SunSirs: China Wood Pulp Price has slightly Declined and is Expected to Fluctuate in the Short Term

According to the monitoring of the commodity market analysis system of SunSirs, both softwood pulp and hardwood pulp showed a slight downward trend this week. On December 13th, the average market price of softwood pulp in Shandong Province was 6,250 RMB/ton, a decrease of 0.32% compared to the average price on December 8th. On December 13th, the average market price of hardwood pulp in Shandong Province was 4,448 RMB/ton, a decrease of 0.67% compared to the average price on December 8th.

On the supply side: With the weakening of overseas demand and temporary suspension, overseas inventory pressure and pulp mill inventory pressure have not continued to accumulate. However, due to disruptions in overseas supply, the US dollar quotation remains strong, resulting in a widening price difference for pulp varieties. In addition, there will be more pulp production capacity put into operation in the second half of the year in China, and overall supply pressure still exists.

On the demand side: Recently, downstream paper has shown a significant improvement, with prices rising and production and sales increasing. But the paper production remains low, and there is not much increase in the actual consumption of pulp. Although there are signs of improvement in the willingness to collect pulp in downstream paper mills, the sustainability is still insufficient. In addition, due to the weakness of broadleaf and the large price difference between needle and broadleaf, there is a lack of confidence in downstream demand in the long run, making it relatively difficult for pulp prices to soar.

Domestic port data: This week, the sample inventory of mainstream ports in China continued to show a trend of accumulation. As of December 12, 2024, the sample inventory of pulp in mainstream ports in China was 1.913 million tons, an increase of 72,000 tons from the previous period and a month on month increase of 3.9%. The mainstream port Qingdao Port has a narrow range of inventory destocking, and the shipping speed has increased, with an average daily shipment of 17,000 tons. The quantity of broad-leaved pulp in the port accounts for more than half. This cycle, Changshu Port's inventory has accumulated, and the shipment speed has accelerated within the week, with a cumulative shipment of over 100,000 tons.

In terms of futures, pulp futures prices have been weak this week. As of December 13th, the opening price of the main contract sp2501 pulp futures on the Shanghai Futures Exchange was 5,786 RMB/ton, the closing price was 5,762 RMB/ton, and the highest price was 5,822 RMB/ton, with a daily decline of 1%. The trading volume was 151,200 lots, and the position was 65,087 lots.

The wood pulp analyst from SunSirs believes that the current accumulation of port inventory is more obvious, while downstream demand is generally average, or there may be a phenomenon of production reduction and supply reduction. In addition, there is no bottom-up drive to reduce inventory, making it difficult to see a unilateral surge logic at the moment. It is expected that the short-term spot price of wood pulp will maintain a range fluctuation pattern.

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