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Ellin: ‘Perfect storm for paper market’

Global markets for recovered paper remain extremely challenging, according to UK’s Recycling Association chief executive Simon Ellin. But he insists the sector can stay positive.

His State of the Nation report, which will be presented at the association’s annual conference in London on 12 November, will say: ‘We currently face a perfect storm that makes the market extremely tough for many of our members. A combination of reduced Chinese quotas, Brexit uncertainty and a general election, an increasingly difficult global economic situation, reduced demand from European and other global mills, a lower PRN/PERN price plus increased shipping costs and volatile currency markets, have forced down OCC prices in particular.’

More demand on the way?

Despite this, there are reasons to be positive about the future, according to Ellin who argues that the fibre market has gone through difficult patches before yet always recovered eventually. ‘China could stay open longer, although this isn’t confirmed yet and we should expect reduced quotas if it does. But the big Chinese mill groups are building new capacity in countries such as Malaysia, Vietnam, India and Myanmar and this should eventually bring more demand onto the market,’ he says.

Quality remains top priority

The ceo believes that the most successful in the market will be those who can provide the best quality material to the end destination. ‘High quality is also essential for keeping vital export markets open. We don’t want to give other markets the excuse to ban imports because they receive poor quality material.’

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