June 1, 2017
Let me start by extracting a paragraph from my last article and build upon this to give more depth to the issue of recycled containerboards, their published prices, and another recent announcement of a mill conversion to these products.
Growth of recycled linerboard volume in North America is significant, yet its total production is not as great as virgin kraft production. This category is generally considered as 100 percent recovered fiber in the marketplace. However, the true definition, as defined by the American Forest & Paper Association, is as follows: “recycled paperboard produced from a furnish usually containing less than 80 percent wood pulp and used as facing material when combining paperboard for conversion into corrugated or solid fiber boxes.” RISI’s Pulp and Paper Week newsletter is considering adding a price index for this segment. At the time of the writing of this article, there is an open period of comment solicitation about its inclusion in the monthly Price Watch for containerboard. Much of this discussion revolves around using only recycled Test 1 linerboard, which is the strongest grade.
So, RISI, the producer of Pulp and Paper Week, and many other publications, conferences, and a newsletter, has sought comments on the publication of a 35# recycled liner and 26# recycled medium price index. Your own Paperboard, Regulations & Sheet Supply Committee has discussed this extensively and sent our views to the editor of Pulp and Paper Week. While the reported spread between virgin and recycled linerboard is often discussed in the commentary section each month, the placing of an actual price index on the Price Watch page, may cause disruptions and calls from your customers and consumers.
Currently, this is compounded by the almost all-time high transfer price of OCC (old corrugated containers). Supply is tight, and export demand to China has been high. History records that as fast as prices move upward, they can also move downward at the same velocity.
Europe distinguishes six levels of linerboard quality not reflected in North America. The Confederation of European Paper Industries (CEPI) sets the minimum quality levels for each grade and publications that publish prices for the grades. That has not been the custom here. With the acquisition of RISI by a European company, one could expect that the new owners would move to list different prices for virgin and recycled linerboards and semichemical and recycled mediums. This is new to all generations and will begin to separate the quality difference in all containerboard.
The 42# virgin liner price was good until about 1991, when the alternative shipping regulations became effective, and we saw many 35# liners and 26# mediums able to generate a minimum 32# ECT through the converting operation, if the board was not crushed.
Last virgin fiber mill was built in 1981 by International Paper in Mansfield, La., very deep in the breadbasket of Southern pine fiber. These forests were also a rich source of mixed Southern hardwood for pulping into semichemical medium, which was the second machine at this mill site. Southern Container built the first modern recycled mill in 1994, much closer to the population and manufacturing centers in the Northeast, Mid-Atlantic, and Midwest. Over time, two other machines were placed at Solvay, N.Y. Today, they are owned by WestRock. This first machine has been engineered to manufacture linerboard as low as 18#/MSF, although the market did not exist for this low-basis-weight linerboard at that time.
Just recently, a Mexican company, Bio-Pappel, with assets already in the United States called McKinley Paper in Prewitt, N.M., acquired Nippon Paper Industries’ Port Angeles, Wash., mill. Besides the production of lightweight recycled linerboard, the brand will include biomass cogeneration plant energy, which is sold back to the grid on the environmentally sensitive West Coast. Trim on one machine is good for 110 corrugators, and the other machine at 155 can trim narrower rolls for the Asitrades and other laminators within their shipping lanes.
This will probably be an astute decision if the correct investment in European boardmaking technology and pulp cleaning and fractionation are installed. Other companies have partially converted newsprint machines without having completed their transformation into the most modern containerboard producing processes.
Ralph Young is the principal of Alternative Paper Solutions and is AICC’s technical adviser. Contact Ralph directly about technical that impact our industry at askralph@aiccbox.org.
