Uncertainty hits PRN marketplace after brewers ruling

Consulted by Valpak and the Environment Agency, last week's ruling found that brewers are not responsible for the 'seller' recycling obligation on the packaging of products consumed on licensed premises (see letsrecycle.com article).

A large number of licensed premises will fall below the threshold for the regulations, especially since many independent pubs and bars with a turnover of less than 2 million a year are handling less than 50 tonnes of packaging a year. Accordingly, there could be a sharp drop in demand for PRNs.

With less PRN money around for glass reprocessors, this may have a knock-on effect on glass prices, since firms selling PRNs at a lower price will not be able to pay current rates for cullet.

However, there are some who believe many pubs and clubs in the country will be large enough to fall under recycling directives, especially chains. Valpak's Jeremy Cuthbert said: “The majority of the individual landlords will still be obligated – 50 tonnes per year isn't that much for city pubs, night clubs and that kind of thing. They will still fall between the targets. The smaller establishments we'll be looking at now.”

But a source on another compliance scheme was not so optimistic, saying that although there would be larger establishments and chain pubs that would now be obligated, a lot of establishments in the country are too small. He also said that with some companies seeing their obligations decrease due to the ruling, and some seeing them increase, there will be a great deal of confusion within the marketplace.

If Valpak is proved correct, and many establishments are obligated to recycle, there will still be the problem that a lot of them won't know they are responsible for packaging recycling, and won't even have heard of the PRN system. So for the PRN and glass demand to remain stable, the Environment Agency will have an uphill struggle to spread the word.

Ian Jones of the Environment Agency said: “We haven’t had the transcript of the case back yet, but we will be issuing guidance to the newly obligated companies.”