• Pulp prices in China have remained stable, while prices in Europe softened slightly: In China, imported pulp business remained stuck at a standstill during the recent week, where BSK resale and futures prices went lower amid a downturn. In the North American market, spot prices for US NBSK and SBSK pulp experienced a $20/t decrease, marking the first price drop in 2024. This price decline coincides with the end of the downtime season in North America, which led to mills increasing their pulp production rates. UTIPULP statistics for June revealed that Europe consumption increased by 15% YoY (+1.3% MoM). Meanwhile, Europe consumer pulp inventories decreased by 6% YoY, while registering a further MoM decline of -4%.  
  • Textile prices saw a mixed trend this week: The ICE cotton contract increased by 6%, while the ZCE cotton contract was stable. Meanwhile, polyester shed 1%. The VSF price was stable as there was no notable price increase by suppliers. The VSF operating rate decreased slightly to 82% WoW from 83% last week, and the theoretical VSF margin for Chinese producers decreased slightly to $-37/t (from $-36/t last week).
  • Most suppliers were in favour of raising offers this week, this led to a DP price increase of $8/t: The spot price for the imported hardwood dissolving is now $950/t, with the DP/pulp spread at $209/t. The domestic DP price increased slightly to ¥7,680/t ($1,055/t) from ¥7,660/t ($1,051/t) last week, reflecting a $105/t premium over imports. Chinese pulp mills continued with the normal production of dissolving pulp, not indicating any plans to switch to paper pulp.
  • Graphic paper prices mostly remain stable: Newsprint edged up +1.3% continuing with the positive trend from last week. This is likely to compensate for higher wastepaper prices. On the supply front, Leipa has permanently idled PM 1 at its Schwedt mill in Germany, as previously announced in March. PM 1 had a capacity of some 170Kt/yr of recycled-based lightweight coated and mediumweight coated paper. Leipa will continue production of CM reels on the mill’s PM 4 (capacity: of 360Kt/yr).
  • Containerboard prices improved further: Kraftliner was up +0.4% (+11% y-t-d) and testliner up a further +1% (+19% y-t-d). After 20 consecutive weekly increases, OCC has taken a breather, easing by 1%. On the back of continued high production costs, Hamburger Containerboard (member of the Austrian Prinzhorn Group), a regional market leader in Central and Eastern Europe will increase their prices for white recycled corrugated liner (uncoated and coated) by €60/t effective by August 2024. Some encouraging news on the supply front, Heinzel is set to close their Raubling testliner mill in Germany, thus removing around 210Kt/yr of capacity.
  • US boxboard producers confirm further price hikes, positive read-through for Sappi North America: Smurfit Westrock, Graphic Packaging and Paperworks will increase board prices by $50-60/t (short ton) next month in the US and Canada. Meanwhile, Suzano will increase boxboard capacity by around 420Kt/yr through the purchase of two facilities from Pactiv Evergreen in North America for $110mn. The operation is the company’s first step toward the consumer and food service packaging segments in the region. The deal includes two mills in Pine Bluff, Arkansas, and Waynesville, North Carolina, that manufacture liquid packaging board and cup stock.
  • Sappi news flow: Sappi announced the sale of all shares in Sappi Lanaken to Dutch company UTB Waalwijk for €50mn. Sappi will receive €40mn in cash proceeds as Sappi will use some equipment (€10mn) at other sites. The transaction is expected to close in October this year. In other news, a fire and subsequent explosion occurred on a supplier truck delivering liquid oxygen (used for bleaching) to the Sappi Saiccor Mill in Umkomaas, KwaZulu-Natal.

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