Guotai Haitong Securities released a research note stating that pulp and paper price declines slowed in July, with box and corrugated paper prices rising in the mid-to-late period. The firm expects pulp prices to recover from the bottom, white paper prices to gradually stabilize and rise, and black paper to continue its upward trend. Supply-demand imbalances persist in cultural paper, while upstream waste paper prices for box and corrugated paper showed an upward trend with relatively stable average prices, providing reasonable cost support and certain bottom support for corrugated paper prices. Imported hardwood pulp maintained prices at $500/ton for select sources, while mainstream prices stood at $490/ton. Imported softwood pulp external prices remained largely stable.
**Cultural Paper: Paper Prices and Costs Declined Simultaneously, Supply-Demand Imbalances Persist**
As of July 29, the July market average price for 70g wood pulp high-white offset paper was 5,094 yuan/ton, down 57 yuan/ton month-over-month (a 1.11% decline) and down 525 yuan/ton year-over-year (a 9.34% decline). First, paper mill quotations showed minimal adjustment in early July, but with lackluster social-level shipments, some transactions loosened. Second, concentrated delivery of publishing orders during the month alleviated inventory pressure for paper companies, though social-level orders remained mediocre and distributors remained cautious in purchasing. Third, downstream printing plants showed limited follow-through on new orders, with declining production in some regions, slow raw paper consumption, and average distributor shipment pace. Fourth, upstream raw material wood pulp average prices continued declining, further weakening cost support for offset paper.
**White Paperboard: Off-Season Paper Prices Continued Declining, Profitability Dropped Month-over-Month**
As of July 29, the market transaction tax-inclusive monthly average price for 250-400g flat white cardboard was 4,036 yuan/ton, down 1.25% from June and 9.02% below the same period in 2024. First, overall market oversupply persisted, with most enterprises maintaining normal production during the month, slow inventory digestion by traders, and pressured market shipments. Second, overall terminal demand remained weak, and coupled with unstable paper prices, customers adopted cautious purchasing strategies. Small and medium-sized paper mills offered limited-time promotional discounts, large enterprises implemented flexible pricing policies, and traders began offering concessions to boost volume in the mid-to-late period. Third, domestic new capacity commissioning and trial production, along with declining white paperboard prices, created bearish market sentiment, while limited phased rebounds in raw material pulp prices failed to effectively transmit positive emotions to the market.
**Box and Corrugated Paper: Continuous Price Increases in Late Month, Though Paper Prices & Profitability Still Declined Month-over-Month**
As of July 29, China's corrugated paper market monthly average price was 3,449 yuan/ton, down 52 yuan/ton from June's average of 3,501 yuan/ton, representing a 1.49% month-over-month decline and 5.03% year-over-year drop. First, early-month large paper mill prices showed mixed movements, with small and medium-sized mills showing low price adjustment willingness and mixed market price trends. In the mid-to-late period, driven by continuous price increases from large mills, small and medium-sized mills showed increased enthusiasm for following price increases, driving narrow market price adjustments upward. Second, downstream packaging plant orders performed poorly overall with insufficient order intake. Early-month wait-and-see sentiment was strong with low raw paper purchasing enthusiasm. Late-month price increase sentiment drove some bottom replenishment, slightly improving market trading atmosphere. Finally, upstream main raw material waste paper prices showed an upward trend with relatively unchanged average prices, providing reasonable cost performance and certain bottom support for corrugated paper prices.
**Wood Pulp: External Price Decline Moderation, Strong Supply-Weak Demand Pattern Difficult to Improve**
Imported hardwood pulp maintained prices at $500/ton for select sources, while mainstream prices stood at $490/ton. Imported softwood pulp external prices remained largely stable. First, declining daily gross margins in the downstream raw paper industry suppressed paper mill pulp purchasing enthusiasm, leading to insufficient demand follow-through. Meanwhile, current pulp market supply showed loose conditions with limited momentum for supply-demand relationship improvement. Combined with the bottom range effect formed by price fluctuations and declines from February to June, this collectively led to month-over-month declines in July average prices for imported softwood and hardwood pulp. Second, both supply and demand sides of imported unbleached pulp and imported chemi-mechanical pulp markets showed weakness, with prices displaying fluctuating downward trends, creating downward pressure on July average prices. Third, since July, the "anti-involution" theme has spread from single varieties to the entire market chain. Accompanied by continuous policy expectation momentum, market bullish sentiment remained high with strengthened spot-futures linkage effects, driving certain upward movements in daily prices for imported softwood and hardwood pulp spot markets during the month, somewhat moderating the July average price decline.
**Risk Warning:** Overseas wood pulp supply chain disruptions, downstream consumption demand falling short of expectations, etc.