When it comes to recovered (scrap) paper exports, China can be regarded a paper tiger. According to Resource Information Systems Inc. (RISI), an information provider for the forest products industry, world recovered paper demand has grown by around 70 million tonnes (45 percent) in the last ten years (2001-11). Demand in Asia represents the majority of this growth, increasing by about 60 million tonnes during that time period. Demand in China, alone, grew 260 percent, largely because of growing demand for paper and board demand, especially on the recycled paper and board side. Figures published by China Research and Intelligence show that China’s imported scrap paper mainly comes from the United States, Japan, the United Kingdom and other countries. In 2009, China imported 10.8 million tonnes of waste paper from the United States, accounting for over 39 percent of the total, while 4.1 million tonnes were imported from Japan, accounting for 15 percent. A further 2.8 million tonnes were imported from the UK, making up roughly 10 percent of the total. Pöyry, a management consultancy and analyst in the pulp and paper supply chain, forecast that by 2015 Chinese paper producers could be using around 81 million tonnes of recovered paper, and close to 98 million tonnes by 2020 – more than a 50 percent increase on current levels. Going forward, RISI forecasts that between 2011 and 2025 China will account for more than 60 percent of the worldwide growth in demand, with total worldwide demand expected to approach 184 million tonnes by 2025. Of that total, RISI expects China’s recovered paper market to reach about 45 million tonnes by 2025, up from 28 million tonnes in 2009. Although RISI expects the recovered paper market to expand over the next 15 years, it predicts the importation of recovered paper to decline worldwide. The reason is limited supplies and higher prices in the developed world, which RISI predicts will force developing regions to recover more paper domestically. “Demand will run up against limited supply of recovered paper in the developed world, and create a growing shortage of recovered paper worldwide,” it says. RISI predicts that this recycled paper “crunch” will push the recovery rates up and put upward pressure on recovered paper pricing. “Attempts by the Chinese government and Chinese papermakers to boost domestic collection of recovered paper continue, but are not enough to catch up with its demand growth. Imports will continue to play an important role,” RISI reports. A noteworthy switch, while exports of recovered paper to China have been on the rise, this March saw the market for old corrugated containers (OCC) to China diminish. RISI attributes this to the fact that board mills in the United States added stock, although they appeared not to be short on stock. As a result, there has been wide spreads in pricing for the product. Consequently, smaller mills in China have been reluctant to purchase the OCC, reports RISI. “Export brokers are offering higher prices to the overseas mills, reflecting the higher ocean freight implemented by the shipping lines,” a West Coast exporter reported to RISI. Operation Green Fence Adding to stresses in the waste paper market is a recently instated Customs inspection initiative in China called “Operation Green Fence.” According to Resource Recycling, the initiative, which was instated in February by the Chinese government, is deeply affecting export markets for recycled commodities. Effective for 10 months, this program mandates that Customs officials check all imported recycled shipments coming into China’s ports. This includes recovered (or recycled) paper, as well as scrap metals and plastics. The purpose of Operation Green Fence is to enforce tougher quality checks. This includes open container inspections and “zero tolerance” for any shipments with contaminants, RISI reports. Among those contaminants are e-scrap, textiles, green waste, anim