France

After a remarkable 2021 in terms of both demand and prices, the momentum has been maintained in 2022. Collection volumes fell on the French market in the first quarter but demand from customers remains strong, driven by good order books for packaging as well as for printing.

Nevertheless, the market faces many uncertainties: the Ukraine conflict and its impacts, inflation, shortages, growth at a standstill and the cost of energy are among the many sources of concern that could impact our market at any time.

Demand has been sustained for the lower grades. Germany is driving the market by offering good prices in Western Europe as a result of, among other factors, weak domestic collections and very low supply from the UK and the East. At the same time, overseas trading is offering slightly higher prices than the domestic market: not a lot of volume, and with serious logistical difficulties, but enough tonnage to apply some pressure.

After an absence of several months owing to an administrative problem, India has returned to the European market - surprisingly rather calmly and at lower price levels than the other Asian countries.

The lower grades market is likely to continue to perform well as long as packaging orders remain good.

Regarding the medium grades, collection volumes are quite low and are not matching demand. Activity levels within this sector are normal. There are even some shortages - affecting newsprint reels, for example, which are expensive and sometimes limited.A similar situation applies to office papers. Teleworking and the decline in printing have made coloured papers scarcer. As summer approaches, some paper makers are wondering how they are going to maintain supply during this usually complicated period of the year, and there will be pressure on the market.With regard to the higher grades, volumes are very low and demand is proving impossible to meet. With the market under pressure, prices have continued their steady rise and negotiations could almost be done before each loading. This pace should be maintained over the summer.Overall, the recovered paper and board market is doing well: the demand is there and prices are going up steadily, reaching record highs. However, nobody can predict what will happen in the coming months. As has been seen in the scrap metal sector, the market climbed very high before undergoing a big correction in May. For recovered paper, however, there seems to be no reason for such concern and further increases are likely. In addition, after two years of health crisis, we are observing a structural drop in paper collections.With plans for new machines to come on stream in France next year, the market should remain firm.