【SHARE】 July corrugated paper market: gross profit margin declines, future trend to be observed
In July, the corrugated paper market showed a downward trend in gross profit margin and a narrow decline in the enthusiasm of paper mills to start production. The supply-demand contradiction in the market remained prominent, but the cost and scale of paper mill actions also brought certain variables to prices.
Narrow decline in gross profit margin, cost and price game
From the gross profit margin data, as of July 29th, the gross profit margin of corrugated paper decreased by 1.33 percentage points compared to the previous period, and the decline expanded by 0.43 percentage points compared to the previous period. Behind this change is the dual effect of cost and price.
In terms of raw materials, the market price of waste yellow cardboard has slowly increased, while the monthly average price remains unchanged compared to the previous period. This month, the overall supply of waste yellow cardboard has decreased, with a decrease in the recycling volume of packaging stations in the first half of the month. The rainfall in the second half of the month has also affected recycling and delivery, resulting in a gradual decrease in the arrival volume of paper mills. According to data from Zhuochuang Information, as of the 29th of this month, the monthly average price of the waste yellow cardboard market was 1473 yuan/ton, which remained unchanged from the previous month and increased by 2.00% compared to the same month last year. The price of corn starch increased by 1.06%, and the comprehensive cost increased by 0.09%.
In terms of price, the corrugated paper market in July showed mixed ups and downs, mainly dominated by horizontal consolidation. In the first half of the year, the policies of large-scale paper mills fluctuated, and the market supply and demand pressures were high, resulting in a weak and volatile trend; In the second half of the year, large-scale factories continued to raise prices, leading to an increase in the willingness of small and medium-sized paper mills to follow suit. The price increase area expanded, and the price center shifted slightly upward. However, the improvement in downstream orders is not significant, and the expectation of demand increment is bearish, resulting in low purchasing enthusiasm. As of July 29th, the monthly average price of 120g AA grade corrugated paper in the Chinese market was 2511 yuan/ton, a decrease of 33 yuan/ton from the previous month, a decrease of 1.30% compared to the previous month, and a year-on-year decrease of 4.01% compared to the previous month. The rise in comprehensive costs and the decline in market average prices have jointly led to a month on month decrease in the gross profit margin of the corrugated paper industry.
The market has experienced a narrow downward trend in production, highlighting the supply-demand imbalance
The estimated operating load rate of the corrugated paper industry in July is 59.17%, a decrease of 0.97 percentage points from the previous month's 60.14%, and a shift from an increase to a decrease from the previous month, but an increase of 1.46 percentage points from last year. Affected by profit pressure in July, there was an increase in shutdowns and maintenance of paper mills, resulting in a narrow decline in the enthusiasm for starting production.The improvement on the demand side is limited, and downstream packaging factory orders remain stable. The expected increase in demand for corrugated paper is bearish, and the purchasing enthusiasm is not high, resulting in a more obvious supply-demand contradiction in the market.
Future construction may continue to decline, with expectations of a narrow upward trend in prices
Looking ahead to the future, in terms of production, some paper mills in Qinhuangdao, Hebei Province plan to shut down for maintenance from August 1st to 15th. Production in some areas will decrease, and the operating load rate may continue to decline.
In terms of price, although there is still supply and demand pressure, given the strong trend of the raw material waste paper market, the cost center has shifted upwards, and large-scale paper mills continue to release price increase plans, boosting market confidence and providing some bottom support for corrugated paper prices. Therefore, there may be a narrow upward trend in corrugated paper prices in early August.
Overall, the corrugated paper market experienced a decline in gross profit margin and production in July. Although facing supply-demand contradictions in the future, prices may increase slightly due to the cost and scale of paper mills, and the market trend still needs to be closely monitored.
Transferred from the packaging and printing industry portal - Paper Box Network https://www.cnzhixiang.com/news/103/2/6388.html
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