2016 packaging obligation figures show UK is on track after Quarter 1

The UK packaging obligations have been published by the Environment Agency, alongside some revisions to the Q1 Recycling Information.

Both pieces of information show the UK is on track in all materials with over 25% recycling achieved, apart from ‘Glass Other – Aggregate’. After two consecutive high value quarters the market looks to be stabilising.

The Q1 Recycling figures were amended due to reporting errors in the reprocessor market. This added approximately 37,000 tonnes of Glass and this will ease the perceived pressure on the market after the initial figures were published, showing a shortfall.

2016 packaging obligation figures

These figures represent the entire UK demand for PRNs in 2016. It provides the market with a benchmark for how much recycling needs to take place in each quarter to achieve compliance. The figures also contribute to the price mechanisms of the PRN market. If the figures show quarterly recycling figures in surplus of the 25% requirement, the price can start to soften, however should these figures show quarterly recycling figures which are lower than the quarterly requirements, prices can rise.

The table below details performance of the PRN market across Q1, all figures are in tonnes. You’ll see the only market in deficit in Glass Other, however with only a 1 .5% shortfall, this should be rectified in the remainder of 2016. It is also important to note that Remelt PRNs can be used to cover Glass Other PRNs, and at the moment the prices are very similar for both.

packaging obligation figures Q1 2016

The ‘recovery’ market, recovered

Before the figures were released, Recovery looked like it might struggle to meet quarterly obligations, although it was on the right track. The changes to the paper protocol seem to have done their job, with both paper and recovery posting surplus in the latest figures.

What does it mean for members?

On the whole the figures are good and the market is moving in a direction favourable to producers. As these feed into price movements we should see lower costs across the year for PRNs. However we still have three quarters to go, and it is unknown how much of the surplus material has been met though feedstock that is only economically viable to recycle at the higher PRN costs.

A word of warning

Whilst the figures are good, I believe a healthy level of caution should be exercised to ensure any market price changes don’t cause large amounts of recycling to cease and volatility to enter the market again. ecosurety will continue to monitor the markets closely and hope these figures show the beginning of a year of PRN markets characterised by stability and falling prices.

If you would like discuss the impact of these figures on your packaging compliance obligations, simply contact our team of specialists on 0845 094 2228 or email info@ecosurety.com.

Richard Hodges

Key account manager

As key account manager Richard helps our largest clients manage their legal obligations under Packaging, WEEE and Batteries legislation. His background in economics helps our members manage their budgets and strategically procure evidence.

Written by Richard Hodges Published 19/05/2016 Topics Compliance

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