The Environment Agency has today (4/3/19) released the Q4 unverified packaging recycling data.
The data holds a large importance when determining the UK’s recycling performance and PRN market. Our expert team have analysed this as it provides a good indication of recycling levels and how 2018 may have been concluded. However, the data released at this stage is unverified and we will be publishing a full update upon release of the verified data when it is released at the end of March.
The release of Q4’s recycling data is much anticipated after verified Q3 figures showed a host of materials were very tight to their respective UK Recycling Targets, meaning it was important we had a positive quarter in terms of recycling levels.
We have provided a summary as follows of each material's recycling performance indicated by the data below, along with graphs showing the percentage of recycled material against the targets using the latest UK obligation data.
Figure 1: Recycling rates after Q4 excluding carry in tonnages from December 2017
Figure 2: Recycling Rates after Q4 including carry in tonnages from December 2017
Please note – PRNs generated in December can be used in either the year they are generated or the following compliance year. ‘Carry-in’ PRNs are PRNs generated in December that were not required in the compliance year they were raised in so they are carried forward for use in the following year. Please see above graphs showing Q4 recycling data both with and without carry in tonnages taken into consideration
After Q3 Paper had nearly reached its own material specific recycling target, however, PRN prices remained high due to the need for the UK to fill its ‘General Recycling’ target. The unverified data shows that without carry in from 2017 being taken into account, Paper finishes 22% above its target and therefore confirms that a good proportion of General Recycling obligation will have been met using paper PRN’s.
Throughout 2018 Glass Other has performed poorly and therefore Glass Remelt levels have been regularly relied upon to make up any deficit in the Total Glass progress. As you can see above from the Q4 figures, even with carry in Glass Other only reached 63%, however, Glass Remelt reaching over 120% has meant that for Total Glass we have reached the annual target.
Despite Q3 recycling figures indicating Aluminium was just about on track to hit the target, PRN prices for this material rose to high levels due to a lack of supply within the market. The Q4 figures show that the performance levels were sustained and without taking carry in levels into account, it reached 102%. Prices in the PRN market remain high and the Environment Agency is continuing to look into the Aluminium market, recycling levels and Aluminium PRN’s.
Much like Paper, Steel had already hit its own material specific target in Q3 and Q4 data now confirms this. Again like Paper, it suggests that Steel tonnages may also have been used against General Recycling in order to hit the UK's annual target, which is why PRN prices towards the back end of 2018 remained high.
Plastic has been of key interest throughout all of 2018 and this remains the case. Now well-documented issues such as export difficulties, the loss of the Chinese market and the ‘Blue Planet effect’ have meant that more people than ever are now aware of the continued delicacy and need for improvement within Plastic recycling sector, making the Q4 data ever important.
The Q4 data shows that without carry in tonnages from December 2017 being taken into account, we only reach 96% of the annual recycling target and when carry in is used, we only just reach the target at 102%. This means that the carry in tonnages which usually act as an ‘insurance policy’ or a ‘head start’ for the next compliance year have been used in order for the UK to hit the level required for compliance in 2018. As the carry in reserve is being utilized it means that the UK will start 2019 with another increased recycling target (meaning more Plastic PRN’s need to be generated to reach compliance) while also having a greatly depleted level of carry in PRN’s. In response, the PRN market has remained volatile with very high PRN prices continuing to rise.
Wood levels look to have reached around the 110% mark for the close of 2018 which is very positive and suggests the balance of feedstocks reaching Biomass compared to recycling routes which generate PRN’s may be changing. PRN prices remain high as further increases of recycling target come into effect for 2019 meaning once again demand for Wood PRN’s has risen.
- Energy from Waste (EfW) or Recovery
As with the other three quarters of 2018, Energy from Waste (EfW) performed well, surpassing its recycling target comfortably. This resulted in a very stable PRN market and therefore a stable price which is expected to continue into 2019.
Alongside the recycling data release, the Environment Agency has also published unverified data regarding the carry in levels which will roll into 2019. These tonnages will be more important than ever with 2018’s performance being tight to target for a host of materials as well as 2019 recycling targets once again being confirmed as increasing.
Figure 3. Unverified Carry in levels comparing 2018 and 2019
The three materials which show a reduced carry over when compared to last year are Paper, Steel and Plastic. The reliance on Paper and Steel to fill General Recycling in 2018 has meant more of these tonnages will have been used up in helping reach 2018 compliance, and therefore less tonnage is now available to be rolled over into 2019.
The poor performance of Plastic throughout 2018 meant that tonnages which would usually be rolled over to 2019, were used to meet Plastic’s own 2018 recycling target and means this year’s carry in levels are about a third of what they were last year. This is concerning as carry in was required to meet compliance in 2018 and will more than likely be needed once again in 2019, a year where more PRN’s than ever before will need to be produced to reach compliance. PRN rates have already risen in response to the data release and do have the potential to continue to rise. This data makes 2019 Q1 recycling figures for Plastic very important as it may take much-improved levels (compared to 2018) in order to slow the price rises in the PRN market.
Comply Direct Members
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PRN Market Update Webinar
Wednesday 24 April at 10:00am
During this webinar, we will provide a review of the 2018 recycling performance. Plus this will be our first look at recycling data for 2019, with a review of the UK's Q1 verified recycling data from the Environment Agency. Register your free place
Please look out for our verified news story at the end of March. If you have any questions about the data, please don't hesitate to contact your account manager or Sarah Foster or Ashley Clay at firstname.lastname@example.org or call 01756 794 951.