Oct 12, 2006. /Lesprom Network/. For the first time, UK exports of recovered paper have exceeded UK mill usage according to data from the Confederation of Paper Industries (CPI) mill returns and HM Customs and Revenue. Exports of 343 000 tonnes compared to a UK usage figure of 332 000 tonnes were experienced in June, while in July exports reached 343 000 tonnes with UK usage of 339 000 tonnes. These figures reflect the continued decline in UK paper and board manufacturing and a slight increase in UK collection. The Far East remains the main export destination, accounting for around 75% of the UK recovered paper exports, with China in particular leading the way with almost 50%. Europe remains the destination for most of the outstanding recovered paper exports. The figures show the critical requirements for a robust and healthy global market for recovered paper and the potential impacts on the UK of any reduction in global demand or regulatory intervention in the market. With further growth in UK collection of recovered paper from the domestic waste stream expected in line with Government policy and targets, the UK will be faced with finding an increased global market share in order to ensure a home for the material. This growth will need to be achieved against increasing competition from other EU member states as they also increase recovery in line with EU and national environmental policies. The US may also start to increase collection as they introduce policies to tackle the global warming issues as seen in California and other states. Commenting on the figures Peter Seggie, CPI’s recovered paper sector manager, said, “The UK has made impressive strides in the collection of recovered paper from the domestic waste stream in line with government strategy but the huge reliance on export markets may lead to long term sustainability issues. The UK is already a European leader in the utilization of recovered paper as a raw material in the production of paper and board products, 75%, but this masks a very low domestic recycling rate, 36.1%, against a European average of 54.6%. This is because of the huge imbalance between UK production of paper and board products and UK consumption.” The UK produces less than 50% of its domestic paper and board needs, with a low export rate of finished goods. This means that, even with a very high utilization rate, domestically the UK uses less than 50% of what it collects. Increased collection rates mean the UK exports just over 50% of what it collects as seen in the recent data Peter said, “We are fine as long as we have a vibrant, expanding overseas market, as we currently have in China, but our European partners are also increasing collection and will become strong competitors in the future. The UK is in the unenviable position that should any issues arise with overseas demand then we will be among the first to suffer as we now have such a low domestic reprocessing level. Continued energy price pressures on domestic reprocessors may contribute to further closures and increased reliance on export markets.” He went on to add “Recovered paper is currently traded on quantity as there is a surplus of demand against supply, however this situation will change in the next few years. Paper and board machines are capital intensive and producers will not tolerate poor quality material once supply levels start to match demand. Future global recovered paper trading will centre on quality not quantity and as the new data suggests, it is even more imperative that the UK leads the market on quality to secure future collection and public confidence in recycling. The management of recovered paper quality will further be a key issue in ensuring that all exports meet the requirements of the waste shipment regulations to maintain a free flow of material from the UK.”