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BIR World Mirror on Recovered Paper – Issue July 2023: ... Image 1

BIR World Mirror on Recovered Paper – Issue July 2023: Mills hit by thinner order books and high costs

  • 25 July 2023

A concise summary of the BIR World Mirror on Recovered Paper – Quarterly Report July 2023. Full version with detailed market reports available in the Members Only section of the BIR website.

The widespread drop-off in consumption of finished products and therefore lower demand for packaging material has translated into challenging conditions for the recovered fibre sector, according to the latest World Mirror compiled by the BIR global recycling organization’s Paper Division.

Some recovered fibre prices have declined during recent months despite weak collection volumes and low stock levels for both collectors and paper mills. In Europe, OCC and white grade prices have dropped whereas the deinking grades have remained relatively stable, albeit at low levels. On the plus side, freight rates to Asia have declined significantly such that the market, although weak, has maintained some impetus. 

From France, it is reported that the recovered fibre industry’s mill customers are struggling for orders and that machine stops are happening every month as a response to market conditions, with the result that some recycled grades are proving very difficult to place and prices are continuing to fall.

For recyclers and paper producers in Germany, the combination of broadly increasing costs and reduced trading volumes is described as increasingly problematic.

During the second quarter of 2023, several mills in Scandinavia were proactive in stocking up on OCC in anticipation of a decrease in collection volumes which is still evident across various grades. There is a continuing decline in demand for the entire range of graphic paper, resulting in thinner order books and production stops for many mills towards the end of the second quarter.

In Turkey, the persistent contraction in paper and board demand since the second quarter of last year was again evident in the same quarter of 2023 and resulted in average production capacity utilization of only around 70%. The domestic market is being heavily affected by high inflation and unhelpful exchange rates, leading to a marked reduction in recovered paper imports.

However, there is brighter news on the producer front in Turkey: the Kipas Paper Mill in Kahramanmaras was able to resume production in July after operations had been halted by the earthquake in February. There is also some optimism that operations at the Kahraman Paper Mill, also stopped by the earthquake, will restart in the third quarter.

In production developments elsewhere, Norske Skog has announced a delay in the start-up of the recycled containerboard machine at its Golbey mill in the east of France - from later in 2023 until the second quarter of 2024.

Slow recovered paper generation across most of the USA has led to worries among mills about sourcing adequate volumes and therefore to rising recovered fibre prices, even though paper mill capacity utilization rates remain sluggish. Recovered paper sellers are encountering few difficulties in obtaining orders from both domestic and export buyers, particularly for OCC and mixed paper.

Read all international market reports

With contributions from its members, BIR publishes periodical commodity reports under the label "BIR World Mirror". These detailed reports exist for Non-Ferrous MetalsFerrousStainless Steel / AlloysPaperPlastics and Latin America and provide BIR members with up-to-date information on the respective commodity or market segment.

The report on Non-Ferrous Metals appears once every two months, whereas Ferrous, Stainless Steel, Paper and Plastics are published quarterly. Latin America is covered twice per year.