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Last Update:2024.02.06

Establishing a value chain for recycling recovered paper and "coordinating resource recycling" for customers

Mitsui Bussan Packaging is building a recycling value chain from the collection of used paper to the sale of recycled paper and packaging materials such as corrugated cardboard made from recycled paper. We interviewed the company about its efforts to "coordinate resource recycling" for its customers by being involved not only in "arterial" logistics but also in "venous" logistics, as well as its future prospects.

Recovered paper is one of the materials that have been recycled for a long time. Mitsui Bussan Packaging is a trading company involved in the entire paper recycling value chain, from the collection of recovered paper to the manufacture of recycled paper and the sale of packaging materials such as corrugated board made from recycled paper. We interviewed the people in charge of contributing to the reduction of CO2 emissions through the "circular economy" by reusing recovered paper, and asked them about the possibilities and challenges of this business.

Japan's High Standard for Recycled Paper

─ ─ In Japan, recycling of recovered paper is advanced, with a recovery rate of over 80% and a recycling rate of about 65%. What do you think is the reason for this?
Mogi: I think the most important thing is the high level of environmental awareness among the Japanese people. In Japan, the education and culture of separating paper for recycling is deeply rooted, and I think this can be called the Japanese model. In addition, because Japan is a resource-poor country, it is necessary to compensate for the lack of resources by recycling, and I think this is the background that has inevitably led to the development of recycling technology for recovered paper.
Shinichiro Mogi, Business Department, Mitsui Bussan Packaging Co., joined in 2006. After joining the company, he was engaged in domestic sales of base paper and packaging materials. In 2021, he was transferred to the Operations Department, where he focuses on "domestic business support to formulate strategies and tactics with a mission to improve the value of the entire Packaging Materials Unit" and "recruitment & training of human resources". Concurrently serves as a member of the Circular Economy Promotion Team in the Performance Materials Division of Mitsui & Co.
─ ─ Can we assume that recycling recovered paper contributes to CO2 reduction?
Suzuki: Yes, since the raw material of paper is wood, we can reduce the input of new wood resources by repeatedly using recovered paper. It also reduces the amount of paper to be incinerated and disposed of, which we believe directly leads to a reduction in CO2 emissions.
Manabu Suzuki, Packaging Department, Packaging Materials Division 2, Mitsui Bussan Packaging Co., joined in 2012. Engaged in domestic sales of base paper and packaging materials. In 2022, he was transferred to the Packaging Office to promote recycling-oriented business with the end user as the starting point.
─ ─ Isn't it true that recycling used paper is costly?
Suzuki: As for the cost, it depends on the specifications of the product, so we cannot make a general comparison. For example, the cost of recycling corrugated cardboard is not so high, but for recycled products that require cosmetics and whiteness, treatments such as removal of foreign matter, deinking, bleaching, and washing are added to the manufacturing process. In other words, the cost of high-quality recycled paper tends to be higher.
So, what about energy consumption?
Suzuki: "Restoring" recovered paper to a white, clean pulp requires a lot of chemicals and energy, and therefore costs more. In addition, the more pulp is washed, the more it is damaged, resulting in unusable waste pulp. Paper manufacturers therefore reduce the burden of bleaching by mixing new pulp with recovered pulp. This also reduces the amount of waste pulp because the strong fibers of the new pulp cover the shortcomings of the damaged fibers of the recovered pulp. By making good use and recycling of recovered paper while taking into account the burden of bleaching, these energy costs can also be reduced.

Current Status of Recovered Paper Collection and Advantages of Mitsui Packaging

─ Please tell us about your company's waste paper collection business.
Hirata: We mainly handle recovered paper discharged from businesses. We collect them optimally from our customers and deliver them to recycling centers (recovered paper wholesalers). There, we are required to collect properly sorted recovered paper in a stable manner at a low cost.
Seiichiro Hirata, Material Resource Office, Packaging Materials Department 2, Mitsui Bussan Packaging Co., joined in 2004. Engaged in domestic sales of base paper, packaging materials, office supplies, and indirect materials. In 2018, he joined the newly established Environmental Resource Office (currently Material Resource Office), where he is in charge of the recycled resource recovery business. He is a certified manager of proper disposal of industrial waste.
─ What are some of the challenges in sorting?
Hirata: Businesses that emit recovered paper have matured in their awareness of recovered paper collection and recycling, but we continue to educate them on the importance of sorting and disposing of waste that contains recovered paper. However, awareness of the possibility of resources being contained in wastes is not yet widespread, and we feel it is necessary to continue raising awareness of this issue.
───Please let us know if you have any ideas for stable, low-cost recovery.
Hirata: We call the flow of disposal, collection, and recycling of recovered paper "vein" and the flow from papermaking to manufacturing and sales of packaging materials "artery." Most of the costs on the vein side are logistics costs, so how to collect recovered paper at a low cost is important from the perspective of resource recycling. In terms of logistics, we are devising various ways to efficiently collect recovered paper in the face of a shortage of drivers and soaring fuel costs. For example, many parts of the collection process are done in an analog manner, but we are using IT systems and digital tools to improve logistics efficiency.
─ ─ What other problems, if any, do you have with the collection of waste paper?
Hirata From the aspect of stable collection, another problem is the decrease in the amount of recovered paper generated. In addition to the stagnation of economic activities due to the Corona disaster and the decrease in paper media such as newspapers and magazines due to digitization, there is the risk of fluctuations in export volumes due to overseas market conditions and exchange rate effects.
───Then, what are your company's strengths in the recovered paper collection business?
Suzuki: While trading companies and other companies handle arterial logistics, few trading companies participate in venous logistics, and Japan's venous logistics industry is in a state of disarray with many detailed companies. In such a situation, we are able to handle venous logistics with the comprehensive strength of Mitsui & Co. Moreover, many companies consult with us on how to balance the environment and the economy, thanks to the trust that comes with being a general trading company.

New initiatives such as recycling of difficult-to-process used paper and jute bags

─ ─ What are the latest initiatives and new technologies in the collection and recycling of recovered paper?
Mogi: Waterproofed paper and thermal paper, known as "difficult-to-process paper," are usually disposed of by incineration. Currently, as the amount of recovered paper being collected is decreasing, the recycling of difficult-to-process paper is attracting attention, and capital investment is underway. Since there is a high need for the recovery of difficult-to-process recovered paper, we are in the process of verifying the recycling of recovered paper back into raw materials.
Hirata: Similarly, we are also working to recycle jute bags, many of which used to be incinerated as garbage. Since jute is also a plant fiber, it can be recycled into paper products through material recycling. We were the first company to recycle jute bags as paper products.

Toward the creation of a mechanism for resource recycling

─ So far, we have talked mainly about the business of collecting used paper. Next, I would like to ask about the process of resource recycling. What would be the ideal form of the resource circulation process?
Mogi: In our recovered paper collection business, we also coordinate a closed resource cycle in which recovered paper is collected from customers, recycled, and sold as packaging materials to the same customers. From the perspective of recycling to realize resource circulation, selling resources, which are emissions, for value also means that customers are also suppliers of raw materials. In other words, if the raw materials (emissions) are supplied at a high price, they will be returned to the consumers themselves. This is an important point.
Until now, we may have only had to think about selling resources, which are emissions, at favorable conditions. We have three perspectives: the "environmental perspective" of recycling resources without limit, the "economic perspective" of linking prices from discharged raw materials to finished products, and the "stable procurement perspective" of being a consumer by supplying resources. We propose resource recycling through a "value network" that realizes these three perspectives.
─ ─ What is the reason for creating such a system of resource circulation?
Mogi: We believe that "visualization of the flow of resource circulation" such as disposal, recovery, recycling, and utilization by our customers creates a "chain of added value" from there. We believe that our role is to support our customers in achieving both "environmental" and "economic" goals from their perspective.
─ ─ In pursuit of a recycling-oriented society, such a business model is ideal, isn't it?
Suzuki: In the recycling of recovered paper, there are many parties involved, including customers, paper manufacturers, and packaging material manufacturers. We must realize packaging materials that meet the quality requirements of our customers using recycled materials. To achieve this, we believe it is important to achieve both "environmental" and "economic" goals as a whole through cooperation and economic rationality with all related companies.

Achieve both "environment" and "economy" through resource recycling

─ ─ Finally, please tell us what you would like to focus on in order to balance the "environment" and the "economy" through resource recycling and lead to decarbonization.
Hirata: I mentioned that the majority of costs in veins are logistics costs, and reducing venous logistics costs will determine the overall cost of resource recycling. There are still some inefficiencies in venous logistics, such as multiple vendors entering and leaving an area at the same time. In the future, we would like to use digital technology to improve the efficiency of venous logistics and, by extension, resource circulation.
Suzuki: We support our customers' resource recycling, starting from the customers' point of view. Customers are becoming more and more environmentally conscious, and we will continue to support our customers in achieving both "environmental" and "economic" goals by focusing on resource recycling, including the recycling of used paper, from the customers' perspective.
Mogi: Under the title of "First One Mile Business," we are focusing on venous activities, not limiting ourselves to recovered paper, but undertaking the management of waste as a whole from the source of emission. We are also proposing to reduce circulation costs and CO2 emissions by linking up with arterial logistics.
At the same time, our greatest feature is that we already have touch points to the source of emissions that enable us to discover resources that can be recycled and productized as the entry point for resource circulation. We are committed to promoting activities that realize resource recycling with economic rationality through a value chain that connects veins and arteries.
--Thank you very much for your time today.

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