WRAP’s market reports provide in-depth information on the latest economic trends and developments facing the UK’s recycling industry. Each report focuses on a different material stream and is presented in a compact, easily digestible format.
- 30% glass containers produced in the UK have an average recycled content of 30 per cent
- 385,000 glass recycling saved around 385,000 tonnes of CO2 emissions over the past year, equivalent to taking more than 120,000 cars off the road
Overview
In January 2007, we published the first glass Market Situation Report. This update considers how the market for recovered glass (cullet) in the UK has since been impacted by developments in the UK glass manufacturing sector, collection trends and prices of cullet and packaging recovery notes (PRNs). In addition, this report focuses on the influence of recent increases in energy and raw materials prices, and trends in the international trade in cullet.
Key themes have emerged from the glass recycling sector in 2007/08:
- the cost of producing glass has continued to increase, driven by rising energy costs and raw materials prices
- glass recovery has increased over the past year, yet cullet consumption by UK container manufacturers remains below its peak
- industry contacts indicate that shortages of high quality cullet have intensified
- and accordingly, prices for colour-separated cullet have increased.
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Chapters
An overview of the market
Around 1.5 million tonnes of container glass were recycled in the twelve months to June 2008, 200,000 tonnes more than a year earlier.
However, although there was an increase in the amount of cullet going into remelt applications – including domestic container manufacture, glass wool and export – the majority of the increase was absorbed by the aggregates market.
Moreover, the amount of cullet used by the UK container manufacturing industry remains substantially below the peak reached in 2006.
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Collection trends
The increase in the municipal collection rate continues to be driven by an increase in kerbside collections. Around 55 per cent of the glass recovered from the municipal waste stream is now collected via kerbside schemes compared with 50 per cent a year earlier.
However, the number of local authorities with kerbside glass collection schemes has remained unchanged over the past year at around 300, representing 70 per cent of the UK’s local authorities.
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Recent developments in the UK glass manufacturing sector
The UK glass manufacturing industry produced around 4 million tonnes of glass in 2007, about 15 per cent more than in 2005.
Between 2005 and 2007, container glass production increased by around 200,000 tonnes to 2.3 million tonnes. Roughly half of the increase came from higher amber glass production. Industry data suggest that container output is likely to continue to grow steadily over the coming years – production is forecast to increase by 1-2 per cent per annum – although competition from other materials, such as plastic, and initiatives to lightweight glass containers, may lead to weaker growth.
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Recent developments in the UK glass manufacturing sector
Cullet and PRN prices
After a period of stability in 2007, prices for colour-separated cullet have increased in recent months. Market contacts indicate that this reflects a number of factors.
First, a shortage of high-quality colour-separated cullet, which is attributed to the growth in mixed-colour and comingled kerbside collections.
Second, rising virgin materials and energy prices, which have increased demand for cullet. The sharp increase in green cullet prices since early 2007 is consistent with the market for green cullet no longer being in excess supply. Mixed cullet prices, meanwhile, have received support from strong export and aggregate demand.
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Raw materials and energy prices
The main raw materials required to manufacture virgin container glass are silica sand, soda ash and limestone. By looking at the total batch costs for these materials it is possible to derive a shadow price for cullet used as a substitute for these raw materials.
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Raw materials and energy prices
International trade
Exports of cullet from the UK have increased sharply in recent years. The majority of exports from the UK are to Spain, Italy and Portugal for closed-loop recycling into wine bottles (Graph 8), with exports to Portugal in particular growing rapidly.
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Challenges ahead
Despite an increase in glass recovery, cullet consumption by UK container glass manufacturers fell in 2007.
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Case study
A case study of Recresco, an innovative glass recycling company opening a new reprocessing plant.
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DownloadGlass Market Situation report - Autumn 2008
PDF, 3.58 MB