Pulp prices in China continue to decline

Pulp prices in China continue to decline amid high inventories and weak demand

    The Chinese pulp market continues to show a downward trend. According to the SunSirs monitoring system, as of April 2026, prices for both softwood and hardwood pulp have decreased compared to the beginning of the month. High port stocks, weak seasonal demand and unwillingness of paper mills to purchase expensive raw materials put pressure on the market. Despite attempts by foreign manufacturers to reduce production and adjust supply prices, the domestic spot market remains under pressure, and traders are forced to lower prices to sell off stocks.

Price dynamics: coniferous and deciduous pulp decrease

    According to SunSirs, the price dynamics in the Shandong region (a key center for pulp processing and consumption) is as follows:

Technical picture (softwood pulp):

•     - The current price is trading below all moving averages.
•     - All moving averages are moving down synchronously, which indicates a steady downtrend.
•     - Each price rebound is suppressed by moving averages ("immediate rebound pressure").
•     - The slope of the moving averages has become steeper since mid-March, indicating an acceleration of the decline and the release of bearish momentum.
•     - At the moment, there are no clear signals of reaching the bottom in the short term.

    The sharper decline in softwood pulp prices is explained by the significantly higher inventory pressure compared to hardwood.

Suggestion: high stocks and pressure on traders

    Despite the fact that foreign pulp mills have taken steps to reduce production, these measures have not yet led to a significant reduction in supply volumes in the short term. Domestic spot reserves remain significant.

Port pulp stocks (as of April 2026):

•     - Total reserves in the main Chinese ports: 2,306 million tons.
•     - Decrease over the period: 46,000 tons (insignificant).
•     - Qingdao Port (the largest transshipment center): There is a slight downward trend, and the average daily shipment remains virtually unchanged.
•     - Changshu Port: stocks decreased, shipments decreased by 32,000 tons during the period.
•     - Other ports show multidirectional dynamics (accumulation or reduction), which reflects normal cyclical adjustments.
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Pressure on traders:

•     - The rate of import of pulp to ports remains stable.
•     - Traders are forced to sell stocks and offer price concessions to increase sales.
•     - Foreign price offers for April shipments, although adjusted, provide limited support to the domestic market due to low demand and significant discounts on actual transactions.
•  

Demand: off-season and unwillingness to buy

    April marks the off-season for pulp demand. The effect of the traditional peak season "Golden March — Silver April" has weakened this year.

Key demand factors:

•     - The volume of paper shipments has slowed down.
•     - The increase in paper prices is met with resistance from retailers and consumers.
•     - The profitability of paper mills remains low, which makes them strongly resist the purchase of expensive pulp.
•     - Procurement is currently focused on meeting urgent needs for replenishment.
•     - There are no large-scale centralized purchases.
•  

Market sentiment:

•     - Expectant moods prevail.
•     - Trading activity is sluggish.
•     - Traders are actively lowering prices to sell off stocks, which puts even more pressure on the overall price level.
•  

Futures market: low volatility

    Last week, pulp futures on the Shanghai Futures Exchange (SHFE) generally showed a weak, volatile trend with lower prices.

Data on the most active contract (as of April 2026):

•     - Opening price: 5,040 yuan/ton
•     - Closing price: 5,060 yuan/ton
•     - Maximum: 5,100 yuan/ton
•     - Trading volume: 36,400 lots
•     - Open interest: 149,690 lots
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Key pulp market indicators (April 2026):

SunSirs analysts' Forecast

    SunSirs analysts believe that the fundamental dynamics of supply and demand in the wood pulp market has not changed significantly recently. There remains a key contradiction between high port stocks and purchases due to an extremely urgent need.

Expectations for the near future:

•     - Market prices for pulp will continue to fluctuate in a range characterized by weakness and stability.
•     - The growth potential is limited.
•     - It is predicted that prices will remain mostly at low levels within a certain range.

Importance for market participants

• - The current situation creates opportunities for paper mills to replenish stocks at relatively low prices, but the lack of confidence in the recovery of demand for finished products constrains purchases.
• - Stock pressure remains high for traders. Price reduction strategies to accelerate turnover are becoming a priority.
• - For foreign suppliers, the Chinese market shows a limited willingness to pay high prices. Price adjustments and possibly further supply reductions may be required to balance the market.
• - For investors in the futures market, the current technical picture indicates a continuation of the bearish trend without clear reversal signals.

Tags: #China #pulp #coniferous forests #deciduous forests #prices #port stocks #demand #paper industry #futures #SunSirs