The second quarterly data release of 2023 shows strong production and steady recovery across most for the 2023 compliance year thus far however, the boost from the Q2 data for each grade was reduced in comparison to the Q1 data release boost. This reduction could reflect improved monthly reporting from reprocessors rather than reduced productions levels, across all grades we are in a better position than where we were at this stage in the 2022 compliance year. It is also important to note that although we saw a reduction in overall recycling obligation, there are still a number of companies yet to register for 2023. This is likely to mean with full demand unknown, prices are likely to stay high across most key grades in the immediate term.
Progress Towards 2023 Recycling Targets: Q2 Data release
Paper and Board
There was substantial boost in production for Paper and Board for Q2 of 2023 with a +67,300 increase (overall production, 2,004,263t), this brings Paper and Board 325,000t ahead of its year-to-date target however, it’s important to mention that Paper and Boards oversupply will feed into the General Recycling obligation.
Compared to Q2 of 2022, Paper and Board is in a positive position for this stage of the year. Global factors such as the energy crisis and European war caused issues around availability and in exports last year however, the impact of these factors is beginning to subside which is positive to see.
Glass Re-melt and Glass Other
In Q2 of the 2023 compliance year, there was a +43,550t boost to the data (overall production, 683,487t), bringing Glass Re-melt 80,000t ahead of its year-to-date target with 683,487 Glass Re-melt PRNs produced in 2023 so far.
Glass Other received a +10,472t boost from the Q2 mandatory reporting (overall production, 237,417t). Despite this boost, Glass Other remains just behind target (-762t), which although disappointing to see, the boost in data has left this grade, although still behind, on the right track to meeting its year-to-date target. We hope to see a continued strong performance from this grade in the coming months.
It’s important to note that the deficit between Glass Other and Glass re-melt, can be met through Re-melts oversupply meaning that Glass overall is in a strong position.
We saw a reasonable increase (+4,306t) from the Q2 mandatory reporting with 79,307 of Aluminium PRNs produced so far in 2023. This leaves Alu 6,160t ahead of its year-to-date target and in a strong position for the second half of the year. As with all the grades, we are working with an obligation that is due to increase as more businesses register with the Environment Agency for the 2023 compliance year, with few aluminium reprocessors and exporters this could be a grade considered at risk of falling behind.
Steel is often one to watch in the quarterly data releases as this grade usually receives a large boost however, this year Steel received only a 13,882t boost bringing its overall production to 211,588t. This is a -67.71% decrease compared to the boost Steel received in the 2022 Q2 data release. This decrease could suggest that the voluntary monthly reporting from Steel reprocessors has improved from last year rather than representing a decrease in production. Steel remains ahead of its year-to-date target by 40,244t, leaving this grade in an advantageous position for the second half of the year.
Plastic received a +31,987t increase from the Q2 mandatory reporting, bringing Plastic to 575,807t overall production and 26,512t ahead of its year-to-date target which for this point in the year we would have liked to see Plastic in a more comfortable position. For Plastic, this is a small boost (-35.8% decrease compared to the 2023 Q1 data release boost) which could be why the PRN price remains high. With many businesses still yet to register and an expectation of the overall obligation to increase, this grade requires continuous review as companies submit their packaging data.
Wood had another strong production month as well as receiving a +60,425t boost from the 2023 Q2 mandatory data reporting, leaving this grade a comfortable 176,733t ahead of its year-to-date target (overall production, 343,939). Despite being ahead of target, due to Woods overperformance this grade is usually used to ease the strain on the General Recycling obligation as well as many companies still yet to register for the 2023 compliance year, there is still some potential for this grade to fall behind.
Ed Ewence, Assistant Commercial Director, Clarity Environmental continues:
“Initially there were some concerns around Glass as with high interest rates and the impact of the cost of living crisis, the public consume less bottled beverages as well as factoring in a reduction in wine sales however, Glass from other waste streams appears to be compensating for this as Glass Re-melt figures look positive.
Despite these figures suggesting a less volatile market, caution is urged as the currently available obligation data is incomplete and the PRN volume requirement for 2023 will increase as producers continue to make late submissions over the coming months.”
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