Looking around, paper shells can be seen everywhere.
We use box board corrugated paper most often, which has obvious advantages, such as saving resources, low price, convenient transportation and easy assembly. However, in the past two years, the price of box board corrugated paper has fluctuated significantly. Picking up garbage and collecting waste products have also been praised by young people as "an ideal life of putting things in order". A piece of paper shell may be really valuable.
With the enhancement of environmental protection awareness, the promulgation of the "waste prohibition order" and the continuous festivals, the price of box board corrugated paper has been plunging. In recent years, the price of box board corrugated paper has been in an unstable state, especially in the fourth quarter of each year, which is mainly due to the large number of festivals during this period and the strong downstream demand.
Recently, the mainstream price of the box board corrugated paper market has mainly declined. Recently, the leading paper enterprises once again lowered the price of box board corrugated paper, about 30-150 yuan / ton. Then, a large number of paper factories such as Dongguan nine dragons, Shanying international, Dongguan Liwen and so on also announced that they would shut down for maintenance. The low downstream demand, the high inventory of paper enterprises, and the decline in the price of waste yellow paper are all sounding the alarm bells of the whole sunset industry.
"Cartons" that are no longer needed?
The price of box board corrugated paper continued to fall, leaving the whole industry in a downturn.
According to the data of the National Bureau of statistics, the average price of corrugated paper has dropped from 3812.5 yuan in mid April to 3558.9 yuan in mid July, and there is no sign of bottoming out. On July 29, more than 130 packaging paper enterprises nationwide reduced their paper prices. Since the beginning of July, the five major bases of Nine Dragons Paper Industry, Shanying paper industry, Liwen paper industry, Fujian Liansheng and other large-scale paper enterprises have successively implemented a price reduction discount of 50-100 yuan / ton for the price of corrugated box board.
As industry leaders cut prices one after another, many small and medium-sized enterprises have to follow suit, and the atmosphere of market price reduction is difficult to change for a while. In fact, fluctuations in the price of box board corrugated paper are common. From the sales situation of the market, there are obvious off-season and peak season, which is obviously directly related to downstream demand.
In the short term, the downstream market is in a weak state, and the inventory of enterprises is in a full state. In order to stimulate the enthusiasm of downstream enterprises to take goods, reducing prices may also be a last resort. At present, the inventory pressure of major leading enterprises is rising. According to short-term data, the output of corrugated paper from June to July was 3.56 million tons, an increase of 11.19% over the same period last year. The supply of base paper is sufficient, but the downstream demand is weak, which is bad for the corrugated paper market.
This has also led to the loss of some paper enterprises, which is a fatal blow to many small enterprises. However, the nature of the industry determines that small and medium-sized enterprises can not raise prices on their own, and can only follow the leading enterprises to lower and lower. The compression of profits has led to many small and medium-sized enterprises being eliminated from the market or forced to close down. Of course, the announcement of shutdown and overhaul by leading enterprises is also a disguised compromise. It is reported that enterprises may resume production in succession at the end of August to meet the relative prosperity of the industry.
In contrast, in 2021, the demand for box board corrugated paper is relatively strong, and the production capacity can still maintain high-speed development. According to the statistics of paper vision, from January to December 2021, the cumulative production capacity of the box board and corrugated paper industry was about 2.04 million tons. With the projects of technological transformation, speed-up and production increase, the actual cumulative new production capacity of box board and corrugated paper in 2021 is expected to be close to 3 million tons.
Especially around the Spring Festival, the market price of box board corrugated paper has been rising. At this time, most of the production enterprises' inventories are in the middle and low levels. Some large-scale paper enterprises have sent out price increase plans after the year in advance, which also directly stimulated the increase of market demand. Secondly, before and after the holidays, downstream packaging enterprises are actively stocking up, and the demand is relatively tight, so the price may continue to rise.
In the second half of the year, the price of box board corrugated paper is likely to rise. After all, festivals such as national day and mid autumn festival may greatly stimulate the demand of downstream packaging manufacturers. The price trend in 2020 and 2021 also well verified this point. It rose sharply at the end of the first quarter, fell sharply at the beginning of the second quarter, and the level of paper price after falling exceeded the low price before rising. From the beginning of May to the end of the year, it entered a continuous upward stage. However, this year's downward trend is obviously stronger and lasts longer.
The impact of weak downstream demand on the price of box board corrugated paper is intuitive. In addition, the cost side and the supply side have an impact on the price of box board corrugated paper. This year's "shutdown and overhaul tide" may also be related to greater cost pressure and declining profit level. Obviously, continuous price reduction has led to a series of chain reactions.
All kinds of signs show that the paper mill industry, which is not rich, has become even worse in the past two years.
The waste paper industry was "sitting together"
"The price of waste cartons is 40 cents per catty, which is too low. Last month, they sold for 60 or 70 cents per catty. It took only a short month to drop so much."
As the main raw material of the paper industry, the price of waste paper has fallen again and again due to the sluggish market. As of July 28, the average price of domestic waste yellow paper was about 2100 yuan per ton, down 250 yuan per ton compared with 2350 yuan per ton at the beginning of the month, a year-on-year decrease of more than 10%.
The reason is that the demand of downstream paper mills is sluggish, and the price of wood pulp, the raw material of paper making, continues to rise, which makes it difficult for paper enterprises to bear the pressure of cost side and starts to be forced to reduce the purchase price of waste paper. once the packaging station fails to keep pace with the falling pace of the paper mill's price, it is bound to suffer losses. The person in charge of a waste paper packaging station in Jiaxing, Zhejiang, said frankly that recently, new price reduction notices have been received almost every day, and many packaging stations in the same industry are now in a loss state.
In fact, since January 1, 2021, when China implemented the "waste prohibition order", the price of domestic waste has been rising. In particular, in the first three quarters of 2021, the average price of waste yellow paper rose to 2415 yuan / ton, an increase of 18.91%. Because there is a gap in the supply of waste paper, it is difficult to make up only by the improvement of the recovery rate of waste paper in China and the import of recycled fiber pulp, resulting in a continuous shortage of domestic waste paper supply.
However, in July, the price of waste paper fell significantly. It is reported that the price of Dongguan Nine Dragons waste paper has been reduced for 11 consecutive rounds, with a cumulative decrease of 510 yuan. At the same time, there are different price reductions in East China, South China, North China and other regions. The highest price reduction in a single day of a factory is 180 yuan.
The continuous decline in prices has made the waste recycling station dare not stock up rashly. One waste recycling worker said, "if we can't sell it that day, we will lose money if we reduce the price in a few days. The rapidly changing market makes our work a bit like stock speculation." This undoubtedly caused the already tight supply side to continue to shrink, and the profits of relevant enterprises dropped significantly. Domestic waste paper listed companies such as Nine Dragons Paper, Liwen paper, Shanying international and Jingxing paper were in an extremely embarrassing situation.
According to the half year performance forecast disclosed by Shanying international and Jingxing paper, Shanying international expects the net profit attributable to the shareholders of the listed company in the first half of the year to be 120 million yuan to 140 million yuan, a year-on-year decrease of 86.06% to 88.05%; Jingxing paper is expected to achieve a net profit of 110 million yuan to 150 million yuan in the first half of the year, a year-on-year decrease of 43.37% to 58.47%.
According to this trend, it is likely that the waste paper market will continue to decline, but by August 1, the waste paper market had changed from a comprehensive decline to a mixed rise and fall. According to incomplete statistics, among the 11 paper mills that changed the purchase price of waste paper on that day, five fell and six increased.
This is probably because the waste paper recycling station is preparing to "stock up" to welcome the possible recovery of the box board corrugated paper industry in September, which is the good expectation of the waste paper market for downstream paper mills. In fact, the whole industry is waiting for a turning point, and the approaching of Mid Autumn Festival, national day, double 11 and other festivals make the market expected to gradually enter the peak consumption season, and the upward probability of the waste paper market from September to December increases.
Everyone will lose, and everyone will prosper. The downturn of the waste paper market has been reversed, which indicates that the box board corrugated paper industry may also usher in a peak season. However, the difficulty in increasing the demand of downstream packaging manufacturers has always been a problem that the box board corrugated paper industry can not solve.
Paper mills looking for a new path?
2018 is the beginning of the decline of the box board corrugated paper industry.
As the largest paper type in China, the output of box board corrugated paper has maintained a stable growth trend until 2018, and even reached the highest point of annual output and sales in the past decade in 2017. Then, the situation took a sharp turn for the worse. In 2018, the output of box board corrugated paper showed negative growth for the first time. At that time, due to the slowdown of domestic demand, the price of box board corrugated paper continued to fall, and the profit narrowed, leading to a decrease in the enthusiasm of paper mills for production.
From 2018 to now, the output and growth of box board corrugated paper have not been stable. As can be seen from the figure below, the growth curve has been wavy. By 2021, the year-on-year growth will reach 20.5%. However, since 2022, the price of box board corrugated paper has been falling from mid April to now, leading paper mills have been forced to shut down for renovation, which is obviously not a good sign.
In addition to the sluggish demand of downstream packaging enterprises, the promulgation of the "waste prohibition order" has also increased the cost of the supply side. The whole industry has been "cautious" all the time, and is cautious about innovation and change on both the demand side and the supply side. It has to be said that the domestic box board corrugated paper industry is in a major transformation cycle in the past five years. How to improve the industrial concentration, broaden the base paper procurement channel, and provide integrated packaging services for end users are the focus of current development.
Obviously, the development of the box board corrugated paper industry has fallen into a bottleneck period and is in an awkward position.
Due to the rising cost of raw materials, the alternative packaging of box board corrugated paper promoted in Europe and the United States has come into the public's view, which is tantamount to adding insult to injury to the already depressed box board corrugated paper industry. Most large enterprises in the FMCG, catering and retail industries have begun to try to use imitation cow cards instead of cow cards to save costs. According to data, in Europe, the increment of imitation cow cards produced with recycled box cardboard is usually 20% - 25% higher than that of raw cards.
Among them, the alternative packaging of box board corrugated paper includes pallets, crates and shrink packaging, among which shrink packaging is widely used. The recent explosion of prefabricated dishes has promoted the development of fast food box shrink packaging machines and bowl packaged prefabricated dishes shrink packaging machines. However, in terms of recyclability, reusability and disposability, box board corrugated paper has absolute advantages. Unless forced, box board corrugated paper will not be eliminated.
However, the public's vision is still shifting to alternative products, although corrugated box board can not be completely replaced, so the demand of downstream enterprises becomes crucial. However, the growth of the industry has been ups and downs, and it is impossible to guarantee a continuous positive growth. In general, if the box board corrugated paper industry wants to break through the bottleneck, it needs to at least coordinate the relationship between the cost side, the demand side and the supply side, and find a balance point for each other.
The development of the industry has always been ups and downs, the constraints of the box board corrugated paper industry have not been eliminated, and there are still many difficulties and challenges on the way forward. Although the consumption environment can not be improved in the short term, in the long run, with the improvement of consumption desire, this industry is bound to die easily.
