vietnam pulp and paper industry report …...2. the world pulp and paper industry 2.1 pulp –2.1.1...

VIETNAM PULP AND PAPER INDUSTRY REPORT Q2/2018

Table of contents

Content Page Content Page

Abbreviations 4 2.2. Paper 25

Summary 5 2.2.1. Production 25

1. Business environment 7 2.2.2. Consumption 31

1.1. Macroeconomic situation 7 2.2.3. Import - Export 34

1.2. Legal framework 12 2.3. The pulp and paper industry in some countries 37

2. The world pulp and paper industry 19 3. The pulp and paper industry in Vietnam 51

2.1. Pulp 19 3.1. History of formation and development 51

2.1.1. Production 19 3.2. Pulp 54

2.1.2. Consumption 21 3.2.1. Production 55

2.1.3. Import - Export 23 3.2.2. Consumption 56

3.2.3. Import 57

Table of contents

Content Page Content Page

3.3. Paper 58 5. Enterprise analysis 81

3.3.1. Production 59 5.1. Introduction of enterprises 81

3.3.2. Consumption 61 5.2. Indicators of business results 93

3.3.3. Export 65 5.3. Indicators of finance 100

3.3.4. Import 68 5.4. Indicators of performance efficiency 104

4. Overview of the industry 71

4.1. Competitiveness analysis 71

4.2. Planning 75

Abbreviations

AEC ASEAN Economic Community GDVC General Department of Vietnam Customs

CAGR Compound Annual Growth Rate GSO General Statistics Office (of Vietnam)

CEPI Confederation of European Paper Industry JPA Japan Paper Association

CPA China Paper Association MFN Most Favored Nation

CPTPPThe Comprehensive and Progressive agreement

for Trans-Pacific PartnershipRISI

Resource Information Systems Inc. (an

information port of pulp and paper industry)

FAO Food and Agriculture Organization SBV State Bank of Vietnam

GDP Gross Domestic Product VPPA Vietnam Pulp and Paper Association

Summary

Content is intentionally removed for demo purpose

• Produced pulp volume in the world reached 156.8 million tons in 2017

• Produced paper volume in the world was nearly 432 million tons in 2017

• In the 1st quarter of 2018, export value of pulp and paper of Vietnam was 208.5 million USD

• In 2017, the number of consumed pulp increased by 11.2% to 171,319 tons in comparison with that in 2016,

• Pulp import is forecast to be the main trend of manufacturers in the paper industry

Summary

• From 2011 to 2017, the production of paper grew at the CAGR of 6.62%. In the 1st quarter of 2018, the quantity of produced paper reached

approximately 889 thousand tons.

• Paper consumption in Vietnam market has been rapidly increasing at the average rate of 7.37% per year between 2011

and 2017

• The number of exported paper of Vietnam in Q1/2018 was about 51 thousand tons which

valued 208.5 million USD, increasing by 48.2% compared with the same period of 2017

Table of contents

1. Business environment

1.1 Macroeconomic situation

1.2 Legal framework

gross domestic product in the 1st quarter of 2018 was estimated to

increase by 7.38% compared with the same period of 2017

• According to reports by General Statistics Office (GSO), the

production index of processing and manufacturing industry in

Q1/2018 increased by 113.8% in comparison with the same period of

Source: VIRAC, GSO

GDP growth, 2011 - Q1/2018

Production index of processing and manufacturing industry,

2012 - Q1/2018

• Average interest rate has tended to decrease since 2011

• Export value of Vietnam in Q1/2018 was estimated to reach 55 billion USD

• Import Export value of Vietnam in Q1/2018 was about 52.8 billion USD

Source: VIRAC collects

Proportion of the contribution of pulp and paper industry to

Vietnam’s export value, 2012- Q1/2018

Average interest rate, 2012- Q1/2018

Source: VIRAC, NFSCContent is intentionally removed for demo purpose

• The VND/USD exchange rate is quite stable and still supported by a

plentiful supply of foreign currencies

Source: VIRAC, NHNN

The VND/USD exchange rate, 2015-Q1/2018

The VND/CNY exchange rate, 2016-Q1/2018

Report on socio-economic situation in 2017 by the General Statistics Office revealed that total revenue of services and goods retails was about 3,934.2

trillion VND

The current positive status of services and goods business has positively impacted the paper and pulp demand

The young population structure creates a potential environment for

the development of the paper industry

Source: VIRAC, GSO

million

people

Vietnam’s population and population structure in workforce,

2010-2017

Table of contents

1.2 Legal framework

Group of regulations on pulp and paper business and production

No. Scrap HS code

1.2 Legal framework

Allowable imported scrap Fee (thousand VND/ profile)

1.2 Legal framework

Energy rated consumption for paper products until the end of 2020

No Product Capacity (ton year)Rate

(MJ/ton)

Group of regulations on import taxes of pulp and paper industry

1.2 Legal framework

2. The world pulp and paper industry

2.1 Pulp

2.1.1 Production

2.1.2 Consumption

2.1.3 Pulp trade

2.2 Paper

2.2.1 Production

2.2.2 Consumption

2.2.3 Paper trade

2.3 The pulp and paper industry in some countries

Table of contents

2.1 Pulp – 2.1.1 Production

million tonsWorld pulp output quantity reached 156.8 million tons in 2017, increasing

by 3.1 million tons which was equal to 2.0% growth in comparison with the

year 2016

Source: VIRAC, FAO

The United States has the world’s highest output quantity

World pulp output quantity, 2014-2020f

Structure of pulp production by country, 2017eContent is intentionally removed for demo purpose

2.1 Pulp

2.1.1 Production

2.1.2 Consumption

2.1.3 Pulp trade

2.2 Paper

2.2.1 Production

2.2.2 Consumption

2.2.3 Paper trade

Table of contents

2.1 Pulp – 2.1.2 Consumption

Source: VIRAC, CEPI

Asia is the world’s largest consumer of pulp with the consumption of

60.8 million tons (2016)

World pulp consumption by type, 2011 – 2017e

million tons

Source: VIRAC, CEPI

The number of pulp consumption over the world in 2017 was 178 million

tons, decreasing by 1 million ton which was equal to 0.6% decline in

comparison with the year 2016

Structure of world consumption by region, 2016e

2.1 Pulp

2.1.1 Production

2.1.2 Consumption

2.1.3 Pulp trade

2.2 Paper

2.2.1 Production

2.2.2 Consumption

2.2.3 Paper trade

Table of contents

2.1 Pulp – 2.1.3 Pulp trade

Source: VIRAC, TrademapContent is intentionally removed for demo purpose

World pulp export - import, 2016 – 2017

The world pulp import value in 2017 experienced fairly marked growth

The world pulp import and export increased in 2017 thanks to 2

main reasons:

2016 2017 Growth

Source: VIRAC, Uncomtrade

Top 10 countries that have the highest pulp import, 2016-2017

Unit: million tons

2.1 Pulp

2.1.1 Production

2.1.2 Consumption

2.1.3 Pulp trade

2.2 Paper

2.2.1 Production

2.2.2 Consumption

2.2.3 Paper trade

Table of contents

2.2 Paper – 2.2.1 Production

million

World paper output quantity experienced a continuous increase with CAGR

of 1.6% from 2012 to 2017

Source: VIRAC, RISI, CEPI

The world’s largest paper manufacturer is China with paper output of

108.5 million tons, followed by the United States with 77.7 million tons,

and next by Japan with 26.1 million tons (2016)

Top 10 leading countries in paper production output, 2016e

World paper output quantity, 2012-2017e

Source: VIRAC, RISI

Paperboard and packaging paper

Structure of world production of paperboard and packaging paper,

World output quantity of paperboard and packaging paper,

2012-2017e

Tissue paper

Global tissue paper output quantity, 2000 – 2017e

Global output quantity of tissue papers, by type,

2012 – 2016e

Market shares of the world supplies of tissue papers, 2016e

Source: VIRAC, PapnewsContent is intentionally removed for demo purpose

Newspaper and printing paper

2.1 Pulp

2.1.1 Production

2.1.2 Consumption

2.1.3 Pulp trade

2.2 Paper

2.2.1 Production

2.2.2 Consumption

2.2.3 Paper trade

Table of contents

2.2 Paper – 2.2.2 Consumption

The 5-year period between 2012 and 2016 witnessed a gradual growth

of the global paper consumption.

Paper consumption was nearly 414 million tons in 2016, increasing 3

million tons in comparison with the year 2015

Global paper consumption by region, 2012 - 2016e

Source: VIRAC, CEPI

Global revenue from paper consumption, 2012-2020f

Source: VIRAC, Statistic

2.2 Paper – 2.2.2 Consumption

Some trends in 2018 impact the world paper:

• Retails:

• The development of the Internet:

• Health consciousness:

• Environmentally friendly products

2.1 Pulp

2.1.1 Production

2.1.2 Consumption

2.1.3 Pulp trade

2.2 Paper

2.2.1 Production

2.2.2 Consumption

2.2.3 Paper trade

Table of contents

2.2 Paper – 2.2.3 Paper trade

• in 2017, total export value of paper in the world increased to

159.5 billion USD, by 5.3% compared to 2016

Source: VIRAC, Trademap

World export value of paper, 2010-2017ebillion USD

• In 2017, paperboard and packaging paper were the most exported

products, accounting for 52.5% of total paper export value over the

world.

Structure of global paper export by type, 2017eContent is intentionally removed for demo purpose

2.2 Paper – 2.2.3 Paper trade

Top 10 countries that have the highest paper export value, 2017e

2016 (billion USD) 2017 (billion USD) Growth2016 (billion

2017 (billion

USD)Growth

Top 10 countries that have the highest paper import value, 2017e

2.1 Pulp

2.1.1 Production

2.1.2 Consumption

2.1.3 Pulp trade

2.2 Paper

2.2.1 Production

2.2.2 Consumption

2.2.3 Paper trade

Table of contents

2.3 The pulp and paper market in some countries

Area of woods

Population (2016)

GDP (2016)Content is intentionally removed for demo purpose

Source: VIRAC, VPPA

Paper production and consumption in China, 2016e

Source: VIRAC, VPPA

China’s pulp output quantity by input materials, 2012 - 2016e

China’s pulp import-export, 2012 - 2017e

Structure of China‘s pulp import, 2017

billion USD

billion USDChina’s paper import-export, 2013 - 2017e

Source: VIRAC, Uncometrade

The United States

Area of woods

Population (2016)

GDP (2016)

The United States ranked 2nd in terms of paper output quantity with 79.02

million tons

The US pulp production, 2010-2017e

Source: VIRAC, FAO

The US paper output quantity, 2011 - 2017e

million

The US import-export value of pulp, 2010 – 2017e

billion USD

Top 10 countries that have the highest pulp export value to the US,

Source: VIRAC, Uncomtrade Source: VIRAC, Uncomtrade

2016 2017 Growth

Unit: USDStructure of the US pulp export by value, 2017e

Paper trade in the US, 2016 – 2017e

Japan is the third largest paper producer and the 4th largest wood pulp

producer over the world

Source: VIRAC, JPA

Area of woods

Population (2016)

GDP (2016)

Output quantity of paper and paperboard in Japan,

2012 – 2017e

Japan’s pulp import-export, 2010 – 2017e

billion USD

Japan’s recycled paper export-import,

2010-2017ethousand

Source: VIRAC, JPA Source: VIRAC, JPA

Source: VIRAC, JPA

Japan’s trade of paper and paperboard, 2016 – 2017e

Structure of Japan’s paper import, 2017e Structure of Japan’s paper export, 2017e

Year of

EstablishmentHeadquarter

Revenue,2016

(billion USD)Logo

Top 10 largest paper companies over the world, 2016

Table of contents

3 The paper and pulp in Vietnam

3.1 History of formation and development 3.3 Paper

3.2 Pulp 3.3.1 Production

3.2.1 Production 3.3.2 Consumption

3.2.2 Consumption 3.3.3 Export

3.2.3 Import 3.3.4 Import

3. The paper and pulp in Vietnam

3.1 History of formation and development

Source: VIRAC tổng hợp

History of formation and development of paper industry

3.1 History of formation and development

Table of contents

3.2. Pulp – 3.2.1. Production

Output quantity of Pulp, 2010 – Q1/2018

Source: VIRAC, GSO

3.2. Pulp – 3.2.2. Consumption

Pulp consumption by volume, 2010 – Q1/2018 Revenue of pulp consumption, 2010 – Q1/2018

Domestic pulp consumption fluctuates depending on trend of pulp production.

million VND

Source: VIRAC, GSO

Source: VIRAC, ITC, TRADEMAP

Source: VIRAC, UNCOMTRADE

3.2. Pulp – 3.2.3. Import

thousand USDPulp import, 2011 - 2017

Top 10 countries that have the highest volume of pulp

imported by Vietnam, 2017

Vietnam’s pulp import has continuously risen for 2 current years,

increasing to151,720 thousand USD (2017), by 18.6% compared to the year

In 2017, the US was the major pulp supplier for Vietnam market with

market share of 42.3%2016 2017 Growth

Table of contents

3.3. Paper – 3.3.1 Production

Source: VIRAC, VPPA

• Between 2011 and 2017, paper production grew at CAGR of 6.6.2% Structure of paper production by type, Q1/2018

Paper production by type, 2011 – Q1/2018

3.3. Paper – 3.3.1 Production

• Packaging paper:

• Paper for printing and writing:

• Tissue paper:

• Joss paper:

• Paper for newspaper printing:

Source: paperonwebSource: VIRAC, VPPA

kg per capita

3.3. Paper – 3.3.2 Consumption

Source: VIRAC, VPPA

Domestically produced paper consumption,

2011 – Q1/2018

Average paper consumption per capita in Vietnam,

2011 – 2017Average paper consumption per capita in some countries,

Paper consumption in Vietnam market rapidly increases at the rate of 7.37% per

year from 2011 to 2017

Source: VIRAC, GSO

million VND

Source: VIRAC, VPPA

Revenue from paper industry, 2010 – Q1/2018

Structure of paper consumption by type, Q1/2018

Source: VIRAC tổng hợp

Structure of tissue paper consumption by type,

Source: VIRAC, GSO

Inventories of some paper products, 2010 – Q1/2018

As a feature of paper industry, paper products should not be stored for a long time due to the risk of fire, mold and rottenness that reduce product

quality and enterprise’s activities

Source: VIRAC, VPPA, TCHQ

tons million

Source: VIRAC, TCHQ

3.3. Paper – 3.3.3 Export

Paper export, 2011 – Q1/2018Vietnam’s paper export in Q1/2018 reached nearly 51 thousand tons,

which valued 208.5 million USD, increasing by 48.2% compared to

the same period in 2017.

Top 10 countries that are Vietnam’s major paper importers, by value

Q1/2018

In Q1/2018, China is still Vietnam’s major importer with value of 37.4 million

Source: VIRAC, TCHQ

Contribution of FDI businesses to paper export, 2013 – 2017

Export of some paper products, 2011 - 2016

Source: VIRAC, VPPA, TCHQ Source: VIRAC, VPPA, TCHQ

Source: VIRAC, TCHQ

million USD

3.3. Paper – 3.3.4 Import

Paper import, 2011 – Q1/2018 Import of paper products, 2011 – Q1/2018

Structure of import paper and paper products by value,

Q1/2018According to General Department of Vietnam Customs (GDVC), in Q1/2018,

Vietnam imported 480 thousand tons of papers, which value 437 million USD

China is the largest exporter of paper and paper products to

Vietnam

Structure of paper import by volume, 2017

Source: VIRAC, TCHQ

Top largest paper import enterprises in Vietnam, Q1/2018

No. Enterprise

Table of contents

4 Overview of the industry

4.1 Competitiveness analysis

4.2 Planning

4. Overview of the industry

4.1. Competitiveness analysis

5-force analysis

Strengths: Weaknesses:

Opportunities: Threats:

Table of contents

4 Overview of the industry

4.1 Competitiveness analysis

4.2 Planning

4.2. Planning

Target of the paper industry development until 2025

Orientation of development

4.2. Planning

No. Project’s manager RegionDesigned capacity (tons/year)

PeriodPulp Paper

Portfolio of investment projects by period

4.2. Planning

Source: VIRAC, Development planning of Vietnam paper industry until 2020-2025

Portfolio of investment projects by period

No. Project’s manager RegionDesigned capacity (tons/year)

PeriodPulp Paper

4.2. Planning

Criterion Unit 2015 2020 2025

Criteria of designed capacity

Criterion Unit 2015 2020 2025

Criteria of output quantity

4.2. Planning

Period

Regions (Unit: ha)

North-

westNortheast Central

Northern

CentralCentral Coast

Northern

Central

Highlands

Southern

Central

Highlands

Southwest

Regions of growing material trees for paper production

Table of contents

5. Enterprise analysis

5.1 Introduction of enterprises

5.2 Indicators of business results

5.3 Indicators of finance

5.4 Indicators of performance efficiency

Typical enterprises in paper and pulp industry, 2016

Enterprise Address Tax code

Net revenue

(million VND)Total assets

(million

VND)2015 2016

Diana Unicharm Joint Stock Company

An Hoa Paper Joint Stock Company

Viet Hung Packaging Ltd.

Bien Hoa Packaging JSC

Sabeco – Song Lam Packaging JSC

Viet Tri Paper JSC

An Binh Paper JSC

Hai Phong Stationery & Packaging Corporation

Dong Hai JSC of Ben Tre

Khatoco Printing and Packaging JSC

Table of contents

Growth of net revenue, 2015 - 2016billion

Source: VIRAC collectsContent is intentionally removed for demo purpose

Gross profit margin, 2015 - 2016

Sales expenses/ Net revenue, 2015 – 2016

Enterprise management expenses/ Net revenue, 2015 - 2016

Financial expenses /Net revenue, 2015 - 2016

Table of contents

Days of sales outstanding, 2015 - 2016days

Source: VIRAC collectsContent is intentionally removed for demo purpose

Liquidity, 2016

Days' sales in inventory, 2016

Structure of Assets and Total assets turnover, 2016

Structure of debts and Debt/Equity ratio2016

Table of contents

Ratios of profitability on assets and equity, 2016

REPORT DISCLAIMER

Report disclaimer

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independent verification. VIRAC has produced this report for private circulation to professional clients only. All information and

statistical data herein have been obtained from sources we believe to be reliable and made to ensure the accuracy of the contents of

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vietnam pulp and paper industry report …...2. the world pulp and paper industry 2.1 pulp –2.1.1...

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