After the trend reversal initiated in April for the mass grades of recovered paper, May saw some more significant price reductions. The reason for this is the calming demand in the UK and in some Asian markets.
Recovered paper converters in the packaging sector are still working hard to pass on persistently high recovered paper costs to their customers: recycled corrugated case material became more expensive again in May in some instances. Recycled cartonboard also cost more.
Meanwhile, talks about second-half publication paper prices are in full swing, and paper producers are not shy about their intentions: facing historically low prices and massive cost increases in recent months, they are seeking substantial price hikes for newsprint and magazine paper. Since publication paper manufacturers are eking out paltry or barely any profits, they are determined to only deliver paper at a substantial price increase from 1 July onwards at the latest.
Woodfree coated and uncoated paper manufacturers are experiencing similar cost and margin pressure. However, they managed to institute higher prices in their segment of the British market in April, with additional mark-ups set to follow before the summer.
Demand for several types of packaging paper and graphic paper that were less sought-after during lockdown has strengthened a little as the UK has eased measures to combat the spread of Covid-19. With restaurants and some retailers reopening their doors and summer tourism picking up, market players think that there is a chance of better demand in the third quarter.
This article is an excerpt from EUWID's report on the paper and board markets in the UK.
Find the entire report and the EUWID Price Watch UK for May in EUWID Pulp and Paper issue no 21/2021, which will be available to our e-paper and print subscribers as of 27 May.