With the exception of scrap metal, it was a pretty flat recycling market out there this week and it looks set to continue into next week too.
For packaging grades, the publication of the Q3 data this week confirmed that for most materials we are close to compliance already and PRN/PERN values have eased a bit, or remained the same if none were even traded.
In paper, OCC came off a little but other grades were unchanged.
Plastics saw no price changes either with many waiting this week to see what the Q3 data would bring.
As mentioned above, industrial non-ferrous metals saw some gains, but there was no change for packaging metals.
The pound was a bit stronger against the dollar at $1.30 compared to $1.29 a week ago. Compared to the euro, the pound was unchanged at the end of the week from last Friday’s €1.10.
With the market waiting for the Q3 data to be published, it was a pretty static physical trading week for packaging grades as a result.
Nobody wanted to move material if there was likely to be a change in the PRN/PERN price.
With the data showing approximately 12% of the quota left to fill in the last quarter, the assumption is that we are pretty much there in terms of compliance for 2020.
The expectation is that the PRN/PERN price will fall further and that is producing less confidence in the physical material market having a good end to the year, especially with underlying prices still challenging (with the exception of HDPE bottles that are still showing good demand).
With half term occurring for many next week, as some regions also go into lockdown, it might take longer for the PRN/PERN market to settle at its natural level.
Most expect next week to be quiet therefore, and some suggest the plastic market now won’t see much activity until the new year.
The market is flat at the moment as those buying and selling wait to see what is happening.
Normally in the second Thursday before the end of the month, trading would be brisk but it was anything but with no real demand coming from anywhere for OCC.
It sees many are waiting for the beginning of November to see where the land lies and then trade for the month.
This is partly waiting to see if the postponement of the Indonesian registration system until the beginning of the year will have an impact if buyers there stock up after the pause they have suffered for more than a month.
There is also a new PM2 machine that is expected to come online at Hamburg Rieger’s Spremburg plant that will have another 500,000 tonnes of capacity and could add to European demand.
But waiting a couple of weeks to assess trading conditions is also a consequence of regional lockdowns happening in the UK and elsewhere in Europe and trying to understand what impact they will have on the market. Will people also buy less stuff this Christmas and will most of it be online?
With these uncertainties, it is understandable that many in the market are hoping for more certainty in the next couple of weeks.
Mixed continues to be the grade attracting most attention with purchases from board, newsprint and even tissue mills helping to keep the price stable this week.
Scrap metal copper grades were up by £100 per tonne this week thanks to stronger numbers on the LME. For the same reason, brass added £50 per tonne and aluminium £100 per tonne.
There was no change for ferrous grades or can prices though.
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