2016 – A Year Of 2 Halves For RDF & SRF Export?

RDF and SRF export data for England during 2016 has now been released by the Environment Agency. So, is the data showing us any signs of the impact of the Brexit vote? Waste and resource management consultants, Monksleigh, analyse the data…

The first thing to note is that there are, in effect, two types of figures available from the EA on WDF exports. The first is the publicly available ‘shipped’ data which many commentators use and the second is the data which represents the actual Transfrontier Movements of RDF/SRF from Exporter to point of notification of disposal/reuse (or ‘destroyed’).

Figure 1 provides an overview of the amount of RDF/SRF ‘shipped’ which shows an increase of around 14% of WDF exported from England year on year.

Figure 1 also highlights a slowdown in the tonnage of WDF shipped from England. That ‘slowing’ has been on the cards for a while as capacity in the EU starts to reach a tipping point and extra capacity has started to come on line in the UK, however, is probably topping out at a lower rate than many anticipated for 2016.

Indeed, many suggested export levels close to 4 million tonnes in 2016, and even we thought it would be close to 3.8 million tonnes based on the analysis of the data released from the first two quarters of the year.

That begged the question for us as to whether there has indeed been a slower rate of export in the last two quarters of the year, or if something else was going on.

In Figure 2 below we show the shipped tonnes and the destroyed tonnes in direct comparison with one another.

The first thing to say is that the shipped data (red line) is indeed showing a lower level of export in the second half of the year than the first half, but is it significant and can we interpret this as a ‘Brexit downturn’?

On the shipped tonnes, it is important to note that the EA publish the exported tonnage as a snap-shot in any one month, and, as far as we understand it, do not go back to these tonnages if paperwork falls behind in a month. So, for example, if a shipment occurred in December, but the paperwork actually only arrived in January, it would not be captured, only the shipment paperwork that arrived in the month would be.

With a large volume of paperwork now being received by the EA (and it is all paper/hardcopy based!) it would not be surprising, if the tonnage is underreported in this shipped data. The EA are in the processing of using a new electronic system which came online during mid-2016, which should improve data capture and reporting.

But what of the last two months destroyed data dropping considerably over the period? It would be easy to assume that something has happened in the EU over the last 6 months, for example a large amount of stockpiling due to warm weather or a shutdown of one or more significant plants (a check of the data suggests that this isn’t the case, with all plants running at around their standard operating parameters).

The other option is that the ‘destroyed’ data is lagging behind the shipped data, and this is something we have seen in previous years. Indeed, we would expect the destroyed tonnage to ‘spring back’ over the coming months as a result of the EA chasing down and processing the paperwork, alongside the traditional lag that occurs – remember of course that a consignee has 12 months to destroy their tonnage from receipt and return the paperwork to the EA.

In conclusion, then, the slowing of exported tonnage has definitely started in the second half of 2016, but the exact magnitude, and its ripple into the destroyed figures are such that it will be the end of the 1st and 2nd quarters of 2017 before the data starts to be clearer, and in that time Article 50 and Brexit negotiations will have commenced.

The parallel delivery of several high profile EFW schemes in the UK over that same period, and into the next few years, are such that it will therefore become increasing difficult to separate the reasons for export dropping – EU uncertainty or UK capacity drivers will start to become increasingly intertwined over the coming years and re-enforcing our view outlined within Figure 3 below – which is that we are probably at the start of a downward trajectory for export in future years.

This article first appeared on www.monsleigh.com. For more Monksleigh articles CLICK HERE

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