Shipping Price Increases
Whilst there are mixed feelings if the market will firm or soften from April, no mill is game to run down stocks too low as the recovered fiber is neither in oversupply, nor can the prices collapse when shipping lines are passing on general freight increases and in some cases higher bunker and other surcharges to inflate prices.
Certainly, the shipping lines are under pressure to increase their base carry rate and eliminate or reduce the multiple number of add on charges which are sometimes quoted in different currencies and creating more work, frustration and uncertainty with their shippers.
In New Zealand, there is a space crisis from February until late May, as shipping lines have not allowed for the seasonal produce peak season. Consequently, Scrap items will not be carried at low rates unless surplus space becomes available. This is similar to grain from Australia out of some ports. Recovered paper is consistent and not seasonal, and from New Zealand 12,500 FEUs are exported per annum and increasing, as the economy and paper recovery improve.
Newsprint mills are endeavouring to push down ONP prices even though the majority of recovered newspapers goes back within Mixed paper for packaging and where the Mixed price level at US$190-200 does not warrant sorting for newsprint mills at US$215.
Overall prices will remain volatile, especially for bulk grades, with the tougher credit limits out of China, freight rate increases, currency fluctuations and future direction of the American economy.