Global Pulp & Paper: P&P Digester: Price Discounts vs. Weather Disruptions

Research evidence excerpt

Global Pulp & Paper: P&P Digester: Price Discounts vs. Weather Disruptions

Global Research

23 July 2026ab

Global Pulp & Paper Equities

Latin AmericaP&P Digester: Price Discounts vs. Weather

Disruptions Forest Products & Paper

Caio Greiner

Analyst

caio.greiner@ubs.com

Could recent weather disruptions limit the downside to prices? Running our +55-11-2767 6294

industry channel checks over the past few days, we found the sector at a crossroads:

Andrew Jones

traders and buyers are calling for discounts, while sellers are pushing for price

stability, supported by recent weather-related disruptions. On one hand, we heard andrew-i.jones@ubs.com

from several traders that buyers are demanding US$20-30/t discounts in the next +44-20-7901 6545

round of negotiations, which would push prices down to US$550-560/t. They argue

Timothy Handerson

that demand remains seasonally soft, while new capacity is expected to come

online in China and Indonesia over the coming months; the market is seen as tighter timothy.handerson@ubs.com

in EU/NA than in China. TTOBMA also indicated this week that “recent feedback +62-21-2554 5000

adds downside risk to the $570/t assumption in July; pricing could be as low as

Sharon Ding

$550/t.” On the other hand, producers are still fighting to keep July prices stable, Analyst

arguing that demand is actually picking up from summer lows, inventories are sharon.ding@ubs.com

depleted, and the restocking season is approaching. Furthermore, Typhoon Maysak +852-2971 6284

brought significant flooding and rainfall to Guangxi province, damaging roads, local

Anojja Shah

infrastructure, and eucalyptus plantations. Our channel checks indicated that these Analyst

weather-related disruptions to wood supply caused woodchip prices to rise 5-8% in anojja.shah@ubs.com