It now appears that there will be no shortage of recycling PRNs in 2001. The PRNs represent the evidence needed to show that companies and compliance schemes covered by the packaging regulations have met their obligations. Instead the main demand is for the bulk of PRNs needed to meet overall recovery obligations.
Strange
One compliance scheme told letsrecycle: “We believe reprocessors have saved PRN stock for December which means that the situation is rather strange as more are available. Material specific PRNs are almost cheaper than recovery PRNs at the moment.”
Another source said that the situation had been eased this year by the greater availability of export PRNs, (PERNs) especially in steel and paper which had kept the price of PRNs down. The extra availability of PERNs is causing some concern among UK reprocessors, and especially within the recovered paper sector. Both merchants who export material and UK mills who want material for use here, have had separate meetings with Sheila McKinley of the Department of the Environment, Food and Rural Affairs. The mills want a crackdown on PERNs, fearing that some may be invalid, while the merchants see the situation differently. They believe they have a right to the PRN in the first instance and the export PRN helps to make up for the low value of the material.
Busy
One indicator of trade in PRNs is the OM Environment Exchange. The first half of December appears to have been the busiest trading part of the year for PRNs on the Exchange which said that its trade in the week of December 10 exceeded 100,000 tonnes. The figure was 38% higher than in the same period last year. But, in contrast to the wider marketplace, OM Exchange managing director Angus Macpherson said that the average value of the PRNs traded is nearly three times higher than last year.
“At this stage, a significant difference is already appearing between 2001 and 2002 prices as both buyers and sellers scramble to meet their obligations ahead of the year-end.”
Ahead of the Christmas period it is expected that some issuers of PRNs may decide to offload them at lower prices for fear of having them unsold at the end of the year. January to November PRNs have to be issued by December 31 and one company or compliance scheme is hoping to buy PRNs at well below market rate through a firm of accountants in Essex.
The firm, Morgan Brown & Spofforth in Loughton, has taken the unusual step of writing to accredited issuers of export PRNs to say that it has a client who is interested in “purchasing your entire PERN capacity and is prepared to pay the reasonable amount of 3.25 per tonne of material for documents which would otherwise have no commercial market value.” Morgan Brown spokeswoman Jan Rickler said she could not give any information as to who the client is.” The firm would only say that the purchaser is “an obligated party”.
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