Chinese authorities issued the 10th lot of RCP import quota for only 56,670 metric tons on July 24. The new volume joined the 1.12 million metric tons under the 9th lot to stir up the US and other recovered paper markets in the world, not because of the size, but because of the time available for order turn-around before December to allow enough time for destination port clearance, including the pass of enhanced inspection to prevent COVID-19 virus to get into the country. Such urgency is further intensified by the recent announcement of Maersk – the largest steamship company in the world – to stop acceptance of solid waste cargo destined to China’s mainland and Hong Kong effective from September 1st, 2020.

Immediately after the release of the 10th RCP import quota, export offers of OCC in the US market gained at least US$5 per metric ton in price, and so were price performance in Europe and Japan. Even though such price increase was generally recognized as short-term response, it did allow both buyers and sellers to start working more actively to complete negotiation and ship orders at the earliest possible date.

So far, China has released 5.75 million metric tons of RCP import quota, equaling 54% of the total volume in 2019. One or more lots may possibly be issued, but the beneficiaries – Chinese mill buyers – will hardly be able to use them for orders in North America and Europe under time and logistics limitation, unless a special grace period granted by the authorities. Nevertheless, Chinese buyers will have to pay more to make sure orders be delivered on time. This partly explains why more active RCP sourcing, especially large Chinese mills, is going on in China’s domestic market, which has driven price to move up repeatedly for weeks.