China’s tightening import policies for recovered paper are changing the paper stock grades that are available to U.S. consumers and affecting the flow of scrap paper globally.

Speakers at the 2018 Paper & Plastics Recycling Conference in Chicago this October said the old corrugated containers (OCC) No. 12 grade that would normally be sold domestically has been shipping to China in increasing volumes this year. The grade, which is comprised of retail, distribution center and grocery store material, is generally of a higher quality than the OCC recovered from U.S. residential recycling programs through single-stream material recovery facilities (MRFs). This residential material, however, is what is currently being offered to U.S. mills since China has tightened quality requirements for recovered paper imports.

In addition, the growth of e-commerce has changed the economics of recycling in the U.S., making local recovery programs critical to recovering those boxes, D.J. VanDeusen of Atlanta-based WestRock said during the conference. (For a Q&A with VanDeusen, see the feature “Going deeper,” beginning on page 70 of the accompanying December issue of Recycling Today.)

China’s domestically collected OCC has become very expensive for mills within that country as the balance between demand and supply has tightened significantly, Hannah Zhao of Boston-based RISI Inc. told attendees, making U.S. collected OCC more desirable to Chinese mills.

"The flow of mixed paper also has been affected by China’s recovered fiber import policies. In some U.S. communities, the material is going to landfill.”

Outside of China, other Asian countries have been able to import much more recovered paper from North America than they had in the past, she added.

The flow of mixed paper also has been affected by China’s recovered fiber import policies. In some U.S. communities, the material is going to landfill because no consumers are willing to take it. As much as 500,000 tons of mixed paper likely have been landfilled as of mid-October in the U.S., Bill Moore of Moore & Associates said at the conference. (For more on Moore’s view of the mixed paper sector, see “What’s next,” starting on page S10.) Its value also has declined considerably since Chinese mills stopped purchasing this material.

Moore said he anticipates other countries will continue to increase their imports of U.S. recovered paper grades in the next few years. Containerboard projects planned for the U.S. and in other parts of the world, he said, will help to consume U.S. mixed paper and OCC.

While the present may be challenging for a number of recovered fiber grades, Moore and other speakers at the 2018 Paper & Plastics Recycling Conference say they feel the future will be brighter.