【Wdoodoo Weekly Paper Industry Report】Port destocking slows down, pulp surges fail

纸浆周报9月28日：港口去库放缓，纸浆冲高未果

本周纸浆冲高回落。针叶浆均价在5028元/吨左右，环比下跌4元/吨；阔叶浆均价4579/吨，环比下跌9元/吨。终端需求增量受限，原纸价格表现疲软，纸厂毛利挤压，高价原料接受度有限。

1. Macro slightly favorable

The pressure of overseas interest rate cuts is gradually being digested. China and the United States have reached an agreement to build a constructive strategic and stable relationship based on respect, fairness, and equality, and have reached a consensus on 8 achievements including a $30 billion equivalent tax reduction arrangement. The temporary easing of Sino US relations will help stabilize global expectations and benefit the risk market.

2. The pulp mill continues to shut down and reduce production, while the port's destocking slows down

In terms of needle pulp, due to the pressure of risk-free import hedging, the market has once again risen and fallen. The price difference of 9-1 has narrowed, and the positive news of short-term cancellation of old warehouse receipts has been basically digested. We have not seen a significant increase in paper mill inventory this week, and port inventories have rebounded again by 20000 tons to 2.18 million tons. The slow digestion of coniferous inventory in ports has constrained market performance. However, the suspension of production cuts for coniferous plants is still ongoing. Canada's Nackawic pulp mill has temporarily reduced production, and UPM still has plans to stop production cuts, providing long-term support for coniferous plants.

The broad-leaved structure is relatively strong. The main producing countries have continuously reduced their shipments to China, while the wildfires in Indonesia are still fermenting. There are not many available goods for sale at the port, and the port inventory is at a relatively low level during the same period. Suzano announced a price increase of $20 in the Asian market and $50 in the European market.

The current price difference between coniferous and broad-leaved trees is low, and the price increase of broad-leaved trees provides some bottom support for coniferous trees. However, the enthusiasm for stocking up downstream before the holiday has decreased, putting pressure on the gross profit of paper mills and limiting the short-term price increase of broadleaf.

3. The gross profit of finished paper has weakened, and there are limited downstream orders before and after the holiday

Paper mills continue to focus on destocking, with low production and sales of mainstream paper types. Finished paper prices continue to decline, with only household paper experiencing a slight increase. Due to the rise in raw material prices, downstream raw paper enterprises are facing increased processing pressure. The release of downstream orders before the holiday is limited, and paper mills are mainly reducing prices to increase production volume. It is difficult to increase short-term operating rates. Therefore, caution should be exercised in pursuing high demand raw material procurement.

Overall, the production capacity of coniferous trees is still in the process of clearing, with strong support from cash flow costs in the vicinity of the first tier low of 4500. However, the high inventory in the port suppresses the space above, and there is significant hedging pressure near the import cost. The main core fluctuation range is still between 4600-4900, and the interval approach should be taken. However, based on the improvement of the supply and demand margin, the bearish trend of the long-term moving average system has turned volatile, and the medium to long term strategy is mainly focused on pullbacks and long positions. In terms of broadleaf, the available resources for sale at the port are relatively tight, and there is support for essential needs. The structural rebound continues, and attention is being paid to the first line pressure of $600.