Rising Raw Materials Gave Rise To Price Surges Printing Industry Accelerated Differentiation

- May 26, 2018-

Rising raw materials gave rise to price surges Printing industry accelerated differentiation


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Recently, with the domestic papermaking industry have announced price increases, more than 30 original paper mills have announced that they will increase the factory prices, and a new wave of raw paper prices will hit the market. “Coated paper and Shuangjiao range from RMB200 to RMB300 per ton.” The relevant person in charge of Jingcheng Printing told reporters that the price of paper keeps rising, but many orders are contracts that were discussed years ago, and the current printing industry is competitive. Intense, finished product prices fluctuate little, and profits can only be compressed.


Xiamen packaging industry: corrugated paper rose by eight or nine hundred yuan per ton!


Industry sources told reporters that there are relatively few paper mills in Xiamen, and the raw materials mainly come from Jiangsu, Zhejiang, and Guangdong. Recently, they have received 6 price-raising letters issued by the original paper companies - Chenming has increased its cultural paper products by 200 yuan/ton since March 1. As of the 1st of April, the company has copied all brands of paper and paper. On behalf of the processing brand increased by 200 yuan / ton; Henry Paper announced that from March 1 on the basis of the current sales price of the base paper to increase 200 yuan per ton. It is understood that more than 30 paper companies have announced price increases.


“The corrugated paper used for the production of color box packaging has risen fiercely, and has gone up by 890 yuan per ton!” She said that as the cost continues to rise, the price of finished products can only follow the "high rise", otherwise the company can not continue.


Raw material prices rise, supply exceeds supply


With the environmental protection departments adopting more stringent control policies for the paper industry, raw materials supply has been affected to varying degrees whether it is manufacturing or waste paper imports.


It is understood that since March 1st, the State has officially implemented the "Environmental Protection Control Standard for Imported Solid Wastes as Raw Materials - Waste Paper or Paperboard," and the requirements for the control of general inclusions in imported waste paper have been tightened to "total" The weight should not exceed 0.5% of the weight of imported waste paper," a substantial reduction from the previous 1.5%. At present, 36% of waste paper raw materials required by China's papermaking industry come from imported waste paper, and 64% come from domestic recycling. Restricting the import of waste paper will undoubtedly bring gaps to raw materials in the domestic papermaking industry within a certain period of time.


“This price increase is a collective rise in the prices of various types of white cardboard, wrapping paper and other categories.” Industry sources told reporters that the price increase was driven by the national environmental protection policy, the transformation and upgrading of paper products industry once again "Painful pain."


In recent years, China has constantly increased the efforts to renovate environmental protection. Many small, backward-looking paper mills operating at low cost have already been eliminated. The standardization of production of paper-based enterprises by scale has indeed brought about cost increases. Especially during this period after the Spring Festival, the major paper companies will enter the daily shutdown maintenance season, further shrinking production capacity and aggravating the market's supply and demand tension. The rise in raw material prices, coupled with the shortage of supply in the market, gave birth to this surge in prices.


In addition, the import quota management system for waste paper implemented in China also increases the supply of raw materials for commercial paper. From the list of the seven approved waste paper import license companies that have been announced by the Ministry of Environmental Protection, the total of three paper companies, including Xiaolong, Liwen, and Shanying, have been approved to account for 56% of the approved total. It can be seen that the industry's brand concentration is increasing, and the scale paper mills will increasingly have “speech rights” in product pricing.


Newsprint and household paper are relatively stable at present


However, the reporter also learned that, since 2017, affected by the increase in raw materials prices, newsprint and household paper prices have also been affected, but the relative is relatively stable. This wave of price increase after the holiday season has not yet been affected by newsprint and household paper. "We haven't received notification of price increases after the holiday." Wang Dian, the person in charge of the printing company of Xiamen Daily, told reporters.


When the reporter visited the Yonghui Supermarket and the surrounding convenience stores in Pinang, it found that there were no signs of price hikes for household paper such as napkins and rolls of paper. “There has been a slight increase in 2017, but since the holiday so far, prices have not changed much, and there has been no notice of price increase.” said Zou Xiao, the person in charge of the convenience store.


The reporter noted that the prices of rolls in supermarkets are basically 20-30 yuan per 10 rolls, and some brands are selling at around 18 yuan. The price of napkins is also about the same as on weekdays. The prices of mainstream brands such as Vinda, Breeze, and Heart India are basically 10 packages ranging from 10 yuan to 12 yuan.


Insiders pointed out that the rise in paper prices will intensify the differentiation of the printing industry, and the survival of the fittest will become more apparent. It is expected that the 2018 will be a year for printing companies to reshuffle.


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