Recycling back from the brink as prices stabilise
published by www.packagingnews.co.uk on 02.12.08
Prices for recovered packaging materials are showing signs of stabilising following a crash, although the jury is still out on how long it will take for the market to fully recover.
Last month, the price of recovered paper reached £1 a tonne, while recovered plastic and steel hit zero, prompting fears of a collapse of the UK's recycling system and household waste collections ending up in landfill.
The crash highlighted the country's dependence on exporting waste, particularly to China. The market was already bracing for the effect of the credit crunch, as demand from the construction and automotive industries fell, which was further compounded by the Chinese decision not to accept mixed waste.
"The Far East is our biggest market for recycled materials, and any change has a dramatic impact on the UK," said Ian Wakelin, chief executive of recycling firm Greenstar.
As a result of falling prices, the Environment Agency (EA) issued guidance for the safe storage of materials in order to maintain consumer confidence in recycling and avoiding sending waste to landfill.
But Jonathan Short, chief executive of recycling firm AWS Ecoplastics, urged waste collectors not to stockpile material in the hope that the price would go up in the next couple of months. "If you can shift the material now, I'd shift it," he told Packaging News.
Short recognised that prices had started to stabilise, but maintained they would remain low for some time due to the global recession. "People are having to get used to lower prices," he said.
However, Greenstar's Wakelin was more confident of the market picking up again within three months, saying there were the first signs of a "bottoming out and recovery". "Prices and demand for all recovered materials have gone up, although plastics remains a challenge," he said.
Local councils, meanwhile, have been urged to stock-pile materials. The Local Government Association (LGA) recommended the action, suggesting it is pinning its hopes on a medium-term recovery.
"If councils are unable to secure buyers for recyclable material, short-term storage should be explored as the most sensible option," said LGA chairman Cllr Paul Bettison.
Bettison said that if longer term storage was necessary it would press the EA for extra facilities, and called on councils to consider composting and energy from waste to avoid having to send material to landfill.
The Advisory Committee on Packaging has said this year's recycling targets are "just about achievable" despite the market collapse. Chairman John Turner warned, however, that there would be "difficulties in a number of areas", particularly those who had "left compliance to the last minute".
