Market Snapshot March 2016

Transcription

1 Market Snapshot March 2016 UK recovered material prices generally increased in value between December 2015 and March 2016 with the strongest gains seen in recovered metal can markets. The price of recovered clear and coloured PET bottles rose by 5-10 per tonne in the three months to March In contrast recovered HDPE bottles fell with natural HDPE bottles down 25 per tonne and mixed HDPE bottle prices declining by 10 per tonne. Chinese demand for UK recovered plastic declined during 2015, down 11% compared with 2014 and the lowest level since The price of news & PAMs and OCC both increased by 7% in the three months to March 2016, while mixed paper and board prices are stable at 50 per tonne. In contrast to plastic, Chinese recovered paper import volumes grew in 2015, up 6% compared with Recovered glass prices generally increased between December 2015 and March Mixed cullet prices continue to show a gate fee of around 8 per tonne. Recovered steel and mixed metal can prices rebounded sharply during the three months to March The recovery was supported, in part by the partial recovery in virgin metal prices during Q Despite the recent increase, recovered metal can prices remain around 30%-50% below year earlier levels. Recovered textile prices fell by around 30 per tonne (10%-15%) between December 2015 and March Recovered textile prices are now some 25%-30% below year earlier levels. Wood waste gate fees (low grade) are broadly stable at per tonne. Gate fees have remained high due to a combination of biomass plant maintenance issues, storage restrictions plus low export demand (due to the mild winter).

2 Table 1: Key recovered material and commodity prices % change per tonne Mar-15 Dec-15 Mar-16 Dec-15 to Mar-16 One year Recovered paper OCC % 39% News & PAMs % 74% Mixed % 52% Recovered plastic bottles Clear PET % -23% Coloured PET % -5% Mixed HDPE % -9% Mixed polymer % -18% Natural HDPE % -19% Recovered cans Aluminium % -28% Steel % -47% Mixed % -47% Glass Clear % 15% Amber % 400% Green % 14% Mixed % n/a Textiles Banks % -29% Charity Shops % -25% Virgin commodities Pulp (NBSK) % -8% PET % 2% HDPE % 12% LDPE % 8% Cotton % -3% Aluminium (LME) % -9% Steel (NWE HR Coil) % -11% Energy Oil (Brent, per barrel) % -30% Sources: WRAP Materials Pricing Report, Thomson Reuters Datastream Note: Percentage changes are based on the mid-points of the ranges where applicable.

3 RECOVERED MATERIAL MARKETS Plastics The price of recovered clear PET bottles rose by 8 per tonne between December 2015 and March 2016 to 103 per tonne. Coloured PET bottle prices also increased, rising to 40 per tonne. In contrast recovered HDPE bottle prices fell with natural HDPE bottles down 25 per tonne to 325 per tonne and mixed HDPE bottle prices declining by 10 per tonne to 120 per tonne. Mixed polymer bottle prices (typically a mixture of both PET and HDPE bottles) increased by 13 per tonne to just under 70 per tonne. Meanwhile, virgin PET and HDPE prices fell by around 2% to almost 660 per tonne and 930 per tonne respectively. The UK exported 791kt of recovered plastic during 2015, up 4% compared with Around 64% of the UK's recovered plastic exports were sent directly to reprocessors in China/Hong Kong, down from 65% in In total, China imported 7.4 Mt of recovered plastic (from all countries) during 2015, down 11% compared with 2014 and the lowest level since quarterly tonnage). Over the whole year an estimated 891kt of plastic packaging was recycled, up 6% compared with The 2015 plastic packaging target of 851kt (net of carryover from 2014) was comfortably met. Plastic PRN prices, which had peaked at up to 75 per tonne during Q4 2015, have remained strong into 2016 with prices being supported around per tonne during the first quarter of In the Budget it was announced that the existing plastic packaging recycling target of 52% for 2016 will be reduced to 49%, and then increase by 2% each year to 2020 (the target had been due to increase to 57% in 2017). Paper The price of news & PAMs and OCC both increased by 7% in the three months to March 2016 to 80 per tonne and 75 per tonne respectively, while mixed paper and board prices are stable at 50 per tonne. Recovered paper prices appear to have seen a sharp price increase over the past twelve months (e.g. news & PAM prices are up 74% versus March 2015), however this is a base effect following the closure of the Aylesford newsprint mill during February/March Virgin pulp prices (a substitute in the manufacture of paper products) increased by 3% during the three months to March 2016 to 555 per tonne. Virgin pulp prices are down 8% compared with year earlier levels. Plastic packaging recycling compliance data shows that 263kt was recycled during Q4 2015, up 23% on year earlier levels. The sharp increase in Q4 tonnage was supported by a 56kt increase in exports to 180kt (a record The UK exported 5 Mt of recovered paper during 2015, up 11% compared with Just over 70% of the UK's exported recovered paper and board was sent to China in 2015, unchanged versus China imported 29.3 Mt of recovered paper (from all countries) during 2015, up 6% compared with The UK s market share of China s recovered paper imports is unchanged at 12%.

4 The rebound in recovered metal can prices has been supported by higher virgin metal prices; virgin aluminium rose by 8% in the first quarter of 2016 to 1,084 per tonne while steel (hot rolled coil) increased by 13% to 259 per tonne. Paper PRN prices, which had peaked at around 5 per tonne during Nov/Dec 2015 on fears that the overall recovery target would not be met fell to 1-2 per tonne in early 2016 after data showed that all packaging recycling targets, including paper and recovery were met. Glass Clear and amber cullet prices rose by 15% between December 2015 and March 2016 to 23 per tonne and 15 per tonne respectively. Over the same period, green cullet prices increased by 3 per tonne to 8 per tonne. Mixed cullet prices continue to show a gate fee of around 8 per tonne. Aluminium packaging recycling compliance data shows that 47kt was recycled during the second half of 2015, up 20% compared with the same period in 2014 and a record tonnage recycled. The increase in overall aluminium recycling was supported by a rise in aluminium packaging exported for recycling, totalling 18kt during the second half of Overall, 76kt of aluminium packaging was recycled during 2015, meeting its obligation for the year (net of carryover). Aluminium PRN prices fell from around 60 per tonne in December 2015 to per tonne during Q Steel packaging recycling compliance data shows that 364kt was recycled during 2015, up 2% compared with 2014 meeting its obligation for the year (net of carryover). Steel PRN prices declined from around 40 per tonne in December 2015 to 25 per tonne in early Glass packaging recycling compliance data shows that 1.6 Mt was recycled during 2015, down 2% versus 2014 but meeting its 2015 obligation. Glass PRN prices have remained stable around 10 per tonne into early Aluminium & steel Recovered can prices recovered somewhat during the three months to March Aluminium can prices jumped by 60 per tonne to 560 per tonne by the end of Q1 2016, although prices remain almost 30% below year earlier levels. Steel can prices increased from 15 per tonne in December 2015 to almost 45 per tonne in March Meanwhile mixed can prices almost doubled to 60 per tonne in March. Both steel and mixed can prices are around 50% below March 2015 levels. Textiles Recovered textile prices fell by around 30 per tonne between December 2015 and March 2016 and are now some 25%-30% below year earlier levels. Textiles sourced from banks are valued at around 180 per tonne while charity shop textiles (the value that a charity receives for charity shop clothing sold to merchants that collect the garments from the shop) are valued at around 243 per tonne. Note that the quality of the textiles collected and transport costs may have a significant impact on the overall price achieved. Wood Recovered wood gate fees remain high at around per tonne for low grade material. Maintenance issues at a number of biomass plants, storage restrictions plus low

5 export demand (due to the mild winter) are thought to be behind the continued high gate fees. WRAP Economics Team March 2016

6 Glossary CPI Confederation of Paper Industries EA Environment Agency HDPE High density polyethylene HMRC Her Majesty s Revenue & Customs kt Thousand tonnes LDPE Low density polyethylene Mt Million tonnes News & PAMs Newspapers & magazines NPWD National Packaging Waste Database OCC Old corrugated cardboard PET Polyethylene terephthalate PRN Packaging Recovery Note While steps have been taken to ensure its accuracy, WRAP cannot accept responsibility or be held liable to any person for any loss or damage arising out of or in connection with this information being inaccurate, incomplete or misleading. For more detail, please refer to our Terms & Conditions on our website: Printed on xx% recycled content paper