Metsa Fibre believes that it might raise the prices for its Nordic wood pulp this year. The Finnish bioenergy producer says that its EUR 1.2 billion new pulp plant will help with the supply for the growing market demand, especially the one from China.
According to Reuters, Nordic forest companies have cut back paper output for years amid consumers' shift from print products to digital devices. But the future looks brighter for pulp made of northern spruce and pine as that is needed for tissue and packaging board - products seen growing on the back of Chinese demand.
Metsa might become the largest softwood pulp seller in the world, after its main rivals: Sweden's Sodra, Canada's Canfor Corp and Mercer International. Once the new Finnish plant will reach its annual capacity of 1.3 million tons in late 2017, the company will start fueling the growing demand.
The European market price for benchmark softwood pulp fell about 14% last year and reached around $810 this year, coming to a more stable ground.
"The rest of the year will be rather flat, there might even be some possibilities to get prices slightly higher towards the end of the year. Next year will probably be quite stable as well, but it all depends on the market and supply-demand balance," Metsa Fibre sales executive Ari Harmaala said.
Metsa expects global demand for softwood pulp to grow around 1 percent annually through the coming years on the back of increased demand for tissue and packaging board in China, as reported by Reuters.
As for hardwood pulp, made from eucalyptus, there are new plants to start production in South America and Indonesia. The plants belong to companies such as Fibria and Asian Paper & Pulp. This year, the benchmark price for hardwood grade reached $662, falling by 15%.
