Turbulent Q3 finishes with strong packaging recycling figures

The figures released today show the UK is on track to meet recycling obligations in all packaging materials.

This is despite a turbulent quarter in the PRN market. The main fluctuations have been felt in the plastic PRN market, caused in part by mixed messages between the monthly interim recycling figures and the final quarterly figures released today.

2016 packaging figures so far

These figures represent the entire UK demand for PRNs in 2016. The table below shows the combined recycling performance of Quarter 1 through to Quarter 3, alongside the requirements (2016 obligations minus the carry-over from 2015).

2016 Q3 recycling figures

Persistent glass deficit but strong metals

Glass Other has experienced a persistent deficit this year, however the surplus in Glass Remelt covers this. It could cause a little pressure into 2017 as the cheaper Glass Other PRNs need to be covered by the (usually) more expensive Glass Remelt PRNs.

Metals are a different story however, as both aluminium and steel enjoyed another healthy quarter, posting good surpluses leading into 2017 discussions.

Strong plastic performance after a shaky September

Plastic PRNs have experienced a number of highs and lows during the quarter, with the price fluctuating significantly throughout. Towards the end of July the market price started to fall on the back of two sets of positive recycling figures. Indications are that purchasing reduced as schemes and producers waited to find the bottom of the market.

In late September, monthly interim figures were released by the Environment Agency showing that between July and August plastic PRN issuing fell by over 50%. This apparently caused the market to rise by approximately £10 over the course of a couple of days. The volatility appeared to reduce into October and these figures will surely help to ward off fears of missing the recycling targets in the UK.

Export conundrum

An interesting conundrum is to be found concerning the number of export PRNs produced over quarter three. Indicators seemed to be showing that this would be a growing element of plastic PRN supply due to the fall in the pound helping exports.

We could be starting to see a lower price for plastic where the less desirable materials are not worth recycling, or exporting, at the current PRN price. As usual, the PRN market self corrects and you would expect to see a fall in figures at some point during 2017 if a lower price continue.

What does this mean for 2017?

Looking forward to 2017, we should be entering a PRN market that is more settled. The figures for this year would indicate that we are on track for a healthy amount of carry over (the tonnage that can be issued in December 2016 and used for 2017 compliance), which will act like a cushion for quarterly performance in the PRN market.

We’ll be watching the interim reports and speaking with recyclers to assess the impact of the falling prices on supply. We’ll also be enabling producers to reduce volatility in the PRN market by using their PRN money to invest in causes that match their supply chain or corporate objectives through our new platform Circularety.

Currently the Circularety platform is in a BETA testing phase until January 2017 when it will go live. Sign up now to preview the site and feedback your thoughts to us – www.circularety.com.

To discuss your packaging compliance needs you can speak to our specialists on 0845 094 2228 or email info@ecosurety.com.


Richard Hodges

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.

Written by Richard Hodges Published 24/10/2016 Topics Compliance

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