Tyre Collections Being Rationed as Infrastructure Faces ‘Meltdown’

50,000 tonnes less worn tyres will be processed this year if the current situation continues on its present trajectory. A week after the news that leading end-of-life tyre (ELT) processor Sapphire is mothballing its Avonmouth facility, the Tyre Recovery Association (TRA) has released a statement warning that the tyre recovery infrastructure is no longer making economic sense to the processers responsible for disposing of many of the nation’s tyre arisings.

“In recent weeks it has become clear that processor ‘gate’ prices have fallen below the levels necessary to accommodate even our current used tyre arisings. As a result, processing capacity is now experiencing a substantial reduction. The consequences of this situation are that our ability to collect and move our product to processors is becoming severely constrained as the collections recovery `pipeline’ for passenger tyres in particular experiences overload,” the statement read, adding:

“For many months now, TRA members have experienced serious pressures on operating margins. Not only have they faced competition from many less environmentally-compliant operators in the marketplace but they have been increasingly unsuccessful in achieving a viable collection rates from their own customers. As a result of this combination of circumstances the situation in the UK recovery market has become critical.”

Unless the economics of used tyre recovery in the UK can be quickly reinvigorated the UK may face a capacity shortfall of at least 50,000 tonnes this year. Since July 2006 the EU Landfill directive requires each member state to re-use, recover or recycle virtually 100 per cent of national arisings, a target which hither to the UK has achieved.

Tyres & Accessories understands TRA is currently in urgent talks with the government, the Environment Agency and other industry associations to alert them to the need for concerted action to tackle irresponsible or illegal tyre disposal and restore stability to Britain’s recovery infrastructure. One suggestion is that the government temporarily lifts scrap tyre stocking limits, but this is just a short-term solution and it is becoming increasing apparent that the tyre recovery and processing business cannot continue as it currently is.

Related News:

• Market Conditions Prompt Mothballing of Sapphire’s Avonmouth Site

• UK Tyre Recovery Sector Fights Illegal Operations, Slim Margins