Market Report
Further weakening market with very strong pricing pressure on deinking grades
NL-Tilburg, December 1st, 2024
The indications for recovered paper prices December are hard to take. The variations in announced price cuts are large, depending on quality but also on region.
Looking at the East of Europe, price reductions from €10 to as much as €25 per tonne are announced there for low grades. Of course, for a while, prices in Germany were considerably higher than in neighbouring countries, but with price cuts that some mill buyers want of €25 per tonne for occ (kls) and other packaging grades, they would now suddenly find themselves with prices below other regions, now that in many places a reduction of €10 per tonne, or a bit more, would become the norm. A better message of ‘we don't need anything’ can hardly be imagined.
Intake will also be limited in December because of the various production stops and destocking announced.
Whereas in the medium and better grades, price cuts have so far always taken place in smaller steps, the combination of a weaker sales market, price pressure on new (finished) graphic paper and high supply and stocks of waste paper seems to be the driving force to seriously cut prices at the end of the year. How much ? Here too, as with the lower grades, a variation from €5 to €20 per tonne with extremes as high as €30. This does not go down easily and not something to say ‘yes’ to quickly, so negotiations are ongoing. But whether there are many alternatives remains to be seen.
As indeed, in exports, there is also considerable pressure on prices of printing grades, and the lower grades were already generally below European local price levels. And why would buyers in Asia change their hitherto applied pricing policy much ? So this then for imports means moving with the prices in countries exporting to Asia. So for December, that is downwards.
All in all, then, business wise it does not look like to become a merry Christmas.
But, perhaps to lighten the dark days before Christmas, Environment Minister Steve Reed of the Labour government in England came up with a plan to streamline the mess of waste collection by asking Councils to make only four waste containers available to all households - one for paper and cardboard, one for garden and other compostable waste, one for plastic, glass and metal and the fourth for residual waste. This would replace a multitude of different ways of collection in which municipalities collect from 2 to as many as 10 streams. For
recovered paper, the long-awaited good news. Now we have to wait for the implementation of this plan.
https://search.app/veVBvu4uPm2r8o8Q7
And some more consolidation in de paper sector. Paper Excellence, that recently changed name to earlier acquired Canadian group Domtar, with subsidiaries in North America en Europe and head office in Amsterdam, has acquired APP, the pulp, paper and packaging arm of the Sinar Mas group, Indonesia. It is a family affaire as sun Wijaya buys APP form his dad.
Price indication
Price indication in Europe for low grades of recovered paper, sorted, baled and ex works are now between € 40 and € 70 per tonne. These prices are depending on quality, available volume, region and loaded weight.
Look here at the Price chart >>
The price chart gives an indication of the price of mixed paper, separately collected, in the Netherlands free delivered mill over the last 10 years.
Scrolling over the top of the columns gives the exact price indication in Euro's per ton.