China’s Recovered Fibre Pulp Market to Reach 82M Tonnes by 2025

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China’s Recovered Fibre Pulp Market to Reach 82M Tonnes by 2025

March 13th, 2020 IndexBox Leave a comment

IndexBox has just published a new report: ‘China – Recovered Fiber Pulp – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

The revenue of the recovered fibre pulp market in China amounted to $23.3B in 2018, approximately reflecting the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). Overall, the total market indicated a buoyant increase from 2007 to 2018: its value increased at an average annual rate of +4.2% over the last eleven years. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, recovered fibre pulp consumption decreased by -23.7% against 2015 indices. The growth pace was the most rapid in 2012 when the market value increased by 32% y-o-y. Recovered fibre pulp consumption peaked at $30.5B in 2015; however, from 2016 to 2018, consumption remained at a lower figure.

Market Forecast 2019-2025 in China

Driven by increasing demand for recovered fibre pulp in China, the market is expected to continue an upward consumption trend over the next seven-year period. Market performance is forecast to retain its current trend pattern, expanding with an anticipated CAGR of +3.8% for the seven-year period from 2018 to 2025, which is projected to bring the market volume to 82M tonnes by the end of 2025.

Production in China

In 2018, the recovered fibre pulp production in China stood at 63M tonnes, leveling off at the previous year. The total output volume increased at an average annual rate of +4.2% over the period from 2007 to 2018; however, the trend pattern indicated some noticeable fluctuations being recorded throughout the analyzed period. The most prominent rate of growth was recorded in 2009 with an increase of 13% against the previous year. Recovered fibre pulp production peaked at 63M tonnes in 2015; however, from 2016 to 2018, production failed to regain its momentum.

In value terms, recovered fibre pulp production amounted to $22.8B in 2018 estimated in export prices. In general, recovered fibre pulp production continues to indicate a prominent increase. The pace of growth was the most pronounced in 2011 with an increase of 47% against the previous year. Over the period under review, recovered fibre pulp production reached its maximum level at $33.3B in 2015; however, from 2016 to 2018, production remained at a lower figure.

Exports from China

In 2018, approx. 549 tonnes of recovered fibre pulp were exported from China; increasing by 3% against the previous year. Overall, the total exports indicated a conspicuous increase from 2007 to 2018: its volume increased at an average annual rate of +3.0% over the last eleven years. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, recovered fibre pulp exports decreased by -5.2% against 2016 indices. The most prominent rate of growth was recorded in 2012 when exports increased by 55% against the previous year. Over the period under review, recovered fibre pulp exports attained their maximum at 579 tonnes in 2016; however, from 2017 to 2018, exports remained at a lower figure.

In value terms, recovered fibre pulp exports amounted to $198K (IndexBox estimates) in 2018. Over the period under review, recovered fibre pulp exports continue to indicate a significant increase. The pace of growth appeared the most rapid in 2012 with an increase of 114% y-o-y. Exports peaked at $282K in 2015; however, from 2016 to 2018, exports stood at a somewhat lower figure.

Exports by Country

China, Hong Kong SAR (93 tonnes), Kyrgyzstan (76 tonnes) and the U.S. (74 tonnes) were the main destinations of recovered fibre pulp exports from China, together accounting for 44% of total exports.

From 2007 to 2018, the most notable rate of growth in terms of exports, amongst the main countries of destination, was attained by the U.S. (+55.3% per year), while the other leaders experienced more modest paces of growth.

In value terms, Kyrgyzstan ($45K), South Korea ($27K) and the U.S. ($24K) appeared to be the largest markets for recovered fibre pulp exported from China worldwide, with a combined 49% share of total exports.

Among the main countries of destination, Kyrgyzstan (+50.3% per year) experienced the highest growth rate of exports, over the last eleven years, while the other leaders experienced more modest paces of growth.

Export Prices by Country

In 2018, the average recovered fibre pulp export price amounted to $361 per tonne, therefore, remained relatively stable against the previous year. Overall, the recovered fibre pulp export price continues to indicate a relatively flat trend pattern. The most prominent rate of growth was recorded in 2012 when the average export price increased by 38% against the previous year. Over the period under review, the average export prices for recovered fibre pulp reached their maximum at $525 per tonne in 2015; however, from 2016 to 2018, export prices failed to regain their momentum.

Prices varied noticeably by the country of destination; the country with the highest price was South Korea ($1,273 per tonne), while the average price for exports to Togo ($53 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of prices was recorded for supplies to South Korea, while the prices for the other major destinations experienced more modest paces of growth.

Imports into China

In 2018, the imports of recovered fibre pulp into China totaled 11K tonnes, going down by -3.9% against the previous year. In general, recovered fibre pulp imports continue to indicate a perceptible curtailment. The growth pace was the most rapid in 2009 when imports increased by 85% y-o-y. In that year, recovered fibre pulp imports reached their peak of 20K tonnes. From 2010 to 2018, the growth of recovered fibre pulp imports failed to regain its momentum.

In value terms, recovered fibre pulp imports amounted to $5.9M (IndexBox estimates) in 2018. Overall, recovered fibre pulp imports continue to indicate a temperate decrease. The pace of growth was the most pronounced in 2009 with an increase of 97% y-o-y. Over the period under review, recovered fibre pulp imports attained their peak figure at $12M in 2010; however, from 2011 to 2018, imports remained at a lower figure.

Imports by Country

Malaysia (3.4K tonnes), Indonesia (2.9K tonnes) and the U.S. (2.9K tonnes) were the main suppliers of recovered fibre pulp imports to China, with a combined 81% share of total imports.

From 2007 to 2018, the most notable rate of growth in terms of imports, amongst the main suppliers, was attained by Indonesia (+68.3% per year), while the other leaders experienced more modest paces of growth.

In value terms, the U.S. ($1.8M), Indonesia ($1.5M) and Malaysia ($1.4M) were the largest recovered fibre pulp suppliers to China, with a combined 79% share of total imports.

In terms of the main suppliers, Indonesia (+65.2% per year) recorded the highest rates of growth with regard to imports, over the last eleven years, while the other leaders experienced more modest paces of growth.

Import Prices by Country

In 2018, the average recovered fibre pulp import price amounted to $512 per tonne, increasing by 1.8% against the previous year. Over the period from 2007 to 2018, it increased at an average annual rate of +1.8%. The pace of growth was the most pronounced in 2010 when the average import price increased by 24% year-to-year. Over the period under review, the average import prices for recovered fibre pulp reached their maximum at $610 per tonne in 2013; however, from 2014 to 2018, import prices remained at a lower figure.

There were significant differences in the average prices amongst the major supplying countries. In 2018, the country with the highest price was Saudi Arabia ($961 per tonne), while the price for South Africa ($364 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of prices was attained by Malaysia, while the prices for the other major suppliers experienced more modest paces of growth.

Source: IndexBox AI Platform

Archives, Global Trade Daily, International Trade

The Spanish Flu and the Stock Market: The Pandemic of 1919

March 11th, 2020 Bryan Taylor, Chief Economist, Global Financial Data Leave a comment

Everyone is concerned about the coronavirus and how it is impacting the global economy. Parts of China have been quarantined to prevent the spread of the virus and the world is wondering how the virus will disrupt supply chains between China and the rest of the world and how it will impact global travel. Will cities that are cut off from the rest of the world be able to contribute to the global economy?

The main precedent for the coronavirus is the SARS epidemic of 2002-2004, but you should also look at the more serious Spanish Flu pandemic of 1919. It is estimated that the Spanish Flu infected 500 million people worldwide, or about 27% of the world’s population and killed between 30 million and 50 million people, or about 1.7% of the world’s population. Were a similar pandemic to hit the world today, this would translate into 100 million deaths. This made the Spanish flu one of the deadliest epidemics in history. The pandemic occurred in the last year of World War I and military censors in France, Germany, the United Kingdom, United States and other countries were told to control information on the flu fearing that it would affect their ability to win the war, but there was no censorship on the flu in neutral Spain where King Alfonso XIII took ill. This gave the world the false impression that the flu originated in Spain, hence the name.

The Spanish flu came in three waves as is illustrated in Figure 1. The first wave, which made people notice the flu, occurred in July 1918. The second and most deadly wave occurred in October 1918 and resulted in millions of deaths. A final wave of the flu occurred in February 1919, and after that, the flu disappeared. Either the virus mutated to a less lethal form or doctors got better at treating or preventing it. Just as no one knows for sure exactly where the virus came from, no one knows why it disappeared.

Figure 1. Death Rates of the Spanish Flu, June 1918 to May 1919

It is interesting to contrast the response of the stock market to the Spanish flu in 1919 with the coronavirus in 2020. The Dow Jones Industrial Average fell over 2,000 points in four days out of fear that the coronavirus will continue to spread and impact the global economy. The fear is that cities will become quarantined, supply chains will be broken, world trade will be impacted and growth in the global economy will slow down.

However, the impact of the Spanish Flu on the stock market was minimal. If you look at the Dow Jones Industrial Average in 1918 and 1919, you can see that the stock market was relatively unaffected by any of the three waves of the Spanish flu. Of course, the Spanish flu occurred in 1918 while World War I was raging in Europe so the war had a larger impact on the stock market than the flu. There were few if any global supply chains that the Spanish Flu could disrupt because the war made supply chains nonexistent. The second and worst wave of flu occurred at the end of World War I when peace was finally achieved after four years of devastating destruction. It is interesting that there was little impact on the stock market of World War I ending on November 11, 1918. Perhaps euphoria about the conclusion of the war was offset by concerns about the Spanish flu.

It is comforting to see that when the final wave of the Spanish flu subsided in February 1919, the market began an increase of 50% which lasted until November of 1919. Whether this increase occurred because of the end of World War I or the end of the flu or both is impossible to say, but it does provide encouragement that once the coronavirus begins to subside, the market will bounce back once again.

Figure 2. Dow Jones Industrial Average, January 1918 to December 1919

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Dr. Bryan Taylor is President and Chief Economist for Global Financial Data. He received his Ph.D. from Claremont Graduate University in Economics writing about the economics of the arts. He has taught both economics and finance at numerous universities in southern California and in Switzerland. He began putting together the Global Financial Database in 1990, collecting and transcribing financial and economic data from historical archives around the world. Dr. Taylor has published numerous articles and blogs based upon the Global Financial Database, the US Stocks and the GFD Indices. Dr. Taylor’s research has uncovered previously unknown aspects of financial history. He has written two books on financial history.

Archives, Global Trade Daily, In The News

MODEX Day Two: Coronavirus Impacting More than Just Trade Operations

March 11th, 2020 GT Staff Leave a comment

Day two for MODEX 2020 concluded with industry players addressing the now-notorious coronavirus and what this means for both domestic and international markets fortunate enough to continue operations without disruption. From what we learned during the session, “Coronavirus and Global Supply Chains” the wave currently felt in China, Italy, and beyond, will eventually make its way to the U.S. and companies have no reason not to be prepared.

Researcher Philip J. Palin, John Paxton with MHI, and David Shillingford with Resilience360 took the unsettling topic head-on and addressed concerns without hesitation. Traders be aware: for domestic and untouched international markets, the worst isn’t over. The coronavirus creates more than just health concerns. It impacts trade operations, legal concerns, and causes financial turmoil as we’ve already started to see.

“The virus is the primary cause of the supply chain impact but the secondary causes coming from the virus include financial, regulatory, compliance, and legal,” explained Shillingford. “Another risk to think about is workforce risk. How many of the workers that left for Chinese New Year have been able to come back, and for those that have returned, are they able to work with open factories or are they still under quarantine?”

“The good news is, the extraordinary supply and demand disruption we’re discussing in terms of China is being released. It’s slow but it’s happening and it’s giving us a benchmark of for how long domestic disruption will be,” Palin stated after announcing the first containership from China arrived at the Port of Los Angeles in almost 10 days on Monday.

Shillingford goes on to explain the shifting patterns in consumer behavior as well, noting that due to worldwide panic, demand is shifting and challenging the logistics sector. Buying habits have undoubtedly changed in recent weeks along with mindsets. Interactions are now limited to a fist-bump or elbow touch rather than a handshake and the numbers of public events cancelled are going up.

“Other things we are seeing involve personnel movement. It’s not just transportation impacted,” Shillingford added.

On the legal side of the crisis, Chinese suppliers are having an issue with certificates and contractual obligations. Shillingford urges industry players to understand the importance of knowing if suppliers have been issued force majeure slips.

“One thing supply chains hate is variance, and there’s going to be a lot of variance and volatility on the demand side,” he concluded.

What does all this mean for the U.S.? At the end of the day, it’s a matter of preparation and strategizing for the more fortunate markets without the disruption of a complete shut-down.

“There was a hidden, horrible problem in the Hubei province that required a draconian measure to prevent transmission of the virus. We should be ahead of that curve as well as the rest of the world, even with this very contagious virus,” explained Palin. “And even if we are behind that curve, we don’t have 300 million workers separated from their place of work.”

Archives, Global Trade Daily, News

Veneer Sheets Market in Asia-Pacific To Post Solid Gains

March 2nd, 2020 IndexBox Leave a comment

IndexBox has just published a new report: ‘Asia-Pacific – Veneer Sheets – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

The revenue of the veneer sheets market in Asia-Pacific amounted to $10.8B in 2018. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). The market value increased at an average annual rate of +1.9% from 2007 to 2018; the trend pattern remained relatively stable, with only minor fluctuations throughout the analyzed period. Over the period under review, the veneer sheets market reached its peak figure level in 2018 and is likely to continue its growth in the immediate term.

Consumption By Country in Asia-Pacific

China (2.7M cubic meters) constituted the country with the largest volume of veneer sheets consumption, accounting for 33% of total volume. Moreover, veneer sheets consumption in China exceeded the figures recorded by the second-largest consumer, Viet Nam (1.1M cubic meters), twofold. The third position in this ranking was occupied by Indonesia (684K cubic meters), with a 8.2% share.

In China, veneer sheets consumption remained relatively stable over the period from 2007-2018. In the other countries, the average annual rates were as follows: Viet Nam (+20.9% per year) and Indonesia (+4.6% per year).

In value terms, the largest veneer sheets markets in Asia-Pacific were Viet Nam ($2.8B), China ($2.6B) and Malaysia ($1.7B), together accounting for 66% of the total market.

In 2018, the highest levels of veneer sheets per capita consumption was registered in New Zealand (99 cubic meters per 1000 persons), followed by Malaysia (19 cubic meters per 1000 persons), Viet Nam (12 cubic meters per 1000 persons) and South Korea (7.39 cubic meters per 1000 persons), while the world average per capita consumption of veneer sheets was estimated at 2 cubic meters per 1000 persons.

Market Forecast 2019-2025 in Asia-Pacific

Driven by increasing demand for veneer sheets in Asia-Pacific, the market is expected to continue an upward consumption trend over the next decade. Market performance is forecast to retain its current trend pattern, expanding with an anticipated CAGR of +2.2% for the period from 2018 to 2030, which is projected to bring the market volume to 11M cubic meters by the end of 2030.

Production in Asia-Pacific

In 2018, the veneer sheets production in Asia-Pacific stood at 7.4M cubic meters, standing approx. at the previous year. The total output volume increased at an average annual rate of +1.2% from 2007 to 2018; the trend pattern remained consistent, with somewhat noticeable fluctuations in certain years. Over the period under review, veneer sheets production reached its maximum volume at 7.8M cubic meters in 2014; however, from 2015 to 2018, production stood at a somewhat lower figure.

Production By Country in Asia-Pacific

China (3M cubic meters) remains the largest veneer sheets producing country in Asia-Pacific, accounting for 40% of total volume. Moreover, veneer sheets production in China exceeded the figures recorded by the second-largest producer, Viet Nam (1.1M cubic meters), threefold. The third position in this ranking was occupied by Indonesia (761K cubic meters), with a 10% share.

From 2007 to 2018, the average annual growth rate of volume in China was relatively modest. The remaining producing countries recorded the following average annual rates of production growth: Viet Nam (+20.6% per year) and Indonesia (+5.9% per year).

Exports in Asia-Pacific

In 2018, approx. 817K cubic meters of veneer sheets were exported in Asia-Pacific; going up by 12% against the previous year. The total exports indicated a prominent expansion from 2007 to 2018: its volume increased at an average annual rate of +5.3% over the last eleven-year period. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. The volume of exports peaked in 2018 and are likely to see steady growth in the near future. In value terms, veneer sheets exports amounted to $843M (IndexBox estimates) in 2018.