Waste paper prices move sharply down

And, while prices for waste paper are down, the attention of many merchants and waste management companies is on actually securing orders for material, which are becoming increasingly hard to come by.

Charging for collection of cardboard and mixed papers is now said to be “an absolute necessity” according to several merchants, although one voiced worries that charges might see some material dumped outside the yards of waste paper merchants.

Little ground for optimism has been offered, although some in the sector are hoping that the very low prices may tempt more orders in from China and India.

Chris White, president of the recovered paper section of the Confederation of Paper Industries, and commercial director at Aylesford Newsprint, said: “At this moment in time there are no words of comfort on the horizon, this is close to being a disaster. We really need the Chinese markets to reopen their gates.”

Merchants report that the Chinese market “is dead”, although it is understood that the main UK buyers of material for China are still taking contracted tonnage.

Licences

One merchant in the Midlands noted: “This is looking pretty grim at the moment. China is stocked-up and many of their small and medium sized mills may have trouble operating after November 20 when their licences come up for renewal.”

And, a merchant in the south of England said that the crisis would put pressure on businesses, with workforces likely to be hit. A factor in this will be that some customers will refuse to pay any extra charges and so collections may have to be abandoned.

Another merchant in the south of England area claimed that the Waste & Resources Action Programme (WRAP) should be taking more of an interest in the situation. “At their recent meeting I was surprised at their optimism which was bordering on complacency.”

Prices

The letsrecycle.com guide prices have been updated today (click here) and show how the price of mixed paper has moved close to zero in the export market with some traders saying that below zero prices might even become a reality with overseas mills wanting a fee for the material. Domestic mills' prices for old-Kls (used cardboard) have also fallen to around the £20 mark although some mills are not buying or are reluctant to take in large volumes. One merchant remarked: “This is the time when you actually don't want to have any large collection contracts.”

Mid grades have also fallen in value, with the price for coloured best pams and multigrade now higher within the UK than on the domestic front.

There is some expectation that mid grade prices may see further falls, especially with a reduction in demand from India.