SunSirs: China Corrugated Paper Continues to Rise, with an Upward Trend in the Short Term

According to the monitoring of the Commodity Market Analysis System of SunSirs, the price increase of corrugated paper has increased this week. On December 19th, the average ex factory price of 140g corrugated paper was 2,796 RMB/ton, an increase of 4.1% compared to the average price on December 15th.

In terms of upstream raw materials: This week, the price of waste paper in Zhejiang region maintained a slight upward trend, while the price of waste paper in domestic paper mills remained stable with small fluctuations. On December 19th, the average purchase price of A-grade waste yellow board paper in Zhejiang region was 1,672 RMB/ton, an increase of 1.33% compared to the average price on December 15th. At present, the intention to ship waste yellow cardboard from upstream packaging stations is heating up, with an increase in the supply of local waste yellow cardboard and a decrease in the purchasing intention of paper mills. Subsequently, some paper mills have lowered prices to stimulate the intention of packaging stations to ship. As a result, the price increase of waste yellow cardboard in the market continues to narrow. In addition, the purchasing prices of leading paper companies have remained stable, and the market's wait-and-see atmosphere has gradually deepened.

On the supply side: With the current decrease in corrugated paper inventory, the operating load rate of paper mills has rapidly risen to a high level. In addition, the tight supply of some specifications has provided strong support for the continuous rise in paper prices. At the same time, large-scale paper mills have continuously raised their ex factory prices and issued the next round of price increase notices, triggering a bullish sentiment in the market and further increasing prices.

On the demand side: Downstream procurement intentions have diverged, as demand for New Year's Day and Spring Festival gradually releases, and downstream packaging factories along the southeast coast still have orders, so they will replenish their inventory appropriately. However, orders from some cardboard factories in the South China market may weaken in the latter half of the year. With the stable performance of downstream packaging factories in receiving orders, raw paper inventory is at a medium to high level. Due to cost pressures, they choose to consume previous inventory, which may lead to a decrease in market transaction volume.

SunSirs paper analysts believe that recently, Nine Dragons Paper has issued another round of price adjustment notices, and its production bases in Dongguan, Taicang, Quanzhou, Tianjin, Hebei and other areas will gradually increase the price of raw paper in batches in the next week, with an increase of 30-80 RMB/ton. The main reason for the price increase trend is the continuous rise in raw material costs and the increase in production costs. Therefore, influenced by the rising market atmosphere, it is expected that the price of corrugated paper will continue to rise in the short term.

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