Germany

Supply and demand for recovered paper were initially in harmony in July. Owing to school and company holidays, however, availability became scarcer as the month progressed. The paper and board industry produced at full capacity, and new capacities in the packaging paper sector increased the demand for lower and high-strength grades. Only with great effort were recovered fibre suppliers able to satisfy demand.

As a result of the shutting down of capacities in the graphic segment and the conversion of machines from white to brown production, remaining producers of these papers are experiencing a very good level of demand. Prices for new paper are rising and the demand for deinking goods is enormous.

However, the sorting of household material is becoming increasingly difficult. The industry now talks of 35-40% graphic paper in collection bins as compared to 50-60% just a few years ago. Depending on the season, files and printing waste can be scarce. This range of grades is also in high demand thanks to the high capacity utilization numbers of hygiene paper producers, so there are further price increases for medium and higher grades. A growing obstacle was freight availability, accompanied by the Europe-wide shortage of truck drivers.

In August, many areas of the catering trade and all types of commercial operations were operating below pre-COVID levels and so less recovered paper could be collected. At the same time, mills’ demand remained high in general and very high from packaging manufacturers. Accordingly, lower grade prices were stable. For the middle and higher grades, good demand was met with reduced availability and resulted in significant price increases. Tissue producers ordered consistently high volumes of recovered paper.

The global economic recovery from the pandemic is leading to massive demand for transport capacity. This often leads to supply chain disruption, which was also evident in the necessary imports of recovered paper into Germany. Imports from the USA and the UK became significantly more expensive. Within Germany and the wider EU, the shortfall in cargo space is currently at around 30%, largely due to the home leave taken by drivers from Eastern Europe.

September brought even higher demand for recovered paper, which the recycling industry was able to satisfy at short notice. Prices for supermarket grades increased in the low double-digit percentage range whereas gains for the other lower to medium grades remained more moderate. The higher grades remained unchanged. Prices for office files rose slightly on the back of demand.

The decreasing proportion of graphic paper in recovered paper collections made it challenging for recovered paper companies to meet demand. Overall, the recovered paper industry was able to fulfil all orders, partly as a result of the improvement in collection volumes after the holidays.