Recent months have seen imports of a number of advertising and publishing grades fall for short periods, before recovering soon after. In particular, this has impacted the coated woodfree grades and sheeted products in particular.
While the impact has been significant in the large volume C2S 150 gsm sheeted grade is not subject to restrictions and provides a very useful example. The last twelve month’s imports are displayed in the following chart.
Imports of Coated Woodfree Sheets (C1S) >150 gsm by Country: Mar ’14 – Feb ’15 (ktpm)
The import trade for heavier-weight sheeted grade has experienced some turbulence over the last year, however the drop off from October 2014 has been dramatic and sustained. The average import volume over the five month to end February 2015 has been just 287 tpm, down from an average 1,734 tpm for the seven months prior.
It is equally plain to see that the country that has taken virtually all of the pain is Korea. Chinese suppliers have also been hit, but not as dramatically. We anticipate, based on industry advice, that Korean suppliers have also taken large import declines in other sheeted grades, but as described earlier, the confidentiality restrictions make that situation opaque.
Countries providing continuing supply are diverse and delivering almost meaningless volumes, though the continuation of supply from the United Kingdom is the only stability left in the grade, at this time.
The only conclusion that can be drawn is that the major importers – merchants in the main – are running down inventories before new purchases are made. Different financial years may contribute to that approach and no merchant, especially one under financial pressures, will be in a position to hold very much stock.
The depreciation of the Australian Dollar has made supplies from some Asian countries, Korea and China in particular, far less competitive compared to the European supplies. This is because the Euro has also declined. That is also impacting the trade. IndustryEdge is aware that switching has occurred in part or in full, by a number of merchants.
Doubtless the Korean producers and their Chinese counterparts (mainly Asia Pulp and Paper), are continuing to pursue market share in Australia, but thanks to currency, they face difficulties in doing so.
In the next edition of Pulp & Paper Edge [Edition 119], in May, we will provide a three-quarter market review and provide full year forecasts for major printing and communication grades.
Originally published in Pulp & Paper Edge in April 2015. For subscription and service enquiries, contact email@example.com.