December 17,2020

GPMA editor team

   At the beginning of December, several paper mills in Fujian Province and Qinhuangdao announced an increase in finished paper by 50-100 yuan (USD 7.65~15.29)/ton, stating that raw paper production costs increased due to the rising price in raw material. Sooner paper mills in Guangdong and other places issued price increase letter one after another.

   On December 8, Dongguan Jianhang Paper claimed an increase by 50 yuan (USD 7.65)/ton of corrugated paper, Dongguan Jinzhou Paper announced its high-strength corrugated paper increased by 100 yuan (USD 15.29)/ton.

   On December 9, Dongguan Hongye's high-strength corrugated paper price increased by 50 yuan (USD 7.65)/ton, and Guangdong Jiangmen Qiaoyu Paper's increased by 100 yuan (USD 7.65)/ton.

   People hold different views in regards of the price rising. It might need to wait for a bit longer to see whether the downstream order is affected. 

   For one thing, paper mills indeed are forced to raise the price as raw materials’ price is rising. For another, this also reflects that it is expected to see increasing demand in the downstream in mid-December. Though it may not be that much, paper mills still want to seize the chance to alleviate the 2020 revenue pressure.

   We believe that although paper mills are raising their price, it should be difficult to cause a nation-wide trend. The e-commerce shopping festival in December in China may bring increased demand, but it’s hard to maintain optimism on its sustainability.

   But at the same time, the price of raw paper won’t see a sharp fall because of the ban on importing waste. In 2021, foreign waste import will be forbidden, which will inevitably lead to the replenishment of imported paper.

Let's take a look at the import and export of corrugated paper in China in the first three quarters of 2020.

Imports have increased significantly, while exports are very limited

   In the past five years, China's total imports of corrugated and containerboard paper have been increasing year by year, with an average growth rate of 124.89%. From January to September 2020, China's total import of corrugated paper is about 2,782,400 tons.

   The export of China's corrugated paper sees a decline following the short period increase. From January to September 2020, China's corrugated paper export volume is relatively low, with an export of about 34,200 tons.

   In terms of import, corrugated paper prices rose at the beginning of the year, resulting in high import volume in the first three months. In March, the import volume increased to 325,800 tons. While China’s corrugated paper plunged in price since April, the imports began to decrease and hit the bottom in May. The imports have rebounded in the following months after May of corrugated paper continued to increase, and reached 452,500 tons as of September.

   In terms of export, the average monthly export volume of corrugated paper was basically stable at about 3,500 tons from January to September. Export volume reached 5,400 tons in March while is rather low in the rest months.

Indonesia is the leading exporter of corrugated paper to China, followed by South Korea; Vietnamese and Indian export volume also see significant increase  

   From January to September 2020, China's corrugated paper imports mainly from Indonesia, South Korea, Vietnam, India, Thailand and other countries and regions with imports volume at 886,500 tons, 355,900 tons, 355,000 tons, 238,900 tons, and 195,600 tons, 136,600 tons, and about 614,500 tons in other regions respectively.

   China’s import volume from Indonesia increased 69.31% compared with previous year, accounting for 31.86% of the total. Indonesia tops other countries.

   Following Indonesia, China’s import of corrugated paper from South Korea in 2020 sees an increase of 33.14%, accounting for 12.79% of the total.

   In addition, China’s imports of corrugated paper from Vietnam and India in 2020 increased 84.51% and 96.19% respectively when compare with previous year.

Laos is the leading importer of China’s corrugated paper, followed by Vietnam

   From January to September 2020, China's corrugated paper is mainly exported to Laos, Vietnam and other countries and regions, with export volume at 12,700 tons, 4,900 tons, and 2,500 tons respectively.

   Export to Laos in 2020 accounting for 37.15% of the total, tops other countries. Second to Laos, export to Vietnam accounts for 7.38% of the total.

South China and central China cities including Guangdong, Fujian, Zhejiang and Jiangsu are the main import destinations

   From January to September 2020, China's corrugated paper imports are mainly concentrated in Guangdong Province, Fujian Province, Zhejiang Province, and Jiangsu Province, with imports of 1,129,800 tons, 569,600 tons, 413,600 tons, and 323,200 tons respectively. Among them, imports volume through Guangdong Province accounting for 40.61% of the total, followed by Fujian Province, the import volume through which accounts for 20.47%. The remaining provinces account for small proportions.

   From January to September, the imported corrugated paper is mainly used for ordinary trade, processing trade with imports (PI), and pure assembly processing (PA), with import volume at 2,670,400 tons, 61,200 tons, and 44,500 tons respectively. Corrugated paper imports for ordinary trade accounts for 96% of the total.

Guangdong, Chongqing, Shandong, Zhejiang and Fujian are the main export hubs

   From January to September 2020, China's corrugated paper export hubs are Guangdong Province, Chongqing City, Shandong Province, Zhejiang Province, and Fujian Province, with export volume at 7,300 tons, 7,000 tons, 6,300 tons and 3,200 tons respectively.

   Guangdong Province tops all other cities, with its export volume accounting for 21.24% of the total; Chongqing second to Guangdong, accounts for 20.58%and followed by Shandong Province, accounting 18.57%. The remaining provinces account for small proportions.

   From January to September, China's corrugated paper is mainly exported for ordinary trade, inbound (outbound) goods via export processing zone, processing trade with imports (PI), and other small-scale cross-border trade, withexport volume at 26,100 tons, 4,100 tons, 2,000 tons, 700 tons and 600 tons respectively. The export volume of corrugated paper for ordinary trade accounts for 76.29% of the total, and the other trade modes account for relatively small proportions.

   The ban on importing waste paper is about to take into effect in China. With some large-scale paper mills operating overseas and the shortage of domestic raw materials, it is expected to see the increase on t corrugated paper import volume, while the export volume will basic maintain the 2020 level.