China’s paper and paper products industry generated RMB1,418.67 billion in revenue in 2025, down 2.6% year-on-year, while total profits fell 13.6% to RMB44.30 billion, according to National Bureau of Statistics data cited in Shandong Chenming Paper Holdings’ FY2025 annual report. Even as profits declined, the industry’s export delivery value crossed RMB80 billion for the first time, reaching RMB80.72 billion.
Operating costs across the sector fell 2.8% year-on-year to RMB1,246.37 billion, broadly tracking the drop in revenue, while national output of machine-made paper and paperboard rose 2.9% to 164.054 million tonnes. The mismatch between rising output and falling profit underscores a supply-demand imbalance that industry data shows has yet to be resolved, even as China’s paper sector enters what regulators are calling a phase of high-quality, structural transformation rather than scale-driven growth. The National Bureau of Statistics figures reflect the full spread of paper and paper products manufacturers nationwide, spanning cultural paper, packaging paperboard, tissue, and specialty grades, meaning the profit squeeze was not isolated to any single product category.
Why Did China’s Paper Industry Profit Fall 13.6% in 2025?
Weak domestic demand is the central driver behind the China paper industry profit decline. The sector is highly correlated with the broader economy, retail sales of consumer goods, packaging and printing, and publishing and education demand, and softness across these related sectors kept overall demand for cultural paper, white cardboard, and coated paper weak, pressuring product prices even as production volumes grew 2.9%. On the cost side, wood pulp prices, the primary raw material for papermaking, saw a brief surge in the first half of 2025 followed by a rapid decline, with softwood and hardwood pulp trends diverging in the second half of the year. Overall, wood pulp prices fell year-on-year in 2025, which partially offset cost pressure but was not enough to prevent the double-digit profit decline.
What Does This Mean for the Global Paper and Packaging Industry?
China’s export delivery value crossing RMB80 billion for the first time, even amid a domestic profit slump, signals that Chinese paper manufacturers are increasingly relying on overseas markets to offset weak home demand, a trend that could intensify competitive pressure on paper exporters in other countries, including India, where mills have separately sought anti-dumping protection against paperboard imports from China, Indonesia, and Chile this year. The regulatory push behind China’s transition, including the GB31825-2024 energy consumption standard that took effect May 1, 2025, and the upcoming AQ7022-2025 pulp and paper safety specification effective November 1, 2026, is expected to accelerate the phase-out of smaller, less efficient mills, consolidating output among larger, better-capitalised producers with complete industrial chains.
Market Reaction and Industry Response
Shandong’s provincial government has taken a leading role in shaping the sector’s direction, issuing guidelines in August 2025 for cultivating “new quality productive forces” across the paper and biomass refining industrial chain, covering pulping, papermaking, digital transformation, and green safety standards. Industry commentary accompanying the data frames 2025 as a period of “cyclical bottoming and marginal recovery,” with expectations that supply-side structural reforms, improving domestic circulation, and policies curbing excessive competition will gradually improve the industry’s business environment. Leading producers with strong environmental compliance and technological capability are positioned to gain share as outdated capacity from smaller mills is phased out.
What Happens Next?
China’s paper industry is expected to continue its shift toward digital and intelligent manufacturing, with smart factory construction and value-chain digitalisation cited as priorities for cost reduction and efficiency gains. The AQ7022-2025 safety specification’s effective date of November 1, 2026 will be a key compliance milestone for mills still upgrading safety protocols. Global paper buyers and competing exporters, including in India, will be watching whether China’s rising export volumes at RMB80.72 billion put further pressure on international paperboard and cultural paper pricing through the rest of 2026.
Frequently Asked Questions
How much did China’s paper industry profit fall in 2025?
Total profits in China’s paper and paper products industry fell 13.6% year-on-year to RMB44.30 billion in 2025, even as revenue declined a smaller 2.6% to RMB1,418.67 billion.
Why did China’s paper exports cross RMB80 billion for the first time?
Weak domestic demand pushed manufacturers to lean more heavily on overseas markets, with export delivery value reaching RMB80.72 billion in 2025, the first time the industry has surpassed that threshold.
What regulatory changes are shaping China’s paper industry?
The GB31825-2024 energy consumption standard took effect May 1, 2025, and the AQ7022-2025 pulp and paper safety specification will take effect November 1, 2026, both aimed at phasing out outdated capacity and improving industry standards.
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