The year 2022 started with positive sentiment following clarity on the shipment of plastic waste from Europe to non-OECD countries through an amendment to the Waste Shipment Regulation 1418/2007. Throughout the year before, EU traders looking to export to these non-OECD countries faced much uncertainty in the international buying and selling of plastic scrap. Most importing countries had given positive replies to European Commission when asked about allowing recovered plastics into their countries.
When the Basel Convention amendment came into force on 1 January 2021, it had been thought that India, Pakistan, and Bangladesh were either on the green list or had indicated agreement with the commission to allow plastics in. But when the amendment to Waste Shipment Regulation 1418/2007 was published at the middle of October, it was noticed that shipments to India and Pakistan still fell under the notification process and Bangladesh had banned the shipment of plastic scrap from Europe.
Recyclers in these countries had been working hard to correct a situation that appeared to have resulted from a lack of clarity or even miscommunication between the authorities. The impasse has now been resolved.
Collection worries
Apart from challenges in international trade, the availability of plastic scrap within Europe remains a big concern for the exporters and recyclers. The collection volumes of good plastic material available for trade is reducing continuously. Many convertors are looking to install small recycling plants in-house to recover their own waste and lower the amount of waste they are putting on the market. A scarcity of plastic scrap is pushing up prices.
Since the end of 2021, the price of LDPE film scrap has jumped by almost EUR 30-40 per tonne, largely due to the non-availability of prime material. LDPE Natural has exceeded EUR 500 per tonne ex works. Recyclers in Europe are paying over EUR 600 per tonne for the same material delivered to their plant. In this scenario, Asian recyclers are under pressure and are buying minimum quantities to keep their plants running. Such prices are not sustainable for them in long run.
Granules demand
Another reason for soaring prices of plastic waste is high demand for recycled granules. Many convertors are now actively seeking to use a percentage of recycled plastic in their packaging to reduce their carbon footprint, even though there can be technical and quality issues in replacing the standard prime plastic. Such efforts to use more recyclables in packaging is on the agenda of many European countries and some have already decided to make it mandatory to drive a circular economy.
In some cases, such as in the UK, a tax of £200 per tonne is to be levied from 1 April on packaging placed on the market that does not have a minimum of 30% recycled content.
Crude rockets
Prices of plastic scrap are expected to remain high as the products continue to be preferred to prime plastics. Since the turn of the year, customers and convertors have not been buying prime plastics at unaffordable levels, anticipating a fall in prices. But prices are not coming down due to low availability and high raw material costs. Nymex listed WTI crude oil prices at US$ 75 per bbl.
Fuente: Recyclinginternational