Where Your Recycled Envelope Goes

I've said it before and I'll say it again--if you don't have a subscription to the online magazine Salon, get one. It's one of the best progressive and creative news and cultural-comment voices out on the web. (Of course, you can always enter into Salon and set your computer to watch the required Web ad for a free daypass while you get your coffee, but plunking down $35 for an annual subscription will make everything go so much smoother.)

In addition to the War Room blog, which I frequently name-check here at Cracks, Salon also hosts the How The World Works blog written by Andrew Leonard and covering the economics of globalization. Sounds like a very dry subject only to be conquered by true wonks, but Leonard does a good job at avoiding any terrifying flashbacks to your Econ 101 class back in sophomore year with dashes of wit and eyebrow-raising real-world examples. Here's a bit from a recent post on the resurgence in pricing for recycled paper:

[I]n today's commodity-mad global economy, scrap paper has seen a new source of demand emerge: China. China has been building new paper mills like crazy for years. But China has few large stands of forest, which means these new mills are mostly built to process so-called recovered fiber.

"Demand in recent years has generally been very good," says Leno Bellomo, commodities marketing manager for Norcal Waste Systems Inc. in San Francisco, "primarily due to new capacity in China and Southeast Asia."

Bellomo did caution that prices for waste paper and other recycled goods are highly volatile. In recent months he said he'd seen downward pressure on prices for most grades of scrap paper (Norcal sorts waste paper into eight different grades). He attributed that, again, to China, but said the problem now was that China had built so many mills that it was suffering from overcapacity.

But not to worry, says Bellomo, because there's a new entry on the scene beginning to show hunger for all kinds of of recycled materials. India.

It all adds up to a tangled exposition of the contradictions and contrary impulses of globalization. There are plenty of good reasons for worrying about the impact of China and India's economic growth on the global environment. But at the same time, China's voracious demand for waste paper that it can turn into cardboard for the boxes encasing all the products it is exporting to the U.S. helps to make the paper recycling industry an increasingly economically viable business.

On the other hand, the boom in Asian paper mills has created brutal competition for mills in the United States. Total capacity in the U.S. is on a steady downward trend, with more mills closing every year. For recyclers like Norcal who are on the West Coast and near large ports, that's not so bad, because they can just stuff a container full of scrap and send it on its way. But if you're in the Midwest, says Bellomo, transport costs skyrocket. In which case, China's demand for scrap paper is less relevant.

So location still means something in the global economy. But in the long run the growth of emerging nations should be good for the economics of recycling. Unless rising energy costs make even transport by sea too expensive. And so it goes.

[PS] And just to disabuse the notion that Salon is just for wonks, it also has a great music section with almost daily downloads and the Video Dog area that collects some of the most interesting video clips on the Web, both political as well as out and out odd (check out this hypnotizing Japanese commercial and my all-time favorite, Secret Jesus). OK, so maybe it's for nerds...