Packaging producers appear to have comfortably met their packaging recycling targets for 2008 despite concerns they might struggle due to the sharp fall in materials prices, writes Caelia Quinault.

The Environment Agency published data on March 11 showing levels of reprocessing and exporting in the fourth quarter of 2008 was relatively consistent with the rest of the year, meaning that the UK's business targets were exceeded by over 400,000 tonnes (see table below). Of this, 275,000 tonnes of packaging recycling evidence (PRNs) was carried over into 2009.

While the carry-over is around 100,000 tonnes less than was carried-over from 2007 to 2008, the performance is much more positive than had been expected after markets for many recovered materials suffered in late 2008 (see letsrecycle.com story).

Provided the business targets were set at the correct level to correspond with the amount of packaging actually placed on the market in the UK in 2008, the figures also suggest that the UK has met the last targets currently set under the European Packaging Directive - which required that 60% of packaging was recycled by December 31, 2008.

The performance is likely to put the UK in a stronger position than expected for meeting business packaging recycling targets in 2009- reflected by the fact that PRN prices in March for many materials are now edging downwards.

Steve Gough, chief executive of the UK's largest packaging producer compliance scheme, Valpak, pointed out that there was actually more carry-over into 2009 for paper and plastics - which suffered the most from the price crash - than from 2007 into 2008.

He said: "Some companies have not reported yet, but paper and plastics were the markets which suffered the most in Q4. One of the main indicators we look at is how much is carried in, compared to how much is carried out. We found that more was carried out than in which is counter intuitive to what has been going on."

"A possible explanation is that lots of material was stored for a while and then moved by the end of the year. The PRN prices were never going to stay at the same levels in 2009 so that also encouraged people to move material and issue PRNs. From the numbers it looks like the UK was fine with a reasonable amount of carry out," he added.

Angus Macpherson, managing director of the Environment Exchange, which is a marketplace for PRNs, said he believed the business targets had been "comfortably met", adding that the performance with regards for aluminium came as a particular surprise.

He said: "Despite all the tales of gloom, quarter four exports went cantering on pretty merrily and were pretty comparable to quarters one, two and three. The aluminium figures startled people a lot. From the looks of things we were barely going to meet the target and suddenly almost 2,500 tonnes of carry forward appeared which surprised a lot of people. That seems to be linked to increasing export and domestic production."

Challenge

Despite revealing a better-than-expected performance, the figures also point to some areas which could present a challenge in 2009. In particular, meeting material-specific targets for materials such as glass and aluminium are expected to prove difficult.

Mr McPherson said that, depending on how you looked at the situation, the UK could be seen to have only just shaved its European target for recycling glass in 2008 and that going forward, the business targets for glass were challenging. He put this down to a combination of factors including the fact that the targets were stretching and that it was a challenge to get more glass out of the waste stream.

He added that he believed it was a good thing that there were no 2009 European targets to meet for metals because he believed it could be difficult to meet them due to problems in the markets - but said that, on balance, he expected the targets would still be met.

Concern over steel in particular was raised by Phil Conran, of consultancy 360 Environmental and a former Biffa compliance specialist. This echoed concerns raised by steel giant Corus (see letsrecycle.com story).

Mr Conran said: "In steel, only 8,000 tonnes were carried forward, suggesting a difficult December and a potentially challenging 2009. Corus' well publicised statements about their drop in 2009 PRN expectations and an overall drop of 95,000 tonnes across the market from 2008 levels, suggest a maximum available level of evidence for 2009 - including the 8,000 carry over - of around 330,000 tonnes. Applying the 2009 targets to the steel data reported by obligated business in 2008 produces a demand of 375,000 tonnes."

Data

In order to help 2009 run smoothly, the Environment Agency is now urging reprocessors and exporters to upload details of the amount of packaging they handle on a monthly basis during Q1 and Q2 2009 onto the National Packaging Waste Database.

The move follows a recommendation made by the ACP in January 2009 to improve reporting (see letsrecycle.com story).

In a note published on its website, the Agency explained: "This is of course purely voluntarily, but your participation in this would be greatly appreciated as early access to the data could allow Defra to respond more quickly to any changes in the market."