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[GreenYes] Re: Suggested Responses to Markets Tanking


Title: [GreenYes] Re: Suggested Responses to Markets Tanking

As  Bob points out, worldwide demand (and anticipated demand) for the
products that use our recovered materials as feedstock, is drastically
down.  But the other, equally important factor in this market is that
credit to conduct business is extremely difficult to obtain.  Sound
familiar?  Every container of recovered material back-hauled to China
(not quite as energy-intensive in the context of our trade deficit)
depends on letters of credit, absent which orders simply are not
placed.  In this respect the economics of secondary materials are no
different from virgin materials, or many other sectors of global
trade.

(Plus, this is happening in the slow season for some secondary fiber
markets, with the packaging for the Christmas sales season long out
the door, and the busy season for agriculture product largely done for
the year.)

We created this “inelastic” supply of materials and pushed it into the
global supply system with great success, and displacing vast
quantities of virgin resources in the process.  So it should not come
as a surprise that when the global trade economy catches pneumonia,
our recycling markets are knocked on their backs.

The local food movement talks about how shorter, decentralized food
chains can be more resilient than the industrial food supply system.
Is there a corollary for the manufacturing sectors that consume our
secondary materials?  What would be the equivalent of local farms in
the world of paper mills, and what portion of the 54 million tons of
paper delivered to markets last year could it consume?

Peter Slote

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