Printing and writing paper or graphic papers can be used for a variety of end use applications such as Books, Magazines, Office printing and writing paper, Brochures, Pamplets, Paper labels, leaflets, inserts etc. Graphic papers at a high level can be classified into coated and uncoated, woodfree and mechanical papers.
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Sappi Europe announced price hikes for its range of Woodfree Coated and Uncoated papers by 8-10%August 04, 2022
Nippon Paper implementing price hikes for printing and business communication paperJuly 14, 2022
Drastic Increase in Paper PriceAugust 29, 2022
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Paper market frequently asked questions
Beroe's paper industry analysis finds out that the major players in the industry are Asia, LATAM, and MEA.
As per Beroe’s category intelligence report, the global production volume of paper will multiply at 3.5-4% CAGR during 2020-2025, reaching around 69 million metric tons (MMT).
The global paper industry statistics suggest that the global demand for paper is declining, so is the demand for North American and European writing and printing paper. One of the major cost drivers for the paper industry as per the paper industry report by Beroe is raw materials.
A majority of the global paper market revenue will come from food and beverages. Moreover, market players are exploring potential avenues in pharmaceuticals and consumer packaged goods (CPG).
The global paper industry report by Beroe reveals that global paper demand is expected to decline at a CAGR of 4-5%.
Despite the countrywide lockdowns and subsequent supply chain disturbances amidst the COVID-19 crisis, leading paper producers are striving to satiate the growing demand for tissue papers from healthcare institutes. Moreover, the public-health crisis is influencing manufacturers to develop antimicrobial tissues that are efficient in combating the COVID-19 infection.
The major price drivers for the global paper industry are supply and demand. Supply disruptions like mill closures can lead to price fluctuations. Some of the other price drivers are raw material cost, labor cost, and energy and chemical cost.
Rising internet penetration, along with increasing usage of electronic gadgets, has driven online retail sales worldwide, especially in emerging regions – China, India, and Brazil. Consumers are increasingly shifting toward digital channels to purchase various essential products. Moreover, paper packaging is lightweight and convenient for transportation and logistics. As such, the booming e-commerce sector will push the demand for corrugated boxes and paper bags over the years ahead.
The increasing shift from petroleum-based resin to eco-friendly alternatives, such as paper-based formats, starch, and biodegradable films, and product customization are significantly influencing the growth curve of the global paper market.
Paper market report transcript
Global Paper Market Outlook
- The global paper market is witnessing a decline, except for Asia and Latin America (LATAM). Digital media usage has enormously increased globally and driven down by the demand for both newsprint and P&W paper grades.
- The most affected grades are newsprint and office paper. Newsprint has been most severely affected due to the loss of advertising and readership. Office paper has been affected due to the electronic exchange and storage of information.
- North America and Western Europe are well-matured regions, showcasing declines of 3–4% characterized by slow demand, closure of mills, consolidation and conversions, while LATAM and Asia showcase a modest growth of 0–1%.
Global Paper Market Overview
- Global demand for papers has been declining and among this, printing and writing paper demand is expected to decline at a CAGR of 2.2-2.9 percent until 2020, whereas Newsprint is expected to decline at a CAGR of 4–5 percent
Demand for North American and European Printing and Writing paper is expected to decrease by about 5 percent/year, due to the rapid development of the internet and e-commerce business models
Asia, LATAM, and MEA are the only regions witnessing positive growth in paper
In 2017, pulp witnessed a robust growth in the global demand as well as low pulp and paper inventories of Chinese paper and cardboard manufacturers, which, together with limited supply, created favorable conditions for price increase.
Raw material is one of the key cost drivers for paper. This is because it constitutes 60–65 percent of the total cost of production. In case of paper, the cost of procuring pulp is an essential element to determine the cost structure of different grades of paper.
According to the paper price forecast, supply-demand is one of the key and foremost drivers of price in the paper industry. Any increase/decrease in demand from the end-user segment will lead to manufacturers announcing price changes, even without any movement in the other costs.
The paper price forecast 2020 shows that supply disruptions like down time, mill closures by manufacturers or natural disasters would lead to shortages or a limited supply, attributing to price fluctuation. Similarly, reduced demand could lead to price declines.
China, being the major exporter of paper, has large demand for pulp which it generally procures from North/LATAM.
Global Paper Market - Drivers and Constraints
Explosive Growth of Online Retail
Surging penetration of the internet and smart gadgets has favored online retailing in emerging regions such as India, China, and Brazil. Consumers are turning to digital channels for purchasing food, cosmetics, and groceries. Paper packaging is lightweight and convenient for logistics and transportation. As such, with the rapid growth of e-commerce, the demand for paper bags and corrugated boxes will increase over the projection period.
Demand for Eco-friendly Products
Paper is the most recyclable and sustainable product at present. Considering the increasing environmental concerns, both consumers and market players are turning to more sustainable paper packaging solutions. Prominent cosmetics, FMCG, and food companies are in constant touch with paper producers to develop advanced paper packaging solutions to meet their sustainability goals.
Raw Material and Resource Management
As per the paper market report, paper manufacturing requires a considerable amount of wood from forests. Also, regional governments have enacted stringent norms on sourcing wood from the forests. Moreover, paper is one of the largest water-consuming industries. For instance, producing an A4-size paper consumes 20 liters of water.
COVID-19 Impact on Paper Market
Despite the nationwide lockdowns and subsequent supply chain disruptions amid the COVID-19 pandemic, prominent tissue paper producers are striving to fulfill the increasing need for tissue papers from healthcare institutes. In addition, the paper industry analysis suggests that the pandemic is offering new avenues to produce antimicrobial tissues that can be efficiently utilized to combat the COVID-19 contagion.
Paper Price Drivers
Raw Material Cost
- Raw material is one of the key cost drivers for paper. This is because it constitutes 60–65 percent of the total cost of production. In case of paper, the cost of procuring pulp is an essential element to determine cost structure of different grades of paper. Different quality of paper have different requirements of either virgin pulp or recovered pulp, according to which the final cost is arrived
- The impact of the labor cost is moderate. However, during bulk production, it might have a significant impact on the overall cost. Labor cost varies from region to region depending upon the availability and skills. Countries like India and China would have cheap manpower due to abundance. On the other hand, countries like NA and Europe would have expensive manpower. Therefore, labor cost is one of the cost drivers for paper production
Energy and Chemical Cost
Utility costs including electricity, maintenance, fuel, and other related costs which directly impact the cost of production. This is considered to be the driver as these costs are added to the total cost in order to determine the overall cost of production. Though these are considered to be the variable cost, it has enough effect on the spend of the company for producing the product.
Demand and Supply Dynamics
- Supply-demand is one of the key and foremost drivers of price in the paper industry. Any increase/decrease in demand from the end-user segment will lead to manufacturers announcing price changes, even without an movement in the other costs
- Supply disruptions like down time, mill closures by manufacturers or natural disasters would lead to shortages or a tight supply, attributing to price fluctuation. Similarly, weak demand could lead to price declines.
- Key Drivers: Downtimes, closures, new capacity, order backlogs, lead time
Exchange Rate and Inflation
- China, being the major exporter of paper, has large demand for pulp which it generally procures from North/LATAM but due to recent fluctuations in the US dollar, production costs are expected to vary. Therefore, this cost of procuring the pulp from a foreign country in terms of foreign exchange value indicates as to how much would be the total spend of the company to produce paper
Why You Should Buy This Report
- This report on the paper industry offers information about the market size, regional and global industry outlook, industry trends, and price drivers.
- It provides Porter's five force analysis of North America, LATAM, Asia, as well as key countries in these regions.
- It provides supplier profiles of major players such as Propal/Carvajal Pula y Papel, Lecta, and Sappi Europe, among others.
- Furthermore, the report on the paper industry trends details the major innovations in the global market.