A paper recycler has reported a ’tough year’ despite UK firms seeing an uplift in export prices.
In February, cardboard export prices rose by £10 per tonne to reach £96 at one point before settling back a pound or two. “Prices have gone crazy high – I didn’t expect it at all,” said a major buyer for the Chinese market, as reported in the latest Market Focus in MRW.
Prices for the UK cardboard are now said to be around £5 per tonne higher than those on mainland Europe.
London-based TGM Recycling’s chairman Graeme Coombes said the past year had been tough despite the price rise.
“The biggest issue we face is diminishing availability of all grades except cardboard. As a large collector and producer of newsprint, we have seen this sector suffer huge falls in volume, while the printing, print finishing and direct mail clients have all been very subdued too,” he said.
UK paper and cardboard production fell below four million tonnes a year and mill usage of recovered materials has dropped by 10% in 2015, according to Confederation of Paper Industries figures.
However, the amount of recovered paper exported rose by 10% to 4.88 million tonnes while the amount imported was 76% higher than 2014, although this still only amounted to 240,000 tonnes.
There has been concern in some quarters that a reliance on exports could be hampered by importing countries such as China and India increasing their use of domestic recovered paper supplies.
A financial statement last year from China’s largest containerboard manufacturer, Nine Dragons Paper, revealed that it sourced 48% of its paper from within the domestic market, with analysts expecting this to grow further.
But Mark Lyndon Paper managing director Paul Briggs said at the time he did not believe the country could become entirely self-sufficient.
In 2015 it established Europlastix before acquiring Plastics Plus Recycling Group, including its operating company Polymer Industries.
“We believe that diversification is the only method of survival; being a paper-only ’one trick pony’ would ultimately lead to our demise,” said Coombes.