Agency outlines PRN obligations for 2014

By Tom Goulding

The Environment Agency has published data giving the first indication of what demand for PRNs will be like this year.

Published yesterday (May 15) on the National Packaging Waste Database, the provisional obligation figures for 2014 are calculated from the amount of packaging that was placed on the market last year, and gives an indication of how much packaging recycling evidence producers will now need to buy under the regulations.

The provisional figures give an indication of what the demand for PRNs will be like throughout 2014
The provisional figures give an indication of what the demand for PRNs will be like throughout 2014

It shows that compared to 2013, the overall obligation for producers across all materials has increased fractionally from 6,872,183 tonnes in 2013 to 6,879,796 tonnes in 2014.

But, while the numbers are yet to be verified, the obligations for steel and glass appear to have dropped, with the latter a direct result of the governments decision to reduce the glass packaging target to 75% in March this year (see letsrecycle.com story).

As a result, the amount of glass recycled in the first quarter of 2014 is in a stronger position than the same period for the previous year, with the amount of glass remelt packaging recycled at 253,300 tonnes meaning an 11,133 tonne surplus on its 242,111 tonne quarterly obligation.

This makes up for the amount of glass packaging recycled via aggregate processes which recorded 106,710 tonnes in Q1, suggesting it could fall short of the 130,368 tonne quarterly obligation figure.

Plastics

And, while the overall obligation for plastics is set to rise again this year to 770,796 tonnes compared to 699,205 tonnes in 2013, Q1 figures show the material performed comfortably well with 201,040 tonnes recycled slightly higher than the 192,699 tonne quarterly obligation.

‘It is positive to see a decrease in the UKs obligation since 2013, particularly in the more volatile materials, such as glass and steel. We are hoping that this decrease will relieve some of the pressure on the PRN markets that we have seen recently.’

Lizzie Russell, Budget Pack

As a result, the value of plastics PRNs is reported to have fallen slightly to around 36 per tonne down from 40-45 last month, the lowest it has been since April 2013.

Commenting on the figures, Ian Andrews, senior market trader at the Environment Exchange, said the early indication for glass was good news for buyers compared to the same period last year – when combined glass remelt and aggregate figures recorded a shortfall of 59,131 tonnes and plastic missed its quarterly obligation by 17,331 tonnes.

He said: The indicators are that glass is a lot stronger and a lot better than it was last year and that overall target has come down so glass will have an easier time of it this year. Buyers had seen a lower return in the first quarter before so they were not going to panic, and they had a double bonus this year when the government decided to help out and reduce the glass targets.

Plastics has also overshot its mark, and this is good news for producers. I think there have been some disparaging remarks in the past on the UKs ability to create the demand in light of the government target, which goes up every year. But this year we dont have the issue of Chinas green fence which caused problems for supply in 2013.

PRN value

Asked what the sector can expect to see in Q2, Mr Andrews added: You dont want that plastics price to dip below a certain mark or it will start to affect exports, and the market will begin to tighten again. As long as those prices are good enough the supply will be there.

PRNobs2014.jpg
PRNobs2014.jpg

Also commenting on the figures, Lizzie Russell of compliance scheme Budget Pack, said: It is positive to see a decrease in the UKs obligation since 2013, particularly in the more volatile materials, such as glass and steel. We are hoping that this decrease will relieve some of the pressure on the PRN markets that we have seen recently.

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2014 obligation figures

In addition to this, the quarter one recycling figures published by the Environment Agency last month show that the quarterly obligation was exceeded by the amount of recycling in all materials except aluminium and steel, which suggests that the markets should remain stable and hopefully the PRN prices decrease as a result.

It is good to see a reduction in the packaging handled in most materials, which shows that effort is being made to reduce packaging usage overall.

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