Research
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Forestry & Paper: Industry Insights
Key message: Prices for Pulp, Paper and Packaging stable this week. Potential pulp supply shock in Asia, while May global demand was up 5% y/y. Mondi’s Merebank mill has restarted.
Afrimat – Investor Day Feedback
Key message: The depth of the management team is apparent, with strong growth prospects in internally funded new
Forestry & Paper: DS Smith H2 22A Packaging Insights
Key message: Record corrugated box volume growth. Returns are back in the zone and a bullish outlook for FY 23E.
Forestry & Paper: Industry Insights
Key message: Pulp prices gain further traction, placing some pressure on Graphic Paper margins. US CFS stats for May point to continued strong demand. Containerboard prices remain stable, while OCC is still rising.
Forestry & Paper: Textile Fibre Insights
Key message: Cotton and polyester in the red, while VSF and DWP prices gain further traction. VSF inventory days tighten further to 12.0, while the average op. rate is down to 74%. VSF theoretical profit further in the red at
-USD 128/t (VSF/DWP spread +13% YTD). Spot DP is stable at USD 1,190/t.
Cement Import Monitor
Key message: Cement imports for Jan-April 2022 are 26% down on 2021 levels, with port issues due to flooding being a limiting factor.
Investec Property Fund – FY22 results and valuation update
Key message: a good recovery in FY22 was driven by improved leasing and operating conditions in the SA portfolio and highly favourable tailwinds in the PEL platform. Relatively strong share price performance over the last twelve months had rendered IPF comparatively expensive, but after a recent selloff its price now more fairly reflects its risk and prospects.
Forestry & Paper: Industry Insights
Key message: Pulp prices rise further in all regions. Graphic Paper prices gain further traction, while Packaging prices take a breather. Earnings guidance upgrades from Stora Enso and UPM.
Forestry & Paper: Textile Fibre Insights
Key message: Cotton, polyester and VSF in the green. VSF inventory days tighten further to 12.5, while the average op. rate is down to 75%. VSF theoretical profit improves but still in the red at -USD 92/t (VSF/DWP spread +17% YTD). Spot DWP is up 4% today to USD 1,190/t.
Forestry & Paper: Industry Insights
Key message: May m/m prices changes: China pulp +4-7%; CWF +9%; UWF +6%; US CFS +8%; Testliner +5%. Norske Skog share price increased the most vs. peers (+13% m/m) in May and is now up 54% YTD. In terms of EV/EBITDA multiples, Sappi and Mondi are both trading at the biggest discounts vs. peers.