Secondary markets commentary- 16 February 2018

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Copper recycling
Copper recycling

FROM 16TH FEBRUARY 2018 INTELLIGENCE REPORT:

It was a rather sluggish market this week with not a huge amount of movement in price, or indeed trade taking place. For those still able to sell into China, the Spring holiday and new year celebrations today helped to take the edge off new orders of material. While those selling into other destinations found that those markets are still struggling to take material and appear largely full up at the moment, unless you have a long-standing relationship with a buyer still prepared to trade. There is also a premium for the best quality material. At home, half-term holidays either this week or next week also took a number of traders out of the market, who have been happy to take a break from what has been a tough market recently.

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After falling back last week, the pound recovered to $1.40 this week, which also made material slightly more expensive for the export market. Interestingly, there has been a bit of movement upwards on some PRN values. Paper has jumped by about 60p per tonne (more on this below), while glass has also strengthened following the publication of the monthly National Packaging Waste Database info.

Plastics
After dropping back recently, the PRN value of plastics has come back up again, pretty much back to where it was. Volatility seems to be the default for PRN values at the moment, and looks set to continue throughout the year as the Chinese ban continues to bite. Certainly though, the high PRN price is helping to keep some material moving, as it is effectively allowing UK packaging material to be subsidised to give a bit of a price advantage against other competitors.
While Malaysia, Vietnam and to an extent Europe are still buying material, this is tending to be based on established relationships and an insistence of quality. There are also reports that a number of plastics exporters are finding it hard to find containers to send to Vietnam, with shipping lines nervous that authorities there will crack down on imports soon.

Paper
The price of OCC increased by £3 per tonne this week, despite overall trading volumes being poor. This was because Chinese buyers tended to focus on the best quality material and were prepared to pay a slight premium for it. They also benefitted from a slightly lower exchange rate for part of the week, plus the release of a bit more import quota. Fears that the reduction in contamination levels from China to 0.5% and the ban on mixed paper (losing 34.5% of its PERN allowance), has led to the PRN price of paper increasing to £2.10 from £1.50 last week. It could be that the PRN price will continue to increase for paper if export volumes to China remain low and make it harder to meet this year’s targets.

Metals
There was no change for metal grades this week as all remained the same as last week.

Pic: http://maxpixel.freegreatpicture.com/Scrap-Recycling-Copper-Reuse-Scrap-Metal-Disposal-1504098

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