China Paper Sector: Robust demand growth, but upstream tightness capped margin recovery

研报英文原文证据摘录

China Paper Sector: Robust demand growth, but upstream tightness capped margin recovery

Global Research

20 July 2026ab

China Paper Sector Equities

AsiaRobust demand growth, but upstream tightness

capped margin recovery Basic Materials

Sharon Ding

Analyst

sharon.ding@ubs.com

Demand +8% YoY, net imports -52%, lifting utilization and self-sufficiency +852-2971 6284

China's domestic demand for paper (containerboard, whiteboard and P&W paper) Elvis Liu

reached 40mt in 5M26, up 8% YoY. Robust packaging paper demand continued to be Associate Analyst

driven by F&B consumption, electronics, and e-commerce activity. Meanwhile, rising elvis.liu@ubs.com

overseas energy costs lifted Southeast Asian paper prices, further reducing import +852-3712 3052

competitiveness and accelerating China's import substitution trend. Containerboard

demand (26mt) grew 8% YoY while net imports declined 23% YoY. Utilization rates

increased by 3ppt YoY for linerboard and 4ppt for corrugating medium. Whiteboard

domestic demand (10mt) rose 12% YoY, and net exports up 13%, with utilization rates

improving by 1ppt for coated duplex board and 5ppt for bleached folding boxboard. In

contrast, P&W paper remained under pressure amid ongoing digitalization and weak

traditional publishing demand. Domestic demand (4mt) was largely flat, with producers

relying increasingly on exports (+27% YoY) to mitigate domestic oversupply. Utilization

rates continued to decline, falling 3ppt YoY.

Recovered paper shortage deepens; domestic pulp production surges

Recovered paper (RCP) supply remained tight in 1H26, driven by: (1) strong packaging

paper production supported by solid domestic demand and rising self-sufficiency; (2)

prolonged rainfall, which further disrupted waste paper collection in 2Q26; and (3)