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Delta Variant Upsets Paper Industry In Dongguan
2021-06-28 12:40chinapaperonline.com
The new and most contagious Delta variant of COVID-19 is now upseting social lives and creating great difficulties to business in Southern China's Guangdong Province. Latest reports from Dongguan – a municipality north of Shenzhen where the variant was earlier detected - said that transportation of inbound raw materials and outbound products of factories was slowing and vigilance on personnel safety and mill operation was raised to a much higher level by company management and local government at the same time. For example, Machong, a township inside Dongguan where Nine Dragons' production complex is located, is now a closed zone due to the detection of infection. Main roads are subject to traffic control and all vehicles, except those holding special permits, are prohibited from passing.

Dongguan is the paper and board production hub of Guangdong Province, housing many mainstream paper and board companies such as Nine Dragons, Lee & Man, Jianhui Paper, Jinzhou Paper and Jintian Paper. Among the 24.36 million/mt of paper and board output of Guangdong Province in 2020, Dongguan contributed around 2/3 of the total, with the complex of Nine Dragons in Machong alone turning out nearly 6 million/mt of recycled fiber based containerboard, coated duplex board and offset printing paper from its 16 state-of-the-art PMs.

Market observers hope that the assault of the Delta variant will be brought under control as quickly as possible by the joined efforts of all walks of life, without severe damages to the flows of recovered paper and industrial packaging paperboard in Southern China in the meantime and not to fuel up price escalation of linerboard, medium and duplex board in particular. If, however, the pandemic continues and administrative restrictions are further intensified, tight supplies of recovered paper and finished paperboard may spread to other parts of China. As a result, prices of recovered paper and industrial packaging paperboard, together with cost of transportation, energy, etc., will become more volatile in the summer than its traditional low-season past.

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