Paper in packaging applications is going strong, while its role in communication and media continues to decline, thus tipping the balance of the recovered fiber stream dramatically toward brown grades. The trend was spelled out in several presentations at the 2015 RISI China International Recycled Fiber Conference, which took place in early December in Shenzhen, China.
Presenter Bill Moore of Atlanta-based Moore & Associates showed statistics for 2014, pointing out that while 45 percent of recovered fiber collected in the United States went to containerboard and boxboard mills, just 1 percent was consumed by newsprint mills. Nine percent of scrap paper collected in the U.S. in 2014 was consumed by tissue mills, and 39 percent was exported.
“Fifteen or 20 years ago that newsprint percentage was higher and the volume and percentage or exports was lower,” Moore commented.
The grades of scrap paper collected and consumed in the U.S. during the past 20 years matches the shifting destinations. According to Numera Analytics data presented by Moore, in 1993, 46 percent of recovered fiber consumed by North American paper mills was old corrugated containers (OCC), while old newspapers (ONP) held a 21 percent share.
Two decades later, in 2014, OCC comprised 67 percent of what was consumed by North American mills, while ONP held just a seven percent share. High grades (which can include printers’ offcuts and white office paper) also have declined, dropping from a 20 percent share in 1993 to a 14 percent share in 2014.
Marc-Antoine Belthé of Paris-based Veolia Environnement SA said the paper industry globally is “more and more driven by packaging,” adding, “This sector highly impacts the demand for containerboard and cartonboard.”
Belthé continued, “The current trend of revamping de-inking mills into corrugated mills will continue in the U.S. and Europe and will push the utilization rate” of OCC and other brown grades. “This, combined with low GDP growth and already high collection rates, will limit the recovered paper supply for export” from those two regions," he added.
As in North America and Europe, China’s paper industry also is tipping toward greater packaging and board production, said Guo Yongxin of the China Paper Industry Chamber of Commerce.
In the first nine months of 2015, Chinese mills produced 14.7 percent more containerboard than they did in the first nine months of 2014. Contrarily, output levels of newsprint, coated printing paper and uncoated printing and writing paper are all down in 2015 compared with 2014.
The trend bodes well for China’s recovered paper industry, which is already skewed toward OCC collection, according to Sarah Feng of the UMPaper office of Boston-based RISI.
In 2014, 48.7 million of the 55.6 million tons of recovered fiber collected in China was OCC, or 87.7 percent. By contrast, just 2.3 million tons collected was ONP, or 4.1 percent. “For ONP supply and demand, the future is not optimistic,” Feng said of the situation in China.
The 2015 RISI China International Recycled Fiber Conference was Dec. 2-4 at the JW Marriott Hotel in Shenzhen, China.