The Papermaking Industry Will Enter The Peak Season, and The Prices of Some Paper Products May Diverge

In August, the papermaking industry began to gradually enter the traditional peak season of the market. Starting from August 1, the domestic packaging paper industry has set off a new round of price increases. Many paper and paperboard suppliers, have announced increases in the prices of corrugated base paper and containerboard paper. Most of the increases are around 30 yuan/ton. This price adjustment reflects the overall recovery of the corrugated paper and containerboard market, as packaging paper suppliers prepare for higher seasonal demand from e-commerce, food packaging, and logistics sectors.

The person in charge of a corrugated paper production company in Shangdong  Province said in an interview with a reporter from Securities Daily that the past July was the off-season for the packaging paper industry. The order situation of downstream packaging plants was not good, so paper companies were purchasing raw paper. Not very motivated. "Small and medium-sized paper companies like ours generally negotiate actual orders, and the price of corrugated paper generally shows a downward trend." However, as raw material pulp prices and logistics costs begin to stabilize, many small and medium-sized paper mills are planning to resume full production capacity, ensuring a more stable supply of kraft linerboard and testliner paper to the market.The person in charge of the paper company said.

According to statistics from Zhuochuang, in July, large-scale paper mills, issued multiple price reduction policies, with the cumulative price adjustment ranging from 30 yuan/ton to 150 yuan/ton. But at the same time, due to the impact of the decline in boxboard and corrugated paper prices, the profit margins of paper companies have narrowed. There are also relevant bases of some large-scale paper mills that have increased the ex-factory prices of some specifications of paper & paperboard products, with the adjustment range ranging from 20 yuan/ton to 50 yuan. /ton. Industry experts believe that the moderate increase in paperboard and corrugated base paper prices is also supported by rising demand for sustainable paper packaging materials, as more brands shift away from plastic packaging.

"Overall, the market performance in July fell more than it rose, and the market price showed a downward trend. " Guo Xiaotong, an analyst at Zhuochuang Information, told a reporter from Securities Daily. Despite short-term fluctuations, analysts predict that the overall paper packaging industry will maintain steady growth in Q4, driven by export orders and increasing demand for eco-friendly corrugated boxes.