The Scottish regulatory body has almost concluded its annual assessment of the compliance of its 104 registered producers for the 13 months up to January 31 2003.
An interim statement from SEPA said: “A total of 20 producers failed to comply with the certifying obligation by the required deadline. Of these, nine remain outstanding and will be pursued accordingly.”
However, although final audits on Integra and Valpak Scotland are still to be completed before the end of March, SEPA has said that the compliance schemes Ecopak, Recyclepak and Wastepack have each complied with their recovery and recycling obligations through the use of “approved evidence of compliance”.
Prices
Meanwhile, the latest packaging waste recovery note prices remain very low compared to the lofty heights that were seen in 2002. Most materials are around the 12 – 15 a tonne mark, with paper slightly lower and aluminium slightly higher.
Some schemes are managing to push prices down to 11 a tonne in some materials, though not many people want to trade at all at these prices. Small volume deals are seeing some PRNs change hands for as little as 8, particularly in paper, and sources believe this may indicate cash flow problems among some reprocessors.
Nervous about the market conditions, many reprocessors are holding onto their PRNs at the moment, in the hope of higher prices in the future. However, the message from some industry analysts is that there may not be higher prices for quite some time.
Pressure
One of the things traders are waiting for is the PRN fraud issue to be resolved – if fraud is found by the Environment Agency or the government, it will affect the supply side of the PRN market to quite some extent, with a resulting upward pressure on prices.
But although the government is looking into possible fraud in the wood reprocessing and recycling sector and in plastics exports, the fear is that nothing will be resolved any time soon. Though the government is thought to be announcing some kind of investigation in the wood sector soon, industry figures do not expect any solid evidence on the issue within the next six months.
Compliance scheme managers therefore see the second quarter of the year remaining as quiet as the first. However, with the schemes determined to look closer at where their PRNs come from after December's Compliance Schemes Working Group (CoSWiG) meeting, as well as the government and the Environment Agency making noises about allegations of fraud in the wood and plastics sectors, quarters three and four could see supplies more in balance with demand.
It is also thought that the industry may see the lack of investment in capacity this year – because of the low PRN prices – begin to bite into PRN supply levels. This will also see upward pressure on prices.
On the demand side, some traders are waiting to hear what the year's official obligation is before any major activity is carried out in the PRN market. Obligated companies must register this year's totals by April 15, so it is thought that PRN trading is likely to pick up mid-April or later.
Click here for the latest PRN prices from letsrecycle.com.
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