BIR Convention: Scrap paper shifts from China to its neighbors

The thousands of tons of old corrugated containers (OCC) and other scrap paper grades that used to head from Europe and the United States to China have found new homes, according to presenters at the most recent Bureau of International Recycling (BIR) Paper Division meeting.

Speaking at the division’s most recent meeting in Amsterdam in late May as part of the BIR 2023 World Recycling Convention, division President Francisco Donoso of Spain-based Dolaf Servicios Verdes SL said Asia as a continent remains the world’s largest recovered paper producer, reaching a level of 120 million metric tons of output in 2021, equivalent to nearly 50 percent of the world’s total.

While Asia remains the world’s leading importer of recovered paper and North America its largest exporter, Donoso and other presenters pointed to the necessary and high-volume shift in the trade that has taken place since China banned most scrap paper imports in 2021.

John Atehortua, a regional trading manager with CellMark in the Netherlands, spelled out the sudden shift in flows of recovered fiber from the U.S. to Asia. Asian markets will always look to the U.S. first, he said, because of the long fiber characteristics of its kraft grades.

The import ban in China had forced “a shift in mentality” among American OCC exporters who now have to be more proactive about seeking clients in Asia, Atehortua said.

From a situation in 2016 where China had absorbed more than 50 percent of U.S. OCC exports, more than half the shipments from the U.S. in 2022 headed to a combination of three Asian destinations: India, Thailand and Indonesia.

Fellow guest speaker Simone Scaramuzzi, commercial director of Italy-based LCI Lavorazione Carta Riciclata Italiana Srl, commented on the same trend in recovered paper shipments from Europe to Asia following the introduction of China’s import ban.

That ban has spurred recycled-content mill investments in Europe and other Asian countries, Scaramuzzi said, and has led to altered shipping services and prices. Other reasons the recovered paper market in Europe had changed drastically in the last four or five years, the Italian trader said, included the COVID-19 pandemic and rising energy costs.

By the numbers, European recovered paper exports to China tumbled from 5.9 million metric tons in 2016 to just 700,000 metric tons in 2020.

In 2022, the leading Asian buyers of European recovered fiber were Indonesia (1.27 million metric tons), India (1.03 million metric tons) and Turkey (680,000 metric tons), according to Scaramuzzi. Despite China’s absence last year, total volumes shipped from Europe to Asia in 2022 climbed around 12 percent year on year to 4.9 million metric tons.

Regarding recycled-content mill capacity developments, Asia was building new facilities, whereas Europe was largely converting machines in existing mills from graphic to brown grades production. Even so, Scaramuzzi said, Europe would still need to export recovered fiber in order to maintain a balance between its scrap paper generation and demand.

Also at the Paper Division meeting, Ranjit Singh Baxi of United Kingdom-based J&H Sales International, who also is a past BIR president and a former president of the Paper Division, was presented with the division’s Papyrus Award.

Donoso presented the award to Baxi, which the Brussels-based BIR says is the driving force behind the creation of Global Recycling Day.

Global Recycling Day was first held March 18, 2018, to coincide with BIR’s 70th birthday and has since taken place annually. Baxi said the reach of Global Recycling Day hasextended to some 60 countries. “This award is for all of you in this room and across the world,” he told delegates.