Europe

During the early months of this year, the European OCC market displayed mixed dynamics. From May onwards, the market began to stabilise as purchased volumes dropped sharply in line with mills’ preparations for summer shutdowns. June and July have been largely quiet months, with downward price pressure and high inventory levels.

In Germany, material availability has been reported as good despite low collection volumes. OCC inventories have grown. Several mills have planned production stops in July and August whereas others expected to continue operations with only a brief summer closure. Recycled containerboard prices have shown some resistance, holding steady in June before decreasing slightly in July.

Despite rising domestic consumption in Spain, OCC prices have remained under pressure owing to the combination of an increase in imports and ample supply. Exports to Asia - particularly from coastal ports - regained momentum as European prices became more competitive, with eastern port logistics supporting this trend.

Italy has been quite stable, with no significant increase in OCC availability. Operators have remained cautious in the face of international price trends, choosing to rely on high-quality industrial recovered material rather than overstocking.

In the UK and the Benelux, cheap offers emerged amid weak export demand to Asia. This created a flow of low-cost material towards Continental Europe - especially to Germany and northern France - and thus applied further downward pressure on local prices.

According to information from RISI/Fastmarkets, price differentials to OCC in mid-July were as follows: Euro 467.55 per tonne versus PIX Testliner 2; Euro 441.73 per tonne versus PIX Testliner 3; Euro 427.25 per tonne versus PIX RB-Fluting; Euro 454.97 per tonne versus Testliner 2; Euro 427.59 per tonne versus Testliner 3; Euro 414.03 per tonne versus RB-Fluting; and Euro 391-395 per tonne versus PIX Paper Newsprint.

In summary, the European OCC market remains highly sensitive to logistics, energy costs and international trade dynamics, with regional variations. The overall effect has been to create cautious market expectations.

Looking back on 2024, the European recovered paper sector showed signs of recovery after previous declines. Recovered paper usage grew by 4.2% across Europe, while total collection volumes remained stable and exports fell. Spain and Italy stood out for their improvements in recycling and production, although high energy costs undermined profitability in Spain. Germany experienced revenue declines owing to similar cost pressures. Overall, OCC margins versus final products remained narrow in a stable market environment.