New Zealand: import levy only partial solution to glass price problem

Most of the New Zealand glass packaging industry has agreed to pay a levy on imported glass for the next six months to ensure recycling continues despite a NZD 82 a tonne fall in the price for clear g…

Most of the New Zealand glass packaging industry has agreed to pay a levy on imported glass for the next six months to ensure recycling continues despite a NZD 82 a tonne fall in the price for clear glass, the New Zealand Packaging Accord announced. The main buyer of recycled glass, ACI Glass in Auckland, cut the price it pays for all glass from NZD 92 a tonne to NZD 75 a tonne early in 2005. The price paid for clear glass plummeted to just NZD 10 a tonne at the beginning of May 2005. City councils have seen their stockpiles of glass for recycling grow as the price fell. In the city of Nelson on the north coast of South Island, the chief executive of contractor Nelmac said that while the levy announcement was “a start”, its usefulness depended on the amount recyclers would be subsidised. Malcolm Topliss added that Nelmac needed glass of all colours to be subsidised up to the NZD 92 a tonne it started at. Subsidising clear glass up to NZD 75 a tonne would be “better than nothing, but it doesn“t solve our problem really”, Mr Topliss said. For commercial reasons, Nelmac did not disclose how much money it has lost on glass, but said the price cuts work out to NZD 37,000 less annually. Before the cuts, Nelmac had been breaking even, rather than profiting from glass, because of the high cost of freight to Auckland. “Long term we really have to find a viable solution for the region and obviously that will continue to be looked at, but this gives us a bit of breathing space I suppose.” Council engineer Andrew James said a decision would be made on whether to restart sending clear glass to Auckland once more details were available. Packaging Accord communications manager Lyn Mayes said the levy would be imposed on all glass imported into New Zealand. It was likely to be a small amount, about one cent per bottle or glass item. The aim was to subsidise clear glass up to the NZD 75 paid for other colours, she said. The accord members who have accepted the levy are ACI Glass, Sutton Group, Coca Cola Amatil, Lion Nathan, Foodstuffs, Progressive Enterprises, Frucor Beverages, Fosters Group, Endeavour Glass and DB Breweries.