SunSirs: China Corrugated Paper Oscillates Downward, Short-term Weak and under Pressure

https://www.chemnet.com   Sep 25,2024 SunSirs

According to the monitoring of the Commodity Market Analysis System of SunSirs, the corrugated paper market has shown weak performance this week, with prices stabilizing and declining. On September 23rd, the average ex factory price of 140g corrugated paper was 2,594 RMB/ton, a decrease of 0.61% compared to the average price of 2,610 RMB/ton on September 16th.

In terms of upstream raw materials, the price of waste paper in Zhejiang region has slightly increased this week, while the price of waste paper in domestic paper mills has remained stable with small fluctuations. On September 23, the average purchase price of A-grade waste yellow board paper in Zhejiang region was 1,543 RMB/ton, an increase of 1.31% compared to the average price on September 16. Currently, due to the weakening of downstream product sales, the raw material market is experiencing a strong wait-and-see attitude. Paper mills in various regions are adjusting their raw material procurement prices appropriately based on their own supply and demand situation. With the end of holiday stocking or a gradual decline in demand for waste paper, there is a possibility of a price drop in the future market.

Supply side: Currently, some paper mills in the corrugated paper market have issued notices of shutdown and maintenance before and after the National Day holiday, and some paper mills have shut down their equipment for technological upgrades, which has led to a decrease in the short-term industry operating load rate. But with the end of the Mid Autumn Festival and National Day stocking season, downstream finished paper sales may continue to be weak, and the inventory reduction of corrugated paper is still relatively slow.

On the demand side: With the end of Mid Autumn Festival orders, the market is in a temporary consumption off-season, and industry confidence in the demand for Jinjiu is weak, resulting in insufficient release of downstream effective demand. In addition, as the end of the month approaches the National Day holiday, some downstream packaging factories will shut down for vacation, reducing the consumption of corrugated paper. Some paper mills will also implement price reduction promotions, while downstream packaging factories mostly purchase according to their urgent needs based on order situations.

The paper analyst from SunSirs believes that the current trend of corrugated paper supply and demand is weak, but the reduction in demand is greater than that in supply. In addition, the continuous release of shutdown letters from paper mills during the National Day holiday has led to expectations of a decrease in waste paper prices. The cost side has no positive support for corrugated paper prices, and it is expected that there may be downward pressure on corrugated paper prices in the short term.

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