Packaging boss: ‘Paper for recycling is short in Europe’

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Demand for recycled paper is so strong in Asian countries that corrugated board manufacturers are finding it hard to get sufficient supply, Roberto Villaquiran said in an interview with EURACTIV.

Roberto Villaquiran is the president of FEFCO, an umbrella organisation representing European associations of corrugated board manufacturers. He replied to EURACTIV's questions by e-mail.

How much recycled paper do FEFCO member companies use as a percentage of their entire production? Do you have targets in this area?

I am proud to say that corrugated paper recycling is the big success story in recycling. Our industry is the one closest to the perfect loop: Corrugated paper can be recycled 100%; and in reality, we really recycle almost every box showing up on the European market.

Since most of our packaging goes to business, recycling is easy because there had been a market for used boxes already decades ago. We did not need legislation for that. And our customers, like the retailers, make money on used corrugated. On average, corrugated packaging companies use paper containing on average 82 % of recycled fibres when making new boxes.

Our targets are of course recycling more where possible, but more important is the reduction of the environmental impact of packaging and product loss. We want to continue finding the best application to protect the products. That way, we ensure these arrive safe at their destination. By reducing product losses, we reduce environmental impact substantially. And of course offer the solution at a reasonable price.

How easy is it to find recycled paper on the European market these days? What are the barriers to it?

Paper for recycling is short in Europe. Due to the extensive exports, mainly to Asia, our companies suffer from getting sufficient supply. The Far East is hungry for our used paper. In China for example, they collect only 42 million tonnes, but need 72 million tonnes. So we always have these periods of strong demand from China and other Asian countries, which can be seen in sudden price raises for our main raw material.

The market of paper for recycling is a typical market where changes of supply and demand result immediately in price changes.

What can we do? We have to pay more, or increase stock, but there are capital and space limits. For our customers, this is not good: since paper is responsible for over 50% of the costs of corrugated, our industry has to adapt prices accordingly. And customers would prefer a more steady mode.

Do you support MEP Gerben-Jan Gerbrandy's bid to create a 'Schengen area' for waste? What would be the advantages of this? What would it take to make it happen?

First of all, you should understand that used corrugated is by no means waste. It is our most precious raw material. It is paper for recycling; a product which is traded and for which a market existed long before packaging legislation started.

But back to your question, I like MEP Gerbrandy’s idea of creating a 'Schengen area' for waste. He is right when saying transport of specific types of waste across borders should be eased to where the proper recycling facilities exist.

This is a problem which does not raise any concern to us. Corrugated boxes are made out of paper which is 100 % recyclable. Due to the long history of paper recycling, the infrastructure is good. In Europe, you can find paper recycling facilities almost everywhere in your neighbourhood. I see that this could eventually be a problem for other products such as electronic equipment.

MEP Gerbrandy’s main objective is to increase even more the re-use and recycling of all materials. He wants to give a sense of urgency to the scarcity of materials which is indeed urgent. But we feel the paper packaging industry is an excellent example to achieving this goal, having already now the highest recycling rate of all materials in Europe.

Looking at another aspect, I fully agree with the recent European Parliament environment committee’s decision to insist on the implementation of the already existing waste legislation instead of creating new tools. Although I believe at some point we should challenge that legislation. For example the Waste Framework Directive. By making sure that the flexibility approach of the waste hierarchy is applied properly. Although it might sound strange, in many cases, recycling is better than reuse. And what we strongly object is incineration of paper. Our raw material is far too valuable to be burned.

In China, Nine Dragons Paper Holdings has made a fortune with recycled paper mainly imported from Europe. Why isn't there a European equivalent?

I believe the structure of business in China is very different. China has grown tremendously at a high speed during the past decades, giving opportunities to growing sectors like the paper sector. Accumulation of capital and therefore growing wealth of entrepreneurs is easier in such an environment. In Europe, the packaging paper market is more saturated; growth is limited, which limits also the growth of personal wealth.

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