In March, DEFRA announced that the Government will bring forward legislation to set new targets for packaging recycling and recovery from 2013 – 2017. The headline is an annual increase in the overall recovery rate of 1% per year taking us from 74% to 79% which does not alarm us.
The painful detail is:
- An annual increase of 5% for plastic, taking plastic from 32% to 57%,
- 3% percent annum for aluminium, taking aluminium from 40% to 55% and
- A more modest 1% per annum for steel bringing it from 71% to 76%.
- A more modest 1% per annum for overall recovery bringing it from 74% to 79%.
At first sight this does not look too worrying until we realise that in 2013 we will need to increase the amount of plastic packaging recycled from just over 600,000t to just under 700,000t. This is a jump of about 15% in real numbers, and the annual ‘carry forward’, the slack in the system, is only about 20,000t. In 2013, to maintain the status quo, the UK will have to recycle an additional 100,000t of waste packaging plastics. This will impact the price of PRN’s and I expect that the price of plastic PRN’s will rise to between £20 and £50 per tonne to create the extra incentive needed to get re-processors to handle this extra tonnage.
The proposed amendments will also change the way that we count glass PRN’s. It is proposed to set a minimum target of 63% of glass PRN’s to be issued by re-processors who melt the glass and cap the number of PRN’s that can be bought from re-processors who produce aggregates to 37%. The glass market should be able to cope with this but there will inevitably be some uncertainty and we hope that this will not make too much difference to the price of glass PRN’s, although it is not too long since glass PRN’s were over £20 per tonne.
We will hold a seminar to explain the changes once the legislation has been published.