Paper
2021 was a truly exceptional year in ways that were so distinct from its predecessor. Whereas 2020 had been dominated by the impact of COVID on our normal working practices and on patterns of demand, last year was characterized by unusually sustained high prices for recovered fibre that were linked to the global economic recovery and to the end of many pandemic-related restrictions. Mills all around the world got back on track and so demand for our materials was consistently strong.
That strength of demand should persist in 2022 given that analysts are predicting further, albeit decelerating, economic expansion. The World Bank Group, for example, expects growth of around 5.5% in 2021 to be followed by a reduced 4.1% gain this year owing to COVID flare-ups, diminished fiscal support and lingering supply bottlenecks, with a 3.2% increase envisaged for 2023 as pent-up demand wanes and supportive macro-economic policies continue to be unwound.
For our own industry, the most eye-catching and disturbing element of these forecasts concerns the reference to persistent supply issues. While demand for our materials remained pleasingly healthy throughout 2021, our business activities were still thrown into turmoil by the unrelenting practical and financial challenges relating to transportation. Freight costs remained very high amid a lack of available containers, many of which became tied up at or outside ports of destination as a result of COVID, thus impeding long-haul export activity. Services also became more unreliable, with fewer sailings available and almost inevitable delays.
At our Paper Division webinar in November last year, guest speaker Florent Noblet of French transport and logistics trade body Union TLF was gloomy about the prospects of a rapid cure for this massive shipping headache, suggesting significant disruption could persist well into 2023. So clearly, we should prepare ourselves for a further onslaught of delays, blank sailings, roll-overs, port congestion and elevated freight rates.
In other ways too, 2021 was far from plain sailing for those recovered fibre businesses relying heavily on export markets. The latter part of the year brought a cessation of EU shipments to India as a result of an error by the Indian authorities which, it was anticipated, would not be resolved before February 2022; administrative errors are a part of life and must be accepted as such, but this oversight relating to a key recovered fibre market certainly did not help our exporters’ cause in 2021.
To add to their woes, the Malaysian government has followed in the footsteps of China and Indonesia by introducing stricter controls on recovered fibre imports, including pre-inspection in the country of origin.
Exporters also took a heavy blow in November last year with the release of the European Commission’s proposal for revising the EU Waste Shipment Regulation. By seeking to restrict exports beyond the EU, this risks being counter-productive if there is no reciprocal restriction on recovered fibres entering the EU under the status of waste as well as stronger requirements on manufactured products imported into the EU.
In these circumstances, a proper status for raw materials derived from recycling would appear to be an excellent solution. France published end-of-waste legislation on December 13 last year, based on the EN643 standard, with the aim of smoothing movements of our industry’s raw materials by classifying recovered paper as a product rather than waste so long as it meets specific quality criteria. Spain and Italy are among those countries to have gone down a similar route in the hope of gaining recognition at EU level for this approach.
While 2021 saw demand being sustained by increased local sourcing activity, we cannot escape the fact that international trade in recovered fibre will remain essential for the foreseeable future in order to balance surpluses and deficits around the world and to ensure that all nations have an opportunity to base their industrial development on the use of our high-quality, sustainable raw materials.
The circular economy will achieve its full potential only when it is treated as truly global.
Jean-Luc Petithuguenin
Paprec Recyclage (FRA)
President Paper Division
(until November 2021)
Francisco Donoso
PRESIDENT PAPER DIVISION
IMPORTANT FACTS
Made from vegetable fibres called cellulose, paper as we know it today was first created in China more than 2000 years ago. Since the advent of the printing press in the 15th century, its use has spread across all continents to the extent that, currently, it is hard to imagine the world without this versatile material. Around 420 million tonnes of paper and cardboard are produced worldwide every year, with well over half of the raw material coming from recovered sources.
Some 50-60% of recovered paper comes from industry and business. This includes paper trimmings, cuttings and shavings from manufacturers and converters, as well as goods discarded before they reach the consumer, such as unsold newspapers and magazines. The remaining recovered fibre comes from households.
THE NEED FOR FREE TRADE
Recovered fibre collections in, notably, North America and Europe easily exceed local consumption needs and so overseas trade has become a major component of this market. But despite the environmental, social and economic advantages of the worldwide trade in recovered paper, flows have been disrupted over recent years. China established itself as the leading importer of recovered fibre, buying around 30 million tonnes per annum from overseas suppliers at one stage. However, the Chinese government has recently imposed more stringent import rules, with the result that overseas purchases are believed to have declined below 10 million tonnes in 2019 and are expected to drop still further.
Similarly restrictive import measures have also been introduced by other countries in Asia which had been leading buyers of surplus material from Europe, thus impacting the global market and creating widespread concern over the diminishing outlets for the world’s excess volumes because of a move away from the free trade principles supported by BIR.
RECYCLING PROCESSES
According to industry estimates, paper can be recycled anywhere from 3 to 8 times. Each time recycling occurs, the fibres become shorter and weaker, and virgin pulp must be introduced into paper production to maintain the strength and quality of the fibre. Through this process, recovered paper and forest-based products complement each other ecologically and economically.
The recycling of paper follows a series of steps which may vary depending on the type of paper and its degree of deterioration.
Sorting: Paper products must be separated according to their composition and degree of deterioration. Different types of paper can sometimes be mixed. Others, such as paperboard, are recycled using a single-grade process, meaning that no other type of paper can be mixed in during its processing.
Baling: Large quantities of paper are packed using hydraulic machines which apply enormous pressure to compact recovered paper into blocks that are easier and more cost-effective to transport.
Shredding: Recovered fibre is shredded into smaller pieces and mixed with water to make pulp.
Washing: The pulp is washed, refined and cleaned, then turned into a slush that undergoes filtering through screens and other separation processes to remove contaminants such as ink, clay, dirt, plastic and metals. Dyes, coatings and other additives can be introduced during this process. Water is continuously drained and cleaned for reuse.
Bleaching: In order to whiten paper, the pulp can be bleached using hydrogen peroxide and chlorine.
Pressing: The resulting paper sheet, known as “web”, is pressed between massive rollers to extract as much of the remaining water as possible and to ensure uniform smoothness and thickness. The semi-dry web is then run through heated dryer rollers to remove any remaining water.
Rolling: The finished paper is processed into large rolls ready to be manufactured again into new consumer products.
Divisional Board
