With the exception of steel and plastic PRNs, prices have edged down in all materials according to traders contacted by letsrecycle.com, with a particular drop in glass PRNs. The price movements have followed Defra's issuing of statistics on the amount of packaging waste recycled in the UK in the second quarter of 2004 (see letsrecycle.com story) .
PRNs are the “currency” used in the UK's producer responsibility system for packaging waste. The notes are issued by reprocessors against material that has been recycled and these are then purchased by obligated packaging waste producers as evidence they have paid for their obligation under the regulations (see letsrecycle.com legislation page) .
Some industry experts have suggested that one factor behind the price drops could simply be that buyers have been scarce because of the holidy period and sellers have been looking for immediate cash flow. Sellers wanting to sell now would be therefore willing to accept a slightly lower price. There could well be a slight increase in PRN prices later this month, these experts believe, as traders resume their usual activities.
However, the rise in plastics PRN values and the fall in glass PRN values seems to have resulted from the new reprocessing figures.
Plastics
Plastic PRN prices have edged upwards following the publication of the latest reprocessing figures, from about 9-11 up towards 11 – 13. The reprocessing figures noted a surprising decrease in the amount of plastic packaging waste recycled in the first half of 2004 compared to the same period in 2003, which could mean difficulties in meeting this year's material-specific plastics reprocessing target of about 370,000 tonnes.
It is thought these figures have been slightly undermined because 27 reprocessors failed to submit returns for Q1 on time and four reprocessors missed their Q2 returns. Several reprocessors have also been suspended from accreditation in the past year.
Analysts are also suggesting that with the clamp-down on inappropriately issued PRNs, the inflation in previous years' figures has emphasised the decline. An error in data submission in which an 18,000 kg amount of plastics packaging reprocessing was mistakenly entered as 18,000 tonnes is thought to have made a significant impact on the figures.
Some plastics reprocessors are holding onto their notes as uncertainty pervades in the marketplace as traders wait for Defra to report back on its fact-finding mission into possible PRN fraud in plastics. This report should be published later this month (see letsrecycle.com story) .
Plastics packaging waste organisation Recoup has written to Defra to seek clarification on the data and is now awaiting a response. The organisation told letsrecycle.com that it welcomes the Environment Agency's increased efforts to scrutinise and enforce the system.
Chief executive Andrew Simmons said: “Recoup has always said that the plastic packaging figures are probably overstated but I would be surprised if the additional scrutiny of the agencies has led to such a dramatic change and suspect the failure to file data may be a more likely reason for the large apparent shift.”
Mr Simmons added that Defra's intention to release timely data was a good move for the market, but warned that without some interpretation the data “may prove to be misleading”. Recoup believe an online, real-time system for assessing PRN supply would improve matters.
Glass
Trading early this month has seen the price of glass PRNs slipping from the mid-20 a tonne mark to as low as 16 to 18 a tonne. This is thought to be the result of improved performances by glass reprocessors in the first and second quarter results of 2004.
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