bestroulette| Broad-leaved pulp: The outer market reported strong gains in May, and pulp prices may be deadlocked in June
Zhuochuang Information Pulp Market analyst Chang Junting
[introduction] the outer disk price of China's imported broad-leaf pulp rose strongly in May.BestrouletteIt has maintained an upward trend for three months in a row, while spot slurry prices have maintained a strong fluctuating trend due to the uncertainty of the supply side, the rise of the outer disk of related pulp species, the improvement of supply and demand and other favorable factors leading the market. In June, the supply and demand of the pulp market continued to play the game, and the cost remained high, but the improvement of the gross profit margin of the downstream base paper was further reduced. at the same time, it is expected that the pulp price stalemate is mainly restricted by the financial attributes of the products and the uncertainties of the outer disk transaction.
The outer disk of broad-leaf pulp continued to rise in May.
The outer disk price of China's imported broad-leaf pulp rose strongly in May and has maintained an upward trend for three months in a row. Zhuochuang Information Monitoring data show that China's imports of broad-leaf pulp outer disk rose 30 US dollars / ton in May compared with the previous month. Judging from the price fluctuation characteristics of imported broad-leaf pulp outer disk in recent years (see figure 2), the outer disk price in May is higher than the historical 7-year average level. In April, the volume of broad-leaf pulp exported from Brazil to China decreased, the spot price of broad-leaf pulp rose, the spot market price of coniferous pulp rose, the mutual support of the increase in the outer disk of broad-leaf pulp and coniferous pulp, and the improvement of supply and demand in the pulp market, it is the driving factor of the strong operation of the outer plate price of broad-leaf pulp, but the low profit fluctuation of the downstream base paper industry is the main factor dragging down the transaction of the outer plate.
The volume and proportion of Brazilian exports to China declined, which directly supported the rise in the outer disk of Brazilian broad-leaf pulp.
According to data from the Brazilian General Administration of Customs, the total export volume of Brazilian broad-leaf pulp in April was 165.Bestroulette.600000 tons, of which 67 percent were exported to China.Bestroulette.40,000 tons (down 2.32% from the previous month), exports of broad-leaf pulp to China accounted for 40.70% of Brazil's total exports, down 4.69 percentage points from March, providing direct support to the Brazilian broad-leaf pulp outer plate.
The strong operation of the futures market, the continuous flat price of the coniferous pulp outer disk and the narrowing of the price difference between the two support the broad-leaf pulp outer disk to rise.
As of May 10, the closing price of the main pulp futures contract on the Shanghai Futures Exchange was 6234 yuan / ton, down 160 yuan / ton from 6394 yuan / ton at the end of April. However, considering the late arrival cost pressure, the current basis was strong. As of May 11, the spot market average price of imported coniferous pulp rose 1.51% to 6417.56 yuan / ton, indirectly supporting the strong spot price of broad-leaf pulp (as of May 11). The monthly average price of imported broad-leaf pulp spot market rose 3.28% month-on-month, an increase of 0.01 percentage points over the whole month of April), which played a certain supporting role in the rise of broad-leaf pulp outer disk.
At the same time, it can also be seen from figure 3 that the price of coniferous pulp has increased for 2 months in a row, and from the point of view of the price difference between coniferous pulp and broad-leaf pulp, the price difference between coniferous pulp and broad-leaf pulp has widened for two months in a row, and the price difference between them has increased to $80 / ton in May, supporting the outer plate price of broad-leaf pulp in May, so the rise in the price of coniferous pulp and the expansion of the price difference between them have become another supporting factor for the outer disk of broad-leaf pulp to rise in May.
In May, the supply and demand of the pulp market improved in a narrow range, supporting the outer disk to rise.
It is expected that the total supply of the pulp market will decline by 1.92% month-on-month in May, and the supply side will be tightened, which is mainly manifested by the decline in import volume (the rise in the outer disk affects the downstream delivery, the increase in the quantity sent by foreign pulp mills to Europe and then the decrease in the quantity sent to China), which is beneficial to the trend of pulp price.BestrouletteThe total demand increased by 1.77% month-on-month, and the demand increment brought about by the release of new capacity in the downstream base paper industry, thus supporting the pulp price. In the case of tight supply and slight increase in demand, the relationship between supply and demand is expected to improve, supporting the current spot market prices. The high price of the spot market has become another driver of the outer disk report.
The profitability of the downstream base paper industry fluctuates on the low side, dragging down the transaction of the outer disk.
The profit improvement of downstream base paper is not good, which affects the improvement of pulp picking enthusiasm and restricts the increase of pulp price. Specific to the theoretical gross profit margin level of the base paper industry (see figure 4), as of May 11, the gross profit margin of the downstream base paper industry was-15.75% to 19.63% (the highest is the gross profit margin of containerboard paper, but the amount of wood pulp in its production cost is sparse. Therefore, the representation is relatively low), down 0.53 percentage points from April to 5.32 percentage points, the gross profit margin of the downstream base paper industry is on the low side. According to Zhuochuang information analysis, the gross profit margin of the downstream base paper industry fluctuates on the low side, and the outer disk and spot prices of superimposed broad-leaf pulp continue to rise, which increases the difficulty of cost optimization of paper mills, which in turn affects the enthusiasm of raw materials purchasing and the upward resistance of pulp prices. it has become the main factor dragging down the turnover of the outer disk of broad-leaf pulp in May.
The supply and demand of the pulp market fell in June, and the pulp price was deadlocked.
In terms of the pulp price itself, the supply and demand of the pulp market continued to play a game in June, and the cost area remained high, but the profit improvement ability of the downstream base paper continued to weaken. at the same time, restricted by the product financial attributes and the uncertainty of the outer disk transaction, it is expected that the pulp price stalemate.
The total supply is expected to decline by 3.02% month-on-month in June, mainly reflected in the expected decline in imports and the narrow decline in supply caused by individual maintenance plans in domestic pulp mills, which is good for the trend of pulp prices. The total demand is expected to decrease by 1.39% from the previous month, and the decline in demand is due to the limited improvement of terminal demand and the decrease of the starting load rate of the base paper industry, which is beneficial to the pulp price. at the same time, the fluctuation of the base paper profit is expected to be obvious, which affects the improvement of the pulp picking enthusiasm of the industry. further drag on the trend of pulp price The high operation of the cost side and the increase of the outer disk quotation lead to the high cost area and support the bottom price of the pulp market, but the actual transaction situation of the later high price outer disk will also affect the trend of the pulp price; the emotional side is still uncertain, and there are differences in the expectation of the main contract price of the pulp futures on the Shanghai Futures Exchange, which will continue to affect the phased trend of the pulp price. There are still uncertainties in the supply chain, mainly reflected in the uncertainty caused by the continuous sudden events in foreign countries and the extreme weather on the production and transportation of pulp mills in South and North America, which further affects the uncertainty of foreign pulp mills on the Chinese market and the expected release of new capacity in the later period, and still has an impact on the trend of pulp prices.
To sum up, the spot market price of imported hardwood pulp in June was mainly deadlocked, and there was still support for the outer plate of imported wood pulp; two Canadian railway companies began to suspend work on the 22nd, and the Finnish pulp mill has not yet resumed production. The impact on softwood pulp, the price difference between softwood pulp and hardwood pulp, and the conduction effect of the two further support the price of hardwood pulp outer plate; Extreme weather at South American broadleaf pulp mills has affected production and changes in pulp mills 'focus on shipping destinations have led to tightening expectations for the volume of imported broadleaf pulp from China, which further directly supports broadleaf pulp prices. However, due to the rapid rise of hardwood pulp outer markets, the ability to improve the profits of the downstream base paper industry continues to decrease, and the paper mill's start-up stock is expected to decline in the later period. Therefore, the paper mill's ability to accept high-priced outer markets has decreased. At the same time, from June to July, Brazil and China are expected to release 4.15 million tons of hardwood pulp, which may further affect the trend of the outer markets in June.
The above only considers the impact of fundamentals and uncertainties on the market. The specific impact still depends on the actual impact of events and the trading strategies of foreign pulp mills on the market. At the same time, the impact of product financial attributes on the market cannot be underestimated.
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