Attached is your PO for deliveries of ResMix for the month of September 2019.

The market for recyclables has movedslightly lower this month primarily due to the reversal of the increased pricing for OCC that we saw last month.  The reversal is attributable to both reduced purchasing of super clean OCC by Chinese buyers and the normal seasonal decline in overall demand as both the Harvest season and Christmas shipping season are coming to a close.

As we mentioned last month, the Chinese buyers of super clean OCC are a fickle bunch.  They are heavily influenced, if not controlled, by the issuance or lack of issuance of the required import permits.  The Chinese government issued a number of permits last month which have mostly been filled, hence the slower buying this month.

We also mentioned last month that we expected the normal seasonal decline in packaging demand to overwhelm the positive development of additional demand for MIX in Asia (new mill in Myanmar).  We believe that prediction is currently coming to fruition.  This is nothing to be alarmed about as it happens every year about this time of year.  If this trend continues, as is likely, we will see some modest declines in pricing through December.

On the positive side, Indonesia did adjust their specifications for MIX paper from 0% prohibitives to .5%.  Unfortunately, the adjustment was not large enough to make a significant difference in the number of suppliers that will qualify to ship to Indonesia.

For the mid to long term, we remain very optimistic about pricing as there are now 17 announced mill expansion projects in North America alone.  Alert readers will note that last month we listed just 16 mill expansion projects.  I am happy to report that NORPAC, a Longview, WApaper mill, announced publically in August their intent to install a second drum pulper at their facility during 2020.  When this project is completed we can expect to see a significant increase in demand for both MIX and OCC right in our own backyard!

As always, rest assured that Pioneer will be working overtime to get the best pricing available in the marketplace each and every day.  We appreciate your business.

Signature Plates.