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Global DWP supply demand structure now and in the futures 3 years
°™°™Christian Chavassieu, a managing partner of CelCo

2018-05-24 09:43:43
Christian Chavassieu, a managing partner of CelCo, presented his report of Global DWP supply demand structure now and in the futures 3 years 
Mr. Chavassieu first raised doubts about the current major trends of cellulose industry chain, and then explained the development of the dissolving pulp market from the four perspectives of supply, demand, supply/demand, and pricing. 

1. Supply 
1.1 World import & domestic DWP trading grew to 6.5 Bn$ in 2017 with continued demand growth and global 1.5% import price increase over previous year. 
1.2 DWP capacity utilization rate recovered strongly in 2017. Now temporarily lower due to DWP mills back on paperpulp. 
1.3 Market share of softwood DWP is reducing against hardwood DWP. In China, the rayon-grade DWP softwood premium over hardwood is averagely $74/mt. 
1.4 Brazil is largest DWP supplier to China. Domestic DWP, CLP, Modified Pulp represents now respectively 23% 6% and 8% of total cellulose supply in China.°° 
1.5 In 2017, world major DWP importers are China, India, Indonesia, Germany, and major exporters are South Africa, the US, Brazil and Canada. 

2. Demand 
2.1 Global Demand for DWP will be growing at a cagr of 3.8 % for the period 2018-2022. 
2.2 China DWP Rayon Staple demand represents 50% of total cellulose demand. 
2.3 Top 3 countries exporting of DWP Rayon grades supply 40%. 

3. Supply/demad 
3.1 Celco estimated that DWP market will only be oversupplied by a spread of 800KT in 2018. 
3.2 Spread of Supply over Demand of Softwood Rayon grade DWP is much tighter than for Hardwood. 

4. Pricing 
Chavassieu pulled out price charts for different countries and different types of dissolving pulp, including Japan, the US, Germany, India, Indonesia and China. He concluded that DWP Rayon grade price is more linked to the VSF industry than the paper pulp Industry. 

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