Short-term market activity for all collected materials could be driven by rising Packaging Recovery Note (PRN) prices.
Prices for the notes rose as the economic slowdown created a perceived shortage for buyers. Sellers reacted to this by raising prices.
However, a combination of the slowdown and processors holding onto material tonnages to roll over into 2009 has created a sellers market irrespective of supply and demand.
This increase in PRN values could have a beneficial knock-on effect for local authority and commercial collectors. As the PRNs rise in value, the overall worth of the material to processors also rises. This could lead to an increase in money offered to local authority and commercial collectors.
A Local Government Association spokesman said: Its probably too early to speculate on the effects of the rise in PRN prices. But we will be watching the situation with interest and we hope that the market for recyclates is stimulated.