BIR Paper Mirror September 2009

Archiv – The following article is based on the latest Paper World Mirror produced by the BIR world recycling body for the benefit of its members.
Across Europe, recovered paper generation levels have been hit hard by a combination of a recession-led reduction in finished paper sales, the summer holiday season, mill closures and downtime, and the disappearance of some traditional sources such as print shops. Recovered paper stocks are at very low levels both in merchants’ yards and at the mills.
Latest figures reveal that, when comparing 2009 with 2008, recovered fibre collection volumes have tumbled 10-15% in the Baltic Countries and 14% in Finland. BIR | The following article is based on the latest Paper World Mirror produced by the BIR world recycling body for the benefit of its members.
Across Europe, recovered paper generation levels have been hit hard by a combination of a recession-led reduction in finished paper sales, the summer holiday season, mill closures and downtime, and the disappearance of some traditional sources such as print shops. Recovered paper stocks are at very low levels both in merchants’ yards and at the mills.
Latest figures reveal that, when comparing 2009 with 2008, recovered fibre collection volumes have tumbled 10-15% in the Baltic Countries and 14% in Finland. Elsewhere, the drop-off in collection tonnages in the Czech Republic, Sweden and the UK are estimated at between 10% and 11%
For many grades of recovered paper, prices in Europe plotted a firm-to-rising course in the third quarter – despite the fact that mills have been producing at lower levels compared to the same period in 2008 and have therefore been buying smaller quantities of secondary fibre.
Recovered paper demand has been strong within Europe for the more limited volumes available: in Germany, for example, some consumers have been prepared to pay special prices for the lower grades; and Spain has reported a recent improvement in domestic order books and a greater willingness among mill buyers to accept the higher price tags on their recovered fibre supplies unless more attractive offers have been sourced from neighbouring countries.
This upturn in European demand, coupled with higher freight rates and also exchange rate movements, helped export prices to climb steadily. Freight rates for the year to date have increased by 100% or more in certain EU countries.
China began the third quarter by paying around US$ 130 per tonne for OCC whereas this figure had increased to US$ 150-plus by the end of the three-month period. Prices for mixed papers increased from US$ 120 per tonne to around US$ 145 during the quarter. Demand from other Asian countries – including India, Thailand, Indonesia, South Korea and Taiwan – remained stable to firm during the third quarter; in particular, healthy orders from India helped woodfree deinking prices to maintain a positive tone.
Following joint representations by world recycling body BIR and the US Institute of Scrap Recycling Industries to the government of India, further progress has been made in clarifying the country’s import control requirements. In Indonesia, meanwhile, the government has extended the list of registered, globally-approved surveyors authorised to undertake pre-shipment inspections to more than 20. The new import control regime could be introduced on January 1 next year although the Indonesian government has yet to make a formal announcement.
Meanwhile, the Ministry of Environment and Forest in Turkey has issued new import control criteria similar to those introduced in India; however, mills are continuing to discuss the new rules with the ministry because of the additional costs and bureaucracy entailed.
Recovered paper supply has been further tightened by new capacity coming on stream. In the UK, Palm Paper’s new newsprint machine came on stream in late August and the company’s growing presence in the marketplace has helped the domestic price of news & pams to outstrip export levels. Meanwhile, machine starts in both Poland and Hungary have helped to boost recovered paper prices in other countries, notably the Czech Republic; Mondi’s new machine in Poland has reportedly impacted collection activities in the south of Sweden.
Also in Sweden, domestic consumption of recovered paper declined 11% to 898 000 tons in the first half of this year compared to the same period in 2008, mainly as a result of the closure of a newsprint machine at Holmen’s Hallstavik facility. The country’s newsprint mills went on to produce at full capacity during the third quarter, not least because of their currency advantage over counterparts in Euro-based nations. However, more downtime is anticipated for the fourth quarter.
Across in Finland, a combination of recession, mill closures and long periods of downtime at other paper and board producers led to a 30% slump in domestic recovered paper consumption during the first eight months of this year; as a result, exports climbed to a record level of around 170 000 tons. And trade statistics from Spain reveal that recovered paper exports totalled 637 103 tonnes in the first six months of this year while imports amounted to 397 662 tonnes, thereby confirming the country’s switch from being a net importer to becoming a net exporter.
Looking to the future, the value of the US dollar, credit restrictions and shipping costs are expected to be major factors in determining the direction of the recovered paper market over the coming months, according to feedback from France. However, many experts anticipate that supply and demand will achieve something close to a balance in the final quarter of the year.