Global rally sees pulp prices at record levels

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A fourth successive month of pulp price rises in the main Chinese market has seen a near 55% rise in market pulp prices to the end of March. The USD100/t rise in the price of Bleached Softwood Kraft (BSK) pulp recorded in March sawn prices at record levels, averaging USD980/t. Further increases are expected to see April prices hit something close to USD1,050/t.

The hardwood pulp equivalent – Bleached Eucalypt Kraft (BEK) pulp – has seen similarly large price increases (just below 50% over the last four months). Prices in March averaged USD710/t, with further increases also expected for April. Hardwood pulp prices remain below their peaks as the first chart shows.

China Chemical Pulp Prices by Grade and Spread: Jun ’10 – Mar ‘21 (USD/t)

Source: Hawkins Wright, Brian McClay & Associates & IndustryEdge


Beyond the actual level of pulp prices, there are two important matters to consider in understanding the recent rises.

Producer and consumer inventories are significant in dialing price movements in pulp markets. Right now, both producers and consumers are ‘short’, and that is flowing through to prices. Shipping disruptions, containers in the wrong locations and other delays imposed by the pandemic have wrought their havoc on pulp markets, like other commodities. There has been a view, supported by the evidence of input prices like those for woodchips, that from late 2019, the average pulp price was unsustainably low. 

One year ago, as the pandemic hit the globe, expectations were that pulp prices would turn up sustainably. They did not, and the result now is a very sharp rise in prices that may well prove to be equally unsustainable.

Our second point is that part of the evidence of the likelihood the softwood price has moved beyond equilibrium is the spread or differential between BSK and BEK. At an average USD270/t, substitution will act as a moderating factor on the higher-priced pulp.

Inventory and production capacity levels appear to support higher BEK prices, but they are not likely to bridge the big gap to BSK, even to the ‘normal’ spread of around USD100/t.

Already, Hawkins Wright reports there is production curtailment in China, associated with the high prices for BSK pulp. Our Korean colleagues have reported increased interest in pulp alternatives, including bamboo grades.

IndustryEdge continues its expectation that pulp prices will stabilise late in the June quarter, with April’s BSK price hikes likely to be the limit.

The lingering implication is that fair value for fibre is now being considered very differently to one year ago. Markets must expect the base prices for pulp to reflect the minimum value for wood fibre and other inputs into the future. The days of super-cheap pulp are likely to be over.


Global Chemical Pulp Prices: Mar ‘21 (USDCif/t)






Change on Prior Month


Change on Prior Month

North America*





Western Europe















Source: Hawkins Wright, Brian McClay & Associates, Pachem and IndustryEdge research

* Delivered


This is an edited extract of the monthly Pulp Market Briefing from Edition 189 (April 2021) of IndustryEdge’s monthly subscription data and analysis service, Pulp & Paper Edge. Each month, extensive analysis and commentary is linked with dozens of detailed data files for Australia and New Zealand, covering everything from latest price movements, major producer and importer activities, global market analysis and demand and consumption analysis.

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