May 2021

Pulp Capacity & Price Changes

• Suzano announces new 2.3 million tonnes/yr BEK project (‘Cerrado Project’) in Mato Grosso dol Sul state, Brazil, with a target startup in the first quarter of 2024. (RISI, May 2021)
• Domtar announced $100 hike for its NBSK and SBSK to North American customers in the first week of May, reversing its initial decision to leave prices flat. Its 634 thousand tonnes/yr fluff and SBSK mill remains in force majeure, ten weeks after the Arctic Blast forced the company to idle production at the mill. (RISI, May 2021)
• Brazil BEK exports marginally up 0.7% MoM in April (+22% YoY) to 1.39 million tonnes. (Comex Stat, May 2021)
• Suzano, Eldorado and Klabin announced to maintain $780/t as June price for BEKP in China. In Europe and North America, due to robust demand, they have announced new list prices of $1140/t (+50) and $1380/t (+60) for June intake respectively. (RISI, May 2021)
• Södra Cell announced new BSKP list price of $1380/t (+60) for June intake in Europe. (RISI, May 2021)
• Stocks of woodpulp at European ports declined 19% MoM to 1.12 million tonnes in Apr’21, down from 1.388 million tonnes in Mar’21. This also represents a 24.5% drop from the level recorded a year ago in Apr’20. (Europulp & Internal, May 2021)
• Paper Excellence aims to open 340ktpa NBSK Prince Albert pulp mill in Saskatchewan in 2023. (RISI, May 2021)

Apr 2021

Pulp Capacity & Price Changes

• Imported BEKP is currently transacted at $770-780/t and BSKP at ~$980-1000/t in China currently. (Internal & RISI, Apr. 2021)
• Chilean producer Arauco announced its May Order Intake offer prices in China after skipping Apr. allocation: BEK $800/t(+70), BSK $980/t(+80). (Internal, Apr. 2021)
• Brazilian BEK producers exported a total of 1.383Mt of hardwood pulp in Mar’21, of which 511kt are to China. Brazilian BEK export to China in 1Q 2021 totalled 1.414Mt, representing a 18% YoY drop as compared to the 1.725Mt in 1Q 2020. (COMEX Stat, Apr. 2021)
• Pulp producers report continued strong demand in North America this month, with the successful implementation of announced price increases (BSK: +$150, BEK:+$100). Pulp buyers have also been trying to secure additional volume on top of their contractual allocation to avoid the more expensive spot markets. (RISI, Apr. 2021)
• Paper Excellence announced permanent closure of its idle 240ktpa NBSK Mackenzie pulp mill, citing limited capacity and ongoing fibre availability issue. Production at the mill was originally curtailed in Jun. 2020 due to market impacts caused by Covid-19 and lack of economic fibre. (RISI, Apr. 2021)
• Suzano, Eldorado and Klabin announced unchanged BEK price ($780/t) in China for May intake, while setting $80 increase in North America and Europe. The announced price increase puts BEK at $1320/t and $1090/t in North America and Europe respectively. (RISI, April 2021)
• NBSK price announcements: Metsä Fibre announced $1300/t (+80) in Europe for May intake. Resolute Forest Products, Canfor Pulp and West Fraser announced $1665/t (+100) as their May NBSK offer price in North America. (RISI, April 2021)
• UPM Fray Bentos mill is currently in the midst of a scheduled maintenance downtime which runs from Apr. 18 till the first week of May; BEK production loss expected to be ~56kt. (RISI & Internal, April 2021)
• Pulp inventories at European ports increased 10.5% MoM in Mar. to 1.386Mt. Analysts pointed out that end-of-quarter inventory building to supply 2Q, coupled with sellers looking to sell more in Europe with European prices approaching China profitability levels, could have led to the higher port inventories. (JP Morgan, Apr. 2021)
• BHKP inventories at major Chinese ports in Apr. flat against Mar. (Apr’21: 1.27 million tonnes vs Mar’21: 1.29 million tonnes). (Internal, Apr. 2021)

Mar 2021

Pulp Capacity & Price Changes

• Hardwood producers Suzano, Eldorado and CMPC have announced new list price of $780/t for April intake in China. This is $50-60/t increase from their announced prices for March. April Softwood intake prices in China currently range between $980-1010/t: Celgar $980, Domtar & Northwood $1010/t. This is at least $30/t higher than the March intake prices. (RISI & Internal, Mar. 2021)
• Chilean producer Arauco announced that it has no Hardwood and Softwood allocation for China in April, as a result of production issue following downtime. (Internal, Mar. 2021)
• Further price increases in Europe and North America in April: BEK producers Suzano, Klabin and Eldorado have announced new list price of $1010/t (+100) in Europe and $1240/t (+100) in North America for April deliveries. North American Softwood producers Canfor Pulp and West Fraser have announced $1565/t (+145) for US NBSK in April. (RISI, Mar. 2021)
• Woodpulp inventories at European ports record the sixth consecutive month of decline (Feb’21: 1.25 million tonnes vs. Jan’21: 1.27 million tonnes, -1% MoM). BHKP inventories at major Chinese ports in Mar. declined against Feb. (Mar’21: 1.29 million tonnes vs. Feb’21: 1.34 million tonnes). (Europulp & Internal, Mar. 2021)

Feb 2021

Pulp Capacity & Price Changes

• Pulp prices continue on a strong rally, with the global pulp demand-supply balance tightening considerably.
• Hardwood producers including Suzano, Arauco, CMPC, Cenibra, Klabin, Eldorado have announced new list prices of $720-730/t for March intake in China. This is $100-110/t increase from their announced prices for Feb. Softwood producers have announced similar increases for their Mar intake: Arauco $900/t (+90), West Fraser Cariboo at $950/t (+150). (RISI & Internal, Feb 2021)
• With the previous price increases successfully implemented, hardwood producers including Suzano, Klabin and Eldorado have announced $910/t (+90) in Europe and $1140/t (+100) in North America for Mar deliveries. (RISI, Feb 2021)
• Woodpulp inventories at European ports continue to see drop month-on-month (Jan’21: 1.27 million tonnes vs. Dec’20: 1.31 million tonnes, -3% MoM). BHKP inventories at major Chinese ports in Feb rose against Jan, attributed to lunar new year break (Feb’21: 1.38 million tonnes vs. Jan’21: 1.16 million tonnes). (Europulp & Internal, Feb 2021)

January 2020

Pulp Capacity & Price Changes

• Hardwood and softwood prices in Asia have risen by more than $150/t and $200/t respectively since Nov 2020. The recent rally in pulp prices can be largely attributed to improving macro sentiment, low inventories on the supply chain (in part due to weaker production) and rising logistics costs [RISI, JP Morgan & Internal, Jan 2021].
• Hardwood suppliers Suzano, Arauco, CMPC and Eldorado have all announced a 3rd consecutive round of hike in Feb.
• --> For China market, current BEK prices are $620/t for contract volumes and $670/t for spot tonnages [RISI & Internal, Jan 2021) --> For Europe and North America, with the $70 Jan. BEK hike also realised, Suzano and Eldorado have tabled another round of $70/t increase, bringing BEK list prices to $820/t and $1,040/t in the two markets respectively [RISI, Jan 2021].
• Major ports see drop in inventory – wood pulp inventories at European ports saw a drop of 12% compared to previous month (Dec 2020: 1.31 million tonnes vs. Nov 2020: 1.49 million tonnes). Similarly, BHKP inventories at major Chinese ports record a drop of 9% against previous month (Jan 2021: 1.16 million tonnes vs. Dec 2020: 1.27 million tonnes] – [Europulp & Internal, Jan 2021]