China’s Paper Industry Production and Operations in 2023 Revealed
Throughout 2023, despite facing challenges such as weakened market demand, rising raw material costs, and changes in the external environment, which added to the overall production and operational difficulties of the paper industry, the sector still holds potential for growth. This is supported by the economic development policies released by the central government in 2023 and the overall positive trend in the domestic economy. With an increasing awareness of high-quality development and the push towards a low-carbon, green paper industry, coupled with enhanced innovation capabilities, new momentum, and effective control over new capacity, the paper industry has maintained a stable development trend.
Gradual Improvement in Production and Operations
According to the National Bureau of Statistics’ flash data, by the end of September 2023, there were 7,628 enterprises in the pulp, paper, and paper product industry, an increase of 308 from the same period last year. Among them, 58 were in pulp manufacturing, 2,559 in papermaking, and 5,011 in paper product manufacturing. The production data from January to September 2023 showed that paper and cardboard production reached 104.43 million tons, an increase of 2.88 million tons or 2.8% from the same period last year; pulp production was 11.81 million tons, up by 0.4 million tons or 0.3%; paper products saw a reduction of 1.18 million tons, down 2.2%; and the production of cardboard boxes decreased by 4.38 million tons, a decline of 17%. Based on these figures and analysis, it is projected that the domestic pulp and paper production and consumption for the entire year of 2023 would be approximately 127 million tons (up about 2.2%) and 129 million tons (up about 4%) for paper and cardboard, respectively. Pulp production for papermaking is expected to be about 8.55 million tons, a decrease of roughly 0.4%, with consumption estimated at 11.6 million tons, up about 2.2%.
Considering the domestic economic development trend and the paper industry’s production and market trends in 2023, the domestic paper industry is expected to exhibit the following trends from 2023 to 2024: 1) The overall production and operation of the paper industry will show a trend of “low before and high after,” gradually improving throughout the year with an increase in the total production of paper and cardboard in line with economic development needs. 2) Due to weakened global market demand, intensified competition, and the impact of rising costs for raw materials and energy, the main business revenue and total profits of the paper industry in 2023 will decrease. 3) Restricted by domestic raw pulp production and the total volume of domestic recycled waste paper, to meet the market demand for paper and cardboard, the demand for various imported commodity pulps by production enterprises will continue to grow. 4) Although China’s paper products had basically achieved a balance between production and demand in previous years, due to the growth in market demand, adjustments in raw material policies, and price factors, some products have become scarce again, leading to imports exceeding exports.
Looking ahead to 2024, despite many uncertainties in the external environment, global economic data shows signs of gradual improvement. According to the World Trade Organization (WTO), global merchandise trade is expected to grow by 3.3% in 2024. As a major manufacturing country and a key player in global merchandise trade, China will inevitably contribute to boosting its economy. Under this backdrop, as the paper industry supports numerous industries, its production and consumption are expected to be driven upward, with the paper industry’s overall operation expected to stabilize and recover.
Increase in Native Pulp Production
From January to September 2023, China imported 26.83 million tons of various commodity pulps, an increase of 4.78 million tons or 21.7% from the same period last year. Among these, bleached softwood pulp imports reached 6.88 million tons (up 1.5 million tons), bleached hardwood pulp 11.82 million tons (up 2.06 million tons), unbleached pulp 0.95 million tons (down 0.26 million tons), dissolving pulp 2.94 million tons (up 0.34 million tons), and waste pulp 3.19 million tons (up 1.17 million tons). Pulp exports were 0.173 million tons, a decrease of 0.033 million tons from the previous year.
Based on the import volume for the first nine months of 2023 and the commodity pulp market supply situation, combined with the domestic production of pulp, paper, and cardboard, it is projected that the total import volume of commodity pulp for the entire year of 2023 will be about 35 million tons, an increase of approximately 18% from the previous year, with an export volume expected to decrease to about 0.2 million tons.
Considering the import of waste paper and waste pulp and domestic waste pulp production, from January to September 2023, the cumulative import of all types of waste paper was only 0.42 million tons, roughly equal to the same period last year. Waste pulp imports totaled 3.19 million tons, a year-on-year increase of 58%, with an additional approximate 0.3 million tons of other paper and cardboard products used as waste pulp.
Due to the ban on waste paper imports, only a limited amount of waste paper from Hong Kong and Macao regions is retained, maintaining waste paper import volumes at about 0.5 million tons in recent years. Based on current information, it is estimated that the total domestic recycled waste paper in 2023 will be about 65 million tons, slightly less than the previous year, with waste paper imports at about 0.5 million tons and waste pulp production totaling about 58 million tons, an estimated decrease of about 1.1 million tons from the previous year. Direct imports of waste pulp are expected to increase by about 30% to 4.4 million tons, plus nearly 0.4 million tons of other paper and cardboard actually used for pulp materials, leading to an estimated total waste pulp consumption of about 62.8 million tons for the year, roughly equal to the previous year.
Based on the import situation of commodity pulp and waste paper, combined with domestic paper and cardboard production and consumption and domestic waste paper recycling, it is projected that the total domestic native pulp production in 2023 will be about 27.5 million tons, an increase of approximately 2.9% from the previous year. Including imports and exports, the apparent consumption of native pulp for papermaking for the entire year is expected to be about 53.2 million tons, an increase of approximately 9.4% year-on-year.
High Demand for Linerboard and Corrugating Medium
According to the analysis and forecast by the China Paper Association on the production and consumption of major paper and cardboard varieties, there are currently 3 main production enterprises for newsprint in China. Affected by demand and costs of waste paper and other raw and auxiliary materials, as well as imports, domestic newsprint production and sales volumes continue to decline. It is estimated that the total newsprint production in 2023 will not exceed 0.8 million tons, with a decline exceeding 10%, import volume around 0.5 million tons, export volume about 0.02 million tons, and the total annual consumption estimated at about 1.3 million tons, a decrease of 3.7% year-on-year.
In terms of printing and writing papers, based on the data available and changes in imports and exports and raw materials for these products, the production volume and market demand for such products in 2023 are generally better than the previous year. The total production of uncoated printing and writing papers is expected to be about 17.75 million tons for the year, an increase of approximately 2.3% from the previous year; exports are expected to be about 1.35 million tons, imports about 0.38 million tons, and the total annual consumption about 16.78 million tons, roughly equal to the previous year.
As for coated paper, which is a restricted product under industrial policy, the market has been relatively stable due to domestic quality improvements and changes in the global market landscape. In recent years, the market demand for coated paper has shifted towards reduced imports and increased exports. Based on surveys and analysis, it is estimated that the total domestic production of coated paper in 2023 will be about 6.3 million tons, an increase of 1.6% year-on-year; export volume about 0.7 million tons, a decrease of approximately 53% year-on-year; import volume about 0.16 million tons, a decrease of approximately 20% year-on-year; and the total annual consumption about 5.76 million tons, an increase of approximately 17% from the previous year.
With the improvement in people’s quality of life and living standards, the production and variety of household paper products have continuously increased in recent years. It is predicted that the total domestic production of household paper products in 2023 will be about 12 million tons, with import volume expected to slightly increase from the previous year, but export volume is expected to grow by more than 40%, reaching over 1 million tons. The apparent domestic consumption is expected to reach 11 million tons, an increase of nearly 4%.
Regarding whiteboard paper, although the overall market demand for whiteboard paper is expected to weaken, the overall market consumption remains relatively stable. Based on current surveys and analysis, the total production for the year is expected to be about 16.3 million tons, an increase of approximately 2.5% from the previous year; the total annual consumption is expected to be about 14.4 million tons, an increase of approximately 4.4%.
Linerboard and corrugating medium, as raw materials for various packaging boxes and cartons, are in high demand in the market, accounting for 50% of the total consumption of paper and cardboard. Based on the available information, it is estimated that the production of linerboard in 2023 will be about 28.3 million tons, an increase of approximately 0.7% year-on-year; the total annual consumption is expected to be about 33.3 million tons, an increase of approximately 5% year-on-year. The production of corrugating medium is expected to be about 28 million tons, an increase of approximately 1% year-on-year; the total annual consumption is expected to be about 31.4 million tons, an increase of approximately 4% year-on-year.