Waste Industry Woes – Take action to avoid financial risk

Published Friday 27th March 2020

There are major developments in the waste industry at the moment that can be summarised in two main points:

1. The higher than average price rises expected across the board from April 2020
2. The potentially devastating impact of COVID 19 on the waste industry.

Each year, in line with Government imposed landfill tax increases, the costs of disposing of waste goes up on April 1st. All the evidence is suggesting that the prices will be higher than normal. This year we are negotiating harder than ever for our clients to keep their prices low.

We are living in turbulent economic times and there are multiple factors affecting the proposed rises;

• Pre Covid-19, the waste industry was already experiencing a significant drop in prices paid for recyclable materials, particularly cardboard. This was due to China’s ban on waste coming into the country and the knock on effect of a shortage of end destinations for the materials.
• To add to woes, other countries – The Netherlands and Sweden were placing additional taxes on waste destined for Refuse Derived Fuel (RDF) – more commonly known as incineration.
• It has become increasingly clear that the effect on the UK, who are a net exporter of waste and send a lot of waste for incineration to such countries, is going to result in higher than average price increases in April 2020.

Following China’s lockdown to deal with COVID-19 and more pertinently many businesses requiring waste companies to temporarily pause collections, presents real risks to the longevity of suppliers – particularly smaller suppliers. It appears too early to say what the long-term impact will be, however we cannot rule out further price rises towards the end of 2020 or suppliers attempting to re-negotiate contracts.

What can businesses do to mitigate the risk?

It is more important than ever to have your waste management system reviewed by competent waste management professional. Our ERA waste specialists are helping multiple clients to pay less for disposal and also put in place long-term sustainable changes.

Our analysts review whether their clients can produce less waste, either through prevention or through re-use. They undertake a detailed review of whether waste can be presented differently that would attract lower disposal charges and perhaps more importantly now more than ever, ensure that contractual obligations protect clients from risk. We truly achieve value for the long-term. Contact us today.

About the Author: Daniel Howells, is a Chartered Waste Manager and Waste Management Consultant. He is a former Key Account Manager at one of the largest waste management companies in the UK. Specialising in the development of strategic plans and project management of key long-term projects providing cost saving initiatives. Daniel’s typical clients have included national high street Retailers, Supermarket chains, the NHS and the Construction sector.