SunSirs: Building Material, Wood Pulp Prices continue to fall in November, Short-Term Shocks

1. Price Trend

According to the price monitoring of SunSirs, the spot price of wood pulp in November is still in a downward trend, and the prices of softwood pulp and hardwood pulp have declined by different ranges. On November 28, the average price of softwood pulp was 4,457.50 RMB/ton, 1.22% lower than that at the beginning of the month. On November 28, the average price of hardwood pulp was 3,782.50 RMB/ton, down 0.46% compared with that at the beginning of the month.

1. Market Analysis

Product: according to the observation of market changes, the overall spot market price of wood pulp in November shows a downward trend, but the price has been relatively stable in the first ten days of this month. Since the middle of this month, softwood pulp and hardwood pulp have declined by different ranges, and then the hardwood pulp has gradually become stable, while the softwood pulp price has been in a fluctuating downward trend until the end of the month.

Industry chain: due to the decline of wood pulp price in the early stage, the spot price of wood pulp has been relatively stable since this month. The lower reaches of the paper mills are generally in the mood of taking goods, mainly for just needed purchases, and there is no obvious sign of increasing demand for the time being. The industry is more cautious and wait-and-see attitude, and the wood pulp price is generally in a trend of concussion and consolidation. However, with the decrease of the delivery of bulk orders in the downstream, the accumulated inventory increases, which leads to the pressure on the wood pulp price. In the middle of November, the wood pulp price shows a slight downward trend. In addition, as the peak season of demand will pass, the demand in the later period may be weak.

Industry: according to the published trade data, China imported 2.626 million tons of pulp in October, up 21.46% month on month. Inventory days and port inventory are still at a high level. In November, some paper mills prepared goods at a low price, and port inventory slightly decreased, but the digestion of inventory pressure is still limited. This month, the wood pulp market began to fade, and the growth trend may be difficult to maintain, making the market confidence performance insufficient in the fourth quarter. Recently, the news of strike was reported abroad, with various factors interwoven, some brands fluctuated in narrow range, and the atmosphere of on-site wait-and-see was strong. In addition, the futures market of the previous period fell below 4,500 RMB/ton, resulting in a downward pressure on the spot market price of softwood pulp. The spot market price of hardwood pulp is relatively less affected by the price of softwood pulp, and the price is in a narrow range.

In terms of futures, on November 28, the opening price of the pulp futures SP2001 main contract of Shanghai Stock Exchange was 4,504 RMB/ton, and the settlement reference price was 4,484 RMB/ton. Yesterday, the settlement price was 4,508 RMB/ton, with 222,340 transactions and 232,130 positions.

1. Market Forecast

According to the wood pulp analysts of SunSirs, although a new round of base paper price increase letter has been sent out in succession, there is no significant increase in downstream demand, and the weakening of market atmosphere also makes later demand weak. In addition, the continuous decline of futures prices and the greater impact of delivery pressure in January, it is expected that the short-term spot wood pulp prices will be mainly in shock consolidation.

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