The Pandemic’s Impact on the Recycled Paper Industry
Less Office Paper, More Takeout Containers
New habits formed during the pandemic have caused changes for paper and cardboard mills. Because so many people are working from home, these companies are dealing with a shortage of recycled office paper. But because consumers are ordering more products online and more take-out food, mills have access to more discarded boxes, which they are making into toilet paper, coffee cups, paper towels, and other products.
The collection volume from US residential recycling programs has risen at least 7% this year compared to last year. This is partially a result of more ecommerce, which requires cardboard delivery boxes. Despite the surge in scrap cardboard supply, the price of recycled cardboard has also climbed this year as more companies invest in equipment to process the resource. Mixed paper for recycling cost next to nothing at the beginning of the year and it now costs about $30 per ton.
An Abrupt Change
Trends in the mixed paper market have changed abruptly. Two years ago the price of scrap paper and cardboard plummeted after China changed its contaminants limits. The country used to process two thirds of mixed paper collected in the US. However, the new restrictions meant that much of the US’ recycled products could no longer be sold to China.
Many US waste management companies were losing money on their recycling operations because they were unable to sell materials to China. Now, however, there is more scrap cardboard available, and US plants are investing in better screening technologies to be able to process it.
With new technology, companies are able to process a wider variety of materials. For example, WestRock, an Atlanta-based company, is encouraging consumers to recycle pizza boxes. There are over 3 billion pizza boxes produced in the US each year. In the past, these boxes were difficult to recycle, but new systems can turn these boxes into pulp even if there is food residue on the cardboard.
Similarly, Georgia-Pacific, which makes Dixie cups, Brawny paper towels, and other products, recently invested $45 million in sophisticated pulp-making plants. These plants are able to process a variety of recycled materials. For example, they can filter out the thin plastic on the inside of paper coffee cups in order to turn the cups into pulp, and then into new products. Lifestyle changes resulting from the pandemic have had unique ripple effects across innumerable sectors of the economy, including the recycled paper industry.
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