In its year-end report for 2006, which was published last week, the CPI said demand for newsprint had dropped 0.9% in 2006, compared to 2005, while sales of coated paper dropped 1.6%.

However, use of uncoated graphic grades and corrugated case materials used for packaging remained stable.

The report also questioned the success of kerbside recycling bins.

It said recovered paper collection for 2006 grew only 3.4%, compared to rates of 8.7% in 2005, and of that rise, only 70,000 tonnes came from kerbside collection.