Vipa Group: Extensive Recycling Can Fulfill Recovered Fiber Requirements in Papermaking

Headquartered in Lausanne, Switzerland, Vipa Group was founded in 1965 by Michel Ehrlich. Today, the group is based on two differentactivities:thecollection&sortingofallkinds of waste and the trading of recovered paper, prime paper, stock lots, other recyclable raw materials, and recycling services. With a pre-established market presence in Europe, the United States, India and Southeast Asia, Vipa Group handles more than 3 million tonnes of materials annually. The family-owned company is now managed by CEO Marc Ehrlich, son of Michel, who joined the company in the late 1990s. In an exclusive conversation with Paper Mart, Mr. Marc Ehrlich, CEO, Vipa Group, talks about the principal vision of the group, an overview of the recycled fiber industry,anoutlookontheIndianmarket,andmore.

Paper Mart: Please present the core philosophy and vision of Vipa Group. Also, briefly take us through the role of the organization and its contribution to the recycled fiber industry.

Marc Ehrlich: Vipa Group, a family-owned enterprise, was established by myfatherMichel Ehrlichin1965.Rightfromitsinitial beginnings,thegroup has been a purpose-driven organization. In view of the collection of paper fiber from waste streams, there should be an outlet and paper mills are considered to be appropriate outlets. However, more often than not, paper mills are in different places than the regions where the fiber is collected because the fiber can be found in highly populated places while the paper productionsitesareinremoteandsecludedareas.

Recently, India is becoming a production giant for the world. This has given risetothedemand forpackaging needs fortheproductsto beexported from India. Buttheproductsareactuallyconsumed inthewestand hencewasteis alsogenerated inthewest. Now,thereisadoubleimbalanceinthiscontext–firstly, the fact that the recycled fiber needs to reach its destination, for instance, India,andthesecondaspectisthetransport.Thecontainersfrom Asia totheWestern partof theworld areusually filled tocapacity but most of the containers are unoccupied while coming back. With the rising concerns over CO emissions, the containers, if shipped back empty to 2 Asia,would beatotalwasteof transportandotherresources. Hence, filling the containers with recycled fiber is a very good way to addressthischallenge.

PM: Shed some light on the significant milestones and the key strengths of VIPA.

ME: In the beginning, Vipa Group was solely a trading company, which meanswe had tofind thespecific material forthecustomeralong with the best logisticsolutionas per therequirements. Subsequently,we'vetriedtoassesswhere we could bring additional value to other sectors. For example, since we are based in Switzerland, we discerned that it would be a great idea to start our own collection, sorting,and recyclingof paperdomestically. Inashortspan of time, we became the biggest recycling company, especiallyintheFrench-speakingpartof Switzerland.Since thisoperational model ispractical, wearedoing exactlythe same in another country where we have a substantial presence,i.e.,Greece.

In Greece, we have three recycling facilities and we aspire to expand further because we feel that recycling can be improvedinthiscountry,thinkingabouthowtoexpandto other businesses where we can bring value. A few years back, we started discussing with our customers and we realized that there was a need for them to export their products. Besides, Vipa had the right platform with best logistics, expertise on the products, and culture of internationalrelations.

PM: Give us an overview of the recycled fiber industry with respect to demand, price, trends, various challenges & opportunities globally, and also the perspective for the Indian market.

ME:Thefiberrecyclingmarkethasseenmajorupheavalsin the last three years due to the COVID-19 pandemic which hasdramaticallychangedconsumerbehaviour. Consumers used to largelydepend on physical retail for theirshopping needsbutthepandemicledtoasurgeine-commercedueto pandemic-induced restrictions and lockdowns. The consequence was such that there was an even greater need for packaging while lesser waste was collected since the retail shops and markets are adept in the waste collection but not the households. To sum up, there was a lack of availability of recovered paper while the packaging needs surged exponentially. This led to a distressing scenario where many paper mills lacked raw materials. We've seen oneof the mostdramaticincreases inpricesof wastepaper. ThesecondshockfortheindustrywastheRussian-Ukraine warwhichledtoaglobaleconomicturmoil.Theperception that recession would hit us while the exact opposite sentimenthappenedwiththesamepsychologicalexaggerations. In justafewdays,wesawthehighestpeak inpricesto oneofthebiggestfallswehaveseeninourhistory.

Now,we'vetofindanewbalancebetweenthecollectionof recovered paper and the subsequent use of recovered

“ paper by the paper mills. I think this balance will be reached somewhere in Q2 of 2023, when we would better understand the cycle we belong to for the next years. It is importanttoencouragethemassestomaketheireffortsin recycling at home so that any crisis in the paper industry and the recovered paper segment doesn't affect the households. Weshould continue to push to have fiberout of landfill and incineration because many countries have recycling ratesclose to 5-10 percentwhen there isa lack of resources,energy,andfiber.

PM: India relatively has a very low rate of recovery of waste paper as compared to other developed nations. Please suggest what could be some relevant strategies to increase the recovery rate in India.

ME: The only strategy that works is education. When the kids go to school, they learn how to recycle at home and persuade their parents to do the same. As long as the general public doesn't recycle, there is no infrastructure thatcan be helpful. If you paythe infrastructuretorecycle and the population is not recycling at home, then the investmentis idle. Thus, togetoutof this 'chickenand the egg' argument, you need to go step-by-step with pushing education. While this might take one generation more; it isnothingwhenyouthinkaboutthefuture.

In India, therearesomegood initiatives. A fewyears back, ITC was developing the 'Wealth out of Waste (WOW)' program. Similarly, in Switzerland, many years back, recycling was based solely in schools where the kids were takingthewastepaperfromtheirhomestoschool,andthe school was responsible to sell the waste paper. The funds generated while selling the waste paper were paid for the classes and excursions. It is quite heartening when a kid pushes forrecycling at home; this becomes the firstsocial step in his/her life as well as the first thing he/she can do for the community. In India, there are big cities as well as small villages; hence, the strategy cannot be the same for everylocation.

PM: According to you, what should be the strategy of papermillstoenhancetheir'sustainability'quotient?

ME: The global trend is to have large-scale paper