Progress Against Recycling Targets: 2024 Q2 PRN Market Review

The latest recycling figures for Q2 of 2024, released by the Environment Agency, reinforce the production trends seen in Q1, with most grades maintaining or improving their positions against targets. The overall outlook can be viewed as optimistic, however, as always, in the PRN system, balancing optimism with caution is the best approach as national and international market conditions can change quickly and in some cases change dramatically and unexpectedly. The purpose of this article is to share the information across the grades so business communications regarding PRNs can be fully informed whilst also remaining balanced and not allowing trends to create future risks.

Despite an addition of 105,379 tonnes to the previous figures released earlier in July, Paper experienced a 5.5% decrease in production compared to Q1. However, Paper remains significantly ahead of its target by 23.5% equivalent to 385,611 tonnes, indicating strong performance despite the dip.

Aluminium saw a 15.7% increase in production from the previous quarter, placing it 5,698 tonnes ahead of target. The PRN market, expecting the data, saw significant price drops as tonnage production met obligation targets. We might see the downtrend continue from here however there are many factors which can alter the trajectory of market movement.

Steel production increased by 2.1% compared to Q1. Though this modest improvement may not be enough to affect the market from a long-lasting flat trend, Steel remains on a stable trajectory maintaining its lead over the target with a surplus of 24,416 tonnes, but PRN production could also be affected with production pauses in the UK Steel as furnaces are modernised.

Glass Remelt had a strong Q2, with an 8.9% increase from Q1, pushing it ahead of its requirements to date. The material is now 6,863 tonnes/1% ahead of target. The facility of December transitional PRNs to move tonnage into 2025 could have an impact unless production radically increases, or obligation radically decreases.

Glass Other (Aggregates) showed a 3.7% increase from the previous quarter, keeping it ahead of target. The PRN market for Glass Other has softened recently, there is the possibility that this will continue.

Plastic production remained relatively consistent with a 0.6% increase from Q1 figures. Despite this, Plastic is on track to meet its target for 2024, and this may also lead to good carryover figures into 2025. A note of caution is that when plastic prices decrease, production can slow down dramatically.

Wood saw a significant 31.4% drop in production in Q2. However, it remains well ahead of its target by 105,650 tonnes, indicating no immediate cause for concern.

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