RISI outlines changes to recovered paper assessments into Asia

Over the last few weeks RISI has proposed a number of changes to its North American and Asian recovered paper coverage, all of them subject to stakeholder consultation. As the changes are widespread and quite complex, we thought it would be useful to provide a simple summary.

The main changes are:

• To stop assessing Mixed Paper, and SRPN into China
• To propose new assessments for SCN into China
• To propose new assessments for Double Sorted OCC 12 into China
• To seek feedback on possible change to OCC 11 into China
• To create new assessments for these grades delivered to other Asian ports

These changes are necessary following China’s ban on imports of “unsorted” recyclables such as mixed paper that began on Dec. 31^st 2017, as well as a new rule that limits contaminants in imported recovered paper to 0.5% from Mar. 1, 2018. RISI has carried out several industry consultations with regards to changing some of its recovered paper coverage in PPI Pulp & Paper Week and PPI Asia. Full details of the proposed changes, and those that have already been implemented can be found below.

Mixed Paper

China’s ban on imports of “unsorted” recyclables has resulted in virtually no Mixed Paper from the US, Europe or Japan being sold into China. Instead, Mixed Paper is being diverted to other Asian ports. In view of this change in trading patterns, RISI has discontinued assessments of US Mixed Paper exports CFR China in PPI Pulp & Paper Week, as well as assessments of Mixed Paper and Board from Japan, Europe and the US delivered China in PPI Asia. These changes took effect on Mar 5 and Mar 16 respectively.

At the same time, RISI has changed the destination title of US Mixed Paper assessments FAS US ports in PPI Pulp & Paper Week from China to Asia. From Apr. 6, PPI Asia will launch new bi-weekly assessments of Mixed Paper & Board from Japan, Europe and the US to Taiwan and Southeast Asia.

Corrugated Grades

The stricter rules on imports to China have also affected corrugated grades, with primarily higher quality OCC such as double-sorted (12) going into China, and standard OCC being sold to other Asian countries.

RISI is therefore currently consulting on whether to change its coverage of corrugated grades.

RISI is proposing to launch new price assessments for US exports of Double-Sorted OCC (12) to China FAS US ports from Apr 5, and to remove the term “Select” from price assessments for exports of Old Corrugated Containers (11) from New York/New Jersey CFR Nhava Sheva, in India so that these assessments would simply reflect OCC (11). In PPI Asia, RISI has proposed to launch new price assessments for US exports of Double-Sorted OCC (12) CIF main ports in China from Apr 6, and to launch bi-weekly assessments of OCC from Japan, Europe and the US CIF main ports in Asia.

Finally, RISI is considering whether to launch new assessments in PPI Pulp & Paper Week for US Old Corrugated Containers (11) FAS US ports destined for Asia, and whether to discontinue OCC (11) assessments CFR China. This change has not been confirmed and no timeline has been fixed as yet.

News Grades

The stricter limits on contaminants in recovered paper imported to China has also affected other news grades such as Sorted Residential Paper and News (56) and Sorted Clean News (58). Like Mixed Paper, Sorted Residential Paper and News (56) is also being sold elsewhere in Asia, rather than into China. To reflect this, RISI has proposed to discontinue assessments of US Sorted Residential Paper and News (56) CFR China in PPI Pulp & Paper Week with effect from Apr 5, and to discontinue assessments of Old Newspapers (6 and 8), which correspond to this grade, CIF China in PPI Asia from Apr 6.

Moreover, RISI has proposed to change the destination title of assessments of US Sorted Residential Paper and News (56) FAS US ports in PPI Pulp & Paper Week from China to Asia and to launch new price assessments for US exports of Sorted Clean News (58) destined for China FAS US ports at Long Beach, CA, New York-New Jersey, and Oakland, CA, ports, and Chicago container yard, effective Apr. 5. Similar changes have been put forward for PPI Asia recovered paper coverage: new price assessments for US Sorted Residential Paper and News (56) CIF Southeast Asia and Taiwan and for US exports of Sorted Clean News (58) CIF main ports in China will be launched on Apr 6.

For comments and queries on the proposed changes, please email pricing@risi.com, mentioning “China Recovered Paper” in the subject line.