The ripple effects of the Iran conflict are becoming increasingly visible on the UK recovered paper market, with freight cost volatility now taking centre stage.
Surcharges for both road haulage and container shipping rose sharply in March. However, market participants say the main concern is not the level of costs, but their unpredictability — including the risk of additional charges being imposed while cargo is already in transit.
It remains unclear how these higher costs will be passed along the supply chain. At the same time, export prices for OCC to Asia began to soften in the second half of March.
Asian demand, meanwhile, remained relatively firm, partly reflecting disrupted supply flows from the Gulf region via the Strait of Hormuz.
Looking ahead, uncertainty remains high, particularly with regard to freight costs, energy prices and demand trends.
