UK: glass PRN prices quadruple

The adverse weather conditions in December 2010, along with a fraud investigation at Nationwide Recycling – a major glass reprocessor in Wales – have led to UK packaging recovery note (PRN) prices qua…

The adverse weather conditions in December 2010, along with a fraud investigation at Nationwide Recycling – a major glass reprocessor in Wales – have led to UK packaging recovery note (PRN) prices quadrupling in a month. Figures from The Environment Exchange show that PRNs for glass were trading at over GBP 40 per tonne up from just GBP 8.50 in December. Nationwide Recycling was suspended from issuing PRNs by the Environment Agency in December after an investigation lasting a year by the EA into fraud, illegal waste activities and money laundering at its plant near Swansea. The suspension led to contracts being broken and a severe supply shortage for PRNs, Ian Andrews, senior market operator at The Environment Exchange said. In December, adverse weather conditions hindered the collection of glass recyclate, which in turn reduced the generation of PRNs. The suspension of the reprocessor meant that contracts were broken and buyers had to find PRNs elsewhere, creating additional demand and a sense of panic among buyers. Environment Exchange managing director Angus McPherson added that a certain element of panic among buyers had made the glass market look more out of kilter than it really is. Gareth Goodall, director of markets at PRN trading platform Scrap-ex, said that the issues at Nationwide and with the snow were behind the spike but played down the long-term effect. I think this just shows that PRN prices can go up as well as down although we didn“t see much of that in 2010, he said. On our forward markets we have selling interest around the GBP 15 level for glass PRNs, which is up around GBP 2.50 over the last week or so. We have also seen a firming up of prices on other PRN classes on the scrap-ex forward markets. Most of the interest now is on the forwards, not the 2010 other than the glass.