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Significant drop in charity textile prices

Textile recycling industry insiders have told MRW that the prices of charity grade clothing have dropped by up to 25% in the past six months.

One textiles recycler said that charity textiles had lost £50 to £100 off their buy-in price - from about £550 per tonne to around £450 per tonne.

This has been attributed to a reduction in quality of clothing because of the recession. “There has been a tumbling effect all through the markets, but at around a two-year lag after the recession hit other recylables as people keep their clothes for longer,” they said.

The price drop also reflected reductions on the selling side, insiders said, as markets in east and west Africa, as well as Pakistan “were very jittery” as a result of some political instabilities.

Another industry trader told MRW they would expect the prices for charity textiles to have decreased by 20% to 30% in the past six months, but that they thought a realistic figure was around 15% to 20% because of pressure from charity retailers to keep their prices high.

Earlier this month in MRW, the Textile Recycling Association (TRA) warned of a crash to the market if charities continued to keep prices overly high and said some collectors offered unrealistically high prices.

One charity retailer told MRW they had experienced no change in the prices they sell their textiles, citing high prices for charity shop textiles at £700 to £1,000 per tonne. They said they were selling textile bank textiles at £720 per tonne and local authority textiles at £420 to £700 per tonne.

In December, MRW reported concern around marked drops in charity textiles prices of around 5% to 10% that month. Oxfam said they have not seen a decline in their market in recent months.

According to the TRA, five TRA members, plus another well known textile collector, had gone out of business in the last six months. The association said others were likely to be making a loss.

Local authority textiles have been slower to respond to market conditions, one industry insider said, as the collection of these was often tied into long-term contracts. However, they said the prices of these will come down and people are already putting in lower prices than they would have two or three years ago in reponse to tenders for these kinds of contracts.

Ross Barry, director of LMB clothes recyclers and president of the TRA, told MRW: “It certainly appears the market hit a ceiling last year and a downward level of adjustment is taking place. In current export market conditions those prices weren’t sustainable.

“Clearly many people are predicting a fall as some charities, local authorities and waste management companies are accepting lower prices in favour of good quality, regular service.”

He concluded: “Ultimately the market will decide, as collectors balance purchasing commitments against spot and forward sales.”

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