PULP AND PAPER MARKET NEWS FOR ASIA November 25, 2011 Vol. 14, No. 41 Identify better producer prospects for greater sales ROI www.risi.com/suppliers Did you know... that copying or electronic forwarding of this publication is illegal in vir-tually every country around the world? We rely on subscription fees to support our worldwide editorial team. Illegal copying hurts our ability to bring you the very best news - and may even subject you to a fine. For information on discounted bulk subscriptions, please e-mail copyright@risi.com. (For general subscription and other inquiries, contact info@risi.com.) In This Issue: Pulp prices still slipping 2 Pulp Biweekly Price Watch 2 Pakistan P&W case renewed 3 RCP Weekly Price Watch 3 Hubei Hongfa starts up BM 5 China probes US coated ivory board imports China s Ministry of Commerce has launched a dumping investigation into coated ivory board imports from the USA after receiving a petition from four Chinese producers. The case is one of many antidumping actions initiated recently focusing on pulp and paper imports either into or from China (see chart on page 5). The Ministry of Commerce said on November 18 that MCC Meili Pulp and Paper, Shandong Chenming Paper Holdings, Ningbo Asia Pulp & Paper, and Ningbo Zhonghua Paper (the latter two both subsidiaries of APP China) filed the case in October. Another major producer, Shandong Bohui Paper Industry, expressed its support for the case, although it did not join in filing the petition. The imports from the USA under investigation are coated ivory board products in which fiber from chemical pulp accounts for more than half of the total fiber content. The grade can be used to produce clothing tags, greeting cards and packaging for tobacco, pharmaceuticals, cosmetics, food and liquid. According to the ministry, the dumping investigation will be focused on imports during the period of July 1, 2010 to June 30, 2011. The alleged material injury will be examined over the period from January 1, 2008 to June 30, 2011. Presently China boasts a total capacity of around 5 million tonnes/yr of coated ivory board, with 3.13 million tonnes/yr from the companies mentioned above. The five claim that during the period from 2008 to June 2011, their combined output of the grade accounted for more than half of the total output in the country. MCC Meili Pulp and Paper has a 300,000 tonne/yr unit at its mill in Zhongwei city, Ningxia autonomous region. Tissue PM part explodes at Nanning Phoenix A blast on a tissue paper unit s iron drying cylinder injured one worker at Nanning Phoenix Pulp & Paper in China. The accident happened on a Kawanoe Zoki unit the night of November 12 at the firm s mill in Nanning city, Guangxi autonomous region. According to a source from Nanning Phoenix, the Japanese supplier has sent people to the mill, and an investigation is still underway. The machine is a recent purchase, having started up in 2008 (No. 6, 2009, p.8). However, Kawanoe Zoki refused to comment on the accident. It is estimated the machine will take at least eight or nine s to restart. An industry insider also reported that Italian company Toscotec, rather than Kawanoe Zoki, is being tapped to supply a new steel drying cylinder. The 20,000 tonne/yr PM has a trim width of 3.4 m and a design speed of 1,000 m/min. The mill also houses 12 other tissue paper machines, including a 12,000 continued on page 5 tonne/yr Kawanoe Zoki PM and another 11 units from domestic suppliers with a combined capacity of around 13,000 tonnes/yr. New PM to come online: Nanning Phoenix plans to bring a new 30,000 tonne/yr tissue paper unit online at the mill by the end of April next (No. 5, 2010, p.4). The machine was initially scheduled to be fired up by mid-2011, but civil engineering work hit a delay. The unit, supplied by Andritz, has a trim width of 3.65 m, and a design speed of 2,000 m/min. The scope of the supply contract included a stock preparation plant, a headbox, a hood and a steel yankee drying cylinder. A mixture of bleached softwood and hardwood kraft (BSK and BHK) pulp will be used to feed the unit. The BSK pulp will come from the firm s own 150,000 tonne/yr fiber line, and BHK pulp is expected to be sourced from the local market. Jumbo rolls will be converted onsite into end products.
Pulp prices slip further in China, weighing down contract talks in Asia Sharp falls of market pulp prices in China since late October have set a precedent for November contract negotiations in other Asian markets, where regular buyers are seeking cuts of $40-70/tonne across the board. The ongoing price talks in South Korea, Japan, Taiwan and Southeast Asia are expected to be wrapped up at the end of this. China still down: To attract buyers, sellers cut prices drastically in the Chinese market in the past, with northern bleached softwood kraft (NBSK) pulp PRICE WATCH: Pulp For specifications and details on how RISI determines prices, see www.risi.com/pulpprice CHINA - Imports (BIWEEKLY) seeing the biggest drop, down $140/tonne to $680-700/tonne (No. 39, p.2). Radiata pine plunged $90/tonne to $660-670/tonne and Russian bleached softwood kraft (BSK) pulp fell $60/tonne to $630-640/tonne. Producers also reduced unbleached softwood kraft (USK) pulp prices this week in China by $50/tonne to $620-630/tonne. The erosion has also been apparent for the short fiber grades since late October in the Chinese market. South American eucalyptus levels went down $80/tonne to $530-550/tonne, while Russian bleached hardwood kraft (BHK) pulp plummeted $110-120/tonne to $520-530/tonne. One market participant said aspen BHK is selling at just $500/tonne, the lowest level of all the short fiber grades. Sluggish demand and falling prices in North America and Europe have prompted suppliers to initiate the steep price cuts in China, where big-volume end-users continue to get tonnage to feed new machines and traders need to replenish their depleting stock. continued on page 6 US$/tonne, CIF, except as otherwise noted. Net of rebates of up to 3%. current prices current price - change 1 vs 25 Nov 11 Nov 4 Nov 26 Nov 2010 week Bleached softwood kraft NBSK (from N. Amer. and Scand.) $680-700 $680-700 $680-700 $810-830 - - -130-15.9% Radiata pine (Chile) 660-670 660-670 660-670 810-820 - -25-140 -17.1% Russian BSK 2 630-640 630-640 670-680 780-790 - -40-150 -19.1% Bleached hardwood kraft Eucalyptus (from Brazil and Chile) 530-550 530-550 550-580 730-750 - -25-200 -27.0% Russian BHK 2 520-530 520-530 610-630 700-720 - -95-185 -26.1% Unbleached softwood kraft From Chile and N. Amer. 620-630 670-680 670-680 740-750 -50-65 -113-15.5% Russian 2 600-630 650-680 650-680 705-735 -50-60 -105-14.6% CHINA - Domestic prices (WEEKLY) Net prices, RMB/tonne, trader s warehouse, including 17% VAT current prices current price - change 1 vs 25 Nov 18 Nov 11 Nov 26 Nov 2010 week Bleached softwood kraft NBSK (from N. Amer. and Scand.) RMB 5150-5250 RMB 5200-5300 RMB 5300-5400 RMB 6500-6600 -50-175 -1350-20.6% Radiata pine (from Chile) 4850-4900 4900-5000 4900-5100 6400-6500 -75-275 -1575-24.4% Russian BSK 2 4800-4850 4900-5000 5000-5100 6300-6400 -125-325 -1525-24.0% Bleached hardwood kraft Eucalyptus (from Brazil and Chile) 4100-4200 4150-4200 4300-4400 5750-5800 -25-300 -1625-28.1% Russian BHK 2 4500-4600 4600-4700 4700-4750 5750-5800 -100-200 -1225-21.2% Chinese BHK 3 3800-3900 3900-4000 3900-4000 5350-5400 -100-450 -1525-28.4% Unbleached softwood kraft From Chile and N. Amer. 5050-5200 5050-5200 5050-5200 5300-5400 - - -225-4.2% Nonwood pulp Chinese bamboo NA NA 4600-4700 5400-5500 NA NA NA NA Chinese bagasse NA NA 4500-4600 4400-4500 NA NA NA NA NA = not available. 1 Changes calculated based on the midpoint of price ranges 2 Russian pulp prices are DAF to Manchuria, China. Prices reported in the previous issues were CIF levels to main Chinese ports, which were $30/ tonne higher than the DAF. 3 Made from a mix of eucalyptus, acacia and poplar wood 2 2011 RISI, Inc. All rights reserved. PPI ASIA/November 25, 2011
Pakistan renews printing and writing paper anti-dumping investigation Days after cancelling a similar case, trade authorities in Pakistan have called a new investigation into possible dumping activity pertaining to imports of coated and uncoated printing and writing paper grades from China, Indonesia, Japan and Thailand. The products under investigation in the case include coated P&W paper in the basis weight range of 73-170 g/m² and uncoated P&W paper in a range of 50-130 g/m². It is aimed at 100% virgin pulpwood grades. The case s timeframe for the determination of whether or not dumping took place extends from July 2010 to the end of June 2011. For determination of injury to the domestic market, the investigation covers July 2008 to June 30, 2011. Rebooted case: The latest investigation was sparked by a complaint from local producer Packaging Limited, who had filed the complaint behind the last one, too. Earlier this, a similar investigation by the National Tariff Commission of Pakistan was dropped after Packages PRICE WATCH: Recovered Paper Imports to China Net prices, US$/tonne, CIF, to main ports in China Limited withdrew from the proceedings (No. 39, p.4). Trade officials confirmed the withdrawal was due to a high court ruling that the first investigation was not lawful, subsequent to legal protests from a Pakistani importer of Indonesian paper over procedural issues. Packages Limited is a paper and board producer that can manufacture 115,000 tonnes/yr of P&W paper at its Kasur mill, and another 24,500 tonnes/yr at its Lahore mill. current prices current price - change 1 vs 25 Nov 18 Nov 11 Nov 26 Nov 2010 week From the US Old corrugated containers (11) $215-217 $212-215 $205-210 $270-275 +3-2 -57-20.7% Old newspapers (6 and 8) 195-200 195-200 195-200 225-230 - -15-30 -13.2% Mixed paper (2 and 3) 170-175 170-175 175-180 210-215 - -20-40 -18.8% Sorted office paper (37) 310-320 310-320 310-320 360-360 - -8-48 -13.1% NDLK (13) 260-270 260-270 260-270 310-315 - -40-48 -15.2% From Europe Old corrugated containers (70/30) 6 175-185 165-170 160-165 225-230 +13 +5-48 -20.9% Old corrugated containers (1.05) 6 195-200 187-190 170-180 230-232 +9 +10-34 -14.5% Old newspapers (2.01) 188-193 185-190 180-185 225-230 +3-17 -37-16.3% Mixed papers & boards (sorted) (1.02) 165-168 165-167 160-165 200-205 +1-16 -36-17.8% From Japan Old corrugated containers 220-223 215-220 215-220 240-245 +4-18 -21-8.7% Old newspapers 247-250 240-245 240-245 245-250 +6-14 +1 +0.4% Mixed papers 227-232 222-225 222-225 235-240 +6-8 -8-3.4% China domestic Net prices, domestic collections except as noted, RMB/tonne, delivered to buyer s warehouse in East China 5, including 17% VAT current prices current price - change 1 vs 25 Nov 18 Nov 11 Nov 26 Nov 2010 week Mixed paper & corrugated board 2 RMB1580-1720 RMB1520-1600 RMB1480-1580 1810-1890 +90 +125-200 -10.8% Old newspapers 2050-2150 2050-2150 2050-2150 2020-2100 - -50 +40 +1.9% Old corrugated containers Post-consumer 3 1700-1810 1640-1750 1640-1700 1750-1760 +60 +130 - - Pre-consumer and imports 4 1830-1870 1770-1800 1720-1800 1810-1890 +65 +95 - - 1 Changes calculated based on the midpoint of price ranges 2 Mixed paper and corrugated board comprises a minimum of 60% OCC; the rest is other paper and board. The OCC content is mainly old boxes made from recycled containerboard manufactured in China. The grade is mostly collected from households in residential areas. 3 Old corrugated containers (post-consumer) has a minimum of 90% OCC; the remainder is other paper and board. The grade is mainly collected from supermarkets. 4 Old corrugated containers (pre-consumer and imports) comprises a minimum of 90% OCC; the rest is other paper and board. The OCC content includes pre-consumer boxes and offcuts from converting plants, as well as some imported boxes made from kraftliner and collected in industrial areas. 5 East China includes Zhejiang, Jiangsu, Anhui, Jiangxi and Shandong provinces, and Shanghai municipality 6 As of March 2011, we have started to shift our coverage of European OCC from the 70/30 grade (70% OCC content and 30% mixed paper) to the 1.05 grade (95%+ OCC), reflecting a shift in the predominant grade in the market. DISCLAIMER: While these prices have been obtained from sources believed to be reliable, RISI does not warrant or guarantee the accuracy and completeness of the information. All prices are best estimates of prices before regular volume and contract discounts and are composite prices as opposed to median or average prices. Actual transaction prices may vary. PPI ASIA/November 25, 2011 2011 RISI, Inc. All rights reserved. 3
Thailand s Double A making progress towards paper mill in Bangladesh Thai firm Double A is awaiting a government license for a new mill in Bangladesh, where it is already the market leader in the copy paper sector and has some tree farming activities. A spokesman for Double A confirmed that it is likely to get an answer regarding its application with the Bangladesh Board of Investment (BoI) to acquire some land in Chittng for the new facility by the end of the (No. 25, p.1). If the land is secured, Double A is planning to build a mill there and run a machine it acquired from Australian paper merchant PaperlinX. The PM could produce 90,000 tonnes/ yr of uncoated fine paper when it was running at the Burnie mill in Tasmania. CHINESE RECOVERED PAPER IMPORTS: OCTOBER 2011 (TONNES) October October Jan-Oct Jan-Oct Grade 2011 2010 2011 2010 Old corrugated containers 1,126,300 1,106,562 12,480,686 11,524,348 Old newspapers 423,470 366,889 5,247,139 4,963,694 Mixed paper 321,109 247,011 3,685,765 3,084,641 Others* 40,131 30,367 587,635 392,615 Total 1,911,010 1,750,829 22,001,225 19,965,298 *Includes paper or board made of bleached chemical pulp. Source: China Customs. CHINESE PULP IMPORTS: OCTOBER (TONNES) Grade October October Jan-Oct Jan-Oct 2011 2010 2011 2010 Kraft pulp 1,006,905 623,428 9,516,311 7,138,475 Bleached softwood kraft pulp 515,251 353,034 4,821,602 3,145,443 Bleached hardwood kraft pulp 444,322 234,986 4,180,476 3,643,284 Unbleached softwood kraft pulp 47,332 35,408 488,702 348,066 Unbleached hardwood kraft pulp 0 0 25,531 1,682 Mechanical and semi-chemical pulp* 91,483 136,079 1,177,632 1,120,105 Dissolving pulp 98,349 65,197 903,187 807,898 Sulfite pulp 3,697 4,634 80,260 26,122 Other pulp** 5,995 6,055 69,517 54,247 Total pulp 1,206,429 835,393 11,746,907 9,146,847 * Mechanical and semi-chemical pulp imports are mostly bleached chemi-thermomechanical pulp. ** Other pulp category includes cotton linter, recycled pulp and other miscellaneous grades. Source: China Customs. The PM is one of two from the defunct Burnie facility. It also contains a 50,000 tonne/yr coated fine paper unit. PaperlinX shuttered the site in 2010, and the 138,000 tonne/yr coated fine paper Wesley Vale mill, also in Tasmania, in 2009, after opting to stop paper production and focus solely on merchant activities. Around the time of the mills closures, there had been some talk on the market that Double A (known at the time as Advance Agro) was interested in acquiring them wholesale (No. 7, 2010, p.8). Double A has not yet made any decisions on the exact grades that will be produced in Chittng, pending the response of the BoI to its application. Nor has the firm decided whether to try to take advantage of Chittng s Export Processing Zone (EPZ) or not, once more reserving judgment until the BoI gets back to it. Bangladesh s EPZs offer 10- tax holidays, concessionary rates after the holidays, and tax exemptions for exports from the zones, as well as support and infrastructure benefits. The Chittng EPZ offers many advantages if the facility is to focus on exports, but that since Double A is already active on the Bangladesh market there is a possibility that zoning the mill outside of the EPZ could make more sense. New PCC plant in Thailand: Elsewhere, Double A has signed an agreement with Minerals Technologies to build a second satellite precipitated calcium carbonate (PCC) plant at the producer s Tha Toom mill in Prachiburi province, Thailand. The new PPC facility, which will be operated by the duo s joint-venture, Double A Specialty Minerals, will have a production capacity of 80,000 tonnes/yr. Startup is scheduled for the third quarter of 2012. The plant will provide PPC for a new printing and writing machine that Double A is erecting at the Tha Toom mill. The PMT Italia unit, PM 3, is slated to come online in the second quarter of next (No. 20, 2010, p.3). The 5.28 m-wide machine will have an operating speed of 1,300 m/min and a capacity of 290,000 tonnes/yr. A Double A spokesman said the flooding devastating Thailand since July has not affected the Tha Toom mill s operations or the installation work for the new PM, as the site is not in the affected area (No. 39, p.3). Minerals Technologies has recently completed the expansion of the existing PPC plant at the Tha Toom site, boosting its capacity from 50,000 tonnes/yr to 70,000 tonnes/yr. PPC is a specialty pigment for filling and coating which helps produce better quality paper at lower cost, which is done by substituting PPC for more expensive wood fiber. JAPANESE RECOVERED PAPER STATISTICS: JANUARY-SEPTEMBER 2011 (TONNES) Collection Consumption Exports January-September % change January-September % change January-September % change 2011 2011/2010 2011 2011/2010 2011 2011/2010 Old newspapers 2,897,438-11.8 2,951,822-10.4 459,009 39.9 Old magazines 1,653,181-3.3 1,665,385-3.0 918,002 13.2 Old corrugated containers 5,887,482 1.3 5,911,351 1.3 1,552,554-6.5 Others 1,993,637-0.7 1,985,298-1.6 556,083 7.1 Total 12,431,738-3.0 12,513,856-2.7 3,485,648 5.0 Source: Paper Recycling Promotion Center. 4 2011 RISI, Inc. All rights reserved. PPI ASIA/November 25, 2011
Rengo gets 100% stake in Chinese subsidiary Japanese packaging giant Rengo has announced its acquisition of a 100% stake in Guangdong Rengo Packaging, a corrugated packaging and folding carton converter in Foshan City, Guangdong, China, following the buyout of its partner. The subsidiary s sales are mostly to other multinationals operating in and around Foshan City, and its net sales last came to RMB 104 million ($16 million). The move is the latest in a string of Coated ivory board dumping complaint in China continued from page 1 Shandong Chenming has a capacity of 480,000 tonnes/yr at its mill in Shouguang city, Shandong province. The two APP China plants in Ningbo city, Zhejiang province, can make about 1.7 million tonnes/yr. Shandong Bohui produces 650,000 tonnes/yr on two machines at its mill in Zibo city, Shandong province. According to the latest data from China Customs, China imported more than 175,000 tonnes of the grade in question from the USA in the first nine s this. During the s 2008, 2009 and 2010, the imports were about 182,000 tonnes, 170,000 tonnes and 199,000 tonnes respectively. Falling prices and more PMs: Prices for general coated ivory board (excluding cigarette packaging board) have plunged sharply this in China RECENT ANTIDUMPING ACTIVITY DIRECTED AT CHINA Country/Region Grade in question Status USA Coated paper Antidumping and antisubsidy duties imposed in November 2010 European Union Coated paper Antidumping and antisubsidy duties imposed in May 2011 Thailand Coated paper and board Under investigation Pakistan Coated and uncoated Under investigation printing and writing paper Taiwan Coated paper Possible investigation under consideration Argentina Coated paper Possible investigation under consideration RECENT ANTIDUMPING ACTIVITY FROM CHINA Country/Region Grade in question Status European Union, USA, Japan Photographic paper and board USA Coated ivory board Under investigation Brazil Source: PPI Asia Bleached eucalyptus kraft pulp investments Rengo has made in its non- Japanese operations. Late last quarter, it took over full ownership of a former joint venture, Tianjin Rengo, which produces corrugated packaging products for multinationals and Chinese customers around Beijing (No. 31, p.5). The company s converting facility is being rebuilt with a larger capacity. The expansion will be complete by the end of the. due to weak market demand. Sources reported that current prices are around RMB 5,900-6,800/tonne ($926.76-1,068.13/tonne), a contrast to the levels of RMB 7,000-7,500/tonne earlier this. A cartonboard producer said that the petition is partially related to the falling prices. Moreover, more coated ivory board machines are under construction in the country. Shandong Bohui is to erect a big coated ivory board machine with a capacity of 1 million tonnes/yr at a new mill in Jiangsu province. Production is slated to start by the end of 2012 (No. 40, p.6). Almost at the same time, APP China will bring online a 1.2 million tonne/yr unit at its mill in Qinzhou, Guangxi autonomous region. The unit is planned to mainly produce liquid packaging board. Provisional antidumping measures taken in August 2011 Evidence being collected by Chinese pulp producers, petition yet to be filed Hubei Hongfa starts up 450,000 tonne/yr BM China s Hubei Hongfa Renewable Resources Technology Development has brought online a new recycled containerboard machine at a greenfield mill in Yichang city, in the central province of Hubei. The machine, which started running on a trial basis on November 15, was supplied by an unknown Chinese supplier. The 5.6 m wide unit has a design speed of 800 m/min, and can produce recycled linerboard in a basis weight range of 150-360 g/m². A mixture of domestic recovered paper (RCP), imported RCP and virgin fiber will be used to feed the PM. Commercial production will start when the machine runs stably. Hubei Hongfa was established in 2009. The new BM is the company s first unit. China s Shandong Chenming sells subsidiaries Shandong Chenming Paper has sold two subsidiaries to a local company in China. The two entities are Chibi Chenming Paper and Xianning Chenming, and both are located in Hubei province (No. 35, p.6). Chibi Chenming has a capacity of 90,000 tonnes/yr of low-quality printing and writing paper. Guangdong Huashen Investment obtained 51% of its shares from Shangdong Chenming (20%) and its subsidiary Wuhan Chenming Hanyang Paper (31%) by paying more than RMB 168 million ($26.35 million). A Hong Kong investor named Profit Pool holds the rest. Meanwhile, the same buyer acquired a 100% stake in Xianning Chenming, which operates a 26,000 ha plantation, at a price of almost RMB 6.7 million. In late August, Shandong Chenming announced it would sell three subsidiaries, including Shouguang Liben Paper as well as the two mentioned above. Shouguang Liben Paper has a carbonless paper capacity of more than 10,000 tonnes/yr. It is located in Shouguang city, Shandong province. Shandong Chenming holds a 26.4% stake in Shouguang Liben. The Nippon Paper Group and Japan Pulp and Paper hold a combined 73.6%. The sale of the third subsidiary is still on the cards, according to a Shandong Chenming contact. All three subsidiaries have recently contributed little profit to the parent company or have been loss-making. PPI ASIA/November 25, 2011 2011 RISI, Inc. All rights reserved. 5
Sri Lankan ministry said to lease Embilipitiya mill Despite Sri Lanka s Embilipitiya Paper Mills restarting production back in June, it has been reported that the government has sold off the machinery and leased out the site to an engineering firm. The publicly owned mill, located in Sabaragamuwa province s Ratnapura district, contains a 15,000 tonne/yr printing and writing paper machine. Local sources said that it resumed operations in June for the first time since October 2008, when it was shuttered due to financial problems. Before its 2008 re-opening, the facility had been idle since 1999 due to a lack of funds (No. 21, p.7). The Sri Lankan government spent much of the last ten s helping the company find an investor to get the plant up and running again. It funded the abortive Rupee 150 million ($1.5 million) revival of the plant in 2008. Now, however, the local media has reported that the Ministry of State Resources and Enterprise Development has sold off the plant s machinery for Taka 400 million ($5.2 million), while the building and lands have been leased out for a 30- period at a cumulative Taka 400 million. The Ministry of State Resources and Enterprise Development has thus far declined to comment on the matter. India s Jejani Paper Mill mulls expansion or sale The management of Jejani Paper Mills in Desaiganj Wadsa, India, has announced its intention to either find a joint venture (jv) partner to expand the site with, or to sell it to investors interested in developing it for pulp production. The mill, which previously produced 9,000 tonnes/yr of printing and writing paper on its sole machine, upped the PM s capacity to 15,000 tonnes/yr of kraft paper as of last. However, due to capital shortages, the PM is only running at around 30% capacity. Due to the shortages, the firm is seeking a jv partner to allow it to boost the PM s capacity to 30,000 tonnes/yr of kraft paper, using recovered fiber as its furnish. Failing that, it is also looking at selling off the site to investors interested in using it as a pulp production plant, due to the availability of wood and nonwood virgin fiber resources in the area. The management reckons the site and its environs would support a pulp line capable of manufacturing 300 tonnes per day. Asian buyers seek cuts as Chinese pulp drops continued from page 2 Those buyers believe that current levels are near or have already hit bottom. They have snapped up available volumes as a result. The uptick in the Chinese market is a welcome relief for suppliers. According to the Pulp and Paper Products Council (PPPC), worldwide chemical pulp inventories rose to 39 days of stock in October, an increase of two days-ofsupply from the previous. The PPPC reported that global pulp shipments shrank 16.8% from the 3.851 million tonnes recorded in September to 3.203 million tonnes in October. Chinese domestic levels fall: The price falls for pulp imports have driven down resale pulp levels in the Chinese market. NBSK stock that Chinese traders sell to domestic buyers dipped RMB 50/tonne ($7.9/tonne) to RMB 5,150-5,250/tonne. Radiata pine fell RMB 50-100/tonne to RMB 4,850-4,900 tonne and Russian BSK went down RMB 100-150/tonne to RMB 4,800-4,900/tonne. Prices include 17% VAT. On the hardwood front, resale prices for South American eucalyptus shifted from RMB 4,150-4,200/tonne to RMB 4,100-4,200/tonne. And prices for BHK manufactured domestically fell RMB 100/tonne to RMB 3,800-3,900/tonne. Contract prices under pressure: Regular buyers in other Asian countries are using low prices in China to push down November contract levels, and suppliers are resisting. Several major buyers indicated that so far, sellers have offered to sell NBSK at $710/tonne, radiata pine at $670/tonne, BHK (South American eucalyptus and Indonesian acacia) at $540-550/tonne, Indonesian mixed tropical hardwood at $530-540/tonne and USK at $630/tonne. These customers are confident that weak demand in North America and Europe has led to suppliers shifting volumes from there to Asia, especially China. They also believe that sellers would not want to differentiate customers in the region by giving them different prices, now that it is more of a buyer s market. Moreover, sellers and buyers have just started negotiations for 2012 pulp contracts. Several purchasers said both sides have discussed only contract volumes for the next, and have not yet talked about ly discounts and annual rebates. Producers gave ly discounts to large-volume buyers of up to 10% discount for BSK and 4% for BHK this. With prices sliding and oversupply likely to be visible for some time, suppliers are worried that Asian buyers may ask for more discounts for 2012 contracts and are therefore not keen to start the conversation at present. Copyright 2011 by RISI, Inc. All rights reserved. Reproduction in any form whatsoever is forbidden without express permission of the copyright owner. Editorial Staff Nick Chang, Editor, Singapore...nchang@risi.com; 65.6395.5872 Jessica Zimbalatti, Senior News Editor, Brisbane...jzimbalatti@risi.com; 61.4.2423.8080 Rita Yao, Associate Editor, Shanghai...ryao@risi.com; 86.21.6157.3978 Aileen Tan, Price Analyst, Shanghai...atan@risi.com; 86.21.6157.3972 Sarah Feng, Price Analyst, Shanghai...sfeng@risi.com; 86.21.6157.3971 Spring Li, Price Analyst, Shanghai... sli@risi.com; 86.21.6157.3973 Editorial Offices RISI c/o UBM, 100 Beach Road, 33-08/10pt, Shaw Tower, Singapore 189702; tel 65.6395.5868; fax: 65.6293.6966 RISI, 9th Floor, Ciro s Plaza, 388 Nanjing West Road, Shanghai, China 200003; Tel: 86.21.6157.3988; Fax: 86.21.6157.3999 Publishing Headquarters RISI, 326, Avenue Louise, Box 22, B-1050 Brussels, Belgium; tel 32.2.538.6040; fax 32.2.537.5626; web www.risi.com Subscriptions and customer service Call 32.2.536.0748 (Belgium) or 866.271.8525 (U.S.); visit www.risi.com/catalog (new subscriptions) or www.risi.com/cs (online customer service); email info@risi.com; fax 32.2.537.5626, or mail to PPI ASIA, 326, Avenue Louise, Box 22, B-1050 Brussels, Belgium. Executives Mike Coffey... President and Chief Executive Officer Matt Graves... Senior Vice President, Pulp & Paper Information Todd Petracek... Vice President, Pulp & Paper News, Markets & Prices Rich Sordahl...Marketing Manager, Pulp & Paper News, Markets & Prices 6 2011 RISI, Inc. All rights reserved. PPI ASIA/November 25, 2011
Use RISI s Global Mill Projects Database to track competitors and maximize opportunities With RISI s Global Mill Projects Database you will Find detailed listings on projects in all stages of development, including information on mill openings, rebuilds and closures, new pulp lines, grade conversions and more. Access project information that is continuously updated by RISI s global team of editors and economists. Utilize simple but powerful search functions with this web-based database to help you quickly identify and track relevant projects; save and manage your searches to easily return to them later. Download all project details into an Excel spreadsheet for easy data management and manipulation. Visit www.risi.com/globalprojects to request access to this powerful tool!