Stable condition

Recycling Today, Jan, 2005

After the somewhat volatile market for many grades of recovered fiber throughout the past several quarters, 2005 is expected to be more stable. Prices should remain on the positive side, as domestic and overseas paper companies see improved balance sheets.

A key indicator, as it has been during the past year, is China's interest in snapping up large blocks of old corrugated containers. This appears to be the case, at least early in the year, as supply remains tight and demand creeps up.

Fighting this flow pattern are domestic mills, which are expected to remain competitive for the material.

Old newspaper (ONP) grades also could see modest gains, as many of the newsprint mills again lobby for a finished newsprint price increase early in 2005. Several newsprint producers were able to push through a price increase late last year.

The ability of the newsprint producers to succeed in their price push will go a long way toward determining whether there is some strengthening in the ONP market next year. While better pricing will be anticipated, early 2005 also typically witnesses the largest decline in generation of ONP.

While there is optimism about newsprint markets, the reality is that North American newsprint production has been on a down cycle over the past several years.

High grades should hold up fairly well, with most of the mill shutdowns in that segment having already taken place.

(Additional news about paper recycling markets, including breaking news and pricing, is available online at www.RecyclingToday.com.)