Friday, April 2, 2010

What is happening to Dunder Mifflin's core business?

It might look like a weird question, but you have to understand I was just about to see another episode of my favorite show, The Office, when I read the following news: "A record-high 63.4 percent of the paper consumed in the U.S. was recovered for recycling in 2009."

Wow, I said to myself, this is impressive. I should read a little more about it. The Office can wait few more minutes (I watch it on Hulu, so there's no time pressure..).

I found the news on, which is the website of the Paper Industry Association Council (PIAC) and it came from the American Forest & Paper Association (AF&PA). It added that "this is great news for the industry and the environment, and exceeds the industry’s 60 percent recovery goal three years ahead of schedule. To balance growing global demand for recovered fiber and decreased paper consumption, increasing recovery nationwide remains a priority."

Something got my attention here - 'decreased paper consumption'. I checked the figures provided by PIAC and saw it's true - since 2004 the supply of paper is in decline. Check it out:

Supply1 (000 tons) Recovered (000 tons) Recovery Rate2
1999105,31646,818 44.5%
2000102,81047,311 46.0%
200197,39546,996 48.3%
200298,94947,645 48.2%
2003 98,018 49,255 50.3%
2004 101,884 50,187 49.3%
200599,613 51,272 51.5%
2006100,665 53,314 53.0%
200797,007 54,325 56.0%
200889,838 51,822 57.7%
200978,90250,036 63.4%


And it's not a small decline: from 2004 to 2009 the supply of paper in the U.S. saw a 29% decline. Now, firstly this is one of the main reasons the recovered rate is relatively high - there's also a decline in the absolute number of recovered paper, but the supply has just decreased in a faster paste.

That's also the conclusion of the report State of Green Business 2010, although they have different figures:

For the first time since 2001, the year of the last national economic downturn, the amount of paper recovered in the U.S declined, by about 2.5 million tons. But at the same time, total paper consumption dropped nearly three times as much, so the overall percentage of paper recovery rose. In fact, the intensity of paper use — the amount of paper used per dollar of GDP — improved by the largest margin since the boom year of 2000.

And the decrease in supply is not just in the U.S. Clive Suckling, Global Leader Forest, Paper and Packaging at PricewaterhouseCoopers wrote in their report,
Forest Paper and Packaging Deals. Branching Out – 2009 Annual Review, that "Market conditions for the Forest, paper and packaging (FPP) sectors remained very diffi cult in 2009. In the latter half of the year, conditions began to improve in some of the emerging markets, while demand in North America and Europe remained at historically low levels."

So it this trend going to continue? And is it a good thing? I believe that the answer is Yes for the first question. We see that the decrease in supply started couple of years before the beginning of the recession (which might got things worst of course) and is likely to continue as companies (and individuals) that try to save in their paper consumption will continue to do so, as they figure out they're reducing costs by saving on paper (see our paperless office post). Other trends as the transition from print to digital in the publishing industry will contribute to it as well.

The second question is more complicated - paper is not a bad thing in itself. Producing it unsustainably is the problem, not to mention its end of life. So even though we see improvement in the recovery rate, there's still much more to be done about the production of paper. Mandy Hagith, author of the recommended book "Paper Trails: From Trees to Trash - The True Cost of Paper" explained the problem:

"No one likes to think of trees being felled, but many of us have a cosy image in our heads that it all comes from recycling or "sustainable" woodlands growing in neat rows, perhaps somewhere in Sweden. It's a myth. Globally, 70 per cent of the 335 million tons of paper the world uses each year comes from natural, un-farmed sources. In Canada, the UK's biggest source of pulp, 90 per cent of its output comes directly from its ancient forests."

So the bottom line is that we don't want to see Dunder Mifflin going out of business and hope they be more successful under the new ownership of Sabre. We just want to see their main product becomes more sustainable!


Raz @ Eco-Libris

Eco-Libris: Promoting sustainable reading!