Prices for the most in-demand grades such as HDPE natural and clear and light blue PET have reached £720-820 and £460-520 per tonne respectively for March – more than double that reported a year ago in March 2021 (see letsrecycle.com prices).
Meanwhile the price paid for higher quality film such as clear natural has reached over £500 for the first time.
Lower quality grades such as MRF film, however, are still commanding a gate fee due to a lack of outlets and barriers to exporting the material.
Demand
Prices have been steadily rising across most grades since demand fell sharply in 2020 due to lockdown, with recyclers now reporting increased demand for finished product as we move out of the pandemic. This is one of many complex factors impacting prices (see letsrecycle.com story).
And, with the Plastics Packaging Tax due to come into force on 1 April (see letsrecycle.com story) and rising costs for energy and labour, it is anticipated that prices will continue to rise.
People are trying to buy as much as possible. Prices are going into orbit
- Plastic recycler
Further upward pressure on prices is expected to come from the situation in the Ukraine, which is pushing up oil prices and in turn virgin polymer prices which impacts on the price of recycled material.
One recycler told letsrecycle.com: “Prices are up across the board. It started with bottles and now everything is up, even more obscure grades. So many factors are impacting prices. The plastics tax, extruders are back in full production post Covid.”
Another commented: “Oil has gone up to $110 a barrel, energy costs and transport costs are up. It is the perfect storm. People are trying to buy as much as possible. Prices are going into orbit.”
‘Astronomical’
One industry insider explained that HDPE natural and PP were in particular demand.
“Pricing is at astronomical levels”, he said. “There is demand for finished product that we haven’t seen before. We could sell all our product multiple times over.
“The price of haulage has gone up which has pushed up charges in the yards, and also the switch from red diesel to white. Turkey has also opened its doors to material again creating more competition.”
Councils
While the price rise is good news for councils and those with material to sell, it is less good for those who need to secure feedstock for recycling plants. There are also fears that it could act as a disincentive for companies to use recycled material.
Companies such as Morrisons have recently announced (see letsrecycle.com story) moves away from plastic packaging and there are fears this could help drive that trend.
“It is not necessarily good as some people who want to recycle material may ask if it is worth it”, one recycler commented.
“The prices are only going to continue to rise,” said another recycler, warning that “when prices go so high there is normally a crash at the other end.”
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