Prices being recorded for paper packaging recovery notes (PRNs) have soared beyond £30 this month for the first time since 2002, on the back difficulties in the export market and the compliance target “sailing close to the wind”.
This comes amid a general rise in the cost of PRNs for all materials, as concerns grow over targets and the amount of ‘carry over’ PRNs which will be taken into next year.
However, the ups and downs are said to form part of the system, with the PRN value stepping in to help where recycling is struggling.
Elsewhere, concerns have been raised that if export outlets dry up for paper, it could more likely end up being sent for energy recovery as recycling options become expensive.
This could be exasperated by strikes at docks, which have begun in Felixstowe and are also planned for Liverpool. Mills in Germany are reportedly “well stocked” and taking extended downtime to deal with energy price rises, while the far-east is reporting lower demand and India “wants to drive the price down”.
With around 40% of paper recycled domestically, these could impact the availability of the export sector for paper exports.
While on track to hit its target this year, paper isn’t in as strong of a position as normal, with provisional data showing 52% of the target has been reached in the first half of the year.
This is because paper usually contributes largely to the general pot and takes a large amount of carry over into the following year.
This year, carry over tonnage is “being eaten into and it’s eroding”.
As a result, more people are reportedly beginning to buy PRNs at the current price due to fears of even more rises, causing a further knock-on effect, with many tipping them to continue rising.