After a month of unsteadiness, China market for both paper-grade wood pulp and recovered paper appears to have regained power to move on. This follows the revitalization of market pulp futures in the Shanghai Commodity Exchange (SCE) which began to rebound to RMB7,200/ mt for NBSK from April 2nd and boosted spot listing of NBSK to about RMB7,240/mt in upper China market, gaining 4.7% from end-March. Momentum also extended to BHK, which edged up to the RMB5,500/mt range at the same time. Encouraged by the positive movement in market pulp, recovered paper market also showed signs of bottom-out. Regardless of minor dips in OCC, price of recovered brown board edged up 3.41% to deliver at the RMB2,300/mt range by the 2nd week of April.

More market analysts concluded that the magnitude of negative performance on either market pulp or recovered paper in March were less than initial fears and impacts on paper and board market as well as converted product market were quickly dealt with by actions of paper and board producers, including further price increases in industrial packaging board on the one hand and extended downtimes taken by Nine Dragons and other mainstream companies on the other. And expecting the end of low season after April, mills will begin their active buys for both virgin pulp and recovered paper in preparation for the high season. In spite of actions from mainstream recovered paper buyers including Nine Dragons and Shanying Paper to lower their sourcing price by about RMB50/mt in mid-April, which has caused concerns of no quick reactivation of the market by some analysts, recovered paper suppliers in key regional markets are in fact poised for a new price hike.

The latest 8.4% growth projection by IMF for China's economy in 2021, which was up 0.3 percentage points from the organization's January forecast, also gave a shot in the arm for the country's paper industry and the market. "…Effective containment measures, a forceful public investment response and central bank liquidity support have facilitated a strong recovery", according to IMF. And such a prediction seems to be proven by a record 19% jump of the country’s GDP in the 1st Quarter from a year earlier by a recent Reuters poll! Along with China's strong economic growth, USA and other major economic powers of the world are also embarking on the road of recovery in 2021. All this has convinced the market and the industry of strong and consistent demand for paper and board, especially in the packaging paperboard sector for both domestic and export consumption. Though market activities may be moderate in the 2nd Quarter, most market analysts remain hopeful that the full year 2021 will be most fruitful to all players of the market from fiber supply to paper and board production and conversion.