There is a fact that Confederation of Paper Industries (CPI) director general David Workman is very proud of. And that is the statistic that the paper industry was likely to have maintained a recycling rate of more than 70% in 2010 in the UK, making it one of the most recycled materials in this country.
“Paper is easily recyclable,” he says. “There is demand for it from both the home trade and the export market. The public associate paper with being recyclable, and much of the infrastructure is in place for it to be easily recycled.”
But looking back over 2010, he sees that some of the biggest challenges were on the legislative front.
“Defra consulted on a huge amount of waste legislation in 2010,” he says, “and I congratulate it for how much it was prepared to consult, particularly on the [UK’s implementation of the] Revised Waste Framework Directive. That is a good sign but, as yet, we do not necessarily know all of the outputs from all of these consultations, and particularly with the waste review coming out next year.
“With the last Government’s waste strategy, the emphasis was on landfill avoidance, but I suspect we will see much more now on resource management. The review will look at quality standards and an emphasis on quality.”
However, Workman is concerned that 2010 saw quite different policy viewpoints from the devolved administrations of Wales, Scotland and Northern Ireland from that of Defra in England.
“UK policies are from the devolved administrations and there is also the localism agenda of the Government that has not fully been defined,” he says. “The UK could end up with a mish-mash of policies which will make it more difficult to work in a global market such as paper, where prices and movement of materials are set by the market.”
He is also keen to recognise the contribution made by the packaging sector in 2010, where cardboard packaging was reduced. He recognises that there are still ways in which this material can be minimised but is pleased with progress so far. But if minimisation of packaging makes environmental sense, does it also make business sense?
“Volume won’t be the king in future. There will be a different agenda based on use of resource. The corrugated sector and packaging sector will have to learn to make money, not from volume but from being cleverer in selling new products and different types of products that use fewer resources. We are no longer in a world where we can produce excessive materials.”
“The corrugated sector will have to learn to make money, not from volume, but from being cleverer in selling new products”
Looking at the markets in 2010, Workman is pleased to report a good year for paper and cardboard. “The export markets have held up and the developing world is crying out for materials,” he says. “In the medium- to long-term, countries such as China will adopt European quality standards and develop domestic waste infrastructure and so will require high quality materials, either from the export market or from their domestic streams.
“Plus, while the developing world looks to expand, there will be viable markets for paper in China, India and Indonesia. As long as we meet quality standards, we will still have key markets.”
Looking at this year, he expects the first half of 2011 for the CPI to be dominated by legislation and the waste review in particular.
Workman says: “In terms of waste implementation, we have a good idea of how Wales and Scotland will go. But I do not have a view on England as yet. The localism agenda is being introduced at a time when we actually need more central control of waste policy. In particular we will have to see how the waste management companies seek to address issues around how material such as paper is collected and treated under this agenda, where local people will have more influence over waste policy.”
He expects the markets for paper will remain volatile in 2011: “The price is a reflection of demand and supply. Prices have risen significantly and if the market remains buoyant, then prices could stay high, but I wouldn’t want to speculate.”
Although much of the value from paper comes from the strong demands of the export market, Workman is encouraged by investment in the UK.
“Palm Paper opened its mill [in Norfolk] early in 2010 and Saica is opening its mill in the Manchester area in 2012. There is big investment going into the paper industry and the existing paper manufacturers are investing, particularly in areas such as biomass power plants. The industry is looking positive, but there is still a long way to go.
“We consume 12 million tonnes of paper in the UK, but only produce 4.5 million tonnes. So there is still lots of potential in this market for UK investment, although the Government needs to create the conditions to make investment more conducive.”
Workman is interested that companies such as UPM and SCA are opening MRFs and is happy with this trend, seeing it as a desire for high standards to be maintained. The paper industry is working to ensure it gets the paper it needs for production. The CPI has an export code of practice and, as part of that, has its own quality code EN643. This limits contamination to no more than 2% by weight of non-paper products, with no more than 0.5% of this coming from metal cans, plastic bottles, other plastic packaging and glass containers.
“We are lobbying hard to ensure quality standards are met, and we take the EN643 standard seriously and will be pushing it hard,” he says. “The UK has a long way to go to match continental quality standards, and particularly countries such as Germany. I know WRAP is setting up quality protocols for materials and we want to work with it to ensure we get the best standards possible. We do not have a policy on which collection method is best. But we don’t like to see paper products collected with garden waste, which I know some local authorities have introduced.
“We know some MRFs are not producing the quality of material required by mills. But the likes of UPM and SCA obviously want material good enough for print production, and are confident that having a MRF will help with that.”
There are a few other issues around that concern Workman and will take up some of his time in 2011. One of these is that energy policy around the Emissions Trading Scheme and renewable obligation targets could make energy costs for heavy energy users such as the paper industry even higher and make the UK less attractive for overseas investment.
And it is expected that there will be a Water Bill in 2011 that could bring even more regulation on use of water by heavy users.
Workman says: “It will look at water use, effluent use and the quality of water. There are mills in the south-east that use a huge quantity of water and there is pressure on water supplies there. Governments do not always think about the cumulative effects of what they do, and I hope this one doesn’t introduce water legislation that has a negative impact on recycling of paper.”
He also hopes that the waste industry does not over-encourage energy-from-waste facilities, particularly if the Government begins to subsidise them, as he would not want to see the recycling of paper become less economic than sending it for energy. But since becoming CPI director general in March 2010, Workman says he has enjoyed the challenges of the paper industry, and is excited by what 2011 holds for paper in the UK.