• Big moves for pulp this week in China and Europe: China pulp prices gained further ground on the back of good demand and continued arbitrage opportunities against the futures market. The May softwood contract on the Shanghai Futures Exchange settled at USD 973/t (excl. VAT and logistic costs). A record 10mt was traded on 3 March, and now with over 260mt of trade YTD, equating to 75% of 2020 traded volumes.
  • Mondi read-through for its 325kt white-top kraftliner containerboard capacity at its Syktyvkar mill in Russia: Significant testliner prices gains were realised in Russia during February, with testliner up RUB 3,750/t vs. RUB 3,100 for kraftliner. The kraftliner (RUB 46k/t)/testliner (RUB 40k/t) spread continues to narrow and could drive substitution. Domestic testliner prices were strong as imports into Russia have been unprofitable in light of higher European prices. Additionally, OCC has also been scarce, with prices reaching RUB 20.5-22k/t in February. Domestic OCC prices are likely to remain elevated as importing OCC remains challenging in light of container availability. Testliner increases of RUB 5-6k/t are on the cards for March vs. RUB 6-6.5k/t for kraftliner from April.
  • Sappi Europe announced a 7-11% price increase for Packaging and Specialties: This is effective for all deliveries from 1 April 2021. Key drivers for the price increase are rising input costs (pulp, energy and freight). Based on Sappi’s broad portfolio, we expect the majority of the increase to be realised by SAP’s Q4 21e.

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