After falling for three consecutive months, the price of recyclable kraft paper (PfR) in Europe began to stabilize in November. Most market insiders reported that the prices of mixed paper and paperboard classified as bulk paper, supermarket corrugated paper and paperboard, and waste corrugated boxes (OCC) remained stable, or even increased slightly. This development was first attributed to good export demand and opportunities in the Southeast Asian market, while the demand of domestic paper mills was still sluggish.

“Buyers from India, Vietnam, Indonesia and Malaysia were very active again in Europe in November, which helped to stabilize prices in Europe, and even led to a small increase in prices in some regions,” a contact pointed out. According to market participants in the UK and Germany, the prices of waste corrugated boxes (OCC) have increased by 10-20 pounds/ton and 10 euros/ton respectively. Contacts from France, Italy and Spain also said that exports continued to be good, but most of them reported stable domestic prices, and warned that the market would face difficulties in December and early January next year, because most paper mills planned to conduct a large shutdown during Christmas.

The price of deinking products that began to fall in September and October fell again in November. According to insiders in the market, the level of the European continent has dropped by 10-20 euros/ton, while the contact person in the UK reported a drop of 5-10 pounds/ton. The price of medium and high-grade products was basically unaffected by bulk products and deinking products at first, but it also began to loosen in October, and the price fell again by 20-30 euros/ton and about 10-20 pounds/November ton. Although the quantity of goods received was still low, the price continued to fall, and only some pulp substitutes remained flat in November.

Another contact said that a major German toilet paper manufacturer announced that the company would start using pulp instead of PfR as raw material in the next few months, which had hit the market to some extent. “This will definitely have an impact on prices, and the trend is already declining. I think the gap between low and medium grade paper will now narrow faster,” he explained.

The main reasons for the sharp drop in the price of bulk paper in recent months are the sluggish demand caused by the shutdown of several European paper mills, the relatively high inventory of both sides of the market, and the weak export. After a sharp drop of about 50 euros/ton or even more in some cases in August and September for two consecutive months, the prices of the European continent and the United Kingdom in October fell further by about 20-30 euros/ton or 10-30 pounds/ton.

Although the price cut in October pushed some levels of prices close to zero, some market experts said at that time that the rebound in exports would help avoid a complete collapse of the European PfR market. “Since September, Asian buyers have been active in the market again, and the purchase volume is very large. It is not a problem to ship containers to Asia, and it is also easy to ship materials to Asia again,” a contact person said in late October, and others shared the same view.

India orders more products again, and other countries in the Far East also participate in ordering more frequently, which is a good opportunity for mass sales. This development continued in November. “After three months of sharp decline, the price of brown grade in the domestic market remained stable,” a contact pointed out. The purchase volume of local paper mills is still limited, because some of them have to reduce production due to high inventory. However, exports help stabilize domestic prices. “In some places, the price of exports to some markets in Europe and even Southeast Asia has risen.”

Other market insiders have similar stories to tell. “Export demand continues to be good, and some buyers from Southeast Asia continue to provide higher prices for used corrugated boxes (OCC),” said one of them. According to him, the development was due to the delay in shipment from the United States to Asia. “Some American bookings in November were postponed to December, and Asian buyers were a little worried, especially with the approaching of the Chinese Lunar New Year,” he explained that buyers were mainly worried about the third week of January at the latest. As the US economy slows down, the focus quickly shifts to Europe. “

However, with the arrival of December, more and more insiders said that Southeast Asian customers were increasingly reluctant to pay relatively high prices for PfR in Europe. “It is still possible to win some orders at a reasonable price, but the overall trend does not indicate that more export prices are rising,” said one of the people, warning that the global packaging paper industry is expected to have a lot of downtime, and by the end of the year, global PfR demand will rapidly dry up.

Another insider said: “The entire European packaging industry has a high inventory of raw materials and finished products. More and more factories announced that the shutdown time in December was very long, sometimes as long as three weeks. During the approaching Christmas period, traffic problems may increase, because some foreign drivers will return to their home countries for a long time. However, it remains to be seen whether this is enough to support domestic PfR prices in Europe.”

“I expect domestic prices to remain stable in December. However, it will be difficult for sellers to sell all available materials, because some paper mills will be forced to reduce production and thus reduce raw material consumption,” said another person, “I think there is no reason to be too optimistic just because the price of bulk paper will no longer fall freely. High energy prices and low demand will lead to large-scale shutdown of paper mills, and the overall economic outlook will be bleak. By the end of this year and the first half of January, we will face an interesting period. These weeks may become very, very long.”