>>> "William P. McGowan" <6500kai@ucsbuxa.ucsb.edu> 04/11/99
01:21pm >>>
Both Peter and Gary Liss mention newsprint minimim content legislation
as key to the increase in de-inking capacity in the late 1980s and early
1990s., yet they both seem to have the cart before the horse, since
market demand preceded legislation. the zoom up in newsprint prices in
1984-85 and 1986 all preceded any attempts to legislate minimum
content.
I know, I was just getting into the recycling business then. ...
>>>>>>>>>>>>>>>>>>>>>>
Bill, you were getting into the recycling business just after one of the
periodic bottoming-out periods in ONP prices of 1982, which was when I
got into recycling. The "zoom up" in newsprint prices you saw was a
recovery from a cyclical downturn. This recovery was not much of a
factor in the unprecedented surge of new deinking capacity almost a
decade later.
This unprecedented surge in deinking, as Peter noted, followed the boom
in local newsprint collection programs in the very late 1980's, the
subsequent bust in ONP prices due to the "glut," and the following surge
of recycled content legislation in statehouses across America as a
means to save the movement to expand recycling.
In Texas, 1991 recycled content legislation led to talks between state
agencies, legislators, and Texas newsprint manufacturers. The major
new deinking facility at Champion International in Houston was planned
and designed with the new legislative goals as a very prominent and
publicly acknowledged impetus. The new and modernized deinking
plants of that generation brought us to a new plateau of "baseline
demand" for ONP which continues the much higher levels of recovery in
the 1990's compared to previous decades.
As Peter also notes, the trade press announced a startling and
sweeping abandonment of announced plans for new ONP deinking
capacity in the mid-1990's, about the same time as the unprecedented
spike in ONP prices. Why did that huge price surge not stimulate the
industry to increase capacity, or at least to stay the course with the
new recycling capacity it had previously announced? Was it supply &
demand, or did the public policy environment have an influence?
Bill Carter