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The Bell Rings For The Future
2020-08-24 10:03chinapaperonline.com
China’s Ministry of Ecology & Environment issued the 11th lot of recovered paper (RCP) import quota on August 18. At the total volume of 197,840 metric tons, the quota was allocated to Nine Dragons, Shanying Paper, Liansheng Paper, Century Sunshine Paper and a few other paper and board producers in the country’s coastal provinces.

Though possible of one more issuance of RCP import quota from the authorities, the 11th lot not only rings the closing bell of the 2020 quota, but also rounds up the final push to the country’s recovered paper import into history! Since 2017, RCP import quota has declined annually and the 2020 quota is further cut to less than 6 million metric tons, which only equals to 41% of the volume in 2019.

Short-term, commercial operation of RCP imports, from order negotiation to delivery into China, is pressed by the closing bell of RCP imports. Such urgency, however, bursts out new prospects of reshaping China’s recycled fiber supply sources in the long run. This is especially true for large paper companies who have expanded their efforts from active search and construction of new sources of recycled fiber supplies in North America, Europe and Southeast Asia to the formation of new trading outlets. According to official web reports of Haikou municipal government on August 14th, Nine Dragons – now the 2nd largest paper company in the world - will build a “Recycled Resources Exchange Center” (RREC) in Southern China’s Hainan Island. Bidding RMB157.71 million to lock the deal for a 40 year lease of 9,520 m2 of land, Nine Dragons intends to leverage tax benefits - offered by local authorities to attract investment in the Island province - through the Exchange for the company’s future imports of recycled pulp and trade expansion in recovered paper, recycled pulp and finished paper and board generated from both China and foreign countries. Nine Dragons also pledged to generate at least RMB13 billion tax revenue to the municipal government within 5 years from the operation of the Exchange in return.

Different from a regional recovered paper trading market with almost all transactions done on cash bases in Fuyang, Zhejiang during the 1990s, the envisioned RREC in Hainan will be an unprecedented and IT-powered platform serving China and neighboring Asian countries with impacts to the global fiber business, market analysts believe.

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