The chief executive of the Recycling Association has said the UK recycling industry should “not get hysterical” about the closure of Aylesford Newsprint.
Speaking at this week’s Secondary Commodity Markets 2015 conference, supported by Prodware, Simon Ellin (pictured) said that the UK paper recycling industry remains healthy, robust and established despite the closure of the Kent newsprint recycling and manufacturing facility.
He added: “We shouldn’t get hysterical about Aylesford. It was sad of course, but looking at it in a hardnosed way, it was capacity that needed to come out of the market. There is a 6% year on year decline in newsprint use and that is set to continue.
“In a global context, Aylesford will not have a big impact, but there are three stages we need to go through first in the UK.
“These are panic in the first stage, then things starting to settle down in the second stage and the third stage is the market already finding its level. We are in the second stage already and enquiries are coming from China, Europe and India to mop up some of the tonnes.
“But if we ever needed a demonstration of the importance of the export market, it has been seen over the last couple of weeks.
“The export market is crucial to the UK market as we do not have the capacity to process everything we produce.”
This view was reiterated by Viridor Resource Management managing director Herman van der Meij who said that “we should be happy that we can move material to Asia and Europe” as it has proven a vital outlet for UK material.
But he warned that the industry has to work together throughout the supply chain to ensure it thrives in these challenging times.
He said that communication and collaboration is key to ensure that high quality material that gets the best value is created and diverse end markets both in the UK and abroad are required to ensure material keeps moving.
WRAP economist Peter Sainsbury looked at the impact of the global economy on the recycling sector and said that volatility has been low in recent years compared to historical standards, and if volatility returns, then it could pressure on recycling companies with tight margins.
However, he said that low oil prices and the effective tax cut this creates should provide a boost to consumer spending and ultimately more demand for commodities and higher prices. While recyclate prices are currently low, they should rebound eventually.
Recoup chief executive Stuart Foster said in his presentation that if UK plastics recyclers can survive the current difficult times, then they will be successful in future.
He also noted that the current situation is different to the crash in 2008 when demand for plastics dropped suddenly. Now, “the dip is down to the oil price, but the demand is still there for our product” he said.
In his presentation, he also suggested that with only 0.5% of PRN revenues being used for communications, more could be done to increase this and show the benefits of recycling to consumers.
This would include showing why exporting material for recycling is better than sending it to energy from waste, despite surveys of the public showing that they thought energy from waste is a better option.
LARAC chief executive Lee Marshall looked at why local authorities will want to see more value come from recycled commodities. He advocated pay-as-you-throw schemes because “it works” as a way to increase tonnages and drive behavioural change.
In turn, this would lead to more material being available to be recycled and would reduce the need for more expenditure on communications. In turn, by introducing pay-as-you-throw schemes, local authorities would be able to see more of a premium from recycled materials by being able to provide better quality.
Prodware solutions specialist Jason Fazackerley said that more intelligence and use of the internet would help to drive the war on waste.
Using smart cities and big data would help drive efficiencies.
He also suggested using social media better to improve communications as well as developing bar code scans that would help people to understand how to recycle a product and when that product will be collected in their area.
SCM Environmental director Gareth Goodall looked at the PRN market and how the global broader commodity complex affected it.