Monday, March 19, 2007

The Perverse and Paradoxical Pricing of Recycled Paper

Logic and experience dictate that items made from used materials should be cheaper than items made from new, virgin resources. Then why does 100% recycled paper cost$1.19 more per ream than paper with no recycled content at all? And why bother to pay more for the privilege of buying something used?
One explanation is that environmental Full Cost Accounting is not reflected in the prices we pay. Normal pricing does not take into account the costs of environmental degradation such as air and water pollution, destruction of natural habitat, and CO2 emission (which as we ALMOST all agree is resulting in climate crisis). For the forseable future, tax payers will be paying the price and eventually footing the bill for these costs, not indivudal purchasers of products.
Hence it is still "cheaper" to use virgin wood to manufacture. Most people are generally more price-sensitive than eco-sensitive. But recycled paper saves water, energy, and of course logging trees.
Cheap products that we buy from China are likewise not reflecting the full cost of their production, either in fair and decent labor practices or environmental costs. Hopefully these factors will shift over time, especially once carbon emission is taxed or traded. In the meantime, paying the self-tax of buying recycled paper seems to me to be a wise investment, a so-called luxury which is worth it.


1 comment:

Jennifer Marie Gerholdt said...

My name is Jennifer Gerholdt and I work for the Magazine PAPER Project at Co-op America (www.magazinepaper.org). The Magazine PAPER Project provides technical expertise and assistance to publications interested in switching to recycled paper. We also help magazines that are already using recycled paper to improve the environmental characteristics of their publications. In addition, we work with magazine industry stakeholders (printers, paper suppliers, manufacturers, etc.), encouraging them to adopt more sustainable printing and publishing practices.

In the 1990's the cost of purchasing recycled paper was a great deal more expensive than virgin (non-recycled) paper, but this is no longer the case. Currently the cost of recycled paper is comparable to virgin paper, and if there is a price differentiation, it is not very much.

In order to drive the cost of recycled paper down even further, it is important to establish a more efficient post-consumer recycling collection system. Post-consumer paper is paper that has reached its end user (the magazine reader, for instance), and has returned to the paper plant via established recycling collection systems. Creating more effective post-consumer recycling collection systems will divert more paper from landfills and incinerators, and reduce the number of harvested trees. An increase in the supply of recovered paper would then be available, which will work to satisfy the ever growing demand for recycled paper with the likelihood of also reducing production costs for all paper.

Bottom Line: Buying recycled paper at Office Max may cost slightly more than non-recycled, but this will change as more consumers start recycling their paper. Econ 101 example of the principle of supply and demand: In the 1950’s TV’s used to cost a great deal, but as demand increased and more TV’s were produced, the cost of purchasing one declined. The same will hold true for recycled paper.