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Data to help with PRN monitoring

Date: 6/09/2013 | Author: Joe Savage

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Following the release of the second quarter data in the previous month, the Agencies have elected to follow this up with more specific data outlining the monthly volumes of PRNs generated via both UK reprocessing and exporting activities. This apparent proactive step has long been requested by those within the PRN regime as a means of better monitoring PRN availability, whilst this is currently only a retrospective step it is both encouraging and interesting to see the data is now available for download on the National Packaging Waste Database (NPWD).

As seems to be the recurring theme with PRNs, the data is likely to send mixed signals out to the industry and still suggests that making compliance for 2013 is still going to be a tricky path to navigate.



PRN table August 2013Firstly plastic, the quarterly data showed that to date the UK is behind schedule if we projected the current results forward. With little in terms of fluctuation there was minimal trending analysis available and as such we have seen strength return the PRN prices once the initial ‘feel good factor’ from a better than expected Q2 wore off. Looking at the monthly data (inset), the trending actually supports the initial downturn in exporting volumes as a result of the Chinese ‘Green Fence’, March was notably half in terms of volume when compared to January and correlates with increases in the price paid for the PRNs available. However, encouragingly from this point exported volumes have steadily grown back to where they started the year and show a very clear upward trend. This could possibly suggest that new end markets have been found for the waste packaging plastics and should this trend continue there is sufficient reason to expect the UK to meet the plastic obligation by the end of the year.

The data is however still very sensitive and fundamentally we’re in no better position than before, as such trading of plastic PRNs has continued well with strong prices paid ranging through £55.00 - £65.00 depending on the volume and delivery requirements.

In contrast, whilst glass looked slightly better after the quarterly data, a closer look at the monthly figures shows a very significant drop off for remelt production in June. April and May both saw big improvements in exports, but do perhaps stick out more as anomalies than regular months and suggest increased prices are allowing stockpiles to be cleared out, perhaps from Q1. Should the Q3 production continue more in line with June then we can expect a very turbulent trading pattern for the later part of the year. The price paid for remelt PRNs remains strong and they have traded well at £65.00 - £75.00 throughout August. The focus from buyers is without doubt to make sure that their remelt quota is secured; as such the urgency and price for the glass other PRNs (usually PRNs via aggregate use) has dropped to below £45.00 towards the end of the month as availability for this grade improved.

Whilst the monthly results do paint differing pictures on the troublesome materials, it is worth noting that prices still remain strong and there is a perception within the sector that compliance will only be met if PRN prices continue to subsidise the flow of waste packaging materials.

PRN chart August 2013It is by no means intentional that the other 4 material grades only get a quick mention, but favourable results thus far for the year continue to support lower prices and expectations that compliance will easily be met for these obligations. Paper has hovered all year in the usual bracket of £0.90 - £1.50, wood a touch above at £1.50 - £2.50, whilst both metals are now trading at sub £8.00 falling from higher prices earlier in the year. A quick word on steel, the monthly reports do support the export slow down reported in the year, but an upturn in that trend and strong UK recycling has ultimately softened the PRN price.

Let’s hope the Agencies keep this type of data available, although I suspect we’re a long way from monthly live data but it is a very big step in the right direction.

View full PRN table

Category: Market Data
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