Recovered Fibre, Nonferrous, Ferrous, France

On the French markets, since the month of September, we are facing a decrease in prices for the different grades of recovered paper. The brown grades are decreasing for about €10 per tonne in September and we are now looking at a new decrease of €15. The prices are not fixed yet. The mill buyers are still trying to find material. They are arguing that the book orders have reduced tremendously during this period. They are speaking of going from two months of orders to a week of orders. The mills are reducing their own selling prices, so this is going to affect the business of course. What we are hearing is that they are reducing their prices.

This is the same decrease we are having for the deinking grades. We are €10 per tonne down in September, and now they want to go down €10-15 this month. Some mills are looking for €20 down. Prices are decreasing quite rapidly.
On the high grades, the pulp substitutes, we are having the same problems. There is a lot of inventory of pulp everywhere in the world. All the pulp substitutes are suffering now and the reduction is from €20-50 per tonne on these prices.

We have noticed some increase on the collection side in August compared to July. This is quite unusual. Normally July is higher in collection because of people going on vacations in August causing less consumption. We have some more collection in August, since the last week of August we are now facing a new decrease in collection. People are not buying as much. The press is suffering, so there is less news and magazines to collect.

Chinese buyers were very active in France during August and September. They were buying a lot. It seems they are looking very deeply at the market now because they are getting better prices. From what I am hearing, it seems that the market is also suffering in the United States. Chinese buyers are looking to buy from America before they fill orders in Europe. The buyers are looking at the market before they are confirming prices. As of early October, we don’t have any confirmation of prices. My opinion is that we will face this situation through the end of the year.

I think that the situation of the finance system in Europe is very highly responsible for what we are facing on the price of raw materials. We are going to see this kind of a yo-yo system of pricing until the end of the year.

It is the same problem in the ferrous market. On top of it, we have some big buyers in Europe and France which are ending their year at the end of September, so they have to reduce their buying tremendously. They don’t want to drop too much inventory at the end of their year.

The same problem exists on the nonferrous side. If you are comparing what is happening to gold and silver in the past weeks, it is also very, very difficult time. Silver went down 26 percent and gold went down 12 percent. There is a lot of speculation on the market now.

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Dominique Maguin can be reached at dominique.maguin@cmp-sas.com.