Coated Paper Market Outlook

From 2-3 years from the second half of 2001, it is an extremely critical period for the domestic coated paper market. Because, during this period, several new coated paper production projects will successively be launched in the country, such as the 400,000 tons of coated paper project of Jindong Paper Phase II, the 200,000 tons of coated paper project of Shandong Chenming Group, and Shandong Gaotang Paper Co., Ltd. has a 200,000-ton copperplate paper project and Zixing Paper Co., Ltd. second-phase 400,000-ton copperplate paper project. By then, the production capacity of domestic coated paper will increase by more than 1.2 million tons. Even considering the increase in consumption of domestic coated paper, it cannot be increased by more than 60% in the shortest period of two or three years. Obviously, this increase of 1.2 million tons of production is bound to snatch other coated paper market. So who's going to grab it? The answer is unique - imported paper!

Coated Paper Market Review - Ocean Paper dominates the world

The demand for Chinese coated paper market began to grow in the 1990s. In the early 1990s, China had been unable to produce high-grade copperplate paper because of technology, equipment, and raw materials. Until 95 years ago, the high-grade coated paper market had been monopolized by Japan. The price is between RMB 11,000 and RMB 1,200,000. 95 years later, South Korea’s coated papers have entered China in large numbers. After a price war, South Korea’s coated paper has replaced Japan’s monopoly position in Chinese coated paper. Before 1999, the average price of coated paper was more than 10,000 yuan. With the production of domestic coated paper production lines such as Suzhou Zixing and Shandong Gaotang, the production of Zhenjiang Jindong Paper Coated Paper in 1999 was completely broken down. Korean monopoly paper has a monopoly on the Chinese market. To date, the average selling price of coated paper is less than 8,000 yuan. It should be said that the beneficiaries of the fierce market competition are Chinese users. Please note that the sharp decline in the price of coated paper is achieved when the average pulp price is basically the same. From this point of view, it can be seen that imported coated paper in the past obtained a huge monopoly profit in China.

In recent years, domestic paper-making companies have gradually realized that the coated paper market is a big "fat" and they have expanded, invested, and built new coated paper production lines. The influence of imports of coated paper on the market seems to be ingrained. Although the quality of domestic coated paper has been greatly improved, some have been inferior and even exceeded the quality of imported paper, but in the minds of the people, imported paper is synonymous with medium-to-high grade coated paper. Only suitable for low-grade prints. Therefore, in the coated paper market, it is still the world of imported paper.

On the other hand, in order to continue to occupy the Chinese market, imported papers have also begun to adopt price cuts to squeeze the domestic paper market. For example, from the analysis of price trends in the past year and from January to May this year, Korean coated paper slipped from the high price of 9,400-10,000 yuan/ton in 2000 to 8,200 - 9,200 yuan/ton at the end of the year, with an average decrease of 10.4%; Moreover, prices in 2001 accelerated by an average 12.1%, which fell to 7400 - 7900 yuan in May.

The current status of domestic coated paper market - imported paper accounts for 2/3 of the market

In 2000, the market capacity of domestic coated paper was approximately 1.7 million tons, of which the sales volume of domestic coated paper was only about 700,000 tons, while the imports of coated paper reached 1.02 million tons (according to customs data), and the market share was close to that. 2/3, 60%. Among the imported papers, South Korea had the largest number of coated papers, which amounted to 360,000 tons, accounting for 1/3 of the total imports, and 220,000 tons more than the second. Also, in the first quarter of 2001, South Korea’s total coated paper imports rose to 43.3%. Judging from the variety of imported paper, Korean papers are multi-pointed and have the most varieties, such as Hansong, Sanshu, Maolin, Hongyuan, Polar Bear, Daewoo, and Xinhu.

Therefore, it is no exaggeration to say that imported coated paper accounts for the dominant position in the domestic market, while Korean coated paper is "the pressure of the Eight Armies" and continues to flood the Chinese market.

Domestic Paper and Imported Paper War Is Inevitable - Reproduce the Battle of Color TV Industry and Foreign Goods

In summary, the 1.2 million tons of copper plate paper capacity newly added in China, only one battle with imported paper, especially Korean paper, has captured most of the market from its share, and this 1.2 million tons capacity can be turned into real ones. Sales, get the desired profit. However, does home-made paper hit imported paper represented by Korean paper?

Compared with Korean paper, homemade paper has only three major advantages:

(1) The existence of import duties makes the cost of sales lower than Korean paper;

(2) The price is slightly lower, but the quality is not inferior to or even better than that of Korean paper;

(3) Timely delivery and convenient service. However, the disadvantage of home-made papers is that although the quality is similar to that of imported paper, there is a deep-rooted impression in the concept of consumption of the Chinese people. The quality of imported paper is much better than that of domestic paper. Perhaps, this is a blind brand effect.

It can be seen that the distance between domestic paper and imported paper is getting shorter and shorter, and the gap between Korean paper and paper especially lies in the psychological gap. It is as thin as a layer of window paper, and one bucket is broken. Everyone may remember that a few years ago, Changhong, with its extraordinary strength and strength, led the domestic color TV industry to attack the imported TV market. As a result, the imported TV was almost on the verge of exiting the Chinese market, and the domestic color TV dominated the market. It can be predicted that the current competition in the coated paper market is like the competition in the color TV industry. But who will be the first to stand out like Changhong? We look forward to the emergence of "Changhong" in the paper industry.

Therefore, from the second half of this year, the competition in the coated paper market will be extremely fierce, and price wars are inevitable. From the analysis of the advantages and disadvantages of the above, as long as domestic paper can make more publicity on changing people’s consumption concepts, its advantage is still obvious. Therefore, it is very likely that it will defeat imported papers in one fell swoop and return the coated paper market to “state-owned”. Future development will create space.

We will wait and see where the winner is. As Chinese, we also hope that domestic paper can win this competition!

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