The weakening of the global macroeconomic environment in the second half presented new headwinds just as our commercial waste markets had begun to stabilise.
The key Netherlands construction market grew for the first time in four years, increasing by around 3% primarily driven by the residential sector, with commercial and infrastructure construction remaining subdued. This improvement remains at an early stage, not least because many of the major construction companies are themselves still recovering. The Dutch industrial and commercial waste segment experienced some price increases in a flat market following an increase in incinerator gate fees and the impact of the domestic incinerator tax of €13 per tonne implemented in January 2015. The outlook is for continued modest growth in construction and demolition waste, supported by a stable broader waste market.
This recovery in our core commercial market was, however, more than offset by the global weakening of the macroeconomic environment, especially in the second half, which led to further deterioration in oil and gas markets, falling commodity prices and lower energy prices.
The fall in oil and gas market prices impacts our Hazardous Waste Division in a number of ways. The first is that our oil and gas customers minimise their operational expenditure and cut back on exploration expenditure. This has included a reduction in the volume and the shape of refinery maintenance programmes and hence a significant impact on the productivity and profitability of our Dutch industrial cleaning business, Reym. The second is that the same cost pressures and reduced cleaning activities have resulted in around 15% less industrial waste sludges being delivered to our ATM facility for treatment. The third is that with virgin oil at very low prices, the market for waste oils, an output of our treatment process, has been significantly reduced both in volume and pricing.
We continue to believe that this reduced maintenance activity and the impact of low pricing is short-term in nature, but we are suitably cautious about forecasting the timing of the recovery.
The global fall in commodity prices also has a direct impact on recyclate prices, particularly metal and plastics. This impacted the Municipal and Commercial divisions by around £3m in the second half. The ferrous metal price fell by 40% in the third quarter of our financial year before stabilising in the fourth quarter. Other recyclate markets, including glass and wood, proved volatile but downside risks were somewhat mitigated through rapid adjustments to inbound and/or outbound pricing to maintain margin. Commodity prices appear to be towards the bottom of their normal cycles, but our growth plans are based on current levels with no expectation of material recovery in the short-term.