Recycling market commentary: 20 April 2018

It is a strange market at the moment, with people searching for markets and how best to serve them.

This is reflected in the fact that the price of OCC appears to be diverging into a 95/5 and 90/10 grade, depending on where it is going, with 80/20 likely to be shunned in future. More on this below.

Or in the plastics market, the fact that February’s export data showed that Hong Kong was the major destination for the waste polymers of ethylene commodity code (see more on that here).

But the fact is that material is moving, and people are finding homes for it. Prices may not have recovered for certain grades, but even mixed paper now has an increasingly better value.

As the sun shines, it might be worth looking at some of the positives. The pound fell back against the dollar again this week to just over $1.40 after threatening to hit $1.45 last week. This followed Bank of England governor Mark Carney hinting that interest rates won’t rise in May after all because of weaker economic data.

For exporters, this makes UK material better value on the international market, and on occasion can be passed on.

Shipping rates are also flat, and cheap compared to the last few years, with little sign that will change for the time being.

For plastics, the high value of the PRN is helping to support the material and keep it moving, giving the UK both a subsidy to the buyer and the seller to keep both interested.

While prices are lower for some grades, they are no longer exceptionally low, with only mixed paper remaining really poor value, and even that is rising.

All eyes next week will be on the Q1 data from the National Packaging Waste Database, and how this effects PRNs though.

We also understand that CCIC is set to increase inspections of material, increasing the frequency of visits to yards that export material to China. This will also add more cost to the exporters.

Prices are at the bottom of the page

Plastics

The high PRN price is helping to keep material moving, and demand remains reasonable into Europe and South East Asia.

There are fears though that these destinations will have to fill up potentially next month, but UK material is competitive against others because the PRN can be used to gain an  advantage.

Small plastics recycling facilities are also popping up in South East Asia and once found are being jumped on by UK exporters looking to work with them.

Trade is therefore solid without being spectacular, but prices are currently holding firm, and look set to be where they are for a few more weeks yet.

Paper

There are effectively multiple markets for OCC at the moment.

There is a 95/5 market which is predominantly operated in by the Chinese buyers. They are searching out the best quality material on the market and are paying anywhere between £90 to getting close to £100 per tonne for this.

Next up is the 90/10 market, which is predominantly being used by UK mills, and other buyers in Europe, India, Vietnam and elsewhere. There is also a small amount of this that is viewed to be China compliant so is going there. This market is trading anywhere between £60 (India) to £80 (UK, Europe and Vietnam) per tonne depending on the material, and whether people want to buy it or not right now.

After that is a kind of 80/20 market, and these are finding it increasingly difficult to sell material, with buyers having their choice of the market and opting for better quality.

For the 95/5 and 90/10 markets, May looks set to be a decent month, with the Chinese buyers having quotas to satisfy and an expectation that demand will improve in other destinations too. The bottom end of the market is expected to remain tough.

Mixed paper has improved in value again with Germany continuing to lead the way in purchases according to reports. How high can it go? With some paying up to £35 per tonne, there might be some more uplift yet.

Metal

Non-ferrous metals saw both copper and brass grades creep up this week on the back of an improving picture on the LME.

Ferrous metals though, including steel cans, declined by £5 per tonne as the US and Chinese tariff situation hit values.

Prices

To see the full prices including trend charts, please visit here

UK plastic bottles

UK HDPE, Wheelie Bins, HIPS, EPS, PP

UK LDPE film

UK pots, tubs, trays

UK OCC, ONP, Mixed paper

UK soft mixed, OIN, SOW

UK Multi, WHL, BW2

UK copper

UK brass

UK aluminium alloys

UK aluminum

UK stainless steel, zinc, lead

UK ferrous

UK engines, cans, plugs

UK glass

PRN paper, plastic, glass

PRNs wood, steel, alu, recovery

UK gate fees, RDF, landfill

UK Gate Fees - EFW, AD, MRF

China plastics

China paper

China metals

US plastics

US paper

US metals