The program, held in Chicago June 24-26, had a mix of domestic and overseas companies. If there was a theme for the show it would be the old saw “Wait ‘til Next Year.”
Most attendees to the show feel that while 2001 is only half over expectations are muted at best, with hope for an improvement perhaps next year. This less than upbeat attitude carried through the meeting, as the litany of problems were ticked off by more than a few recyclers: declining demand, slowing generation significant downtime, an uncertain export market, dropping finished product prices, among others.
While these comments seemed to be on everyone’s lips, other issues have been cropping up, which will likely add to the uncertainty surrounding the domestic market. The growing presence of claims being filed has become a more important issue as of late. With the abundance of fiber on the market, some exporters feel that overseas mills, especially those in China, have been looking to cut price through filing claims against many shipments. This move, several exporters pointed out, is creating some ill will for many vendors.
Another growing concern for many recyclers has been the uncertain economic condition of a number of paper and paperboard mills. There already has been the Chapter 11 filing of several paper companies. There are a number of other paper and board mills that are struggling with difficult markets. Several recyclers note that some of these mills are stretching out their payments, leaving some paper stock dealers with tens of thousands of dollars owed.
The problem appears to be getting more difficult in the Midwest. There are a number of smaller, much older mills. Many of these operations are having a difficult time competing in the market, especially as price and demand continues to decline.
Several mills in the Midwest already have filed for bankruptcy protection, with the possibility of several other mills perhaps being forced to shut down. There already has been a number of mills that have shuttered mills throughout the Midwest.
Although most attendees acknowledged markets were very trying, there still was an upbeat tone. Part of the reason is the belief that markets have likely bottomed out. Some vendors feel that prices could see a modest bump in price, although it is more likely that demand will start to pick up as generation of new supply continues to slip. Prices may not show much in the way of a rally until next year, a long way away for many paper stock dealers.
Despite the tough markets being experienced, attendees expressed confidence that markets would turn. As one vendor said it, “It always does.”
The preliminary information shows that next year’s Paper Recycling Conference will be held in New Orleans in late June. For more information contact Maria Miller at (216) 961-4130.