Mexican domestic OCC prices sink in November

A downturn in recovered fiber demand in November has triggered a decline in prices and demand for imports in Mexico

Mills in Mexico experienced a downturn in recovered fiber demand in November that decreased prices for most grades, with those for local old corrugated containers (OCC) dropping significantly and those for imports falling further, according to Fastmarkets’ pricing survey and market report on Tuesday November 8.

Imported bulk grade pricing has declined for four consecutive months on weakening demand from major buyers. Mills in Mexico typically aim to wrap up every year with reduced recovered paper inventories, and this trend is at play this year.

Prices for domestic OCC have inched lower in recent months, but those declines were limited, with local market participants arguing that cost inflation supported prices. This month, however, prices have eroded quickly amid a surge in imported OCC offers at extremely low prices as well as an overall negative environment for sales of corrugated boxes.

According to Fastmarkets’ price survey, domestic OCC prices moved to 3,000-3,600 pesos ($154-185) per tonne in November from 3,800-4,500 pesos per tonne in October, down 31.3% compared with a year ago.

We believe that extreme pressure on prices will continue until December; all mills have full inventories, and demand is not coming.

Imported OCC pricing dropped by $30 per ton in November to reach $65 per ton, slumping by 68.3% year on year. With price declines in every month since August, OCC imports in Mexico have tumbled by $105 per ton in just four months.

Mixed paper pricing declined by $10 per ton to $20 per ton in November, down by 83.3% year on year, amid a persistent supply/demand imbalance.

Suppliers said mills in Mexico have stopped securing container shipments of OCC, instead receiving tons via trucks and railcars in November.

“It definitely has slowed,” a seller said of Mexico’s demand for OCC. “They’re pushing back… They have demand, but it’s not as good as it was.”

Demand for high deinking grades declined month over month, according to contacts. As a result, prices for deinking high grades also decreased in November, with mills buying fewer volumes of sorted office paper (SOP), sorted white ledger (SWL) and pulp substitutes such as hard white envelope cuttings (HWEC).

Prices for SOP, SWL and HWEC all fell by $5 per ton in November to $265-275 per ton, $345 per ton and $485 per ton respectively. Still, those prices are higher compared with a year ago.

“High grades are still in demand, maybe a bit less since we are facing the end of the year,” a mill contact said. “Mexico historically lowers inventories at the end of the year.”

According to one seller, recycled-content tissue mills in Mexico have “high inventories” in November.

Meanwhile, elevated premiums that mills have maintained for months finally fell in November, buyers and sellers said.

“Mexico is pulling back a bit,” a second seller said of SOP and SWL demand in Mexico.

“Tissue mills are… taking premiums down,” the second seller added. “They can do that with Mexico shrinking inventories.”

This article was first published in our PPI Latin America newsletter. Find out how you can access the latest market developments in the Latin American region directly from your inbox by speaking to our team.

What to read next
Explore the implications of the 50% tariff on the pulp market, impacting trade dynamics and costs for industries reliant on pulp.
The corrections are as follows: AG-BRY-0004 Barley Feed barley FOB Argentina $/mt Incorrect prices: August $119.00 per tonne Corrected to: August $219.00 per tonne Fastmarkets’ pricing database has been updated to reflect this change. These prices are part of the Fastmarkets Ags Grains package. For more information or to provide feedback on this correction notice or […]
Understand the impact of avian flu on Brazil's poultry exports and the packaging sector's critical challenges in the coming months.
Discover how Klabin, Brazil’s largest producer, leads in packaging paper and innovates with its Eukaliner product.
In this article, we’ll look at the impact of US tariffs on the soybean markets as they unfolded and weigh what it could mean for the future.
Fastmarkets’ Agriculture publishing schedule has been updated accordingly. You can find the publishing schedule here. For more information or to provide feedback on the publishing schedule update, please contact Eduardo Tinti by email at: pricing@fastmarkets.com. Please add the subject heading “Argentina Grains publishing schedule, 2025.” Please indicate if comments are confidential. Fastmarkets will consider all comments received […]