Recycling prices and market commentary: 9 November 2018

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Exports of recycled materials are sent via container ship

The PRN price continued to dominate again this week, with odd data from the National Packaging Waste Database causing confusion.

When the monthly data for October was published, an extremely large figure was shown for plastics that caused the market to go haywire. This figure was revised soon after, showing approximately half of what had been originally published, and more in line with what it should be.

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At the end of all this, the plastic PRN price stayed where it had been before.

The glass remelt PRN price has got much stronger this week reaching £40 per tonne from around £25 last week as meeting the target looks a bit tighter. This hasn’t yet affected glass prices, but with the PRN effectively a subsidy for glass, prices should rise next week.

In the physical market, most prices were pretty much stable, even if there are rumblings underneath that things may change as we head towards Christmas and 2019.

News that Vietnam has introduced new national standards including 2% maximum contamination levels was a talking point this week, and more on that is below in both the plastics and paper sections. At least it shows that Vietnam is set to remain an export market for the time being.

The pound was largely unchanged against the dollar at $1.30 and against the euro strengthened slightly from €1.14 to close to €1.15.

Recycled plastics

Prices were stable, even though the PRN price was variable once the mistaken monthly data was published as mentioned above.

Although the PRN price eventually returned to where it had been previously, there wasn’t too much incentive for physical material prices to change.

Following the publication of new rules on exporting plastics to Vietnam, it does appear that this market is re-opening, albeit slowly. The conditions to export there are now quite tough and can only be for manufacturing purposes only. But at least this market is opening.

The fact that PET bottles can be exported there should open some opportunities, while other plastics will need to be shredded to specification.

However, the problem in the short-term is that many containers remain caught up in port, and those who had legitimately exported there are still struggling to get their loads to the final destination.

As a result, until these containers are cleared, shipping lines are reluctant to accept plastics destined for Vietnam. It will probably be in the New Year before this situation eases.

Forecast prices

1 week           4 week

PET      295-301         296-302
HDPE   519-525         520-526
LDPE    215-221         216-222

Recycled paper

Market prices were unchanged on the whole this week, even if some traders changed their prices by a pound or two, it tended to balance out.

Chinese buyers were either buying small loads of OCC or out of the market altogether, only really buying decent volumes for their other Asian mills at lower specification and lower price.

Where they were buying for China, and small loads are still being shipped there, the Chinese specification price was somewhere between £85 to just over £100. The high PRN price did benefit some who were able to extract an extra pound for their material, but not all.

However, other destinations such as domestic UK, Europe, India and Vietnam were anywhere between £65 to £85 with many out of the market, especially as OCC seems hard to come by.

This is unusual at what is typically a busier time of the year as material comes on the market before Christmas. It appears that consumers are not making Christmas purchases as yet in the hope that prices will fall around Black Friday.

It could be that much more material will be available towards the end of the month, and into December. With prices having fallen in recent weeks, despite a lack of material in the market, it could be a further slump is on its way unless Chinese buyers suddenly feel confident about 2019 licenses nearer to Christmas.

UK mills had already filled up prior to Christmas and are mostly not interested in buying either. Domestic and export buyers don’t seem to want to buy and sellers don’t have much to sell.

Those exporting to Vietnam will also have to meet tougher rules after the country announced a 2% contamination limit and 20% moisture level. Although EN643 suggests a 1.5% limit, Vietnam has been a destination where 2-3% from UK has been acceptable. US exporters have typically sent bales with 5% and even higher to Vietnam at times.

The 2% limit is likely to have an impact on price, with Vietnam being tough on inspections. A small premium might be paid to meet this specification, but not as high as Chinese specification which requires 0.5%.

But it could also mean that more US tonnage is displaced to other destinations such as India and prices there could fall even further. This will all come out in the wash over the coming months.

One bit of good news is that Vietnam appears to still be accepting mixed paper exports. After indicating that it would be banned, there has been no revision to permitted HS codes, and those who export believe that mixed is still permitted for the time being.

Forecast prices

1 week           4 week

OCC      82-86           82-86
N&P      112-116       112-116
Mixed    42-46          42-46

Recycled metals

Brass and aluminium grades both lost a bit this week, with the former coming off by £50 per tonne and the latter by £25 per tonne.

Steel prices also lost £10 per tonne, including cans, after having risen by the same amount last week.

The spread for aluminium cans has also tightened.

Recycled prices

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

 

 

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