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accompanied the 20th anniversary of Earth Day has been scaled back.
More legislators are becoming cognizant of the difficulties of finding
markets for material. A recent study by the U.S. Conference of Mayors
found the number one concern by cities with recycling programs was the
inability to find end markets for the material.
While the slowdown in collection should balance supply and demand,
the opening of more mills will undoubtedly follow with more cities starting
curbside collection programs. Whether or not this balance will remain will
depend largely on continued economic strength.
Another promising sign, one which will go a long way toward dictating
the direction of ONP’s markets, will be the strength of the newsprint
industry. After suffering several straight quarters of sluggish demand and
sharply discounted prices, it appears newsprint markets have bottomed
out. While better newsprint markets will be dictated by an improved
economy, there appears to be preliminary signs prices for newsprint will
remain fairly stable domestically. While it is unlikely prices will show sharp
increases, at the same time it is considered doubtful prices will tumble any
further. What will be closely watched this year is the Canadian newsprint
industry. Because a significant amount of the collected ONP moves to
Canada, an improvement in the Canadian newsprint industry will be a
major reason for better market conditions for ONP in the United States.
With uncertain export markets for this year, a number of paper stock
dealers hope for big things for the Canadian newsprint industry to offset
disappointing overseas market for ONP.
OLD CORRUGATED CONTAINERS
The grade generating the widest range of opinions has been old
corrugated containers. The commodity continues to be the most often
recycled paper stock grade by weight. Figures point out the recovery rate
for OCC at greater than 50 percent. With a maximum recovery level not
much higher than 60-70 percent, some theorize as the economy
improves, a shortage of OCC will spring up. New players will compete with
historic users for available supply. At the same time many paper stock
dealers feel prices could climb by $50 a ton or more this year.
This opinion is not universal, however. A number of paper stock dealers
feel supply is actually much higher, with more corrugated available than
previously reported. One reason is the difficulty in gauging the amount of
OCC being imported from outside the country.
A positive sign for the industry has been the opening of several new
facilities geared to handle large amounts of OCC. These facilities already
have stabilized market conditions in parts of the United States.
In the eastern United States, expansion programs are allowing mills to
increase the OCC consumed. In other instances the opening of previously
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