Global pulp capacity expansion slows as China reduces deficit

Compared to our previous world fiber map from 2020, our new Recovered paper and pulp world map reflects growing hardwood pulp trade and less dynamic softwood pulp trade in 2023, a result of one of the most significant capacity expansion phases in recent decades in South America and Asia. Here, we explore how these trends will evolve as the next pulp market cycle begins and what this means for global pulp market participants. First, we consider the short-term market outlook for pulp prices. A downtrend in the second half of 2024 compressed margins and increased downtime at many mills at the beginning of 2025. A more balanced market in the second half of the year could create the right conditions for a gradual rebound in pulp prices from Q3 2025 onward. Second, we explore how changes in China’s pulp production could impact global trade going forward. We also outline why we believe a new phase of hardwood capacity expansion will be smaller and more challenging to complete.