Reverse Market Influences
08-04-2008

No one would have forecast even a few years ago that waste paper prices would be strongly influenced by shipping restrictions and dwindling waste paper supply from the two major sources, USA and Europe.

With a weak US dollar, there is no longer a surplus of outbound shipping containers for low value waste paper.  Firstly, America has become a more competitive source for other commodities, and secondly, its recession is reducing Chinese imports, and as a flow on less inbound containers.

Normally suppliers absorb oceanfreight increases.  These have historically been cyclical or peak season, which have temporarily increased freight rates, but no longer whilst vessels are full and when more materials are being containerised including grain and steel.