Recently, Chinese papermaking companies have been issuing price increase notices one after another. Some companies stated that after a price hike of 100 yuan per ton (Chinese Renminbi, hereinafter) on May 25, starting from June 1, the price would be raised by another 100 yuan per ton. Industry insiders believe that the main reason for the price hikes is the pressure on profitability.
One papermaking company in China’s price increase notice has been circulating in the industry. The pricing letter shows: “Based on the current market conditions and cost pressures, the company’s pricing has reached the safety line of enterprise operation. In order to maintain the steady operation of the company, after careful consideration, our company has decided to increase the order price of double adhesive paper by 100 yuan/ton from May 25, 2025, and by another 100 yuan/ton from June 1, 2025.”
Chinese papermaking companies have raised prices several times this year. According to a report from Huaxia Times on May 29, white cardboard prices have been raised in January, February, and March this year. In late May, papermaking companies once again issued price increase notices.
On May 20, Bohui Paper Sales Department issued a price increase notice for industrial paper: starting from May 21, 2025, prices for all products would be adjusted, with a price increase of 200 yuan per ton (including tax); on May 22, the Yueyang Lin Paper Marketing Center Market Department notification, starting from May 25, 2025, the order price was increased by 100 yuan per ton on the basis of the current price, and starting from June 1, 2025, the order price was increased by 100 yuan per ton based on the price of May 25, 2025; on the same day, Huatai Paper also issued a price notice letter, with the timing and magnitude of the price increase the same as Yueyang Lin Paper, involving all cultural paper, copper plate paper, and special paper series products.
Some companies have chosen to raise prices starting in June. The domestic sales department of Sun Paper Industry issued a price increase notice on May 22, with a price increase of 200 yuan per ton on all cultural paper products based on the existing price from June 1.
In explaining the reasons for the price increase, Sun Paper Industry stated that due to changes in market supply and demand, as well as various factors such as disorderly competition within the industry, in order to maintain the health and sustainable development of the company, “We are adjusting the sales prices of relevant products.”
In addition, Nine Dragons Paper, APP (China), Asia Pulp & Paper, Chenming Paper, Dahua Paper, Tianbang Technology, Luohe Yinge, Liansheng Pulp, and International Paper, among others, have also issued price increase notices.
Regarding the reasons for the price increases, Kong Xiangfen, an analyst at ZHUOCHUANG Information Paper, stated to Huaxia Times that the current price increase by papermaking companies is related to prices being at historically low levels, putting pressure on profitability. In addition, the increase in raw material pulp prices has provided a basis for the paper companies to raise prices.
A staff member of the industry leader Sun Paper Industry stated that currently, paper prices are still at a low level, and the reasons for this situation are related to demand and also to the industry’s significant expansion of production.
Low paper prices have put pressure on the performance of papermaking companies. In the first quarter of 2025, Sun Paper Industry achieved operating income of 9.898 billion yuan, a year-on-year decrease of 2.82%; net profit was 886 million yuan, down by 7.32%. Leading specialty paper producer Xianhe Shares achieved an increase in revenue but not in profits in the first quarter of 2025, with operating income of 1.991 billion yuan, a year-on-year increase of 35.42%; net profit was 236.2 million yuan, a decrease of 12.13%.
China’s largest papermaking company, Chenming Paper Industry, achieved an operating income of only 797 million yuan in the first quarter, a sharp decrease of 88.2% year-on-year; net profit attributable to shareholders of the parent company suffered a loss of 1.45 billion yuan, a drastic decrease of 2594.4% year-on-year; after deducting non-recurring gains and losses, the net profit attributable to the parent company’s shareholders increased from 226 million yuan in the same period last year to a further increase of 1.46 billion yuan.
Many companies were already facing a downturn in performance throughout 2024. Among listed paper companies, Zhongshun Soft & Delicate saw a decrease of 76.8% in net profit attributable to the parent company in 2024, with a profit of 77.18 million yuan; Jingxing Paper Industry saw a profit of 71.26 million yuan, down by 22.2%; Hengfeng Paper Industry saw a profit of 116 million yuan, down by 14.94%; Yibin Paper Industry suffered a net loss of 128 million yuan; Shanying International lost 451 million yuan, a sharp decrease of 388.46%; Bohui Paper Industry had a profit of 175 million yuan, down by 3.3%; Qingshan Paper Industry had a profit of 84.75 million yuan, down by 30.48%; Heng’an International had a profit of 2.299 billion yuan, down by 17.93%; Huatai Stock had a profit of only 36.16 million yuan, down significantly by 84.81%.
Regarding the future of paper prices in China, Kong Xiangfen, an analyst at ZHUOCHUANG Information Paper, expects that the price of white cardboard in the market may rise and then fall from the end of May to June, mainly influenced by the transformation of driving factors. It is predicted that paper prices may temporarily stagnate and adjust in mid-June, with the risk of prices falling towards the end of the month.
ZHUOCHUANG Information’s double adhesive paper analyst, Li Shuang, stated that overall, the supply and demand end may constrain paper prices. It is expected that there will still be resistance to price increases in the market for double adhesive paper in June, and the overall trend of paper prices will remain stable. Due to the low base price at the beginning of the month, the average monthly price is expected to decline.
While paper prices remain low, pulp prices are on the rise. Some analysts believe that the performance of papermaking companies this year may continue the downturn seen in 2024.