2015 Packaging Recycling Targets met with ease (in the end!) – Q4 Packaging Recycling Figures Released Early – Show Very Strong Performance

UK 2015 Packaging Recycling Targets Met with ease – in the end……

The Environment Agency this week published the Quarter 4 2015 Packaging Recycling Figures (PRN Market), surprisingly a month in advance of the release date, perhaps to bring some realism to the market which had got carried away for so early in the 2016 Packaging Compliance Year. All material specific recycling targets were easily met for 2015 with a significant carry forward into 2016 (320,000 tonnes), although slightly down on 2015.

The problem materials of 2015 Plastic, Steel and Aluminum have recovered well. With Plastic Recycling having a record quarterly performance, Steel Exports picking up the slack for the fall in UK Steel capacity and Almuminium Incinerated Bottom Ash (IBA) volume coming online.

2016 is starting to look more manageable.

Plastic prices peaked for the year at over £60.00/tn the target was easily met with an unbelievable 263,000 tonnes of plastic exported / recycled in Q4, compared to 196,000 tonnes in Q3! This resulted in a healthy carryover of 35,000 tonnes which alongside the target being cut from a 5% to a 2% increase, makes plastic more manageable with prices due to fall back to more reasonable levels, which can meet the still challenging target.

More positive news for the PRN Market was announced with additional PRNs coming on stream in 2016 for Paper (increase in mixed paper packaging % protocol) and Aluminum volume coming through from Incinerated Bottom Ash which should really start to ease the recent pressure on the General Recycling and Recovery markets as we go through 2016.

The Table below Summarises the final and total packaging recycling compliance position by material specific obligations (demand) for 2015 and the actual material recycling performance (supply) and surplus available for carryover or written off.

For more information and projections on how to manage your obligations for 2016 and beyond please get in touch.

The graph below tracks the PRN material prices throughout 2015 for information.

Background

Under the Producer Responsibility (Packaging Waste) Regulations 1997 – 2016, Obligated Producers, any UK Company with a Turnover of £2m+ and handle more than 50 tonnes of Packaging, are required to offset annual recycling and recovery obligations, by purchasing Packaging Waste Recovery Notes, PRNs. Each Packaging Material (Paper, Glass, Steel, Aluminium, Plastic, and Wood) has its own recycling material specific target, set by the UK Government, and free market supply and demand price driven market, PRNs.

Packaging Waste Recovery Notes, PRNs, have an individual material market value which fluctuate depending on perceived DEMAND (the Total Recycling Obligations of all 7,000 UK Obligated Companies) and the SUPPLY (the actual Recycling and Export of Packaging Waste from within the UK). Where there is a perceived market shortfall in a packaging material price will rise to stimulate more recycling in the market, and where there is surplus, price will fall.

Obligated Companies / Producers submit and declare the Packaging they place on the market for the previous calendar year. This data allows Recycling Obligations to be calculated against the annual Government Recycling targets. The data is submitted once a year.

Packaging Waste Recovery Notes are issued by Accredited Reprocessors, Recyclers or Exporter of Packaging Waste. They report the actual amount of recycling on a Monthly basis to the Environment Agency / SEPA / NIEA who then issue a Quarterly Report highlighting the total UK Recycling Performance. PRN prices react according to the perceived market conditions.
The market experts at Co2 Compliance, have worked in this specialised and sometimes volatile market since 1999, and share regular commentary and market analysis with our clients. Our goal is to minimise our clients bottom line cost of compliance.