Recycling Market Commentary and Prices: 22 June 2018

China’s economy and its regulations weighed heavily on the recycling market and recycling prices this week with news suggesting the export of recyclables to there is going to get tougher.

First of all, it was revealed that the General Administration of Customs was making importers of recyclable materials reapply for their licenses.

In the short-term, this could make it more tricky for mills and recyclers to bring material into China, especially as the new rules will be in place from 1 August 2018.

But in the longer-term, importers will have their licenses for five years rather than the three under the previous rules and this may bring some certainty, with the proviso that these licenses could be pulled at any time if the regulations are breached.

One other factor that may bring concern is that the Chinese economy appears to be slowing, with it now being predicted that it will miss the Government’s 6.5% growth target for 2018.

Official Chinese economic data showed that exports, investment by companies and consumer spending all declined in May compared to the same month a year ago.

With a potential trade war with the United States over tariffs also emerging, this could knock further growth potential off the Chinese economy.

Indeed, industrial metal prices fell this week as the impact of the tariffs depressed prices on the LME.

It also remains the case that the recycling market is considering the impact of 100% inspections and the additional costs that is likely to bring.

Otherwise, conditions were reasonable for the export market. Shipping prices remain stable, and should be into July as a result of the oil price stabilising making it difficult to justify container price rises.

This week also saw the pound drop into $1.31 territory making UK materials for export cheaper, although by the end of the week it was back at $1.32 as it was this time last week.

A similar pattern was seen with the euro, with it dipping below €1.14 in the week, but recovering to that same value by the end.

Recycled Plastics

Prices remain largely stable with the market enjoying high prices for many grades.

Demand is good for bottles ahead of the expected summer holiday slowdown, with UK and European buyers keen to take good material.

Film continues to struggle, although the material is finding outlets despite the difficulties of getting it into Vietnam and Poland.

Industrial plastics continue to have very strong demand from UK and European buyers in particular.

Recycled Paper

The good news at the moment is that mixed paper has increased in price again, with good demand coming from Europe and UK mills for what is still a cheap grade that has seen improved quality.

Against recent trends, the price remains very low of course, but at least it isn’t close to zero as it was a couple of months ago.

OCC was stable once again, despite the fears of exporters to China of what the new inspection regime and renewal of licenses for the mills they supply will mean for them. Despite this, OCC to China was still attracting above £150 per tonne in most circumstances, although one buyer was reported to have reduced its buying patterns.

Domestic and European mills are feasting on mixed paper and so are anywhere between £80 and £120 on OCC depending on how much they want. The Indian market remains at the bottom of the price range somewhere between £70 and £90.

News & pam was stable this week, but the World Cup effect should lead to more pagination at the moment and more material for collection.

Recycled metals

As mentioned above, fears over the Chinese economy and tariffs on industrial metals hit the price of these on the LME.

As a result, copper lost £150 per tonne on the week before and brass was down by the same amount.

Aluminium grades lost £50 per tonne, although this hasn’t affected cans as yet. But when July pricing is negotiated, it wouldn’t be a surprise if aluminium can prices were lowered if the LME situation stays the same.

Steel grades were stable.

Prices

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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