Printers to pay more for paper removal

The current oversupply of waste paper is the worst Australia has experienced since 1998, with the depression of paper prices expected to continue through 2006. This coincides with a seven-year global cycle of a slow in the use of secondary paper utilisation.

According to Graeme Holland, chief executive at recycling organisation Paper to Paper, Australian Paper’s Shoalhaven mill has previously paid 50 per cent more compared to export prices for a low-yield stock already in surplus globally. Now the possible closure of its de-inking facilities means printers’ waste is destined for the lower-value export market.

“Non-contracted suppliers are already being turned away,” says Holland. “While companies are subsiding exports because of existing contracts, a new price will inevitably be renegotiated when these contracts expire.

“Printers have to face the fact that they may not be paid at all for waste products, or alternatively be charged for its removal.”

Paper to Paper emphasises that printers have traditionally not received payment for any of their waste that was exported over the last 30 years. He advises that if printers are willing to separate paper qualities then any impending charge for paper removal could be costed into printing contracts – effectively raising the price of the process itself.

David Shirer, executive general manager of corporate affairs at PaperlinX, confirms a study is currently underway on the economic feasibility of the Shoalhaven mill, one possible outcome of which will be a shift of much of its production to the Maryvale mill and a closing down of its de-inking facilities.

“Our organisation will continue to provide a range of recycled products, but our consumption of printed waste will ultimately depend on the demands of customers,” says Shirer. “There is no point us making a product people do not want.”

Paper to Paper claims the Amcor Fairfield de-inking mill is already suffering similar conditions to the Shoalhaven mill, with its operations currently under review, while Visy is overstocked and was exporting throughout 2005. This all points to the likelihood that printers will be forced to pay more for waste removal in the near future.