Recycling Market Commentary and Prices: 29 June 2018

China continues to dominate what is going on in the recycling market and market prices, whether it is on a weekly basis or the continuing fallout or existing or potential recycling import bans and restrictions.

Its Government continues to muddy the waters with the revelation that it plans to ban solid waste imports by 2020, although any further detail on what this actually means remains unclear.

Other countries are also looking to restrict imports, with Thailand now likely to ban plastics and e-waste.

In the market this week though, Chinese buyers have helped push up paper prices, with the exception of mixed paper which remains banned. Mixed paper was buoyed by others though (more on this below).

Plastic prices remained stable, although an easing PRN value may become a concern. However, there may be some optimism ahead for exports to Vietnam (more on this below).

Metals struggled though, with copper grades hit hardest, but most others falling too. Ferrous grades were unchanged though.

The pound continues to fall back, dropping a touch on last week’s $1.32 to $1.31 this week, making UK material cheaper to deep sea destinations.

Against the euro, the pound also fell from €1.14 last week, to €1.13 at the time of writing, again making UK material better value for European buyers.

Plastics

Prices remained stable this week, but demand for bottle grades remains good. However, there will be concern for film grades with Vietnam remaining effectively shut, and Thailand looking to introduce a ban on plastics.

We understand Vietnamese customs are now clearing 50 containers per day of the inspections backlog it has, and this is likely to take at least two months to clear. This might mean that Vietnamese ports might start to accept material again in September, rather than the previously announced October. Of course, much will depend on whether this rate of inspections continues to be met.

The PRN came back off by just a pound, and some in the industry believe that if it were to fall below £60 per tonne, it could make trading conditions rather tough.

However, with the Chinese ban in place, Vietnam still closed and Thailand expected to ban plastic imports, unless new capacity opens elsewhere, end destinations may end up being harder to find – especially accredited facilities. Therefore, the likelihood of a strong PRN price for the next few months looks probable.

Paper

Mixed paper jumped up in price this week on the back of very strong demand from UK and European mills. While the price was mostly in the mid-£40s, up about £10 per tonne on last week, it is believed some were prepared to pay over £60 for the best mixed.

Even at this price, it looks like good value to UK and European mills who are struggling to compete with the Chinese premium paid for the best OCC.

Interestingly, Chinese purchasing has been behind a very strong price increase in over-issue news and pams, where contamination levels are obviously extremely low.

This has also helped push up the price of the normal news & pam grade, although only by a touch. But there could be potential to go a bit higher.

OCC was up a touch this week, aided by buyers passing on the exchange rate benefit to sellers. There is still very strong demand for OCC across the board, with over £160 per tonne available for the ideal material.

Further down the OCC scale, Indian buyers remain the most reticent and are quoting the lowest prices.

Metals

With industrial metals prices falling on the LME this week, scrap prices followed too.

The potential trade war and tariffs on metals between China and US, has frightened investors on the LME.

As a result, scrap copper prices were down by £200 per tonne, brass by £150 per tonne, and aluminium by £150 per tonne.

Ferrous prices were stable.

Although can prices were unchanged this week, it wouldn’t be a surprise if aluminium cans came off next week as a result of recent LME price falls.

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