit margin of the main business; During the reporting period, the exchange income decreased year on year, resulting in an increase in financial expenses year on year.

Shenwan Hongyuan Research Report pointed out that the tight supply of wood pulp will keep the pulp price at a high level in 2022, and the pulp price will continue to rise from the end of November 2021, reaching a historical high, up 42%/50% from the end of November 2021, bringing huge cost pressure to the paper industry and seriously squeezing the industry's profit space.

According to the data of the National Bureau of Statistics, from January to November 2022, the operating income of enterprises in the paper and paper products industry above designated size was 1376.52 billion yuan, up 1.2% year on year; The operating cost was 1216.86 billion yuan, a year-on-year increase of 4.1%; The total profit was 47.8 billion yuan, a year-on-year decrease of 38.6%. As of November 2022, the number of paper and paper products loss-making enterprises was 1936, up 37.5% year on year. The number of enterprise losses hit the highest level in nearly three years, according to Huacheng Import and Export Data Observation Report.

Difficult profit environment accelerates industry reshuffle

The difficult profit environment has also promoted the accelerated reshuffle of the industry and the continuous optimization of the industry structure.

According to the 2022 third quarter report released by 27 listed paper companies, the total revenue of the five listed paper companies in the first three quarters exceeded 100 billion yuan, accounting for nearly 70%. According to the data of China Paper Association, the number of paper enterprises above designated size in China has decreased for 7 consecutive years.

With regard to the market in 2023, Shanying International believes that with the orderly recovery of consumption and the elasticity of demand brought by the replenishment of the industrial chain, the uncertainty factors affecting the paper industry are significantly reduced, and the pace of the implementation of the "stable growth" policy is accelerated, which will provide support for the economic stabilization, and it is expected that the prosperity of the whole industry will recover.

It is reported that the paper production capacity of Shanying International has been steadily landing. In May and October 2022, the wholly-owned subsidiary Guangdong Shanying 1 million ton paper project was started. In terms of projects under construction, Zhejiang Shanying 770000 tons of paper making project, Jilin Shanying Phase I 300000 tons of corrugated paper and 100000 tons of straw pulp project have been successfully promoted, and about 2 million tons of landing capacity will be added in 2023. After the industry stabilizes and recovers, it is expected to further improve the production and marketing scale and restore the profit level. Considering the factors such as capacity climbing, it is expected that the sales volume in 2023 will increase by more than 20% compared with that in 2022, with a large profit growth space.

The staff of the Board Secretary Office of Chenming Paper Industry reported to the reporter about 2022 and looked forward to 2023 with optimism, "In 2022, on the production side, the company has cooperated with world-class pulp and paper machinery suppliers in recent years, such as Voith in Germany, Wiedel in Finland and Andritz in order to upgrade the paper equipment in an all-round way, improve the technological level and expand the operating effect. On the supply side, the company launched the 'forest-pulp-paper integration' strategy to achieve a pulp and paper integration enterprise with basically balanced pulp and paper production capacity, and smooth the fluctuations of major upstream raw materials. In 2022, in the United States, Paper360 In the list of the top 75 global paper enterprises launched by the magazine, we are ranked 24th, ranking among the top 30 for many years in a row. It is expected that in 2023, with the combination of favorable factors such as smooth transportation, pulp decline and consumption recovery, the paper industry is expected to see marginal improvement in operating performance. "

Positive fundamentals in 2023

On the whole, with the gradual improvement of the epidemic situation in 2023 and the introduction of a number of stimulus and subsidy policies in the consumption field, the overall domestic economy gradually recovered, the consumption demand impacted by the epidemic accelerated to recover, and the prosperity of the paper and packaging industry showed a bottom-up trend.

The steady promotion of the dual-carbon policy and the "plastic ban" is conducive to promoting the growth of market demand for paper packaging. In 2020, China proposed to strive to achieve carbon peak by 2030 and carbon neutrality by 2060. On August 1, 2022, the Implementation Plan for Carbon Peak in the Industrial Sector proposed to further improve the "1+N" policy system of double carbon to ensure the implementation of carbon peak targets. On the other hand, the further implementation of China's "plastic ban order" has also accelerated the application of "paper instead of plastic" in the consumer field, and promoted the continuous growth of domestic market demand for paper packaging.

Earlier, the CHOICE terminal of Oriental Fortune showed that the share prices of some high-quality enterprises in the A-share paper and printing sector had risen first, indicating that market investors had paid attention to the basic area pole signals of relevant enterprises. Among them, the stock price of Yueyang Forest Paper, which is mainly engaged in cultural paper, rose by more than 15% in January, the stock price of Xianggang Technology, which is mainly engaged in food packaging paper, rose by more than 17% in January, and the stock price of Chenming Paper Industry rose by more than 2% in January. Huacheng Import and Export Data Observation Report.

Yueyang forest paper staff told reporters that, "Looking forward to 2023, shipping costs continue to fall back, international pulp giants continue to expand production, and domestic pulp futures contracts in each month are significantly inverted in the near and far months, and it is expected that the supply-side costs will continue to improve. With the optimization and adjustment of domestic epidemic prevention policies, the speed of the resumption of classes in the lower reaches will increase, the demand for special paper in industrial enterprises will increase, and the enthusiasm of the demand-side stock is expected to improve significantly. It is expected that the performance of the paper industry will be better than that of 2022 in the whole year of 2023 。”

Shanying International, which is mainly engaged in packaging paper, also expressed a positive view on 2023. It believed that the adjustment and optimization of domestic epidemic prevention and control measures, the speed of logistics, express delivery and bulk transportation picked up, and the leading enterprises in the express industry will also add outlets, which will stimulate the demand for packaging paper to a certain extent. It is expected that the market of packaging paper for express delivery in 2023 will be better than that in 2022.

Analysts pointed out that there are many signs that the industry has reached the bottom of profit. With the gradual recovery of market demand and the rational return of costs, the enterprise's profit is expected to be restored. Huacheng Import and Export Data Observation reported.

At the same time, under the background of continuous optimization of the industrial structure, the leading enterprises with the whole industrial chain represented by Chenming Paper are expected to take the lead in breaking through in the post-epidemic era by virtue of their advantages in strategy, products, research and development, technology and management.