Vietnam's economy in general and the paper industry in particular still have positive signals in the first 5 months of 2020. Paper production is estimated at 1.85 million tons, increased 7.8%; paper exports reached 656.9 thousand tons, increased 97.4%; paper import reached 853.1 thousand tons, increased 7.8% over the same period of 2019. Of which, packaging paper and tissue paper grew in production, export and import.

Positive trend

Domestic packaging paper production will increase sharply again from the third quarter of 2020, due to the recovery of supply of domestic recycled paper, world supply and better logistics capacity, recycled paper prices is decreasing and tends to continue decreasing in the future. Domestic consumption of packaging paper will strongly increase again from the third quarter of 2020, and Vietnam is expected to announce the end of the epidemic in July 2020; The approved EVFTA Agreement will encourage and boost the export of apparel, fisheries, footwear and electronics; the shift of FDI into Vietnam, the government set GDP target for 2020 at  4.5 - 4.8%.

Consumption of printing paper and writing paper will increase again in the third quarter of 2020, production of notebooks, export notebooks and domestic production and processing of goods will increase again.

The consumption of tissue paper in the group of tissues will rise again from the third quarter of 2020, the service of catering is growing, the tourism industry is surging up by means of stimulus package and preparing in the main crop of the third quarter.

The price of pulp is likely to clinb up in the third quarter of 2020, the pulp manufacturing plants in South America changes the long-term maintenance plan in the second quarter to the third quarter, production of printing paper and writing paper increase in the third quarter in Western Europe and North America.

The price of import recycled paper is likely to drop sharply, the supply will increase again in Western Europe and North America but the demand for paper production in many importing countries such as India, Mexico, Indonesia ... has not yet recovered. The economy still stagnates due to the impact of the pandemic; China has granted permission to import 4.51 million tons of recycled paper in the first 4 months of 2020, down 43% over the same period, expected to import 7 million tons in the whole year (11 million tons in 2019).

Negative trend

Export of packaging paper to the Chinese market is expected to fall, and the economy of China in 2020 is not expected to grow. Export of packaging paper to other markets will compete sharply on prices, lower production materials, and global consumer demand will also fall when the world economy is forecast to decrease by 5.2% compared to 2019.

Domestic printing and writing paper will compete fiercely with foreign paper from Indonesia, China, and Thailand, with low consumer demand in the region, while inventories soar, their currencies depreciate against USD, exports to Vietnam market will increase accordingly.