ISSUE #1019

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CCTI Annual Meeting 
June 3-4 , 2020
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CCTI is Nashville Bound for the 2020 Annual Meeting & CMA Fest!
Get ready to scoot your boots and mark your calendar to join CCTI for the 2020 Annual Meeting in Nashville, TN!  

Join us June 3-4, 2020 at the beautiful Gaylord Resort in Nashville. The CCTI meeting will be held minutes from the airport and only 15 minutes from all the fun and festivities of CMA Fest!  

Best of all, our CCTI special room rate of $239 is available
during CMA Fest too!  Bring your family and come for the networking and educational meetings, but plan to stay for some country sized fun!
Andreas Schwab Appointed CCTI
Technical  Committee Chairman
Andy Schwab
The CCTI Technical Committee met in Las Vegas September 26, 2019.  Longtime CCTI member, Andreas Schwab, was recently appointed chairman of the CCTI Technical Committee by the board of directors.  

Board President, Lloyd Anderson said, "Andreas brings a great deal of knowledge and expertise to the CCTI Technical Committee.  We are pleased that he has volunteered and we look forward to his leadership in the coming years with the organization."

Over 20 years in the core industry, Andreas Schwab is now working globally as an independent consultant for users and manufacturers of cores in all business areas. With his knowledge of their needs / demands and his background in core manufacturing, he develops solutions for more transparency and effectiveness in the whole supply chain. Effective measurement tools and experienced application are keys to the company's best interests.  In addition, he is representing the Grünig KG - a leading European glue manufacturer - and supports them and their customers as technical support in the business area of paper and board. Read full bio here.

F or any questions or copies of the latest documents, or if you have any interest in serving on the CCTI Technical Committee, please contact .  
Ox Industries buys former Climax building near its Carthage, NY, paperboard mill

OX Industries
There's a buyer for the former Climax Manufacturing building in Lowville along with new jobs.
Sources told 7 News the deal sells the former Climax building to a paper company already doing business down the road in West Carthage.

Ox Industries bought the Carthage Specialty Paper plant in West Carthage at a bankruptcy auction last October.
Now a year later, 7 News has learned the company is buying the former Climax Manufacturing building in Lowville from the Lewis County Industrial Development Agency - a move, sources say, that could create up to 30 new jobs as part of a converting business.

Containerboard demand picks up strongly in Brazil; recycled grades suppliers to implement price hike
After consecutive months of sluggish demand in Brazil, sales rebounded at a very strong pace during October, market players in the containerboard market said. According to buyers and sellers, year-end demand should have seasonally strengthened since August, but 2019's pickup came later than usual: "We are not talking about restocking, but real demand. We see Brazilian exporters more active, and demand in preparation for Black Friday and Christmas taking place with more boxes and corrugated paper purchases, so this is very good news," a contact said.

Another source stated that demand has been much stronger in October, which is even affecting forecasts of corrugated board shipments for the year. "With the level of sales I see now, we can end 2019 with corrugated board sales around 1% higher than in 2018. It is not a very huge growth but if sales were still in the pace we were noting before, this would not be possible."

In addition to good demand, October and November will have more working days than in 2018, which should support better figures year-over-year, a source commented: "This makes a difference for us, combined with a stronger demand now we have a positive feeling for the closure of the year."

According to market participants, demand has been good enough to pressure recycled grade paper prices up. Several suppliers set hikes around 4-5% for testliner and medium starting mid-October. "I have received the increase and started to pay it. But full implementation will be in November," a source stated. Another contact confirmed the trend: "There is no paper availability, recycled paper machines are running full now and the price hike will move on in November, with prices moving up about Real 100/tonne."

Sources stated that the price increase in the recycled grades will help producers to pass on costs with inflation. "Demand improved a lot due to the seasonality. We believe that box prices can also move up soon, maybe in January if demand ends the year in a good level. The only problem is that even in this better momentum, several box makers are financially fragile due to feeble demand earlier this year, so I still have problems receiving payments on time," a contact noted.

As full implementation of price hikes for recycled grades are supposed to take place only in November, PPI Latin America's price survey showed stable prices for testliner and fluting in October. The first is traded at Real 1,900-2,200/tonne, up 1.2% over a year ago, while the second is negotiated at Real 1,710-1950/tonne, practically stable compared to October 2018.

White top liner (WTL) is also unchanged at Real 3,100-3,400/tonne, 7.4% higher than a year ago, while kraftliner minimum prices moved up by Real 100/tonne to Real 2,450/tonne, after offers ate lower levels were not detected in the market in October. Year-over-year, kraftliner prices are up 4% in Brazil at Real 2,450-2,700/tonne range.

The latest data released by the Brazilian Tree Industry Assn (Ibá) show that packaging paper output in Brazil is 2.3% higher through August year-over-year, at 3.6 million tonnes. Domestic sales in the eight-month period were almost stable over a year ago at 0.9% or 1.1 million tonnes. The data still reflects months of lower than expected demand in the Brazilian market, as the country awaits reforms promised by the new president Jair Bolsonaro.

In September, however, some positive news started to pop up in the market, such as a higher rate of formal jobs creation. In October, another important step was the final approval of pension reform, which calmed down financial markets and even helped the Brazilian currency exchange to appreciate back vs the dollar, after several months under strong pressure.

According to Ibá, packaging paper exports from Brazil in the period improved 5.7% in the period to 405,000 tonnes, with the country's apparent consumption 2.1% higher than Jan.-Aug. of 2018 at 3.2 million tonnes.
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Industry Directory Updates 
& Advertising Opportunities!

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RCP quality a major focus at US mills and MRFs as price plunge remains, exports require cleaner bales

The quality of recovered paper has taken center stage today in the USA after China implemented strong measures the last two years banning or restricting low-quality tons and after pricing for domestic recovered fiber has plunged in the last year as demand dipped and supply swelled for most grades.

US mills and material recovery facilities (MRFs) this year have been investing even more in quality assessment tools and data as well as new cleaning equipment to track and clean up the moisture, ash, plastics, cans, and other contaminants inside some recovered
of immediate response with staff that is able to support the customers in the corrugator Lifecycle, it was evident that a fully supported local subsidiary was necessary," the company said in its release.

T his week, a large mill company told P&PW that it tested a quality assessment tool that uses near-infrared technology (NIR) at a few of its mills so as to better understand the composition of its incoming bales. The probe assesses bales from the inside out without breaking them, is portable, and offers data and analytics on quality and procurement - all of much interest to mills and MRFs. The mill contact said his company is one of several to try out the tool and step up its attention to quality detail.

"It's really important for us to understand what is in the bale," the mill contact said. "We can go back to the supplier and give them more information. What is the quality we are buying? Thirty-four percent that we get in is rejected."The contact added: "I don't want moisture, and I don't want bad quality."

For inspection of material shipped to China, mills break the bales and look for prohibitive, out-throws, moisture, and fiber strength. Moisture detection is the main focus, and Chinese mills have machines to identify moisture levels. 

For US recovered fiber, a contact with connections to China said that quality has "definitely improved over the years," yet "not as fast as some countries." 

While visual tests and NIR technology have existed for assessing bale quality, the measurement device and data and analytics system mills are testing, called BaleVision, is offered through Voith's merQbiz, a California service provider for buyers and sellers in the recovered fiber industry, and Boston Consulting Group Digital Ventures, contacts said. Data on quality in bales in this capacity "has not been available before," a contact said. MerQbiz maintains that potential cost savings from BaleVision, when it comes to bale yield, logistics costs, and landfill avoidance, are more than $1 million.

For mills, the tool "provides visibility" into what they are buying and "the ability to feed that data forward to improve the papermaking process," a representative from merQbiz told P&PW this week. For suppliers, insight is gained into "the truly quality profile" of the recovered fiber, "which can benefit them with pricing," the merQbiz contact said. 

MerQBiz said it is working with more than 30 different companies to employ the quality assessment tool. Contacts have pointed to several mill systems that have tested the tool, from WestRock and Cascades to Kruger and Atlantic Packaging. WestRock and Cascades are two of the four largest consumers of recovered paper in North America. 

A large waste management company also is said to be considering this process as a "selling tool to export" recovered fiber, a contact said. MRFs and their single-stream recycling programs have been blamed for years over what many perceive as a lack of quality control, especially with mixed paper. Mills have told of avoiding certain MRFs or municipalities as well as switching up where they buy their recovered fiber due to quality concerns, while others shared stories of exported US MRF material being rejected in large numbers.

Quality sells. Quality sells, especially in today's low-priced market. Old corrugated containers (OCC) on the domestic market in the USA is at its lowest price level in 25 years."

You can't sell anything that's not clean. The dirty producers don't stand a chance," a large containerboard mill contact said. "You can be very picky at your mill. You can be as picky as you need to be because there's so much more supply out there [today]."

With more supply available, US mills and those mills exported to can be pickier on what they purchase, and they have been for all of this year, according to contacts. This has left some supply without buyers, and as one contact recently described has led to the landfilling of recovered fiber: "They're just putting it in the hole." Mixed paper has been landfilled for a couple of years now, especially since China officially banned the grade in January 2018, as supply far exceeds demand, and OCC has been landfilled this year as well. 

Klabin forecasts stable hardwood pulp prices, improving demand; works on Puma II advance

Brazilian pulp and packaging paper producer Klabin sees improving market conditions for hardwood pulp demand and believes prices have bottomed, pulp director José Soares told analysts in an earnings conference call. The company reported its first-quarter results after the complete phase-out of its contract with Fibria (now Suzano) showing pulp sales 18% lower year-over-year at 326,000 tonnes. 

"We see some price adjustments already happening in softwood pulp and inventories restock slowly taking place. The price spread between softwood and hardwood is around $105 now, so the next move is towards hardwood," Soares said. "In the next months, hardwood prices should remain mainly stable and up to the Chinese New Year we should see only superficial adjustments, with more material changes possibly occurring in the beginning of 2020, after the Chinese New Year, which this year will take place earlier, at the end of January."

Since August, Klabin is trading by itself 900,000 tonnes/yr of bleached eucalyptus kraft (BEK) pulp produced at its Puma mill in Ortigueira, Paraná state, which was previously negotiated by Fibria. The mill has a total capacity to produce 1.2 million tonnes/yr of BEK and 400,000 tonnes/yr of bleached softwood (BSK) pulp. Soares said that Klabin has been welcomed by buyers with its new volumes and about 70% of its output is being exported.

The executive believes that pulp producer inventories in China will continue to decrease in the fourth quarter as demand starts to pick up. During the third quarter, sales to printing and writing paper producers showed some improvement in China bec ause of a more intense demand for the production of textbooks.

Demand for pulp in Europe, Soared added, is still slow, mainly affected by a sluggish printing/writing paper market. The company, however, is advancing with the closure of contracts with European clients and expects to complete more deals during London Pulp Week.

In the third quarter of 2019, Klabin also took a longer than usual 16-day shutdown in the Puma unit. As previously reported by PPI Latin America, the shutdown was a result of market circumstances and weak seasonality in the Northern hemisphere, aiming to trim about 80,000 tonnes of market pulp output.

The next programmed downtime for Puma is scheduled for October 2020, when Klabin plans to have a shorter 11-day stoppage.
Packaging. In the packaging market, Klabin's third quarter results showed mixed trends. The company reported a surge in sales of boxboard, which increased 25% yearly, totaling 191,000 tonnes. According to paper business director Flavio Deganutti, the raise was driven by greater demand for carrier board as the beverage industry continues to seek for alternatives to plastic.

In containerboard, however, results differed. Kraftliner sales dropped by 11% in comparison to the same period of 2018 to 85,000 tonnes. The company said sales slowed due to lower global demand as the packaging industry suffers the consequences of the trade war between US and China. Klabin continues to integrate its own paper production with box conversions as a way to mitigate the effects of the reduction in international prices of kraftliner.

"The positive side is that, similar to what happens with pulp, we see some stability in prices for kraftliner going forward," Deganutti said. "We see some upside, which may materialize in a few months, but obviously not in the short term."


WestRock receives 13 awards at North American Paperboard Packaging Competition

WestRock Company, a leading provider of differentiated paper and packaging solutions, was recognized for packaging design excellence at the 76th annual North American Paperboard Packaging Competition. The company won 13 awards - the most of any entrant - including the Sustainability Award of the Year.

Sponsored by the Paperboard Packaging Council (PPC), the competition is judged by a panel of packaging experts. The awards recognize packaging that represents the best in converting excellence, innovation and sustainability that the North American folding carton industry has provided its customers over the past year.

The First Alert package produced by WestRock, which received the Sustainability Award of the Year, replaces a fully enclosed PET blister clamshell with a NatraLock blister card, a sturdy, flexible, more sustainable alternative to traditional blister seal and clamshell applications.

"WestRock connects people to products through innovative, sustainable packaging," said Pat Lindner, Chief Innovation Officer and President, Consumer Packaging for WestRock. "We are proud to have been honored by the Paperboard Packaging Council and even prouder of the trust our customers have placed in us. These winning designs represent the value we can provide our customers when we combine our market insights and commitment to sustainability with the design and innovation capabilities of our talented employees."

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