The latest BIR World Mirror from its Recovered Paper division has highlighted the ongoing weak demand for recovered paper.
Paper Division president Francisco Donoso said that there was “subdued demand for finished products” leading to decline in demand for OCC and deinking grades.
He added: “While stock levels are quite high at most paper mills owing to low consumption whereas stocks in recyclers’ yards are perhaps lower as a result of reduced collection volumes. However, our main problem is the weak demand for recovered paper.”
However, he noted that for white grades and pulp substitutes the situation was quite different with prices remaining high, despite recent small falls in value, due to the price of virgin pulp being high.
The Paper Division president also criticised proposals by the European Parliament to introduce tougher procedures for waste shipments from the EU.
He added: “Exports of recovered paper are always for recycling and never for disposal and yet the same restrictions will apply, with the result that recovered paper exports will be much more difficult in future. All paper mills interested in importing from the EU will have to pass strict audits to demonstrate that their production standards are equivalent to those in Europe, and yet these audits are not deemed necessary for European mills when buying.”
Francisco Donoso also noted that prices in Asia have been volatile. On India he added: “India has reviewed the prescribed limits for non-paper materials in recovered paper consignments from other countries. This new measure will bring further controls in the country of origin and an obligation to recycle all imported material without the option of disposal. It also will bring more bureaucracy in terms of, for instance, documentation and contracts.”
In the same report, Reinhold Schmidt from Germany said: “According to a market expert, the paper machines of the “big all-rounders” ran at full speed leading up to the festive period in December, and then partially until the year’s end.
“Up to that point, energy prices were still advantageous owing to annual contracts, etc. Manufacturers’ warehouses were filling with new paper and some smaller factories planned shutdowns for Christmas.
“In western Germany, as well as in the Netherlands, Belgium and the UK, there were further slight upward price adjustments for the lower and kraft grades, mainly because of reasonably good exports of recovered fibre which are urgently needed. While demand from Asia is high, price remains the bottleneck. Mills in Eastern and Southern Europe also increased their prices slightly.”
But he added that in the second half of December sales of recovered paper declined, and inventory build-up on the supplier side was unavoidable. Sales of printing paper declined, but deinking and higher grades remained stable.
Turkey’s Ekrem Demircioglu revealed that the Turkish paper industry worked at full capacity in the first half of 2022, but the second half was weaker with brown grades in particular seeing a 40% drop in demand.
He said this comes at a time when: “Turkey’s annual production capacity has increased to 5 million tonnes but, owing to the above-mentioned market recession, total production was only around 3 million tonnes in 2022. Although official numbers have yet to be announced, recovered paper provided by local companies amounted to some 2.5 million tonnes while a further 1.2 million tonnes was imported.
“Ongoing investments are set to increase total domestic production capacity to 8 million tonnes over the next four years.”
