According to the monitoring of the commodity market analysis system of SunSirs, the prices of softwood pulp and hardwood pulp first increased and then decreased after the May Day holiday. On May 11th, the average market price of softwood pulp in Shandong was 6,370 RMB/ton, a decrease of 0.47% compared to the average price of 6,400 RMB/ton on May 1st. On May 11th, the average market price of hardwood pulp in Shandong was 5,830 RMB/ton, a decrease of 0.51% compared to the average price of 5,860 RMB/ton on May 1st.

By observing market changes, it can be seen that the spot price of wood pulp shows a fluctuating trend after the holiday. In terms of supply, the factory resumed work well after the holiday, and the accumulation of inventory at the port has been alleviated. Due to the strong sentiment of international pulp mills to boost prices, external quotations continue to rise, supporting the strength of domestic imported wood pulp spot prices.

As of May 9, 2024, the sample inventory of mainstream pulp ports in China is 1.793 million tons, a decrease of 5.4% from the previous period. The inventory has shown a trend of destocking after accumulating for three consecutive weeks.

In terms of demand, after the current holiday, there is currently no seasonal support for tourism or e-commerce promotion festivals in the short term, and downstream processing factories have average replenishment of raw paper. May is still in the traditional off-season for consumption, and downstream demand is dragging down the price of wood pulp. From the perspective of the impact of demand on prices, the bearish sentiment is also increasing. The differentiation between supply and demand continues, and there are reasons for both the rise and fall of prices.

In terms of futures, post holiday pulp futures prices have turned from strong to weak. On May 10, 2024, the main contract of SP2409 pulp futures on the Shanghai Futures Exchange opened at a price of 6,234 RMB/ton, closed at a price of 6,204 RMB/ton, and the highest price was 6,236 RMB/ton, with a daily decline of 0.58%. The trading volume was 97,200 lots, and the position was 195,995 lots.

The downstream white cardboard prices have been continuously declining. On May 11th, the market average price of white cardboard 230g-400g was 4,536.67 RMB/ton, a decrease of 1.52% compared to the market average price on May 1st. The current price of white cardboard continues to decline, in contrast to the previous increase in raw material wood pulp prices. In May, paper mills may adjust their production line structure or shut down production to ease shipping pressure. Due to the paper mills gradually transferring inventory to traders, there is a more obvious oversupply situation in the market. May is still in the traditional off-season of demand, and there may be a seasonal decline in market orders, which temporarily lacks positive boost for the market.

SunSirs Wood Pulp Analysts believe that there is not much change in the current post holiday supply and demand market, and downstream weakness is more obvious. The poor transmission of pulp prices has led to profit compression. However, the cost support for wood pulp is strong, with external market reports and tight supply expectations providing support for spot prices. It is expected that short-term wood pulp spot prices may continue to fluctuate widely.

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