EPRC: European Fiber Ships Out

As European nations have recovered more paper this decade, much of the additional tonnage has been able to ship out to Asia thanks to low freight rates.

Shipping lines are rocking that boat with sizable per-container freight charges in October and November, but the price spike may not be more than a temporary barrier to the flow of material.

At a session entitled “Long Distance Voyages” at the 2007 European Paper Recycling Conference, panelists active in the export market gave their views on what they say will remain a vibrant market.

As China’s Lee & Man Paper Mfg. Ltd. continues to increase production, it will continue to seek out European old corrugated containers (OCC), says Maggie Chew, a managing director with Lee & Man’s Mark Lyndon International brokerage arm. “OCC is part of a large loop, so the more containerboard that is produced, the more OCC that can enter the [supply] stream,” she remarked.

The long distance voyages of goods shipped from China to Europe and flattened boxes on the return trip should continue, said Chew, who announced during her presentation that Lee & Man-Mark Lyndon will be opening a sales office in Nottingham, U.K. by the end of 2007.

. The OCC supply that Lee & Man requires is “at the wrong place, that’s why we all have a job to do,” Chew commented to her European audience.

China’s two containerboard giants—Lee & Man and Nine Dragons—are expected to grow from having a combined 8.45 million tons of capacity at the end of this year to at least 12.8 million tons by the end of 2010. “And Nine Dragons has probably announced a new machine since I started this presentation 10 minutes ago,” quipped Chew.

Sweden-based Cellmark has tied into that same export loop, noted Mark Mijnster from the company’s Benelux office.

The growth of economies in China, India and Russia are “influencing the availability and prices of natural resources,” declared Mijnster. On the paper side, with Nine Dragons having plans for paper machines numbers 18 through 23 on the drawing board for 2008, Mijnster said the company’s growth is “a bit dazzling, and frightening.”

Mijnster also urged attendees to keep an eye on the Indian market, where some 140 million people daily now read newspapers, providing one of several paper industry growth markets. According to Mijnster, the nation imports some 50 percent of the scrap paper it consumes, and its requirements for fiber are likely to increase.

Recovered fiber veteran Giuseppe Masotina of Italy’s Gruppo Masotina has taken part in Italy’s conversion to a next exporter of recovered fiber.

That nation’s recyclers are beginning to collect more paper in the central and southern parts of the country, continuing a trend toward more tonnage available in Italy. “The consequence of this collection growth is that Italy, from 2004, can be included in the net exporter nations,” said Masotina.

In Italy, the value of recovered fiber exports is now almost double the value of scrap paper imported, Masotina noted. Much of that fiber is heading to other EU nations, including Germany and Austria, although China is growing as a destination.

The 2007 European Paper Recycling Conference, organized by the Recycling Today Media Group, was held in at the Hilton Amsterdam Oct. 3-5.