Global – The following article is based on the latest Paper World Mirror produced by the BIR world recycling organisation for the benefit of its members.For most recovered paper markets, the first quarter of this year proved to be largely stable until its final few days. In late March, many countries reported a significant drop in OCC prices owing to, among other factors, reduced demand from China and far higher shipping freight rates.
Indeed, the weakness in the Asian fibre market appeared to become more pronounced in the aftermath of the Chinese New Year holidays. OCC prices for Asian main ports had begun the first quarter at US$ 190-plus per tonne but slid to US$ 175-plus at the end of March. Prices of mixed paper conforming to quality specifications occupied a narrow range despite weaker demand. The first quarter began with mixed paper at US$ 165-plus per tonne and ended it at around US$ 160-plus.
For exporters in the UK, container shortages and softening Chinese demand for both OCC and mixed paper dented their optimism of earlier in the quarter. They also reported that ‘very strong’ Indian demand had resulted in multigrade price increases of around £10 per tonne (US$ 16-17) during the early months of the year and that domestic mills had still not achieved high stock levels despite moving their prices higher too. But again by the end of the quarter, higher freight rates had taken some of the gloss off Indian prices.
The traditional first-quarter increase in OCC demand from China following the lunar year holidays was ‘shorter-lived than ever before’, according to feedback from Spain. A brief price hike ‘was rapidly erased’. Domestic prices have been higher than export values but have also been reduced in the run-up to Easter.
Exporters in France also experienced this decline in Asian buying interest. However, the domestic market has been buoyed by an increase in collection volumes since last summer – although pressure still remains on sourcing material. With regard to the middle grades, for example, demand was ‘normal’ during the first quarter ‘but there was no significant volume to offer’.
Germany also reported an increase in incoming tonnages in March, with a proportion apparently going into building stock. In Italy, meanwhile, sorters saw a ‘substantial’ reduction in volumes coming from business outlets such as printers and retailers, as well as from urban waste collections. The same story applies to Finland where the economic slowdown is blamed for the reduction in consumer activity and printed media use which has led to less recovered paper and board becoming available for collection from industry, trade and household sources. On a positive note, the domestic paper and board industry is ‘running well’ and ‘experiencing excellent demand’, with the result that ‘some imports have been needed to cover raw material requirements’.
Recovered paper prices jumped in Turkey during the first quarter of 2014 as a result of high demand for OCC and newsprint.
Looking back on some of the statistics for 2013, the Czech Republic recorded a 2% drop-off in recovered paper collection volumes to 790 000 tons and a 9% increase in exports to 627 000 tons while fibre consumption by domestic paper mills plummeted 35% to 200 000 tons as a result of capacity closures. And in Germany, use of paper for recycling by domestic mills climbed 1.6% to 16.45 million tons last year; exports fell 12.8% to 2.7 million tons while imports totalled 3.87 million tons.
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