27 January 2020 by Joshua Doherty

Alupro seeks investment details after PRN hikes

Aluminium recycling trade body Alupro has hit out at the Packaging Recovery Note (PRN) system, claiming that despite 2019 targets being met, the market developments last year need to be carefully assessed in light of the high PRN prices.

Remarks about the market have come from Rick Hindley, Alupro’s executive director, who was commenting on provisional packaging data which the Environment Agency published earlier this month (see letsrecycle.com story).

The data suggested that 116,000 tonnes of Aluminium was recycled in 2019, against a target of 113,000 tonnes. (Picture: Shutterstock)

The data, to be finalised in March, forecasted that 33,000 tonnes of aluminium was recycled in the fourth quarter of 2019, leading to an overall yearly figure of 116,000, against a target of 113,000.

More than 3,000 tonnes were carried over from 2018 to help meet 2019 requirements.

Credibility

Despite targets being met, Alupro explained that the quarterly data released by the Environment Agency in 2019 consistently suggested that a significant volume of PRNs were being raised but not issued. He suggested that this “resulted in inflated PRN prices, peaking at over £500 per tonne and undermining the credibility of aluminium as a material with enviable recycling credentials”.

Mr Hindley said: “It is excellent news that the target has been exceeded and the sustained growth of aluminium packaging recycling continues.” However he went on to question developments in the market last year.

Rick Hindley, Alupro’s executive director

He said: “The abnormally high PRN price has significantly impacted producers and once again brings into question the system itself…. We are eager to see what additional investment to support further increases in aluminium packaging recycling and collection will result from the hugely increased revenues received by some aluminium recyclers and exporters last year.”

Compliance fee

The record high prices for aluminium and plastic had sparked concerns throughout the year that the targets would be met, which led to prices continuously increasing as demand for the PRNs grew.

One potential solution to the issue which has been suggested is some form of compliance fee, similar to that in the WEEE sector, which would see compliance schemes having to pay per tonne for what they miss, rather than the PRN price when it was particularly high. This is an approach which Mr Hindley backed.

“The data again clearly suggests that the aluminium PRN market has been distorted”

Rick Hindley, Alupro

“Alupro is fully aligned with the Advisory Committee on Packaging’s proposal for a Compliance Fee, which has garnered wide-spread support and could offer obligated businesses an alternative route to compliance whilst reforms of the producer responsibility system are pending,” he explained.

Mr Hindley added: “In addition, a joint industry letter was sent to Defra in December, highlighting the concerns shared across the retail food and drink manufacturers and packaging manufacturers, including British Retail Consortium and Food and Drink Federation, in relation to the negative impact of the enormous PRN price increases.”

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