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U.S. OCC Shipments to China Are Down
December 8, 2007 Official Board MarketsU.S. OCC shipments to China down 12.3 percent year-over-year for January-September 2007. Of the 3.7 million metric tons of recovered paper exported from the U.S. in January-September 2007, shipments in each category were higher than last year, according to the latest data from the U.S. Dept. of Commerce (DOC).
China remains the number one market for U.S. recovered paper exports, by far, accounting for 57 percent of the total market. Though the first three quarters of 2007, nearly 7.2 million metric tons of recovered paper was shipped from the U.S. to China. This was 11.1 percent more than a year earlier.
Although Chinese orders of OCC from the U.S. were down during this time, all other grades advanced. Shipments of mixed papers were up 4.8 percent and ONP increased 54.5 percent.
Other top markets for U.S. scrap paper exports are Canada, Mexico, India and South Korea, in that order. However, with the exception of India, deliveries to these countries were down year-to-date versus the first nine months of 2006, according to DOC data.
Through the first nine months of 2007 versus a year ago, OCC exports advanced by 6.6 percent, mixed paper was up 3.4 percent, old newspapers (ONP) increased by 16 percent. The third quarter was particularly robust, with shipments in each category up by double digit amounts, for a total increase of 13.2 percent versus third-quarter 2006. Likewise, September ended the quarter on a high note, with total scrap paper exports up 13.3 percent compared to the previous September.
Compared to January-September 2006, U.S. recovered paper deliveries to Canada dropped by 2.2 percent; Mexico, in third position, dipped by 1.6 percent. While South Korea inched down just 0.7 percent, a 41.8 percent growth in shipments to India advanced that country from fifth to fourth place, bumping South Korea down from fourth position to number five spot.
In September 2007, total demand for U.S. scrap paper, including both exports and U.S. consumption, was 3.9 million metric tons. Domestic consumption of more than 2.5 million metric tons accounted for just under two-thirds of total demand, and 34.6 percent was exported. U.S. consumption of recovered paper was flat (down 0.1 percent) year-over-year through the first nine months of 2007, totaling 23.6 million metric tons, the American Forest and Paper Association (AF&PA) reports. From August to September, it dropped 5 percent.
With consumption declining, U.S. mill inventories at the end of September stood at 843,500 metric tons, an increase of 2.5 percent from a month earlier and 3.8 percent higher than a year ago, according to AF&PA. However, the dip in consumption is lower than the rate of decline in U.S. paper and paperboard production, which reached 82.7 million metric tons on an annualized basis for January-September 2007. This was down 1.2 percent from total paper and paperboard output for full-year 2006, AF&PA reports.
