paper recycling – Market Report
The recycling market remains finely balanced; packaging grades demand and pricing has fallen in both Europe and the Far East. This is driven by good stocks in the European mills and the Far East re-entering the American market as Trump continues to swing around with Tariffs. The European mills continue to look at opportunities to increase their tight margins by reducing input costs. However, we believe that the low collections in the summer and the increased capacity in Europe will prove problematic and we can expect pricing to increase quickly in July and August.
Demand and pricing in all the other sectors have remained stable or seen small reductions as most mill groups are watching the stocks in anticipation of low collections in the summer period.
Packaging
Packaging mills in Europe – prices have seen a decrease in, OCC 1.04.00 & 1.05.00 and mixed papers (1.02.00), of between €10 to – €25 per tonne. In the Far East, pricing has decreased at similar rates.
4.01.00, 4.02.00 & 4.03.00 grades pricing have seen similar price pressures.
Newsprint & Graphic Papers
We are seeing pricing that is stable or with small reductions. Poor availability of recovered paper for this sector is keeping demand at levels to sustain prices, but mills margins are under tight pressure, so some have looked to reduce input costs.
Tissues
As per the Newsprint sector.
Pulp Substitutes
As per the Newsprint sector.
Pricing prediction
In European markets, with low collections and new production in the packaging sector, we expect to see increased demand and pressure on pricing over the summer period. We believe that demand in the Newsprint & the Tissue sector will also remain strong, and with low collection rates, we expect pricing to increase.
Demand for the far east is stable and we expect no increase. We believe this market to remain flat in the coming weeks in Europe. This change is as a result of the easing of tariffs, and the opening up of the US market which is allowing far east buyers to move back into this area.
Overall, our Q3 pricing prediction is; increases in July / August and settling to reductions in the Autumn.