The latest wood prices appear fairly stable, despite the recent drop in wood PRN prices. Generally, wood recyclers are charging between 0 and 12 per tonne for mixed wood brought to them.
Some recyclers, particularly in the North of England, believe the price they charge is likely to rise in the coming months, as the pressure to increase wood quality and packaging content intensifies from the direction of the board mills.
“Supplies are not great at the moment,” said one wood collector. “The attitude is that we should be taking it away for nothing, but we can't survive doing that.”
Positive
However, with healthy competition for material growing in many areas with new recycling firms cropping up across the country, there are some recyclers saying that charges could even be reduced – and could turn into positive pay-outs for suppliers if they keep the quality high.
“We're not paying for wood yet,” one recycler told letsrecycle.com, “but we can see it happening in the future as there's some competition for wood now. That's the way it's been going here, from charging 10 a tonne to 5, and now we're offering a free tip. We can see it going the other way in the future, towards paying 5 for good, clean wood.”
Split
There are some that believe that the boardmills' insistence on good quality wood and high packaging content could split the wood stream in two, with a clear-cut pricing differential for good quality or packaging wood to mixed wood supplies.
“The PRN system is back-firing,” one Northern England wood recycler insisted. “They're asking for 100% packaging, and suppliers are turning back wood that's not packaging. They're creating two wood streams.
But the board mills have been keeping the prices they pay to recyclers for chipped wood fairly well fixed at between 20 and 26 a tonne. The mills are encouraging suppliers to increase the standard of wood quality (see letsrecycle.com story).
Split PRNs
Another strong reason for a possible split in the wood streams is that wood recyclers are looking to get their hands more directly on PRN money.
Some of the mills are paying a slight premium for packaging material, either directly or in the form of administration costs and incentives for proper audit trails proving material is packaging waste. But recyclers are finding that turning packaging waste into saleable products themselves – for example, animal bedding and horticultural products – they get a much better return.
Up in Scotland, where competition is fairly high between firms in the Glasgow-Edinburgh “corridor”, there are firms already paying suppliers up to 3 a tonne for high quality wood.
“The alternative markets, like animal bedding, are a huge area for us at the moment, and there's a lot of expansion in that direction,” said one Scottish recycler.
Industry eyes are also turning to the biomass industry as a future outlet for chipped wood, and the use of wood for fuel in energy generation is expected to become a huge issue in a few years' time, possibly even competing with the board mills for the UK wood market.
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