THE CRISIS IN THE RECYCLED WASTE PAPER MARKET

Circular economy
rMIX: Il Portale del Riciclo nell'Economia Circolare - The crisis in the recycled waste paper market

E-Commerce is also exacerbating the crisis in the recycled waste paper market, which collapsed in 2019


The crisis in the recycled paper market began to manifest itself in August 2017 with the beginning of the drop in prices on the international market, and then worsened in 2019, where both the exported volumes and the prices per ton are putting the recycling sector is in crisis.

The reasons for this situation can be found in the reduction of imports by China , by the trade war extended over many sectors between the USA and China and, paradoxically, by the increased collection capacity of recycled paper, which cannot be used fully without exports.

If pre-crisis numbers saw China as the primary importer of waste paper , with around 30 million tons per year and Europe with around 8 million, today the Beijing government imports “only” 12 million tons and, of this figure, a large part comes from the US-UK consortium.

This surplus of paper that was destined for the Chinese area is placed in other markets, forcing sales by decreasing the price, with the aim of getting rid of unsold stocks.

Considering that in Europe about 56 million tons of paper were collected in 2018 against a use of about 48 million, thus generating a difference for excess supply equal to about 8 million tons, paper that accumulates per year after year with very important management problems.

This situation generates an imbalance, also financial, of the collection system in which substantially there is an acceptable level of sales, in quantitative terms, and a remunerative level on the price of the product that can cover all the costs of the chain.

Then there are other factors, concomitant and collateral, which have increased the problems described above and which we could summarize in these points:

  1. Consumer disaffection with some plastic packaging has led to an increase in the use of paper packaging, with the consequence of producing more was
  2. The efficiency of the collection system, like that of glass, creates an offer higher than demand, which will have to be addressed through financial support to the circular paper economy.
  3. The explosion of e-commerce , which has its favorite packaging in cardboard packaging, generates a very important increase in cardboard waste.
  4. There has been much discussion about the social and ecological value of the sales system through web platforms, in which the supporters of the efficiency of technological modernism are compared with those who argue that the online sales of non-durable goods are the consequence of the whim and laziness grown with consumerism and a total lack of respect for the environment and for small businesses formed by neighborhood or village shops.

To frame the size of the “e-commerce” phenomenon , we need to get an idea of the numbers it generates in the world and which are expressed in about 3,000 billion dollars , with a forecast of reaching 4,000 billion in 2022.

The most representative companies of the phenomenon are Amazon and Alibaba , which offer goods anywhere in the world, in the shortest possible time and at the lowest price ever . The success of online sales is based on these three pillars, a system that has put traditional distribution in crisis and, with it, also the workers who were part of it.

But if on the one hand I don’t think we can charge for the formula of online shopping, the closure of many medium-small shops , which had already entered into crisis with the advent years ago of the large distribution chains, it can certainly be said that the home delivery business of single items in a very short time is generating an environmental problem to be taken into consideration.

Not wanting to go into the specific phenomenon of the increase in traffic due to this fractional logistics system, where the movement of a huge number of individual packages, in continuous rotation between suppliers, distributors and customers, creates an appreciable emission value of CO2 and NOx , as it deserves a dedicated study.

Instead, I would like to consider the impact that this delivery system creates in terms of increasing cardboard packaging . In fact, the supplier sends the item to the warehouses of a company such as Amazon or similar, which stores it in its warehouse pending the customer’s order.

Upon receipt of the order, the distributor will pack the item in a new cardboard package , suitable for shipping depending on the size of the package purchased. In practice, up to now, at least two packages have been used , with the relative accessories for the packaging.

This is not an action with a negligible impact, if designed on a large scale with millions of packages moving every day and has no comparison, from the point of view of the environmental impact, if the same operation was done from the shop near home , who will only use the manufacturer’s packaging , or at most will add a bag that can still be reused at home.

But what if the product was rejected by the end customer? The return of the rejected product needs further packaging for shipping and, here too, we are not talking about small numbers if we consider, for example, that Zalando , the well-known brand of online sales of clothing and accessories, declares returns for about 70 million parcels .

An important thing to note is that most rejected packages end up in the “Destroy” area (area where new items are destroyed) as there is no economic convenience in returning the item to the manufacturer.

This generates a substantial amount of waste and packaging which must be handled by the country of distribution and not by the manufacturer.

Automatic translation. We apologize for any inaccuracies. Original article in Italian.

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