Page 77 from: November 2012

77November 2012

Paper

Many areas are still without electricity
and a major transportation problem
exists in finding enough truckers with
undamaged equipment. At the same
time, it is proving difficult for truckers
to find fuel on a steady basis; in New
Jersey, for example, drivers can fuel up
only on certain days based on their
licence plate number.
Under these circumstances, not much
paper is being recycled and transported
to the New York and New Jersey piers;
as a result, recovered paper buying
activity has intensified on the west
coast of the USA.
Prices for mixed papers, corrugated and
news have recorded modest increases
on the domestic market of late. Export
increases were higher, with most of the
demand coming from China. No major
changes in export prices of woodfree
deinking grades were seen in the New
York and New Jersey areas but stronger
demand and prices have been reported
from the US west coast. Pulp substitutes
have remained basically unchanged.
In the first eight months of this year, US
exports of recovered fibre were 10%
lower in value terms at US$ 2.3 billion
and 6% down from the volume per-
spective at 14.6 million short tons,
according to figures from the Census

Bureau. Sales to China fell 3% over the
period to US$ 1.46 billion while Indian
customers cut their payments by 8%
to US$ 187 million.
Year on year, US overseas shipments of
recovered paper dipped 4% to 1.7 mil-
lion short tons in August, wiping 7%
off its associated revenues to give a
figure of US$ 260 million. In value
terms, US exports of corrugated mate-
rial bucked the generally downward
trend in rising 3.4% year on year to
more than US$ 1.1 billion.

Asia
OCC ‘craziness’
October was an energising month, espe-
cially for cardboard which experienced an
explosive increase in demand. And owing
to generally low collection volumes, the
result was a substantial price hike.
This upsurge in demand was triggered
mainly by only a few of China’s larger
paper mills, with Indonesia alone in
keeping pace with the price increase.
Smaller mills in China and also those
in Taiwan, the Philippines, South Korea
and India have not matched these lev-
els, while European consumers too
have not been following what one
expert described as ‘this craziness’.
The corrugated price is expected to
sustain a downward correction in the
coming period given the large volumes
already purchased and the steady
increase in collection volumes tradition-
ally seen in the lead-up to Christmas.
Remarkably, the strong demand for
cardboard has had little or no effect
elsewhere in the recovered fibre market,
with mixed papers the only other grade
to have achieved a slight increase. The
middle and high grades have either
maintained existing price levels or suf-
fered a decrease for November.
Demand from India remains poor and
is focused solely on a few kraft grades,
woody shavings and other specialty
grades. Demand for coated book stock,
coloured letter and other woodfree
grades remains poor.
Although the shipping lines keep trying
to raise freight rates every month, they
have yet to meet with success.

US buyer for UK newsprint producer

UK-based Aylesford Newsprint,
which has the capacity to produce
around 400 000 tonnes of news-
print per year from 100% recycled
fibre, has been bought by US invest-
ment holding company Martland
Holdings LLC from its existing joint
owners, namely South Africa’s
Mondi Group and Svenska Cellulosa
Aktiebolaget (SCA) of Sweden.
Landry Kouakou, Executive Director
at Martland Holdings, says of the
acquisition: ‘Aylesford’s high-quality
asset base, its unique industrial
know-how combined with a strong
balance sheet with no financial debt
and an improved operating structure
will represent key assets for the
future. We are long-term investors
with the commitment to build life-
time relationships with the compa-
ny’s customers in Europe and over-
seas, enhance operational excellence
while remaining nimble and flexible
in serving our clients.’

According to Mondi Group’s CEO
David Hathorn, the disposal ‘allows
us to continue to focus on our core
businesses, while creating an oppor-
tunity for Aylesford to continue sup-
plying newsprint to the major nation-
al newspaper groups in the UK’.
Aylesford Newsprint’s production
capacity represents around one third
of the UK total, according to Mart-
land Holdings. The business gener-
ated revenues exceeding £150 mil-
lion (US$ 240 million) last year. Ian
Broxup, Acting Managing Director
of Aylesford Newsprint, adds: ‘The
transaction opens up new opportu-
nities to reinforce the company’s
position as a UK newsprint pro-
ducer.’
In the first eight months of this year,
the UK produced 790 019 tonnes of
newsprint – or 3.7% less than in the
corresponding period of 2011,
according to figures from the Con-
federation of Paper Industries.

Contributing to the
Recovered Paper Market
Analysis:
• Melvin de Groot (Van Gelder

Recycling, the Netherlands)
• Mariëlle Gommans

(Bel Fibres, Belgium)
• Steve Vento (Vipa Lausanne

SA, Switzerland)

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