Report by ERA Research

Pulp exports from Russia’s large forest resource mainly head towards China, therefore Western sanctions will see little direct impact on pulp prices. Nevertheless, ERA Research expects pulp prices to remain stronger for longer in the face of logistical issues that will present themselves, with early-year strength continuing for longer before excess inventories are finally delivered. Recommended trades include LONG Mercer, with another quarter of low maintenance and good shipments expected (TP $16). Despite the strong pulp outlook, investors should EXIT Rayonier Advanced Materials with a heavy maintenance year ahead a key risk.