Reflections on the hottest Asian newsprint market

Reflection on the Asian paper market

since the first quarter of this year, the paper price in the Asian market has continued to decline. Looking at the development of the market in this region, there are several aspects worthy of reflection

first, many insiders analyze the cycle of the pulp and paper market mainly based on the changes in its supply, but the controversial point is that papermaking is a capital intensive industry, which will inevitably form a large increase in new production capacity after investment, resulting in the volatility of product prices. In addition, demand changes more frequently, and the degree of change is often greater than that of supply. At present, the price of paper is declining, mainly due to the reason on the side of the demander (the key functions of other composite materials also include magnetic, resistive and optical properties, which are caused by slower economic growth and sharp increase in inventory), just as it was during the recession from 1998 to 1999

second, excessive inventory is also an important factor, which is part of the reason why prices in Asia are more unpredictable than those in other regions. Users in Asia prefer to hoard more because of the long purchase journey from some manufacturers, the lack of stock in the spot market when the supply is tight, and the insufficient prediction of the price trend. The reason behind the grim situation of paper prices in Asia this time is that printing companies hoarded a large amount of inventory in the first quarter of this year, and the market did not judge the sealing performance of samples based on the amount of this batch of inventory; Some people in the industry think that keeping the paper inventory confidential can put them in a favorable position in the market. So far, we still don't know much about how much inventory can be reduced in the next few months, but people have begun to question this

third, because most of the transactions in the Asian market are carried out in the form of spot, its price system is very fragile, and North America and Europe will sell their excess products to the Asian region when the market is weak. This is because users in Asian countries have always been enthusiastic buyers in the spot market. When the markets in North America and Europe are tight, users in Asian countries often beg manufacturers to improve their production and operation rates, and are willing to buy their products at a higher price or re purchase from their long-term customers

fourth, although the paper production in Asia will soon be self-sufficient, the market for this kind of paper is global. In fact, through communication, information, exchange, logistics support, the reduction of trade barriers, Asia and the rest of the world have become closer and linked as a whole. When the rise in the price of paper in the United States was resisted in March this year, that is, the monthly income of production assistants in Asia was also more than 2000 yuan, which signaled that the price of paper rose to the end. The price of paper in Asia generally fell in the second quarter

previously, some market analysts said that from 1992 to 1997, countries in Asia imported 30% of the paper they needed from the rest of the world. Later, due to the rapid growth of paper production capacity in Asia from 1996 to 1998 (currently China is still building), this figure was reduced to 15%

with the rapid development of information industry, the market has become more transparent and efficient. Not only can the global manufacturers accurately know what happened in the Asian market, but also the manufacturers in the Asian region can accurately grasp the sales opportunities in the markets in other regions of the world. However, at present, we still cannot predict the price trend of paper in the Asian region, because its market situation is still volatile