The interim recycling figures released by the Environment Agency yesterday show the UK met its quarterly requirements for all materials except wood.
The table below shows estimated gross and net requirements for 2018. These are based on last years submissions, with 2018 government targets applied.
It also shows the carry over tonnage reported earlier in the month. Carry over is the amount of PRNs produced in December 2017 that are issued for 2018 use.
What does this mean for producers?
Producers requiring large amounts of plastic PRNs will be hopeful that this will lead to a price fall. Early trading has shown a very small softening in the price, however we may see a further standoff from suppliers who refuse to sell to ensure the price remains at a high point. Regardless of what happens, it shows the UK is able to fulfill its PRN requirement in the face of Chinese recycling restrictions.
Although paper is in surplus, the extra surplus would usually be used to cover general obligations. Producers can finance their general obligations using any PRN, but the lowest price PRN is generally used. As the surplus does not cover the general recycling obligations, this will increase the pressure on the paper PRN price.
Wood has fallen well short of its quarterly requirements, and the prices have already risen past the £20 mark. The huge increase in the target is having repercussions in wood but also compounding the issues in general and therefore paper.
Glass has missed its target for this quarter, however only very slightly. We could see a slight price increase caused by this.
Ecosurety will continue to communicate the changes in the PRN market throughout the year. For the remainder of the year we would expect to see higher prices in paper, wood, general and aluminium. We expect plastic to stabilise at its current market price.
If you would like to speak with Ecosurety, please contact us on 0845 0942228.
Key account manager
As key account manager Richard helps our largest clients manage their legal obligations under Packaging, WEEE and Batteries legislation. His background in economics helps our members manage their budgets and strategically procure evidence.