In the week that the Resources and Waste Strategy consultation that included extended producer responsibility reform, it was the PRN/PERN system that may be replaced that was the main talking point.
Plastic PRN/PERN values are close to reaching £200 and may even hit that today or next week. The market was trading this week up to £195, but was rising so rapidly that many expect prices to break this barrier in the next few days.
Just to put this in context, the PRN/PERN price broke £100 over Christmas, so has taken just over five months to double in value.
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As a result of this, packaging grades have increased in price.
Paper PRN/PERNs are also being talked about as the next possible grade that could shoot up. With trading volumes very low at the moment, there is a view that the next set of data may show issues with paper meeting its targets unless trading improves. However, until the data emerges, this would be speculation.
Apart from plastic packaging rises mentioned above, prices were largely stable this week.
At the time of writing, it had been reported that talks between the Conservative Government and the Labour Party to agree a Brexit deal had collapsed. With it also reported that the Prime Minister Theresa May will step down in June, this uncertainty caused the pound to fall against the dollar. It was trading at $1.27, compared to $1.30 a week ago. This makes UK material cheaper on the international market, although it remains to be seen whether it will stimulate any more interest.
Against the euro, it had dropped to €1.14 from €1.16 last week.
As mentioned above, it was the PRN/PERN increase that had most influence on the plastic market this week. The jump in its value both this week and last week, pushed up the physical price of packaging grades.
Demand was strong for PET and HDPE bottles as a result, particularly from domestic and European sources.
Film grades also increased a touch, but domestic recyclers were domestic to push prices up too much. European demand from 99/1 and 98/2 was very good, with the PRN/PERN value helping to stimulate demand.
There are also reports that more low grade film and pots-tubs and trays are finding export markets, aided also by the PRN/PERN value. Concerns remain though that the high cost of the certificate, it greater than the cost of disposal, and so we are exporting these grades to places such as Turkey to go into landfill or illegal storage ultimately.
The market was very quiet this week for recycled paper. It remains in the doldrums has it has been for several weeks.
Demand was low from almost all markets, with China, Europe and UK all not especially active in the market.
All grades remained largely the same.
One factor that is helping to keep prices where they are is that arisings of material are also very low. If normal amounts of material were available, prices could be much lower.
There is some crossed fingers going on that China may increase tariffs on US fibre (as US fibre is in demand from Chinese mills at the moment as it is cheap and good quality). The problem with that is that there was no change in the tariffs announced by China this week for paper grades.
It isn’t yet clear if the drop in the value of the pound could stimulate more demand, but if it does, there will be searches for material and this could help push prices up.
For the time being, the pessimistic view of the market is winning out.
Copper increased by £50 per tonne in a market that saw no other price changes.
For recycled paper prices, click here
For recycled plastic prices, click here
For recycled metal prices, click here
For recycled glass prices, click here
For PRN/PERN prices, click here