Chinese and Korean Coupon Papermakers Sit and Talk

The trend of Shanghai coated paper market is of concern: The price dropped sharply in the first half of this year and fell below 7,000 yuan/ton at the lowest. What's wrong with this? According to industry sources, this is mainly due to the low price of Korean coated paper sold in China.

Sino-Korea copperplate paper mills have taken the opportunity to sit down for peace talks. This is the first time that China’s copperplate paper industry has fallen into a trade war. On the one hand, it is related to the price trend of coated paper, and it also shows that Chinese coated paper companies have the ability to participate in the international market dialogue during the development. In the increasingly fierce market competition, how can domestic companies improve their own response capacity? The peace talks should be instructive.

Purpose of negotiation: harmony

August 13, 2001 afternoon, Zhenjiang Jindong Paper (Jiangsu) Co., Ltd.

The Sino-Korea Coinplate Factory first sat down to face-to-face negotiations. South Korea sent 4 staff to represent 6 factories: Hansong Paper, South Korea Paper, New Maolin Paper, Xinhu Paper, and Polar Bear Paper, Hongyuan Paper; and China participated in five companies: Shandong Quanlin Paper, Mudanjiang Daewoo Paper, Zhenjiang Jindong Paper, Shandong Wanhao Paper and Shanghai Jiangnan Paper Mill.

The theme of the talks was the low-cost sales of Korean coated paper in the Chinese market.

South Korea believes that the current fierce competition in the Chinese coated paper market should be the Chinese reduced production insured price; while the Chinese attitude is tough, given the fact that Korean coated paper is sold at a low price in the Chinese market, the Korean side should reduce the number of exported copperplate papers exported to China and put The price of coated paper exported from China is equivalent to the price in the Korean domestic market.

According to reports, there was no word "dumping" at the meeting and the two sides obviously wished to talk "and". However, according to the statistical data of the General Administration of Customs of China in 2001, the import volume of Korean coated paper in April increased by 7.93% compared with the same period of last year, while the import amount was only 25.36 million US dollars, which was a drop of 0.05% from the same period of last year. The phenomenon of price increase and price drop is very obvious.

The data provided by South Korea shows that 100G coated paper is 727 US dollars / ton for South Korea, and 708 US dollars / ton for 120-180G coated paper. From the Chinese market, it is calculated that the current dealer price of Korean coated paper in China is about RMB 7,200-7,800/ton, after deducting 15% customs duty, 17% VAT, and an issuance fee and terminal fee of RMB 250/ton, Its CIF should be converted to 620-670 US dollars / ton, and deducting about 20 US dollars per ton of freight, the actual CIF is only 600-650 US dollars / ton.

Chinese Enterprises: With Dialogue Capital

The peace talks were initiated by the ROK. Relevant people believe that the reason why Korean companies sit down to negotiate with Chinese companies is that the key factor is that China’s coated paper companies have accumulated enough industrial strength after the development of the past few years.

Coated paper is high-grade printing paper. In the past, due to problems in technology, equipment, and raw materials, our country could only rely on imports. After 1996, with the successive production of coated paper enterprises in China, the monopoly of imported coated paper was gradually broken. By the end of 2000, China's domestic production capacity of copperplate paper was about 920,000 tons, with approximately 400,000 tons of Gold East Paper Phase II, 200,000 tons of Shandong Chenming Group, 200,000 tons of Shandong Gaotang Paper, and Zixing Paper II. 400,000 tons will be launched one after another. Within a year or two, the production capacity of domestic coated paper will also increase by 1.2 million tons.

For the Korean low-cost exports, Chinese companies began to take active action in June this year. Coated paper was reduced from 7,600 yuan/ton to 7,200 yuan/ton. As a result, the Korean companies have been “unforgettable” and have taken the initiative to communicate with Chinese companies and requested peace talks.

The five major Chinese companies that sat down with the Korean side to discuss peace have state-owned holding companies and foreign-owned holding companies. The five companies' production capacity accounts for more than 80% of the domestic production capacity of copperplate paper, and the six Korean companies are also the largest copperplate production enterprises in South Korea, with an annual production capacity of approximately 1.4 million tons. Therefore, although it is a small-scale negotiation, it has attracted a lot of attention.

If the meeting is not opened for too long, substantial progress will be made. The ROK said that it will raise the price of coated paper exported to China in September, reduce the quantity of coated paper exported to China, and promised to submit a specific price adjustment plan by August 22.

This means that in the Chinese-foreign trade competition, Chinese companies are fully capable of dialogue.