In an era when reducing carbon emissions is a planetwide priority, neither shipping lines nor politicians should be in a hurry to interrupt the long-standing global supply chain of recovered fiber. That was the message from former Bureau of International Recycling (BIR) President Ranjit Baxi, speaking at the online International Recycling Week event June 21.
Baxi, managing director of London-based International Recycling Ltd., said Europe generates from 4 to 7 million tons of surplus recovered fiber annually “for which we need a home.” Traditionally two things have made that a practical and profitable endeavor: affordable sea freight rates from Europe to Asia, and regulations that support the free flow of baled scrap paper from one nation to another. (The same circumstances apply to North America’s surplus scrap paper.)
The affordable sea freight circumstance has vanished in the past 15 months, while Green Deal policies being considered in the European Union could bring an unwelcome end to the free trade of old corrugated containers (OCC) and other grades shipped from Europe.
Regarding freight, Baxi said rates in Europe are beginning to decline from peaks reached earlier in the COVID-19 crisis, but they are “still excessively high for our product to accommodate such sea freights.”
Shipping lines are aware of the role of recovered fiber to fill the large ships they have built, he said. “I remember talking to a chairman of a shipping line, and he said, ‘Recovered fiber helps us to fill the base cargo of our containerships so we can carry other cargoes on which we make the money.’”
Ships have become even larger since that conversation, Baxi said, “and that concept has not changed.” He added, “My message to the shipping industry and the recycling industry is: Let’s please work together; let’s be responsible partners and let’s work together as a team.”
In the current situation, Baxi said it is “not possible” for scrap paper exporters to plan ahead with “yo-yo pricing” for freight. For shipping lines, it is not ideal to launch vessels with empty containers. For the sake of everyone on the plant, said Baxi, scrap paper is an “essential raw material supporting carbon savings and combatting climate change,” and disrupting its use is counterproductive.
In a separate presentation, Jori Ringman, director general of the Brussels-based Confederation of European Paper Industries (CEPI), expressed optimism for the global and European containerboard and corrugated box sector.
Numerous trends are prompting European paperboard producers to add capacity, Ringman said, including the sustainability and circular economy movements creating a shift away from plastic in some applications. Ringman pointed to a 2019 study by Sweden-based Material Economics which posited that “in Europe alone, some 4.5 million metric tons of plastic packaging could be replaced by paper and board without a loss of functionality.”
The EU Green Deal could further boost consumption of recycled-content paper and board in particular, he said. CEPI and other organizations are anticipating additional Green Deal regulations to be announced later this year, and in preparation has set a target of a 90 percent recycling rate for fiber-based packaging in the EU by 2030.
Ringman concluded, “The long-term trends are on our side. The policies will create change, and the industry is proactive to invest to make things happen.”
In opening comments for the event, Hrishikesh Vora, CEO of Mumbai-based Adler Paper, said: “2020 was a challenging year, and just when we thought 2020 was bad and 2021 was going to be better, we’ve had ‘Lockdown Part 2,’ and that has also wreaked havoc across all our industries.”
Despite the effects of COVID-19 in India and around the world, Vora credited the Materials Recycling Association of India (MRAI) for its support of the recycling sector on several fronts. “I’m hopeful that our collective industry is standing strong, will join hands, will ably support each other and come through 2021 stronger,” he stated.
International Recycling Week was organized by United Arab Emirates-based Waste & Recycling Middle East & Africa magazine.