- Pulp prices gain further traction, with European pulp prices up 4-5% w/w: NOREXECO pulp futures for CY 23E imply a 10-16% decline in Europe, and a decline of 12-20% in China. APP confirmed a vessel crashed and destroyed a pier bridge at the OKI mill in Indonesia. APP estimates a total impact of lost BHK shipments of 250kt over the next five months. A fire at Mercer International’s 660ktpa Stendal NBSK mill in Germany is also adding pressure to an already stressed market.
- Graphic paper in the green led by CWF (+1% w/w); however, pulp prices place pressure on margins: After factoring in a 30% discount to list pulp prices, the CWF/HW spread decreased by 14% w/w to EUR 206/t, while the UWF/HW spread dropped 9% w/w to EUR 321/t.
- Testliner drops 1% w/w, while OCC keeps rising (+1% w/w): The kraftliner/testliner spread increased by 5% w/w to EUR 159/t, while the testliner/OCC spread declined by 1% w/w to EUR 576/t. US OCC prices increase further as containerboard and boxboard mills continue to build up inventories. Packaging Corp of America, IP, WestRock, Norpac, and several other mill companies have upped their demand for US OCC in July.
- ICC Dutch TTF Gas Futures has jumped from EUR 81/MWH in June to over EUR 175/MWH currently: With the sharp energy rises in Europe, some producers have already curtailed operations. Metsä Tissue announced temporary production stops at its Kreuzau mill in Germany and Zilina mill in Slovakia. Some Italian paper and board mills are likely to suspend production in the coming days, with the spot price well above EUR 126/MWh, when some Italian mills took downtime. Prinzhorn Group’s Hamburger Containerboard has reduced its production capacity by 20kt in July.
- Mondi insights: Mondi Syktyvkar to produce cartonboard (under the brand Komipak) for dairy industry as Russia faces food packaging shortages. In June, Mondi Syktyvkar launched the new board production with output of 3-4k per month (36-48ktpa) and signed contracts for chemical supply with new partners from India, China, Thailand, Indonesia, and Uzbekistan. Featuring a white-top liner suitable for printing applications, Komipak is an essential component to aseptic packaging for foods with a short shelf life, such as milk and milk products.
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