• Pulp prices stable but with mounting pressure in China: Most softwood producers are cutting prices by at least USD 50/t in China due to the ongoing purchasing standstill. Chinese pulp imports for May saw volumes flat m/m by up 19% y/y to 2mt. May PPPC stats indicated that global chemical pulp inventory days of supply increased by 6% m/m to 38 days of supply, while shipments were flat m/m (down 4% y/y) to 4.271mt. This saw utilisation drop by 400bps m/m (-300bps y/y) to 86%. NOREXECO pulp futures for CY 22E contract implies a 11-13% decline in Europe vs. a 15-16% decline in China.
  • European graphic paper margins weaken further: After factoring in a 30% discount to list pulp prices, the CWF/HW spread is further in the red at -EUR 18/t (UWF producers stable at EUR 180/t). April European demand for Graphic Paper saw a strong rebound y/y but down m/m: CWF +34% y/y & -19% m/m; CM +15% y/y
    & -12% m/m; and UWF +15% y/y & -11% m/m. In North America, demand remains robust, and pricing continues to improve. According to RISI, Sappi is planning a two-day moratorium (not taking orders, not proving quotes) in order to “get a handle” on the tight supply-demand market situation.   
  • European containerboard prices up 0.5% w/w: SCA confirms EUR 50/t increase for both brown and white kraftliner in Europe from 1 August. This is on the back of “a continued strong market for transport packaging”. Klabin announced a similar increase for sales in Europe as well as Latin America. Kraftliner prices in Brazil are up over 46% y/y in June. Following most North American peers announcing a USD 50-90/t price increase for containerboard, WestRock and IP have announced a 10-14% price increase for corrugated boxes and corrugated sheets effective 1 August.

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