Paper

SPRING CLEANING

Cleaning up of all kinds has brought an influx of several grades of fiber into the market within the last month, leading to a general price weakening across the board, according to several sources.

"This time of year is big for cleanouts," says one Midwestern recycler. Sources say the market has been inundated with old corrugated cardboard (OCC), leading to a slight drop in prices.

Spring cleaning has been no help to the long-suffering office grades, which have been experiencing low prices and high inventories all year. Sources continue to lay blame for the depressed market on the secure document destruction industry. Flooded supply by the growing popularity of the industry has been further increased by the time of year. A Midwestern source says the weeks following April 15 usually see a dramatic increase in domestic office paper generation, as many individuals and companies purge old files in the post-tax season.

Office paper has been sluggish so far in 2005, but sources are confident that the market will right itself eventually. "All it would take is one big mill to open up for the grade—that could change it around completely," says one recycler.

Some sources report that quality issues have been plaguing some of the file cleaning and document-destruction-generated material. Plastics, like those from discarded report cover sheets, winding up in the mix have been irking some mill buyers, especially in the Midwest, a source says.

A New England source reports some trouble in the region, including a drop in pricing of approximately $10 per ton, leaving OCC hovering around the $70 to $75 dollar range. Another source in the region reports a number of mills curtailing their buying and even shutting down, some for several weeks at a time.

The hungry demand from China seems to be tapering off, as well. Exports have softened, but not vanished, sources say, and the gap between domestic and overseas orders has been closing. Some sources say late spring holidays in China could be responsible for the slow buying.

A California recycler reports the same sluggish market out west and claims the current infrastructure is too weak to support all the activity in the market.

However, industry sources remain optimistic that summer traditionally brings less generation and will help to balance out the market in the coming weeks.

The old newspaper (ONP) grade has remained firm in the face of the problems facing other main grades. Recyclers and buyers across the country are preparing for the summer season, which typically brings slimmer newspapers, which equates to a potential drop in supply and a hike in price.

Some sources report transportation problems stemming from the rise in fuel costs. (Additional news about paper recycling markets, including breaking news and pricing, is available online at www.RecyclingToday.com.)

The 2005 Paper Recycling Conference & Trade Show, taking place in Atlanta June 26-28, has announced its lineup of moderators, including: