The upstream pulp sector continues to cope with a decrease in demand worldwide. Over 2015, most regions saw pulp production (and prices) declining on average, especially leading producer China (-2% y/y) and Brazil, down -2.5% since an annual high in 2012.
The downstream sector does not seem to fare better with no end in sight for graphic paper long-term decrease. Asia, which accounts for 45% of total paper and board demand, can barely make up for sluggish demand from either Western Europe or slowing-down Latin America.
The situation seems most challenging in Europe because of the strong dollar, which weighs down on European pulp buyers. Add to that the growing competition from digital devices (much tougher than in Asia) leading to plant closures.
Tissue and corrugated papers are the only two subsectors to stand out, still on a positive trajectory, thanks to a rising demand for e-commerce packaging.