BIR World Recycling Convention: Lack of free trade hurts paper recycling industry

Paper committee session panelists discussed the challenges caused by government policies.

June 30, 2014
Recycling Today Staff

“Hurdles to free trade are detrimental to economic growth and also to our companies,” Reinhold Schmidt, president of the Bureau of International Recycling’s (BIR) Paper Division. Schmidt, also president of the German recycling company Karla Schmidt, discussed the challenges the challenges during the Bureau of International Recycling's (BIR) paper committee meeting, June 3 in Miami.

Taking his home market as an example of a “negative” political environment, Schmidt said that the introduction of a circular economy law in 2012 has put Germany’s traditional recycling branch on the “endangered” list and weakened the country’s recycling structure. “We don’t expect any privileges, but we want at least to be able to work in fair competition with public powers,” he said. Policy-makers should give more consideration to the jobs created and taxes paid by these companies, he added.

In her overview of the European Recovered Paper Association’s (ERPA) activities, President Merja Helander of Finland-based Lassila & Tikanoja focused on legislative matters in describing the European Parliament’s rejection late last year of the end-of-waste proposal for paper as “a big surprise and disappointment.” It has since been suggested that the paper and recycling industries should “find a new beginning and understanding” about end-of-waste and “come up with a binding solution.”

Helander acknowledged the process will take more time - possibly “a couple of years” - but noted, “ERPA will definitely do its utmost to start the process again. End-of-waste is far too important to our industry; we must not give up but find new ways to solve the problems.”

In a review of European recovered paper markets, Helander spoke of a “reasonable balance” in Scandinavia. Meahwhile, Lars-Gunnar Almryd of IL Recycling noted that Turkish mills using mainly old corrugated containers (OCC) “have started to utilize all grades, thus pushing up their prices.”

Thomas Braun of Germany’s recycling association BVSE, said that in Southern Europe, mills are continuing to come under pressure from energy costs and other factors.

Delivering reports for Western Europe, two representatives from France-based companies -- Dominique Maguin of La Compagnie des Matières Premières and Paprec’s Jean-Luc Petithuguenin -- underlined “persistent” fiber supply pressure, as well as the importance of using appropriate terminology when referring to the industry’s materials and activities.

Discussing the Asian market, Ranjit Baxi of U.K.-based J&H Sales International highlighted a sharp drop in Europe’s recovered fiber shipments to China, from 2.11 million metric tons during the first quarter of 2013 to 1.897 million metric tons the first quarter of 2014.

Additionally, U.S. paper stock shipments to the same destination were broadly unchanged, whereas deliveries to China from other Asian countries soared from 318,000 metric tons to 727,000 metric tons. China’s total imports from all sources were fractionally higher in this year’s first quarter at 7.2 million metric tons.

George Chen, president of New Jersey-based G&T Trading International Corp., offered a number of market development forecasts in his presentation. He noted that there is tightening in shipping line export space, more recyclables are staying domestic due to the addition of new machines, fiber prices remaining somewhat flat, with smaller suppliers “finding it difficult to survive” and the continuing emergence of India and Vietnam as “very important markets.”

According to another speaker, Otavio Pontes, vice president of business development at Stora Enso Biomaterials in Brazil, new pulp mills are generally more efficient in cost terms. As a result, virgin pulp “is becoming very competitive with recycled fiber” and this will be reflected in the coming years, he suggested.

Baxi, who several years ago launched the BIR Paper Division’s Papyrus prize to honor paper recycling leaders, received the 2014 award. In giving the award, Schmidt described Baxi’s “exceptional” standing in the sector. He also was made an honorary president of the BIR Paper Division.