Paper market concerns continue

Posted on 10th March, 2020

An international warning of price pressures in the recovered – waste – paper market has come from the global organisation, BIR.  The French president of the recovered paper division of BIR, which is a global recycling industry federation, has warned that not all recovered  paper will find an outlet in current markets.

The situation has been exacerbated by the Coronavirus which has hit industry in China and is a big factor in a reduction in container shipping volumes causing further price pressures in the waste paper market.

The warning came from Jean-Luc Petithuguenin of France’s Paprec, who is president of BIR’s paper division and his concerns have been echoed by his division colleagues.  From Spain and reflecting the negative pricing seen in some parts of the current market, Francisco Donoso of Alba Servicios Verdes, said: “Grades such as mixed paper are already at below-zero pricing, for the first time in Spain’s recycling history. Never have such low prices been recorded in this country.”

Commenting on the current market in more detail, Mr Petithuguenin said in the last quarter of 2019 nothing much had changed, with difficulties in selling and tough prices continuing.  He continued: “This may be a new year but there have been no new trends as yet. We are still facing a surplus across the market, with high stocks throughout Europe and very few outlets. And there is still heavy pressure on prices.”

Plastic to cardboard?

Looking forward Mr Petithuguenin, remarked “So what’s next in 2020? It is hard to say but it is possible the market might see a return to reason. In Europe, such low prices might lead to reduced tonnages becoming available as there would no longer be an incentive to sort. Some packaging might also shift from plastic to cardboard. Demand will be boosted by two new paper mills projected for the second quarter while South East Asia will continue to provide demand too. The main issue remains deinking but collection will necessarily decrease, thus leading to some equilibrium.”

Within the UK now more charges are being imposed for the collection of waste paper and the French president of BIR, backed this approach, saying: “To get through this storm, we must adapt to the needs of buyers and make sure every delivery is paid for.”