According to the monitoring of the commodity market analysis system of SunSirs, the prices of softwood pulp and hardwood pulp are still declining last week. On July 5th, the average market price of softwood pulp in Shandong was 6,232 RMB/ton, a decrease of 1.08% compared to the average price of 6,300 RMB/ton on June 30th. On July 5th, the average market price of hardwood pulp in Shandong was 5,420 RMB/ton, a decrease of 2.87% compared to the average price of 5,580 RMB/ton on June 30th.

In terms of supply: The production capacity of softpulp in 2024 is relatively limited, and the early shutdown of the equipment has led to expectations of a reduction in future supply. The domestic pulp import volume remains at a relatively high level, but the demand for pulp in Europe has improved, and the destocking cycle is coming to an end. European paper mills are expected to experience a replenishment cycle in the second half of the year, which may also lead to a decrease in domestic arrivals. However, in July, some external pulp quotations remained unchanged and slightly decreased, which provided insufficient support for the domestic market.

In terms of demand: The current market coincides with the off-season and demand is weak. Some paper companies may continue to explore to alleviate inventory pressure. The decline in terminal demand has not shown a significant improvement, and paper prices are difficult to maintain stability and increase, providing poor support for upstream pulp prices.

Domestic port data: As of July 4, 2024, the sample inventory of mainstream pulp ports in China is 1.628 million tons, a decrease of 4.9% from the previous period. The inventory has shown a trend of destocking this week, and port inventory has shown a trend of destocking for two consecutive weeks. However, the hoarding and procurement enthusiasm of the industry is not high, and downstream manufacturers have a moderate trading sentiment and a strong demand for goods, resulting in limited acceleration of pulp consumption.

In terms of futures, the market price of wood pulp futures fell weakly. On July 5th, the main contract of SP2409 pulp futures on the Shanghai Futures Exchange opened at 5,850 RMB/ton, closed at 5,790 RMB/ton, and the highest price was 5,850 RMB/ton, with a daily decline of 2.56%. The trading volume was 381,400 lots, and the position was 255,607 lots.

SunSirs Wood Pulp Analysts believe that the current market focus is not only on changes in overseas supply, but also on observing the rapid turnover of warehouse receipts. In addition, the hardwood pulp market in the internal market has started to decline. Although the overall decline is limited, the negative impact of new equipment has not been fully digested, and the market's weak mentality continues. It is expected that the spot price of wood pulp will fluctuate at a low level in the short term.

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