Prices of Recovered Paper Grades Shot Up in the U.S.

The generation of recovered fiber has slowed down significantly.

SEATTLE (Scrap Monster): The U.S. recovered paper grades witnessed rapid surge in prices, triggered by acute shortage across various grades. OCC prices led the rally, said the most recent report released by FastMarkets RISI. The surge in prices was partly due to uncertainties on account of COVID-19 spread.

The average buying prices of OCC skyrocketed by nearly 196% since January this year to nearly $71 per ton. It must be noted that OCC grades had reported average price of $24 per ton in the January buying period. The prices had averaged at nearly $25 per ton during the latter half of 2019, after recovering from historic lows at the beginning of the year.

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According to the report, other recovered paper grades too reported rapid surge in prices during the second week of April, with a few grades recording unprecedented upsurge within a few days itself. The report foresees price increase to extend to May buying period as well.

The generation of recovered fiber has slowed down significantly. This is mainly due to temporary suspension of some residential recycling programs and reduced collection from department stores and businesses on account of lockdowns. This coupled with pent-up demand from paper mills across the globe is seen contributing to the extraordinary price jump.

Recently, several packaging majors including Sonoco had implemented hike in prices for various grades of uncoated recycled paperboard (URB).

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