A ban on the use of certain types of plastic has come into force from October 2023 in the UK, supporting the trend of reducing plastic consumption. It has been decided to ban single-use plastic plates, trays, bowls, cutlery, balloon sticks, and certain types of polystyrene cups and food containers. This decision was known in advance, so it did not come as a surprise to users, but sources say that some businesses are still not ready for the transition. These actions are intended to reduce the generation of plastic waste that cannot be recycled and will pollute the environment. The problem of excessive plastic consumption was exacerbated in 2021 when, amid COVID restrictions, consumers bought more goods for themselves at home. Sources believe the banned plastic will likely be replaced with sustainable products and reusable crockery.
The ban will reduce plastic consumption in the country but is unlikely to affect prices in the short term. The plastic market has been in a sustained surplus for more than 12 months, so plastic prices have already been cut as much as possible by manufacturers in a bid to maximise sales. UK polyethylene prices in September are 23% lower year-on-year (y-o-y), and polypropylene prices are down 20% y-o-y.
The main price fluctuations during the surplus market period are determined by production costs and raw material costs, which are largely determined by changes in the price of crude oil. Crude oil prices have been rising for the last four months, since May, and plastic producers started trying to pass on the increased raw material costs to consumers in September. Thus, oil prices were 20% higher in September than in May, while plastic prices are down 14% since May, a 2% month-on-month decline, confirming the weakness of the plastic market.
