Paper

The recovered fiber market continues to show strength in early 2007. The first quarter of the fiscal year is typically a slow time, but healthy export demand is driving prices up across the board, particularly for old corrugated containers (OCC), according to sources.

"Markets are hot," says one Ohio recycler, adding that the export market is the primary driver.

Prices have been so strong—$160 per short ton delivered to the harbor in California, according to one West Coast recycler—that some in the market are wondering if the industry is in for a repeat of 1995. One recycler based in the Southwest recalls the year when prices skyrocketed—only to drastically bottom out. "We hope it’s not like that," he says. "The steeper the climb, the harder the fall."

Other sources believe that the hungry export market is enough to keep such a drastic event at bay. "We have a whole different world now that we did in ’95," says one Midwestern packer. "It’s a global market." Fears of a bursting bubble aside, the market is enjoying some of the strongest prices in recent memory, and OCC isn’t the only grade standing out. Strong prices are being reported across most grades, including ONP (old newspapers), office pack and mixed. "When OCC goes up significantly, the other grades seem to follow," says one Southwestern recycler.

A California recycler credits some of the current market’s strength to new capacity coming online overseas. He says new machines have opened in China for ONP and OCC, and Indonesian mills have also expanded, contributing to an increase in demand. "Overall, there’s a lot of new capacity causing somewhat sudden additional demand," he says.

He adds that since so much tonnage is headed overseas, some domestic mills have raised their price offerings just to compete. "It’s a packer’s market right now," he says.

Some sources expected a slight slowdown for the Chinese New Year season. While the historic precedent is for China’s mills to curb buying some during the holiday, a Midwestern recycler reports aggressive buying continues so far this year. The Midwestern packer reports talk of expected mid-month price increases in spite of the holiday.

On the domestic front, late January 2007 brought the announcement of merger plans between Abitibi-Consolidated Inc. and Bowater Inc. According to a press release, the two companies made a definitive agreement to combine in "an all-stock merger of equals." The new company will be called AbitibiBowater Inc., and with expected pro forma annual revenues of about $7.9 billion, it will be the third largest publicly traded paper and forest products company in North America and the eight largest in the world.

It’s still too early to measure the effect this move will have on the market in the Southeast, according to a buyer based in Florida. He says there’s not much discernable difference yet, but also reports a slight cooling in buying in the area. "Nobody’s going to buy too much right now because you don’t know what’s going to happen," he says.

According to the press release announcing the merger, the company will own or operate 32 pulp and paper facilities and 35 wood product facilities mainly in eastern Canada and the southeastern United States.

(Additional news about paper recycling markets, including breaking news and pricing, is available online at www.RecyclingToday.com.)

The 2007 European Paper Recycling Conference and Trade Show will be held Oct. 3-5 at the Amsterdam Hilton in The Netherlands.

According to show organizer the Recycling Today Media Group, the third annual European Paper Recycling Conference will offer European recovered paper packers and brokers, mill buyers and equipment business executives the opportunity to discuss current industry trends and to network with colleagues.

"The conference features an outstanding program, display area and extensive networking opportunities," says James Keefe of the Recycling Today Media Group.

Keefe says paper recyclers and fiber consumers in Europe will have plenty to discuss. "The recovered fiber industry in Europe continues to experience dramatic change," Keefe comments. "Fiber flows and trading patterns are changing as traditional consumers close capacity and new consumers come on line, while East Asian buyers book more loads of recovered paper out of Europe. It has never been more important for industry professionals to come together at a central meeting place," he says.

The program will cover a wide variety of issues topical to the paper recycling industry, including mill consumption trends, recovered paper pricing trends, international trade and demand patterns. The event has proven valuable in keeping mill buyers, brokers, packing plant and depot mangers up to date on the pan-European and international trends that will affect their businesses.

Those seeking more information on the conference can visit the event’s Web site at www.PaperRecyclingEurope.com for program details and updates, including information on speakers and panelists.

The European Paper Recycling Conference will also include a display area featuring equipment and service providers showcasing their latest products and technology to improve production efficiencies, quality and capacity.

Readers in Europe who wish to register for the conference can contact a conference representative at 31 20 5040200 or visit www.PaperRecyclingEurope.com for more information.

For paper recyclers who are interested in events stateside, the Recycling Today Media Group hosts its Paper Recycling Conference & Trade Show in Orlando June 10 to 12. Additional information is available at www.PaperRecyclingConference.com or by phoning (800) 456-0707 and asking for the conference division.

Fibre Marketing Group LLC, Baltimore, and its affiliate DK Trading Corp. Inc., have announced the acquisition of Westreet Industries Inc., which operates a paper and plastic recycling facility in Baltimore.

Westreet’s parent company, Specialty Industries Inc., Red Lion, Pa., will continue to be associated with the company, providing some sourcing representation in its market area.

Fibre Marketing Group is a recycling products brokerage firm with offices in Ft. Pierce, Fla., and a plastic recycling facility in Baltimore.

The acquisition will increase Fibre Marketing Group’s ability to service the Mid-Atlantic and Southeastern markets, according to a news release from the company.