Industry representatives have told letsrecycle of their concerns at the current situation and highlighted the fact that there is strong home demand for material which is not being met by the collection of bottles in the UK.
Alan Davey, general manager at Linpac Plastics Recycling, said: “There is plenty of demand and plenty of material, but not enough is collected because there are not enough subsidies. There is a shortfall in supply in the UK. We could handle more bottles but now we are having to import them from continental Europe and it is frustrating that we have to source from abroad.”
Others see used plastic bottles coming into the UK at low prices because their collection has been heavily subsidised in Germany and elsewhere.
And, the low price of virgin material is dampening the market. Colin Williamson, chair of the British Plastics Federation recycling committee, said: “Most of our members are having a rough time. Virgin material is cheap and so it is often uneconomic to recycle goods.”
The plastics market has remained reasonably strong over the last six months especially for HDPE and LDPE, confirmed Andrew Simmons, of Recoup, the plastics bottle recycling organisation. “People want material, but the export market is undermining business in the UK. Rising oil prices have not had a marked effect, virgin HDPE has dipped a bit and virgin PET has increased steadily.”
In the waste management sector, demand is also strong. Shanks wants more bottles to meet demand from its customers. Jacqui MacCaig, recycling support manager for Shanks, said: “We haven’t got enough bottles and we are able to process many more. We do not have any problems selling bottles, but we can’t get enough of the material.”
The British Plastics Federation has criticised the government and said the plastics recycling market is being hampered by various constraints including the Climate Change Levy which is “having a disastrous effect on recyclers”. Matt Clements, industrial issues executive for BPF, said: “These constraints are having a telling effect on a sector whose capacity has not increased in the last year. This was in face of a government agenda which suggested a need for increased recycling capacity in the UK.”
Looking ahead, Mr Davey said that he doesn’t see the situation improving in the short-term because there is insufficient subsidy. “The total cost of sorting, collecting and baling plastic bottles is about 250/300 per tonne while the inherent value is 100 per tonne. If there is to be change, the government must legislate.
“The low PRN trading value is nothing like enough to make up the shortfall in costs and there will almost certainly be a shortfall in PRNs at the end of the year. This gap could easily be bridged by collecting more plastic bottles. The PRN value is short-sighted, this is the fault of companies like Valpak who only looked at short-term subsidies.”
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