Forest Products & Paper Pulp & Paper - UBS Global Pulp Pulse

COVID-19 could accelerate graphic paper demand decline on increased investment in digital content, migration to online learning/working & economic uncertainty, but better performance could result from pent-up demand or return to normality.

28 Apr 2020

Global Graphic Paper Demand in Different Recessions

Source: Fastmarkets RISI

This bar chart shows the global graphic paper demand in the recessions of 2001, 2008, 2009, 2019, 2020E, and 2021E. It shows the demand for 5 types of paper: newsprint, coated woodfree printing and writing paper (CWF), uncoated woodfree printing & writing paper (UWF), coated mechanical paper (CME), and uncoated mechanical paper (UME).

Insight of the Week: Feedback from Fastmarkets RISI Graphic Paper Webinar

We participated in RISI's webinar to discuss the impact of COVID-19 on global graphic paper markets (~30% of paper grade market pulp demand). RISI expects global printing and writing (P&W) demand to fall 9.4Mt in 2020 (-10% year over year), more than twice the contraction in 2019 (-4.3Mt). As a result, global operating rates are projected to fall to record lows, requiring significant closures for a return even close to 90%. Most importantly, P&W demand in Europe is projected to fall 14% year over year in 2020 (from -7% in 2019) and represent the main laggard for market pulp (European P&W producers are mainly non-integrated and, therefore, have a larger impact on market pulp demand). Between grades, RISI projects woodfree paper to remain more resilient than mechanical paper and uncoated to outperform coated grades (heavily used for commercial printing, which is retreating quickly).

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