One year ago, I started reporting on the recycling industry. Upon starting my position, I was told that the recycling industry was facing many tough yet exciting challenges. It has been amazing for me to see the resilience of companies and individuals in the industry as they have weathered tougher-than-usual market conditions across all segments of the industry.
Recyclers have experienced downright ugly markets for recovered paper in 2019. There was some optimism at the beginning of the year that perhaps the slump caused by China’s tightened import policies in 2018 would subside and prices for recovered fiber would rebound by summer.
Yet, summer came and prices for mixed paper hovered at about $0 per ton across the U.S., and old corrugated containers (OCC) prices dropped from about $70 at the start of 2019 to $25 per ton by July. Movement of recovered fiber also was challenging because many paper mills were overstocked on inventory and were taking extra (unexpected) downtime.
Brokers, paper recyclers and material recovery facility (MRF) operators told Recycling Today they hadn’t seen conditions this bad in their entire careers.
“I’ve done this [for] 35 years ... and this is probably one of the most challenging times in my life,” a MRF operator from the Midwest told Recycling Today in June.
When fall came, prices for recovered paper didn’t inch up as expected; however, movement improved slightly.
Looking ahead to 2020, most recyclers don’t have the same optimism they had at the start of this year. While demanding conditions may remain at the start of 2020, I don’t think things are all doom and gloom for recovered fiber. This past year, several paper companies—both domestic and abroad—have announced plans to expand their capacity to consume recovered paper. Some companies already have added new capacity, including Pratt Industries, which we featured on the cover of our October issue. That company has opened its paper mill in Wapakoneta, Ohio, which can consume about 400,000 tons per year of mixed paper.
We also have seen many companies persevering through tough conditions, and Recycling Today has shared some of those stories this past year. In August, we connected with Duluth, Georgia-based Recycling Management Resources and learned how that company has found opportunities to grow by servicing accounts that other companies were no longer willing or able to service. At our MRF Operations Forum Oct. 22 in Chicago, we also heard stories about recyclers making investments in retrofits and equipment upgrades to clean up their fiber quality and have better products to bring to market.
I know more stories like these exist in the industry. Many recyclers are both flexible and steadfast, and those able to weather current conditions for recovered fiber likely will be stronger and smarter when markets rebound.