The Institute of Scrap Recycling Industries (ISRI) Chief Economist delivered this presentation at the Fall 2013 board meeting examining the paper market through macroeconomic indicators and global market stats, and provides an outlook for the future.

1. Economic and Paper Market Trends
Paper Division Executive Committee
ISRI 2013 Fall Committee and Board Meetings
San Francisco, CA
October 22, 2013
www.ISRI.org

2. Macro Indicators:Gross Domestic Product
Fastest Growing
Sectors in Q2
2013:
Gross Private
Domestic
Investment
(+9.2%)
Exports (+8%)
Sharpest
Contraction:
Nondefense
Government
Spending (-3.1%)

3. Macro Indicators: Unemployment

4. Macro Indicators: Inflation

5. Prices: Recovered Paper Index

6. Global RP Supply Steady through 2011
Source: Bureau of International Recycling

7. But US RP Export Sales Dip in 2012...

8. Jan-Jul 2013 Exports by Volume (short tons)
Grade
2012 YTD
2013 YTD
% CHG
CORRUGATED
6,038,457
5,689,233
-6%
433,830
413,984
-5%
PULP SUBSTITUTES
1,022,729
869,524
-15%
NEWSPRINT
1,424,040
1,378,797
-3%
MIXED PAPER
2,635,544
2,598,294
-1%
OTHER
1,335,192
1,335,144
0%
TOTAL
12,889,791
12,284,976
-5%
HIGH GRADE DE-INKING
Source: U.S. Census Bureau/U.S. International Trade Commission

9. China Remains the Key Overseas Market
CHINESE RECOVERED PAPER IMPORTS (TONNES)
OCC
ONP
Mixed paper
Total RCP
August 2013
1,434,606
600,479
392,110
2,495,592
July 2013
1,245,345
597,794
466,295
2,384,435
% change
15.2%
0.4%
-15.9%
4.7%
1,564,052
526,988
482,389
2,645,702
-8.3%
13.9%
-18.7%
-5.7%
Year-to-date 2013
11,034,133
4,542,888
3,609,667
19,803,822
Year-to-date 2012
11,348,482
4,592,875
3,526,295
20,018,876
-2.8%
-1.1%
2.4%
-1.1%
August 2012
% change
% change
Source: RISI/China Customs.

10. Outlook
Uncertainty remains the recurring theme with unsettled
questions on:
• Domestic mill inventories
• U.S. Budget, debt ceiling, regulatory challenges
• Timing of Fed tapering and impact on Dollar
• Transportation and Energy Costs
• Last but not least, China imports