Reasonable progress was made in August overall, but with only 3 out of 7 grades meeting their monthly target we will need to see consistent uplift in production rates to meet the yearly targets. This month’s data highlights continued issues with exports and increasing costs across the supply chain. For this data set it is important to keep in mind that although the Environment Agency have released the 2022 obligation, several large producers are yet to submit their data, so, like most of the industry, we are working from a projected obligation.
August data released
Reasonable progress was made in August overall, but with only 3 out of 7 grades meeting their monthly target we will need to see consistent uplift in production rates to meet the yearly targets.
At 300,000T for August we’ve seen notable improvement in paper production since last month and a surpassing of the monthly requirement. Whilst this is an improvement, a difficult commodities market means there’s still ground to regain. Capacity in European mills has slightly improved as shutdowns often occur over the summer.
After a particularly slow July, it’s great to see a boost in plastic production (90KT) despite the impact of export difficulties and increasing fuel costs. However, we will need to see a continued upturn across the coming months to remain on target.
In August we produced 128KT of glass remelt which is very consistent with how remelt performed last month; due to the current deficit between the glass grades we would need to see a similar performance across the next couple of months in order to get back on target.
One of the strongest performances of the year from glass other at 45KT, despite this, the performance is only in line with the monthly requirement so there are still significant increases in production needed across the coming months in order to get back on target.
Whilst remelt looks set to be close to target, concerns among the glass industry are very much around the glass other production. With the increasing cost of the glass other PRN, it is possible we will see an upturn in glass other production over the coming months.
Steel fell just short of its monthly requirement (20KT); however, this is a grade that typically sees a large uplift in reports following the release of the quarterly data (as we saw in Q1 and Q2).
Aluminium is performing reliably at 10KT production this month; however, this is one of the grades where we can see the most impact from the confirmed obligation which is still causing weariness in steel reprocessors.
Wood continues to be way ahead of target (50KT) having already surpassed its total obligation for the year however this is tied in with General Recycling which we are still trailing behind on target for.
“August was a stronger month than the previous, however, concerns over glass aggregate continue. After July’s weak performance, it’s good to see plastic and paper beginning to get back on target and with most paper mills planned shutdowns now over, we hope to see a consistent strong performance from paper.
Although there are positive expectations that some of the weaker grades will improve over the coming months, it is important not to underestimate the significant impact of increasing energy costs across the supply chain at home and abroad could have on recycling rates.”