Tissue Market Turns Bullish
The wood pulp tissue prices in Shandong and Hebei have been increasing since mid-December, while the price changes of bamboo and cane pulp tissue in Sichuan and Guangxi lagged behind. As of early January, the mainstream transaction prices of wood pulp tissue in Hebei has increased by RMB 700-800/mt, and those in Shandong and Henan were closely on par. The price of bamboo pulp tissue in Sichuan rose by RMB 300/mt, and some wood pulp tissue mills in East China managed to implement a roughly RMB 500/mt price hike.
Rising imported wood pulp prices magnify tissue mills’ cost pressure
The pulp futures price started to increase around December 7 of 2020, and the new round of wood pulp import offers was released around mid-December. The $30-50/mt hikes in import offers had boosted the market sentiment of the pulp futures market to some extent. In addition, a few leading producers were heard procuring feedstock at high prices. As a consequence, participants were optimistic about the future market.
On the back of rising pulp futures and pulp import offers, tissue mills passively followed the price rise. Most medium-to-small tissue mills held relatively small feedstock reserves and started purchasing after a certain period of consumption. As the cost pressure mounted, tissue mills raised their offers to prevent operating losses.
