2018 Q1 Reprocessing & Export Supply Figures
Collectively, the Glass supply looks reasonably comfortable although Aggregate supply continues to decrease with the shortfall being covered by increased Remelt tonnage. If the trend was to continue then one would expect both note values to align.
Some will have been slightly shocked by the strength of the recently released supply figures as Plastic had reported Q1 supply at 322KT. This was quickly revised down to 251KT for the quarter bringing it closer to the projected quarterly demand. Although slightly behind the 2017 Q1 figure (261KT) some sellers are still to finalise their return and it is hoped that when complete the figure will be in line with demand expectations. Plastic prices are expected to hold at current levels for the next quarter to ensure supply is secured.
In Paper, a 140k decrease from the same period in 2017 has resulted in prices increasing. It may be that we are finally seeing the effect of the export ban on Mixed Paper grades into to China. Paper demand is expected to increase this year with the general recycling pot requiring significant excess tonnage from this market. In the short term one would expect some further upward pressure on the price.
Wood supply is down on the same period last year even in light of the fact that we have seen trading open at historically high levels this year. As with Paper, it is expected this market will see further price increases in the short term. With the Wood market unable to provide supply for the general recycling pot other markets will need to produce significant surplus to make up the shortfall.
The Q1 figures show that Steel is producing an excess but unfortunately at current levels it will fail to accommodate the anticipated increase in general recycling demand. Weak early pricing has done little to incentivise sellers and this market remains finely balanced going forward.
In Aluminium we are on track however the reduced carry in tonnage has ensured close attention is paid to this year’s supply as a weak quarter could result in significant upward pressure on prices.
Finally, The EFW market continues to produce significant surplus and based on the most recent figures prices should remain at the bottom end of the scale for the foreseeable future.
- Ian Andrews