The UK has failed to meet the 2004 packaging recycling target it was set by the EU.
Government figures revealed the nation came 80,790 tonnes short of the level required by the Packaging and Packaging Waste Directive.
The plastics industry missed its first material-specific target by 40,901 tonnes, while aluminium and steel targets were also missed.
Chief executive Steve Gough said: "The figures illustrate that significant tonnages of packaging recovery notes (PRNs) that were available at the beginning of the year were only purchased towards the end of the year.
"Valpak believes it is irresponsible of compliance schemes to leave purchasing the bulk of their obligations until the final quarter of the year."
Gough suggested that for each tonne a firm falls below its target, it should pay a fine equal to the highest price that was paid that year.
"This would ensure that these funds are invested back in to the UK recycling infrastructure," he added.
The Government reduced the official amount of plastic waste recycled in 2003 by 80,000 tonnes after discovering some reprocessors had illegally issued PRNs.
Valpak said this meant the target for 2004 was harder to meet than had been expected, and that the PRN market did not cope well with the sudden change.
"These figures demonstrate the need for continued investment and strengthening of the PRN system," said Gough.
"However, it is encouraging to note that the material accepted for reprocessing increased significantly in paper, glass, wood and plastic towards the end of the year.
"This bodes well for the achievement of the general recycling and plastics targets in 2005."
The latest figures can be seen at: http://www.defra.gov.uk/environment/waste/topics/packaging/data.htm