So far, 2014 has been an extremely bad year for collectors, graders and exporters of used clothing and textiles in the UK. In turn, this has adversely affected the income that both local authorities and charities receive for their goods. Charity shops that have become reliant on the sale of used clothing to processors can be particularly susceptible. One charity shop chain lost around £100,000 in the last year. Part of their losses can be attributed to a fall in the value of used clothing.

Local authorities have seen a decline in the amount of money received from clothing collected in their banks since the beginning of the year. Whilst the size of the drop is varying between different authorities, those authorities that managed to secure over-inflated prices during the silly season in 2013 have come in for a bit of shock when it has come to a price review. In some cases, the income received has dropped by up to £200 per tonne. Although a fall of this size is the exception, I would urge authorities to look at the market price reports so that they know what the current market values are for used textiles.

Going forward, if you receive an offer from a collector that is considerably above the market rate and you are thinking about entering into an agreement, I would ask further questions. It is not the pounds per tonne figure that you should be primarily interested in – it is the total income. An efficient operator that collects a good tonnage and pays a competitive rate is likely to generate more revenue for a local authority than a collector that offers an overinflated headline rate, but does not empty banks regularly, leaving them more susceptible to theft or overflow and thereby reducing the tonnage collected.

As for what the near future holds, it is difficult to say. There is still a downward pressure on prices, and there are no obvious signs that things will change soon, with problems in all the main markets.

At the time of writing, there is a ceasefire in place in Ukraine, but it remains to be seen whether this will hold. Ukraine itself is an important market. UK exporters who sell into Ukraine have been stockpiling clothing as business has slowed down dramatically. In addition, sanctions imposed on Russia as a consequence of the conflict have weakened the rouble. In the last year, it has lost around 20 per cent of its value against the pound, euro and dollar. For Eastern European importers, Russia is an important onward market. The weakening of the rouble affects Russia’s buying power, which in turn affects our exports into Eastern Europe.

Exports to Sub-Saharan Africa are continuing to be affected by a variety of different issues. This includes civil unrest in several countries in the region, weak currencies, terrorist attacks and devastating fires at East Africa’s largest open-air markets in Kenya, and now the outbreak of the Ebola virus in West Africa. All these issues are contributing to a restriction in the movement of goods and free trade.

Back at home, an issue that continues to vex processors is the matter of insurance. One broker has written to its customers advising them that there is only one insurance company that they deal with now offering insurance policies for businesses in the waste industry. Another broker has a facility that can be called upon, but only following detailed inspections and credit checks. Even then, the minimum premium is £15,000 and a minimum £50,000 excess on claims. In other words, it is extremely difficult for used clothing/textile collectors to get affordable insurance. Therefore, they are cutting costs in a number of different ways, which include reducing the prices that they can pay local authorities and charities for the clothing that they collect.