Bracing for a potential hardwood pulp price correction

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Bracing for a potential hardwood pulp price correction

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Pulp & Paper - LatAm

Bracing for a potential hardwood pulp

price correction

Price Objective Change

Cautious stance on pulp reinforced 14 June 2026

As we approach the second half of the year, we mark-to-market our pulp price forecasts Equity

while maintaining our cautious view on the commodity. In our assessment, current price Latin America

levels already reflect a late-cycle environment. Although the market proved tighter than Pulp & Paper

expected in recent months, supporting stronger pricing than we had anticipated (close to Caio Ribeiro >>

~US$600/t), recent indicators suggest that this dynamic may be shifting. As a result, we Research Analyst

believe pulp prices are at a near-term peak, with the balance of risks now pointing to a Merrill+55 11Lynch2188-4375(Brazil)

downward move. caio.ribeiro@bofa.com

Guilherme Rosito >>

Signposts point to ST peak, with downside risks building ResearchMerrill LynchAnalyst(Brazil)

A number of key indicators suggest that market conditions are becoming increasingly +55 11 2188 4363

guilherme.rosito@bofa.com

consistent with late-cycle dynamics. Resale prices are now trading at a discount to

Mariana Leite >>

imported price benchmarks, pointing to softer underlying spot conditions, while demand Research Analyst

signals have started to weaken, as reflected in lower shipment volumes and more Merrill Lynch (Brazil)

+55 11 2188 4073

cautious buyer behavior. At the same time, papermaker margins remain under pressure, mariana.leite@bofa.com

constrained by lack of success in hiking paper prices and structurally higher costs. George L. Staphos

Although hardwood pulp prices have stabilized around ~US$600/t and remain above cost Research Analyst BofAS