Demand remains strong for recovered paper in April

Recovered paper prices aren’t showing any signs of decline in late April. According to statements shared in an "RCP Special Report Story" from Fastmarkets RISI's Pulp & Paper Week April 23, paper mills continued to place orders in late April, yet some recyclers and recovered fiber brokers did not have enough supply available for them. 

Recycled-content tissue mills have steady demand for sorted office paper (SOP) and other deinking grades. However, SOP generation has been reduced, and with less SOP supply, mixed paper demand is increasing slightly. According to the April 23 special report, one contact shared that some recycled-content tissue mills may start consuming mixed because of the lack of SOP . Mixed paper demand also is being driven by shortages of old corrugated containers (OCC). 

A material recovery facility (MRF) operator based in the Midwest tells Recycling Today he’s noticed increased demand for all recovered paper grades. He says with the increased prices for OCC, more mills are turning to mixed paper where possible. 

“With the price jump, I think some mills are looking to use mixed paper to supplement some of the OCC feed,” he says. 

However, mill operators say they can’t always use mixed paper in lieu of other paper grades. Several sources tell Recycling Today that the characteristics of SOP and mixed paper are very different, and it can be challenging to substitute mixed paper for SOP or vice versa without changing the characteristics of the end products.

Some mill operations also confirm with Recycling Today that tissue mills can sometimes use small amounts of mixed paper, primarily for brown toweling products used in the away-from-home segment. But with fewer people going to restaurants and businesses because of COVID-19-related lockdowns, mill operators say the use of mixed paper is not growing in that area.

“We had seen a lot of mixed paper going to brown toweling for restaurants,” the MRF operator in the Midwest adds. “But with many restaurants closed, there has been less demand for mixed to be used in brown toweling. It isn’t all up in arrows on mixed paper.

“But pricing has been great [for recovered paper],” he continues. “Pricing for mixed paper has finally gone up—in April we saw a $10 price increase. I think, hopefully, we will continue to see domestic capacity and demand grow and bring prices up” for recovered paper.