While the weather appears to be warming, plastics and paper recyclate markets appear to be cooling.
For the plastics market, a big drop in the value of the PRN/PERN this week had a big impact on the price of physical material.
While the paper sector is seeing softening demand from some end markets, plus fears that India might soon be inaccessible is having an impact too.
Metal grades have bucked this trend though with copper and brass both up.
For the plastics and paper recyclate markets, the outlook for May appears that prices will be lower than those seen in recent weeks.
Against the dollar, the pound was slightly stronger at $1.38 from $1.37 a week ago. The euro/pound exchange rate was unchanged at €1.15.
Following publication of the Q1 data, the value of the PRN/PERN dropped sharply by around £40 per tonne.
With the data showing a very, very strong start to the year, there was a lot of surprise at this, but there is also a viewpoint that there must be an error in the data and this will be corrected.
However, the PRN/PERN market didn’t like what it saw and the price of certification dropped to around £50.
Physical grades didn’t necessarily drop by the same amount, as the price drop hadn’t quite filtered through fully.
There is also some talk that underlying prices are beginning to come down, especially as European demand seems to be falling at the moment.
As we get closer to May, it looks like it could be an uncertain month for the recycled plastic market.
There was a scarcity of trade this week, with buyers of material looking to lower the price they pay and sellers holding back in the hope the buyers will come back at higher offer levels.
This resulted in a wide spread of prices paid for OCC with anything above £100 and below £145 possible depending on destination, quality and the needs of those trading.
European mills that have been trying to push prices down over the last few weeks haven’t seemed to be getting anywhere as others appear happy to keep prices where they were while they stock up.
Asian buyers seem less keen though, and expect to be paying less in May. Nobody is expecting higher prices, and predictions are everywhere between stable and upcoming crash.
One factor that could bring about the latter is India. While demand from there remains good, the escalating Covid crisis there could suddenly pull the rug from under the market. As things stand, India is open for business and trade is continuing. But with Covid unfortunately infecting ever more people there, it could be its Government announces tougher measures (New Delhi has started a six day lockdown already). Alternatively, disruption could occur simply because people are sick.
With India increasingly providing pulp to China, that could also have a knock-on effect there too.
What is clear, is that May looks uncertain at the moment for the recovered fibre market.
Copper increased by £100 per tonne this week and brass by £50 per tonne. All other metal grades remained the same.