Corrugated waste paper in the United States is expected to fall to freezing point, and the price of corrugated waste paper in Asia is soaring again!
Import prices for used corrugated boxes (OCC) continue to climb amid a rebound that began in Asia two weeks ago. The first buyers to push up prices are Chinese-affiliated cardboard and recycled pulp mills in South East Asia (SEA), who have been willing to pay high prices for high-quality U.S. and European exports of used corrugated boxes (OCC). These producers have enough tonnage to provide ample raw materials for their new recycled pulp lines in Thailand, Malaysia and Batam, Indonesia.
Meanwhile, other customers in South East Asia and Taiwan also stole some of the imported used corrugated boxes (OCC). In addition, Indian buyers have also joined the competition, chasing tonnage and seemingly driving up prices every day. Two weeks ago, brown-grade used corrugated boxes (OCC) in the United States rose by $20-25/ton, and European used corrugated boxes (OCC) prices rose by $15-30/ton.
At that time, the price increase brought the price of dual-class used corrugated boxes (OCC) (DS OCC 12) in the United States to $145-170/ton, waste corrugated boxes (OCC) No. 11 in the United States to $140-160/ton, and waste corrugated boxes in Europe (OCC) (95/5) to $135-145/ton. South East Asia markets do not require pre-shipment inspection in the country of origin, such as Thailand, Vietnam and the Philippines, and the market in Taiwan is currently the same.
Prices in Indonesia and Malaysia, which require preshipment inspection, rose by $5-15/ton. To take full advantage of this favorable situation, suppliers of usedcorrugated boxes (OCC) have continued to seek price increases over the past two weeks. DS OCC in the United States in Taiwan is quoted at $175-180/ton, and South East Asia and India are quoted at $180-200/ton.
Sellers also cut their offers, citing continued declines in waste paper recycling and low inventory pressure as they deal with a backlog of large orders received over the past month.
Mills in Taiwan and Vietnam are under pressure to deliver waste paper in January. Meanwhile, customers in Indonesia and Malaysia were also forced to stock up on waste paper ahead of Ramadan in April. With China's economic downturn showing no signs of easing, Asian buyers see a surge in waste corrugated boxes (OCC) as unsustainable.
Recycled pulp and packaging materials produced by Chinese affiliates in South East Asia are supplied to the sluggish Chinese market. At the same time, other manufacturers in the region, products from India and Taiwan, have sluggish exports to China and see no signs of recovery. Many of them have cut production of machines that produce recycled pulp and finished products for export to China.
Sellers acknowledge that buyers have taken advantage of last month's unprecedented low prices to replenish inventories. Both supply and demand believe the current price hike may end soon; however, sellers believe current prices will remain historically low, fluctuating in a narrow range amid shrinking waste paper recycling in the United States, Europe and Japan.