The strongly-worded attack on the government and the Waste & Resources Action Programme came from the Swindon-based Confederation of Paper Industries which represents companies such as St Regis, UPM-Kymmene and Aylesford Newsprint. And, the CPI also claimed that the latest WRAP business plan actually indicated there was little to gain in further developing the reprocessing of paper in the UK.
Peter Seggie, CPI Recovered Paper Sector Manager, hit out at the government for introducing “higher and higher recycling targets”. He said: “Before introducing higher and higher recycling targets, UK governments must ask themselves if there are solid, sustainable markets to accommodate reaching them, otherwise they are only kidding themselves.”
Defra reponse
Responding to the view from the CPI, a spokeswoman for Defra said: “Commodity prices go up as well as down, and while we will continue to monitor the situation closely, we remain committed to our recycling and landfill targets. More than 8 million tonnes of paper are collected per year for recycling in the UK. This has avoided millions of tonnes of greenhouse gas emissions and waste ending up in landfill.”
Global markets
The CPI pointed to the likely recession in the UK and downturn in market demand. In a statement the organisation said: “The UK relies on global export markets to take well over 50% of the recovered paper it collects with Far East markets taking over 75% of the export total; this has left the UK in an incredibly difficult and strained situation. Exports account for, on average, over 400,000 tonnes of recovered paper from the UK per month and without these markets UK merchants are left with little option other than to store the material they have paid significant amounts for or sell at loss making prices.”
Price collapse
The statement continued: “The situation in the UK has also exacerbated price falls in Europe as there is a glut of UK recovered paper on the European market as well as excess European domestic stocks from the lack of Far East buying. Rapid price collapse was always a significant risk for the UK givens its huge reliance on Far East markets and its diminishing domestic papermaking infrastructure to shield it from global economic turbulence.
“With no obvious signs of Far East buyers returning to the market soon there is a serious possibility that storage of recyclables may end up being a very high risk strategy with huge costs to those requiring storage, including the tax payers through local authorities. It is also rather ironic that Defra and the Environment Agency are looking at the possibility of relaxing storage regulations for recyclables when it is their intention to increase regulatory controls for the storage of recovered paper within the new Environmental Permitting Regulations exemption system from 2010.”
And, the paper organisation also commented on the possibility of storage of materials. It said: “Even if Far East buyers return to the market quickly it is very doubtful that prices for the material will be anywhere near where they were through the middle of 2008 and excess stored material is likely to suppress prices for a much longer period.”
WRAP business plan
WRAP came in for particular scrutiny by the CPI. The statement said: “The global market has been used as a mechanism to date to drive continuous increases in recyclate collection from the UK waste stream and this has led in part to many stakeholders taking it for granted that it would always be there. This strategy has been allowed to carry on with little interference from government and indeed the new WRAP business plan showed that they felt there was little to be gained by continuing to develop domestic markets for the more common materials such as recovered paper.
Mr Seggie commented, “The UK must learn from the lessons of these volatile times and, like the banking crisis before it, look at lowering future risks by examining what can be done domestically to make the UK more self sufficient. WRAP must look in detail at this market collapse to see what lessons can be learned for the future with regards to UK waste and recycling policy.”
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