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UK Government Publishes Recycling Targets for 2020

8th March 2017

As part of the Spring Budget 2017, the Chancellor, Philip Hammond, has revealed the 2020 recycling targets for all packaging materials. This follows on from the 2016 Spring Budget, in which targets for glass and plastic recycling were announced. These targets are displayed in Table 1  below. No specific targets for 2018 and 2019 have yet been announced for paper, aluminium, steel, and wood, overall recycling, and recovery targets in these years. This differs from the equivalent announcement for glass and plastic one year ago. As shown in Table 1, the new targets are a reasonable shift from the 2017 targets, with a greater increase than has been seen from previous years. These ambitious targets are, perhaps, a message of intent from the first Spring Budget of Theresa May’s government with regard to recycling and the UK’s environmental credentials.

These ambitious targets could lead to increases in PRN prices, as a consequence of a shortfall of material available to meet the target, and thus an increase in recycler costs. Concern about PRN price increases is most significant for wood PRN. This is due to the large increase in the recycling target and competition in demand for waste wood from other re-uses, such as in the production of energy. Following a nine percentage point increase in target by 2020, there may be an additional rise in aluminium and steel PRN price. Concern may be lower than for wood, due to a smaller increase in addition to less demand for used aluminium outside recycling.

The consequences of the new targets upon the UK circular economy and the PRN market will certainly be interesting in the coming few years.