Transcript Market Pulp Outlook: Effects of the Collapse in Graphic Paper

La industria del papel y celulosa
latinoamericana: entorno empresarial
Marina Faleiros, Senior News Editor
Mayo 2015
[email protected]
1
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Resumen del CV
•
•
•
•
•
2
Gerencia informaciones del sector de celulosa, papeles gráficos y cartón
en América Latina para la consultoría americana RISI, la mayor
proveedora de informaciones para la industria de base forestal en el
mundo.
Ubicada en la oficina de San Pablo, trabaja con reportes y análisis sobre
la macroeconomía de la región y los principales movimientos de la
industria de celulosa y papel.
Ya visitó profesionalmente todos los principales complexos industriales
del sector en los países del continente y anteriormente trabajó en la
Asociación Brasileña Técnica de Celulose y Papel (ABTCP).
Graduada en periodismo por la universidad Cásper Líbero y actualmente
cursa MBA en Finanzas y Economía
Ya reportó sobre la economía brasileña en dos de los mayores periódicos
del Brasil, O Estado de S. Paulo y Folha de S. Paulo.
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Notes and Abbreviations
•
•
•
•
•
•
•
3
Dollar figures are per tonne unless noted
BSK = Bleached Softwood Kraft Pulp (“long” fiber)
– NBSK (northern), SBSK (southern), radiata
BHK = Bleached Hardwood Kraft Pulp (“short” fiber)
– BEK (eucalyptus), NBHK (northern mixed, maple, aspen), acacia, mixed
tropical hardwoods
DP = Dissolving Pulp, primarily textile grade (viscose)
P&W = Printing & Writing Paper
– Coated and uncoated; woodfree and mechanical
AVC = Average Variable Cost of Production
– Also called Delivered Cash Cost—no depreciation, interest, corporate
overhead or selling costs
TPY = Tonnes per Year
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Celulosa mundial: desarrollos
recientes
4
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Highlights of 2014 Capacity Developments
• BHK Developments
– Montes del Plata startup
• 1.3 million TPY, Jul 2014
– Oji Nantong startup
• ~500,000 TPY, Jul 2014
– Old Town closure
• ~200,000 TPY, Aug 2014
– ENCE Huelva closure
• BSK Developments
– Ilim Bratsk
• Finised a long ramp-up
after a maintenance shut
in June
– Pols (Austria)
• Recovery boiler repair
• ~200,000 TPY loss until
late 2015
• ~400,000 TPY, Aug 2014
5
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As Expected, Pulp Demand Was Stronger
in Second Half 2014, Especially in Asia
World-20 Shipments by Destination, Thousand Tonnes per Day
50
45
40
35
30
25
20
15
10
China
Western Europe
North America
Rest of World
5
0
07
6
08
09
10
11
12
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13
14
A Strong US Dollar Tends to Hold Down
Commodity Prices, Including Pulp
USDEUR
1.80
US$,
Euros,
1000
900
1.60
800
1.40
700
1.20
600
1.00
500
0.80
400
0.60
0.40
USDEUR
300
Price NBSK China
200
0.20
100
Source: RISI
0.00
0
95
7
98
01
04
07
10
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13
16
19
BSK Delivered Cash Costs to Shanghai:
Third Quarter 2014
RISI Cost Benchmarking
8
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World Production of Paper and Board
Graphic, Packaging and Specialty and Tissue; Percent Change
8%
6.6%
5.7%
6%
4%
3.9%
3.7%
3.2%
3.0%
2.7%
1.9%
2%
1.9%
1.0%
0.5%
0.7%
1.0%
0%
-0.4%
-2%
-2.0%
-4%
-6%
-5.6%
-8%
2000
9
2002
2004
2006
2008
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2010
2012
2014
The New Reality for World P&W Demand:
Peak Demand Has Already Happened
180
P&W Production
2007 Forecast
Million Metric Tons
160
140
120
100
80
60
40
20
0
80
10
85
90
95
00
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05
10
15
Demand for Tissue Papers
Million Tonnes
40
35
30
World
China
N. America
W. Europe
Rest of World
25
20
15
10
5
0
2000
11
2002
2004
2006
2008
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2010
2012
2014
Pulp Supply and Risks
•
•
•
•
•
12
Large BHK capacity expansions around mid-2015
– CMPC Guaiba: 1.3 million tpy, mid-2015. Risks?
Continuing swing from BHK to BSK production
– Certainly as long as price gap is >$100/tonne
Continuing shift from “integrated” to “market” pulp in North
America and Europe
Cost curve is shifting downward…could accelerate if the US
“super dollar” reappears
• A reprieve for small, inefficient BHK lines in Europe?
DP demand still growing briskly, pulling some paper grade pulp
capacity into DP production
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Key Points for the 2015 Forecast
• Pulp demand outside of China is growing slowly, so Chinese
inventory swings dominate the demand side
– There will be a large increase in Chinese BHK import demand
in 2015
• A stronger economic environment in 2015 worldwide will boost
pulp demand, but not by as much as was expected
• The next BHK line to start up will be in mid-2015, helping to pull
the industry operating rate (and profitability) down in the middle
of the year
• Euro risk is still substantial
13
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Papeles para
empaque
14
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Is Global Containerboard Still Growing?
180
10%
160
8%
140
6%
Millions
120
100
4%
80
2%
60
0%
40
-2%
Volume (L)
Percent Change (R)
20
0
-4%
01
15
03
05
07
09
11
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13
15
Emerging Markets Are Growing Faster
180
160
140
10.0%
Emerging Markets
Mature Markets
Global Growth (R)
8.0%
6.0%
120
4.0%
80
2.0%
Millions
100
60
0.0%
40
20
-2.0%
0
-4.0%
01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16
16
16
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But Even They Are Slowing Down
10%
8%
2001-2008
2011-2016
6%
4%
2%
0%
-2%
World
17
North
America
Europe
Far East
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Latin
America
All Other
The Latin American Markets are Among
the Fastest Growing Markets in the World
Percent Increase in Demand, 2009-2012
20%
15%
19.1%
10%
14.8%
5%
12.2%
9.3% World Average
0.6%
0%
-2.9%
-5%
Rest of World Latin America North America
18
Europe
Asia
The Growth Markets Can All Be Expected to
See Demand Rise with Standard of Living
2012 Figures
Per Capita Packaging
Demand kg/Person
140
North America
120
100
80
60
Asia
40
Latin America
20
Rest of World
0
0
19
Europe
10
20
30
40
Per Capita GDP, PPP Constant Dollars
50
The Latin American Packaging Markets
Are Far from Homogenous
Per Capita Packaging
Demand kg/Person
70
60
50
40
Mexico
Ecuador
Argentina
30
20
Guatemala
Dominican
Republic
10
0
0
20
Chile
Brazil
5
Colombia
Venezuela
Peru
10
15
20
Per Capita GDP, PPP Constant Dollars
25
The 10 Largest Latin American Paper
Packaging Markets by Tonnage
Guatemala
2%
Costa Rica
2%
Venezuela
3%
Peru
2%
All Other
5%
Brazil
37%
Ecuador
3%
Colombia
5%
Chile Argentina
5%
8%
21
Mexico
28%
Brazil Has the Largest Economy in Latin
America, and Also the Largest Packaging
Market
Average Annual Growth
Rate
7.0%
6.0%
2009-2012
2013-2015
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
GDP
22
APC
Production
Brazil Stands Out from the Rest of Latin
America on the Trade Front
Net Imports, Thousand Tonnes
100
0
-100
-200
-300
-400
-500
2008
2009
2010
Containerboard
23
2011
Boxboard
2012
2013
Wrapping
2014
Specialty
2015
The Mexican Packaging Markets Are More
Volatile than the Brazilian Market Due to
the Influence of the USA
Average Annual Growth
Rate
7.0%
6.0%
2009-2012
2013-2015
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
GDP
24
APC
Production
Argentina Is One of the Few Countries in
Latin America Where Demand Lags Well
Behind GDP Growth
Average Annual Growth
Rate
7.0%
2009-2012
6.0%
2013-2015
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
GDP
25
APC
Production
Chile Has Turned in Fairly Steady Growth
in Paper Packaging Demand
Average Annual Growth
Rate
7.0%
2009-2012
2013-2015
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
GDP
26
APC
Production
Chile Has Been the Only Country Other
Than Brazil to Maintain a Trade Surplus
Net Imports, Thousand Tonnes
300
200
100
0
-100
-200
-300
2008
2009
2010
Containerboard
27
2011
Boxboard
2012
2013
Wrapping
2014
Specialty
2015
Conclusions: The Latin American
Packaging Markets …
•
May be small in absolute terms on the global scale
– But contribute significantly to global growth given the high growth
potential for the region
•
Are quite diverse, reflecting each country’s economic makeup
– The markets in any individual country may struggle during a particular
year
– But growth in other parts of the region often offsets this
– Resulting in more even growth than is seen in other parts of the world
•
Are a critically important
– For participants located within the markets
– As well as those from outside Latin America
Cartón
29
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How Are the Global Markets Coping with
China’s Capacity Bulge?
4.0
Growth, Million Tonnes
3.0
2.0
1.0
0.0
Global Demand
Chinese Capacity *
-1.0
-2.0
2009
2010
2011
2012
2013
* Realized Capacity Growth 2009-2013, Planned 2014-2015
30
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2014
2015
2016
Boxboard Demand in the Rest of the
World Is Small (5.3 Million Tonnes in
2013) But Growing Rapidly
Million Tonnes and Percent of Global Demand
0.3, 6%
1.0, 18%
2.8, 54%
1.1, 22%
31
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Latin America
Middle East
Africa
Oceania
Brazilian Exports of Multi-ply Boxboard
Compete in Global Markets with the
Other Coated Virgin Grades
Thousand Tonnes
250
200
150
Middle East
Asia & Oceania
Africa
Europe
North America
Other Latin America
Argentina
100
50
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
32
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Latin American Demand to Outpace Capacity
Expansion, Leading to Modest Growth in Net
Imports for the Region
0.5
100%
Demand
Capacity
Operating Rate
0.3
90%
0.2
85%
0.1
80%
0.0
75%
-0.1
70%
3
33
33
95%
4
5
6
7
8
9
10
11
12
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13
14
15
16
Operating Rate
Growth, Million Tonnes
0.4
Latin America, Africa and the Middle East Will
Be the Battle Grounds for Virgin Boxboard
Exports
Net Imports, Thousand Tonnes
1,000
800
600
Latin America
Africa
Middle East
Oceania
400
200
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
34
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Take Home Points for Global Boxboard
• Demand should continue to grow across the world in
2015-2016
•
35
The massive capacity build in China will have an impact on global
trade throughout this period
– Especially in the solid bleached and multi-ply virgin sectors
• Current suppliers to the Asian market will be displaced and will
be seeking new homes for their exports
• Chinese ivoryboard mills will have costs similar to European
mills, and will be competitive in areas where shipping costs are
nearly equal
• Latin American and North American mills still have cost
advantages over Asian producers, but prices in these regions
are above the cost floor
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Papeles para impresión
36
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World Printing & Writing Paper Demand
Is the global market in decline? Yes, its just a matter of degree.
120
Million Tonnes
12%
Volume (L)
Percent Change (R)
110
6%
100
0%
90
-6%
80
-12%
96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19
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Yet, Global UFS May Still Be Growing…
Mechanical grades appear to be flat or declining globally
60
Global Demand, Million Tonnes
50
40
UFS
CFS
Cme
Ume
30
20
10
99 0
1
2
3
4
5
6
7
8
9 10 11 12 13 14 15 16 17 18 19
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Global UFS Demand Growth for 2015 and 2016
Varies by Region
Thousand Tonnes, Percent per Year
-478 (-2.9%)
-42 (-0.7%)
-140 (-1.0%)
576 (1.0%)
76 (2.9%)
102 (1.4%)
138 (4.3%)
Global: 211 (0.2%)
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-21 (-2.3%)
Latin America: Small, Yes…
But Growing Market??
4.5
News -0.9% *
UFS 1.4%
CFS 1.4%
Cme 1.6%
Ume 1.6%
4.0
000 Tonnes
3.5
 UFS largest and growing
 Graphic demand fell 4% in
2013 and 1-2% in 2014
 Optimistically expecting this
to turn slightly positive in
2015-2016
 Newsprint only grade in
decline
40
3.0
2.5
2.0
1.5
1.0
0.5
0.0
99
1
3
* Annual growth rate 2015-2016
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5
7
9
11
13
15
…The Region’s Imports Are Growing While Producers
Focus on Pulp
 EBITDA margins are far better in pulp as it
leverages the low wood costs better than paper
 Newsprint requires softwood or recycled fiber,
neither of which is plentiful in Latin America, so it
is often imported
Thousand Tonnes
Latin American Net Imports Rise
1,300
1,100
900
700
500
300
100
-100
-300
News
CFS
Cme
Ume
UFS
99
41
 Uncoated freesheet exports from
Brazil offset by imports
elsewhere
1
 All other grades require imports
from abroad to fulfill market
requirements…CFS imports have
inundated certain markets
3
5
7
9
11
13
15
 Operating rates are only 88-90%
due in part to imports
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Mexico…Better Prospects than Most of Latin
America Due to Stronger GDP and Link to US
Markets
1,000
900
 Mexico GDP back to 3% in 20152016
 Uncoated freesheet struggling
with slight declines in 2013-2014
 RISI Forecast of Renewed Growth
in Demand Seems Optimistic and
Based on Stronger GDP
News 0.8% *
UFS 2.2%
CFS 3.4%
Cme 3.9%
Ume 4.7%
700
000 Tonnes
 Newsprint will not recover but
could stagnate ... an improvement
from past trends
800
600
500
400
300
200
100
0
99
1
3
* Annual growth rate 2015-2016
42
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5
7
9
11
13
15
Comparative Costs for Producing Standard 20
lb/75 gsm Cut Size Office Papers
US Dollars per Tonne, Second Half of 2013
$1,200
Mill Cash Costs
SG&A
Capital Costs
Delivery to Natural Market
$1,000
$800
$600
$400
43
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Mexico
Western
Europe
China
Japan
Nordic
Indonesia
US South
Brazil
Thailand
$-
Central
and
Eastern…
$200
World Uncoated Freesheet Demand
Million Tonnes, Percent Change
2011
2012
2013
2014
2015
2016
North America
%ch
9.3
-4%
8.8
-5%
8.8
0%
8.4
-5%
8.1
-3%
7.9
-3%
Western Europe
%ch
7.6
-5%
7.4
-3%
7.0
-5%
7.0
0%
7.0
-1%
6.9
-1%
Eastern Europe
%ch
3.0
-3%
3.1
2%
3.1
1%
3.1
1%
3.1
-2%
3.1
0%
Far East
%ch
26.9
4%
27.3
2%
27.7
2%
27.8
0%
28.0
1%
28.3
1%
Latin America
%ch
3.6
1%
3.6
0%
3.6
0%
3.7
2%
3.7
1%
3.8
1%
Middle East, Africa, Oceania
%ch
3.2
5%
3.4
6%
3.2
-4%
3.3
3%
3.4
3%
3.5
3%
53.7
1%
53.6
0%
53.5
0%
53.3
0%
53.4
0%
53.5
0%
Total
%ch
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Global Demand for Cut Size Uncoated
Freesheet Paper
Thousand Tonnes
19,000
18,000
17,000
16,000
.
15,000
14,000
13,000
45
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North American Demand for Cut Size Uncoated
Freesheet Paper (Thousand tonnes)
6,000
5,500
5,000
4,500
4,000
3,500
3,000
2000
46
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
© Copyright 2015 RISI, Inc. | Proprietary Information
2011
2012
2013
2014
2015
2016
Latin American Demand for Cut Size Uncoated
Freesheet Paper (Thousand Tonnes)
1,600
1,500
1,400
1,300
1,200
1,100
1,000
900
800
700
47
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Per Capita Consumption of Cut Size Uncoated
Freesheet Paper by Region
KG/Person
18
16
14
12
10
8
6
4
2
0
2000
2013
2023
Europe
North
America
Asia/Far
East
Oceania
Middle
East
Africa
Latin
America
Global Overcapacity Developed in
2011-2013
Announced Net Uncoated Woodfree Capacity Changes for 2011-2013 vs.
Demand Growth for the Same Period, Thousand Tonnes
5,000
4,000
Capacity Growth
Demand Growth
3,000
2,000
1,000
0
-1,000
Europe
N. America
Asia, ME,
OCE, Afr
Latin America
Global
Note: Asian capacity expansions exclude the offsetting effect of government mandated closures of small, old, polluting mills
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Leading to a Rise in Exports from Asia While
Brazil’s Net Exports of Uncoated Freesheet
Stagnate
Thousand Tonnes of Net
Exports
3,000
Brazil
Indonesia
China
2,500
2,000
1,500
1,000
500
0
-500
1999
2001
2003
2005
2007
2009
© Copyright 2015 RISI, Inc. | Proprietary Information
2011
2013
2015
UFS Demand and Capacity Changes More
Balanced for 2015-2016
Announced Net Uncoated Woodfree Capacity Changes for 2015-2016 vs.
RISI Forecast of Demand Growth for the Same Period,
Thousand Tonnes
5,000
4,000
3,000
Capacity Growth
Demand Growth
2,000
1,000
0
-1,000
Europe
N. America
Note: includes prorated capacity changes for 2014
Asia, ME,
OCE, AFR
Latin America
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Global
Uncoated Woodfree Operating Rates
North American shuts had surprisingly little impact on operating
rates due to surge in imports
100%
99%
98%
97%
96%
95%
94%
93%
92%
91%
90%
89%
88%
87%
86%
85%
84%
83%
N. America
W. Europe
Asia
Brazil
2008
2009
2010
2011
2012
2013
© Copyright 2015 RISI, Inc. | Proprietary Information
2014
2015
2016
Paper & Board Markets – Global
Paper and Board Demand
Newsprint
Printing &
Writing
27 mt
7%
Tissue
Cartonboard/O
ther
• Improvements in developed economies, led by
robust growth in the USA and the end of
recession in Western Europe, will drive
improved paper and paperboard demand
growth over the next two years.
• This improvement comes even as the Chinese
economy slows and Brazil officially enters
recession, but the growth of the US economy
seems to be domestically fueled.
• A major round of capacity expansion in Asia will
put pressure on global tissue and boxboard
markets despite projected healthy demand
growth.
Containerboard
Figures outside of pie chart are forecast changes
in demand from 2014 to 2016.
• Despite major capacity closures by North
American producers in 2014, global graphic
paper markets remain oversupplied, with
stagnant global P&W demand and a negative
outlook for newsprint.
Muchas gracias!
[email protected]
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Thank you for your attention!
For more information:
Latin American Forecast
www.risi.com/latinam