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In 2018, the trend of paper prices changed greatly. How large is the price drop in April?
Apr 09, 2018

After the Spring Festival in 2018, paper enterprises of scale have carried out price adjustments three times in succession, and the overall range was 400-500 yuan/ton. However, the price of corrugated paper for small and medium-sized paper enterprises began to decline in the middle to late March. The corrugated boxboard market in 2018 is clearly different from 2017. What's the difference?

In 2018, the market trend of corrugated cardboard paper is obviously different from that of last year. What is the difference?

After the Spring Festival in 2018, the scale paper companies raised the prices of corrugated paper and linerboard three times in a row and raised the total amount by 400-500 yuan/ton. The addition of non-use policies has tightened, and the employees in the corrugated cardboard and paperboard market are generally optimistic about the market.

However, due to the lack of overall downstream demand, in late March, corrugated paper and linerboard materials, the price of waste yellow paper, fluctuate frequently. In a short period of half a month, the price of used yellow paper experienced a decline and then turned again. Falling trend. In some regions, the price of corrugated paper for small and medium-sized paper enterprises also loosened around RMB 100/ton.

Recalling that in March 2017, the price of corrugated paper and linerboard had fallen sharply. In mid-to-late April, paper prices entered an upward channel and continued to rise to September. The corrugated cardboard and paper market in 2018 is markedly different from 2017. Mainly reflected in the following aspects:

1. During the Spring Festival of 2018, the paper company's downtime was extended from the previous year. Due to the significant increase in paper prices in the fourth quarter of 2016, during the Spring Festival of 2017, there was no scheduled shutdown of the medium and small paper mill production lines. The normal scheduled holidays during the Spring Festival holiday resulted in a significant increase in paper inventory after the Spring Festival. During the holiday of the Spring Festival in 2018, the production lines of small and medium-sized paper enterprises generally arrange for downtime and maintenance, and the downtime is long. Most paper mills have their production lines shut down for 15-20 days, and a few paper companies have more than 30 days of downtime.

2. The inventory of paper enterprises before and after the Spring Festival is controlled at the mid-low level. Due to the long downtime of most paper companies during the Spring Festival, corrugated paperboard and containerboard companies have low and medium inventory levels before and after the Spring Festival.

3. The inventory of downstream companies before and after the Spring Festival was kept at a reasonable level, and blind purchases and large inventory inventories were significantly reduced. The downstream cardboard factory only made a small amount of supplements before the Spring Festival. After the Spring Festival, it judged the market more rationally and purchased on demand. Therefore, the inventory of downstream companies after the Spring Festival was not high.

Change of Mindset: Responding to sudden rises and falls, Downstream companies adopt a “purchase-and-use” strategy

The mentality of the downstream companies to deal with the soaring and plummeting prices of raw papers has gradually become more rational. Looking at the purchase of base papers from the downstream companies around the Spring Festival, the mentality of downstream companies in 2018 has changed significantly from that of 2017. Mainly because of the excessive base paper stocks of some downstream companies last year, corrugated paper and cardboard prices did not rise during the peak season in the fourth quarter of last year, causing downstream companies to digest high-priced raw materials in the fourth quarter.

In order to avoid these problems, the procurement of downstream companies in 2018 is more cautious. In particular, during the off-season in the first half of the year, normal stocks are the main reserve, and some downstream companies adopt the strategy of following the adoption.

Analysis: In April, although demand was in the off-season, there was little space for paper prices.

Downstream companies tend to be more rational in their purchasing attitudes, and no longer have large reserves of raw paper stocks. In April, when demand was in the off-season, there was downward pressure on the prices of corrugated paper and linerboard in April. However, since the price of raw materials for waste paper remained at a medium-high level in 2018, there was little room for downward prices for corrugated paper and cardboard in April.


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