SunSirs: In February, the Price of Wood Pulp Continued to Decline, with Weak Shocks in the Short Term

Price trend

According to the monitoring of the data of SunSirs, the prices of softwood pulp and hardwood pulp continued to decline in February 2023. As of February 24, the average market price of softwood pulp in Shandong was 7,010 RMB/ton, down 3.97% from the average price of 7,300 RMB/ton on February 1. The average market price of hardwood pulp in Shandong Province on February 24 was 5,930 RMB/ton, down 5.72% from the average price of 6,290 RMB/ton on February 1.

Analysis review

From the observation of market changes, the wood pulp market price continued to decline in February, and the decline continued to expand, and the pulp futures price also showed a downward trend. In terms of supply, the import volume of pulp in 2022 decreased by 520,000 tons year-on-year, with a decrease of nearly 2%, which made the domestic supply side tight. Subsequently, the news of overhaul and shutdown of production plants in Finland, Canada and Indonesia spread again. The main pulp plants in South America shut down unexpectedly, and the supply situation continued to be tight. In addition, the external market continued to offer high prices, and the export of some regions was restricted, and the total domestic import volume was still at a low level, which played a certain role in supporting the pulp price.

In terms of demand, although the downstream operating rate increased in February, the market's performance on raw material procurement was general, and the domestic port inventory continued to accumulate. In order to increase the delivery of wood pulp, the spot price of wood pulp fluctuated and fell. Then the downstream market resumed production, and the operating load rate continued to rise. Under the mood of buying up and not buying down, the enthusiasm for wood pulp procurement was not good, and the market continued to wait and see.

On February 24, the opening price of the Shanghai Stock Exchange pulp futures sp2305 contract was 6,512 RMB/ton, and the latest price was 6,480 RMB/ton, with a daily decline of 1.85%. The transaction volume was 177,900 and the position was 152,755.

Market outlook

According to the wood pulp analysts of SunSirs, the supply and demand side of the domestic wood pulp market continued to play a game. With the deepening of the internal and external inversion of the pulp price, traders are facing greater financial pressure, and the spot price still has a trend of weakening. It is expected that the spot price of wood pulp will continue to fluctuate weakly in the short term.

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