In 2019, China's household paper market continued to grow steadily, with fierce market competition. The investment in new projects mainly focuses on the expansion of leading enterprises and the equipment upgrading of existing small and medium-sized enterprises, so as to further improve the industry concentration and overall equipment level. Relatively excess capacity and stringent environmental requirements increase the pressure on small and medium-sized enterprises. Relying on the sharp drop in commodity pulp prices and their economies of scale, leading enterprises have effectively improved their gross profit margins through effective measures such as saving energy and reducing consumption, strengthening the construction of new channels such as e-commerce, optimizing product structure, and launching new products with high added value.
I. the white paper on sustainable development of China's paper industry was released
On February 22, 2019, the China paper association and the China paper association jointly released the first white paper of China's paper industry, the white paper on sustainable development of China's paper industry. For the first time, the paper industry in China has made efforts and achievements in sustainable development. It is of great significance to understand the development of papermaking industry and eliminate the misunderstanding of papermaking industry. Including China papermaking industry overview, the white paper length, sustainable development, circular economy, sustainable development, raw materials, and sustainable development, products article, the sustainable development, ecological environment, sustainable development, technology development and personnel training, and sustainable development, social responsibility report, papermaking industry sustainable development outlook, a total of eight parts.
Second, the industry continues to maintain the momentum of development, accelerate to the high-end development
1. Leading enterprises continue to expand production, and equipment upgrading of small and medium-sized enterprises continues
The new sanitary paper machines put into production in 2019 are mainly modern sanitary paper machines of crescent type or vacuum circle type. Among them, the new projects put into production by leading enterprises are mainly imported paper machines, but they also begin to choose domestic paper machines. Equipment upgrading and upgrading of small and medium-sized enterprises are still under way, mainly domestic paper machines. The enterprises in the north China baoding household paper base are replacing the production equipment and putting into production the new paper machine. At the same time, the backward paper machine with high energy consumption and low efficiency is basically eliminated. According to the statistics of the household paper commission up to the beginning of December 2019, the projects are summarized as follows:
(1) leading enterprises continue to expand production
★ in 2019, hengan, weida, zhongshun jieiru, liwen and other leading enterprises steadily expand production:
● hengan: in jinjiang production base, fujian province, an additional 24,000t /a hand-wiping machine from sino will be put into production in January 2019. The group's total output capacity of household paper is 1.454m t/a.
● vader: hubei xiaogan production base has added two 30,000t /a sanitary paper machines from tusk, which will be put into production in June 2019 and September 2019 respectively. In addition, one energy-consuming paper machine of guangdong xinhui factory was eliminated, and the total output of household paper of the group reached 1.25 million t/a.
● zhongshun jieiru: hubei xiaogan production base has added 4 PMP 25,000 t/a sanitary paper machines, which will be officially put into production from may to November 2019. The group's total output capacity of household paper is 760,000 t/a.
● liwen: in jiujiang production base, jiangxi province, 6 new 17,000t /a sanitary paper machines from baotou will be put into production from September to October 2019. The group's total output capacity of household paper is 965,000 t/a.
(2) small and medium-sized enterprises continue to upgrade equipment
★ new paper machine:
In 2019, sichuan yibin paper industry put into production two 25,000t /a imported sanitary paper machines made by yaseli; Ring dragon, chicken born, rain sen, Dr. King, cedar, integrity, and other enterprises in production of domestic high speed tissue paper has more than 70 Taiwan (sets), equipment providers mainly include foshan treasure company, shandong sino, shaanxi bean wisdom, Shanghai and guizhou hengrui light good, zhucheng dazheng, xi 'an Olivia, mianyang, tianjin day light, jiangxi oklo, baoding d extension, etc. Nearly 30 sets were provided to the household paper enterprises in baoding, hebei.
★ paper machine transformation:
Jiangyin dingchang paper machine has reformed 4 crescent-type sanitary paper machines for pengzhou al paper industry, among which 2 have been put into production and 2 are being installed. The ordinary circular mesh toilet paper machine with a width of 2,850mm and a speed of 180m/min was transformed into a crescent paper machine with a speed of 450~500m/min. The steam consumption of tons of paper was reduced from 4~5t to 2.2t. Up to now, dingchang paper machinery has successfully transformed more than 20 single-cylinder and single-mesh sanitary paper machines with a speed of less than 200m/min and a diameter of 2.5m or 3.0m for domestic enterprises into medium-speed crescent paper machines.
Fang yuanzhong and quanlin group signed a contract to upgrade a wheat straw pulp sanitary paper machine in August 2019. This transformation transformed the old paper machine into a crescent type sanitary paper machine. After the transformation, the design speed of the paper machine was 600m/min, the width was 2,900mm, and the steam consumption of the ton of paper was less than 2.3t. It was put into production in October 2019. Quanlin plans to convert the company's remaining 16 paper machines into crescent paper machines.
2. The performance of listed companies keeps growing
(1) hengan group: in the first half of 2019, hengan group achieved revenue of 10.777 billion yuan, up 6.3% year on year, and net profit of 1.878 billion yuan, down 3.6% year on year. During the period, the household paper business benefited from the good market response of the group's key promotion products, such as the tea thread enjoy series and the new series of bamboo PI, and the strong e-commerce sales growth of the household paper segment, which contributed to the stable sales growth of the group.
In the first half of 2019, the income of household paper business increased by about 7.4% to about 5.461 billion yuan, accounting for about 50.7% of the group's revenue (first half of 2018:50.2%). In addition, the price of wood pulp, the raw material for paper making, fell in the first half of 2019, and the decline of raw material cost was gradually reflected in the first half of 2019, which improved the gross margin. During the period, the product gross margin rose from about 19.2% in the second half of 2018 to about 25.0% in the first half of 2019, close to the level of the same period last year (first half of 2018:25.8%). Since the group kept the product price stable when the price of wood pulp was high, there was no pressure of large-scale price reduction during the period. Therefore, the benefit brought by the cost decline was especially obvious. The group expects that the price of wood pulp will continue to decline in the second half of 2019, and the gross margin of household paper will continue to improve significantly in the second half of 2019.
(2) vidal paper: revenue of hk $11.729 billion in the first three quarters of 2019 (of which hk $9.634 billion came from household paper business), up 9.1% year on year; Gross margin increased 0.3 percentage points to 29.2%; Operating profit rose 29.8 per cent to hk $998m.
In the first three quarters of 2019, vader maintained strong growth momentum, mainly due to the company's business strategy, weak wood pulp prices and better product portfolio. In the face of increased market competition, trade tensions between China and the United States, and the continued depreciation of the renminbi, vader will continue to optimize its product portfolio, maintain rigorous cost control and develop new products to achieve the desired full year performance in 2019.
(3) zhongshun jieiru: in the first three quarters of 2019, its operating revenue reached 4.82 billion yuan, up 18.11% year on year; Net profit was 438 million yuan, up 39.96% year on year.
Iii. Relative excess capacity, intensified competition and increased operational risks of small and medium-sized enterprises; May affect the relevant industrial chain
At present, the household paper industry is still in the stage of relative excess capacity. In recent years, the new production capacity is too concentrated, the competition pressure is increasing, coupled with more stringent national environmental protection requirements, depreciation of the RMB exchange rate, marketing costs continue to increase and many other factors, making small and medium-sized paper mills operating pressure is increasing, the industry has entered a period of reshuffle. Some projects scheduled to start production in 2019 are still delayed.
Overcapacity has also affected equipment suppliers. Due to the spurt of investment in the household paper industry in recent years, many domestic equipment suppliers have been attracted to the household paper production and processing equipment manufacturing industry. While promoting technological progress in the industry and replacing imports, the price competition of equipment is also increasingly fierce. With the end of the investment peak period of this round of elimination of backward production capacity, the new market demand will gradually decline in the future, increasing the risk that small and medium-sized equipment suppliers will be eliminated.
Investment is continuing
★ projects planned to be put into production in 2020 and beyond are still based on the expansion or new base of existing household paper enterprises:
(1) leading enterprises
● jinhongye: hubei xiaogan base, planned to put into production two 60,000t /a crescent toilet paper machines of weimei in 2020; The newly-built base in rudong, jiangsu province is planned to put into production two 60,000t /a crescent toilet paper machines of vimade in 2021, and 18 25,000t /a crescent toilet paper machines of PMP in 2021 and after.
● vader: on April 3, 2019, vader's annual output of 200,000t household paper and other projects were signed and settled in deyang jingkai district. The project will invest about hk $2 billion in relocation, expansion and upgrading, and construct a western production base, e-commerce distribution center and logistics center with an annual capacity of 200,000 tons of household paper and nursing supplies, forming an efficient production, logistics and sales network. At the same time, we will speed up technological innovation in products and equipment, develop intelligent manufacturing technology, build intelligent factories, and realize automatic production and transportation of the whole process from raw paper production, processing to storage.
● zhongshun jieiru: hubei xiaogan base, planned to put into production 100,000 t/a household paper project in 2020.
Zhongshun jieiru announced on July 9, 2019 that it plans to build a 300,000t /a bamboo pulp and paper integration project. The project will be located in the lidu industrial park in lidu peninsula, lidu township, quxian county, dazhou city, sichuan province, and will involve the construction of 318,000 t/a (air dried pulp meter) bamboo pulp and 300,000 t/a household paper (including base paper and post-processing) capacity. The total investment of the project is RMB 4,087,151,000, and the project is expected to take 70 months. The preliminary work period of the project is 10 months, and the construction period is 60 months. Among them, pulping production line one-time input, three years to complete the construction; Paper production line is constructed in three phases, with a capacity of 100,000 t/a per phase.
● tiesen: a new base in suzhou, anhui province is planned to put into production two andritz 60,000t /a toilet paper machines and eight xinhe 17,000t /a crescent toilet paper machines in 2020. Jingzhou base in hubei province, with a planned new capacity of 450,000 t/a. The first phase of the project is planned to put into production 12 xinhe's 17,000 t/a crescent toilet paper machines in 2020. Guizhou chishui base plans to put into production 6 baotou 17,000t /a vacuum circular mesh sanitary paper machines in 2020; The chongqing base is scheduled to put into production 10 of sino's 17,000 t/a crescent toilet paper machines in 2021.
● dongshun: dongping base, shandong province, plans to put into production in 2020 two 30,000t /a crescent toilet paper machines (DCT60) cooperated by chuanzhijiang and weimei, and one 20,000t /a crescent toilet paper machine of bato; The first 16,000t /a sanitary paper machine of chuanzhijiang is planned to be put into production in 2020.
● lewen: on June 17, 2019, guangdong lewen high-grade paper for daily use (phase ii) project officially started. The project mainly produces and sells household paper base paper and finished products, paper diapers, diapers, wipes and so on. An investment of 600 million yuan is expected to be completed in 2021. On September 21, the people's government of chongzuo city, guangxi province and liwen paper co., ltd. officially signed the agreement of "guangxi (chongzuo) annual output of 1 million t pulp paper (household paper) e-commerce intelligent logistics industry chain project". The total investment of the project is about 11 billion yuan.
(2) baoding area
★ projects planned to be put into production in baoding region in 2020 include more than 10 enterprises including hongxing, dongsheng, huabang, ruifeng, yongxing, chenyu, zeyu, chensong, xinyu and hengxin;
★ the leading enterprises in baoding region, while actively eliminating backward production capacity and upgrading equipment, also started the strategic layout of new production bases in the country:
● gang xing paper: build a new production base in xiaogan, hubei province. The first phase of the project is planned to put into production two baotou 20,000 t/a crescent sanitary paper machines in 2020.
● baoding yusen: build a new production base in taian, liaoning, with the planned annual capacity of 160,000 t and the production of 6 crescent sanitary paper machines. The first phase of the project is planned to put into production two PMP 30,000t /a crescent toilet paper machines in 2020.
● cedar paper industry: plans to invest in areas outside baoding to set up factories, is currently in shandong and shanxi and other places for site inspection.
● dongsheng paper: build a new production base in panjin, liaoning province, sign two hualin crescent sanitary paper machines for the first phase of the project, and plan to put them into production in 2021 and beyond.
● baoding linhai: the newly-built production base (haotang paper industry) in kaiyuan, liaoning province has put into production two light and fine 17,000t /a crescent toilet paper machines in the first phase of the project, and two light and fine 20,000t /a crescent toilet paper machines in the second phase of the project in 2019.
(3) other areas
Projects planned to be put into production in other regions of China including northwest, southwest, central and south China in 2020 mainly include: more than 20 enterprises including jiamei, zhongnan, nursing care, jiada, jintong, xurong and aowei.
(4) Japanese paper companies enter the Chinese market
The two andritz 60,000t /a crescent sanitary paper machines in the first phase of the expansion project of household paper base paper in jiangsu prince paper co., ltd. located in nantong economic and technological development zone with an annual output of 360,000 t are scheduled to be put into production in the first half of 2020.
Separately, Japanese media reported that Japanese paper companies began increasing production in 2019 to tap demand for household paper such as toilet paper in China. In addition to oji's investment in China, oji has increased its domestic production capacity in Japan by 10 per cent, mainly for the Chinese market, focusing on high-end toilet paper products. Dawang paper will invest 20 billion yen in its chuanzhijiang and Kerr plants in Japan by 2021 to strengthen the production and processing equipment of household paper to expand exports to China. The company will manufacture household paper base paper at the chuanzhijiang plant, which will be processed into products by local manufacturers based in China, and plans to expand sales of moisturizing paper (cream paper) in the Chinese market.
(source: daily paper magazine)
