Cellulose Price Trend and Forecast

Cellulose Regional Price Overview

Get the latest insights on price movement and trend analysis of Cellulose in different regions across the world (Asia, Europe, North America, Latin America, and the Middle East & Africa).

Cellulose Price Trend for the Q2 of 2024

Cellulose is industrially produced primarily through the extraction of plant fibers, with wood pulp being the most common source. The process begins by treating the raw plant material, such as wood or cotton, with chemicals to separate the cellulose fibers from lignin, hemicellulose, and other non-cellulosic materials. Applications in various industries like paper manufacturing, textiles, pharmaceuticals, and food products drove the market sentiments. In the first half of 2024, the imported wood pulp market experienced an initial rise, followed by a decline driven by supply disruptions because of strikes and wars in multiple regions, which tightened supply expectations and raised prices.
 

Cellulose Price Chart

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Despite rising pulp costs, downstream paper mills struggled with low profitability, limiting demand and procurement enthusiasm, particularly after a sluggish post-Spring Festival period. Although there was a brief boost in cellulose demand in March due to peak production in the raw paper industry, this waned by April, further pressuring cellulose prices. Imports also dropped due to international supply challenges and low downstream acceptance of high prices. Therefore, the cellulose market sentiments were relatively dull in the second quarter of 2024.

Analyst Insight

According to Procurement Resource, supply is expected to outpace demand, which can lead to a continued weakening of Cellulose prices in the short term.
 

Cellulose Price Trend for the Q1 of 2024

Cellulose is a polysaccharide that is primarily found in plant cell walls. Because of its presence in almost all plant cells, cellulose is also the most abundant organic compound on earth. In Asia, cellulose prices were intricately linked to the international agriculture market throughout the first quarter of 2024.

Chinese cellulose prices initially dipped but stabilized around March, influenced by the sliding curve of vegetable prices in Asian markets. Conversely, the European cellulose market saw a swift incline in prices due to reduced grain supply from Ukraine, a top exporter in the region.

The ongoing war with Russia led to a notable decline in plantation areas, causing supply volumes to shrink and prices to rise. Furthermore, the European agriculture market's strong performance at the end of the previous year provided a price advantage in the first quarter of 2024.

Meanwhile, in North America, cellulose market dynamics paralleled those of Asia, with the United States experiencing increased corn acreage but weak demand from downstream industries. Market sentiments remained diverse across regions. These variations underscored the complex interplay between supply, demand, and geopolitical factors shaping cellulose prices worldwide.

Analyst Insight

According to Procurement Resource, given the fluctuations in the supply and demand outlooks of Cellulose across different regions, the price trends are likely to waver in the coming months as well.
 

Cellulose Price Trend for the First Half of 2023

The price trend for Cellulose continued on the same downward-wavering trajectory in H1’23. The market experienced some normalization in the first half of 2023. The upstream cost support declined substantially because of gradually stabilizing crude oil prices since the Russian Oil supplies were still free-flowing for some major economies like India and China.

Further, new supply chains and trade routes came into existence as trade normalization practices were being employed to battle the mounting global economic inflation. Overall, the cellulose prices swung low during the said period with some occasional reverse fluctuations, especially in the latter half of the second quarter, as the inventories were gradually moving.

Analyst Insight

According to Procurement Resource, the cellulose prices project some increase in the upcoming months, but narrow-ranged fluctuations are expected.
 

Cellulose Price Trend for the Q2, Q3 and Q4 of 2022

Cellulose being the major component in plant cell wall composition is often sourced out of plant pulps like that of cotton, wood, and hemp. It is the most abundant natural polymer in the world. Cellulose is a feedstock commodity for paper production and other fibre-related industries.

So, the price trend for cellulose depend on the downstream demands.

Q2 2022 witnessed a sharp rise in cellulose prices as the Chinese lockdown put pressure on the downstream, and freight disruptions worsened the situation. Hence, the prices for cellulose kept wavering on the higher end for most of Q2 and Q3. However, in the fourth quarter, the Chinese government lifted the covid restriction aiding industrial production. The supply chains normalised causing the upstream production costs to subside, decreasing the overall costs.

Initially, the market dynamics were supportive of the price trend because the upstream costs were down, and the steady downstream demand kept the cellulose market going. But Q4 witnessed a staggering fall in demand, which further pushed the price trend for cellulose to the lower side.

Analyst Insight

According to the Procurement Resource, the price trend for cellulose are likely to remain unsettled in the coming quarter given the current pricing fundamentals. However, in the long run, the trend look hopeful but will be heavily dependent on the demand from downstream pulp and paper industries.
 

Cellulose Prices (Q1 2022)

Asia

Pulp futures increased in China during the Q1 2022 due to disruptions in supply. BSK futures traded at 857 USD/MT by the end of January, increasing by close to 49 USD/MT since the beginning of the year.

Latin America

Suzano SA, a Brazilian pulpmaker, increased pulp pricing for customers in Europe and North America in January. The price of the commodity was hiked by 30 USD to 1,170 USD/MT for European clients, while for North American clients, it was increased by 40 USD to 1,380 USD/MT. Such increase in pulp prices affected the [rice of cellulose as well.
 

Cellulose Prices (Q4 2021)

Asia

In India, demand for paper had reached pre-covid levels by the final quarter of 2021 as offices reopened after lockdowns due to the pandemic. The packaging sector grew by almost 10%. Paper prices rose as a consequence of the rise in input costs such as energy and chemical prices, as well as a rise in transportation costs. Imported pulp prices rose heavily during the quarter, which was a rare event. The pulp prices stabilised a bit later on but were estimated to go up eventually. The rise in pulp prices was a result of the price rise in lumber.

North America

In the US, Rayonier Advanced Materials Inc. announced that it will increase prices for all its cellulose products by at least 15-30% to help the company adjust for the impacts of cost inflation throughout its global supply chain. In the second half of 2021, the company experienced a marked increase in major components of its cellulose input costs such as freight, fibre, energy and chemicals and therefore increased the prices of cellulose products to supplement ongoing costs.
 

Cellulose Prices (Q1-Q3 2021)

Asia

In Asia, in the months of February and March, the spot prices for pulp were skyrocketing. The major factors for the rise in pulp prices were the increase in freight costs amid ocean freight shortages. Another contributor to the price rise was an increase in demand for at-home tissue, while the demand for away-from-home tissues declined due to the lockdown restrictions. China witnessed a shift in the market towards paper towels and premium toilet tissues.

Europe

As a result of the rise in production costs, the Burgo group increased its graphic paper prices in Europe by 15%. Energy, chemicals, and pulp prices increased, which in turn increased the prices of paper. The rise in transportation costs from China and Asia in general also contributed to the price rise in Europe.

North America

In North America and Europe, several printing and writing mills experienced a shortage of pulp supply following the low demand in the previous year which had brought down the pulp prices.
 

Cellulose Prices Overview 2020

Asia

In China, Domsjö Fabriker, a part of the Aditya Birla group, increased the price of its cellulose by 50 USD effective from September 2020. The price increase was a mechanism to balance the supply-demand dynamics.

Increased pulp costs put pressure on the entire industry in Q4 of 2020, and it persisted into 2021, leading pulp prices in China to nearly quadruple. The Chinese market had grown pulp and paper consumption, with tissue and packaging/board growth driving strong demand in China. The pulp price in China was in the range of 550-700 USD/MT. Since cellulose is the basic component of paper and paperboard, the increase in pulp prices affected cellulose prices as well.

North America

In 2020, the pulp market had been hit hard by the low demand which brought down the prices of pulp. Several printing and writing mills in North America shut down temporarily or permanently as a response to the shift in demand dynamics.

Procurement Resource provides latest prices of Cellulose. Each price database is tied to a user-friendly graphing tool dating back to 2014, which provides a range of functionalities: configuration of price series over user defined time period; comparison of product movements across countries; customisation of price currencies and unit; extraction of price data as excel files to be used offline.