SunSirs: The Overall Price of Wood Pulp Fell in China in December 2022

According to the data monitoring of SunSirs, in December, the price of softwood pulp showed a trend of rising and falling, while the price of hardwood pulp continued to decline. As of December 29, the average market price of softwood pulp in Shandong was 7,340 RMB/ton, up 0.27% compared with the average price of 7,320 RMB/ton on December 1. On December 29, the average market price of hardwood pulp in Shandong was 6,446 RMB/ton, down 2.04% compared with the average price of 6,580 RMB/ton on December 1.

From the observation of market changes, in early December, the news of work stoppages began to spread from major timber producing areas in Canada, and the strike crisis of the American Railway Association was on the verge of breaking out and the strike incident in Chilean ports resumed. Concerns about pulp supply continued to rise, driving the price of wood pulp to rise. Although the import cost decreased in late December, the price remained high. At present, the overall import volume of pulp is still below the level of the same period last year. The cumulative import volume of coniferous wood pulp from January to November is 5.934 million tons, down 16.8% year on year. In the case of tight supply, the support for the pulp market is limited.

In December, the downstream demand was insufficient, the market's willingness to purchase wood pulp was still low, and the domestic port stock of pulp was accumulated in a narrow range, which depressed the spot price of wood pulp. In addition, near the end of the year, the demand of pulp downstream base paper manufacturers has basically maintained a rigid demand, and due to the introduction of technical transformation capacity and new capacity, the price of finished paper is under obvious pressure. The utilization rate of production capacity of manufacturers affected by health events is relatively general, and the market is in a tepid state.

On December 29, the opening price of the pulp futures SP2305 contract of the Shanghai Futures Exchange was 6,638 RMB/ton, the latest price was 6,636 RMB/ton, with a price drop of 0.54%, 93,700 deals and 126,895 open positions.

Wood pulp analysts from SunSirs believe that the import supply of pulp will remain tight by the end of the year, and there is not much domestic supply. As the spring holiday is approaching, the shutdown letters of the downstream market are frequently issued, and the purchase of wood pulp is more cautious. It is expected that the short-term spot price of wood pulp will continue to fluctuate at a high level.

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