A non-forestry friend found this.. thanks, Chuck!
Here’s a link.
Below is a quote, which reminds me a bit of our energy discussion in terms of sometimes-mysterious currents of world trade, as to where jobs are, where resources are developed and where they are used. Like this quote from below:
It does not explain how a Wisconsin tree can be cut down, turned into pulp, trucked to a port, shipped 7,000 miles around the globe and come back as paper less expensive than that produced in the mill a few miles away.
“These inventions came from China,” Lindsay said. “When people go pointing their finger at the Chinese paper industry or saying we shouldn’t be buying paper from China – paper came from China.”
The West, he says, is in denial about the competitive edge offered by Chinese science, engineering and ingenuity. And Wisconsin’s paper industry, he says, has lost the culture of investment, innovation and risk that defined it in the last century.
“You can only get so much from an old machine,” Lindsay said. “And only so much from your trade tariffs or whatever else you are doing to protect your product from lower-cost products from elsewhere before you eventually have to face the reality.
“You have to innovate to survive in this world.”
But China’s success is not nearly that simple. It does not explain how a Wisconsin tree can be cut down, turned into pulp, trucked to a port, shipped 7,000 miles around the globe and come back as paper less expensive than that produced in the mill a few miles away.
The Washington-based Economic Policy Institute estimates the Chinese government doled out at least $33 billion in subsidies to its paper industry from 2002 to 2009 – the period that coincides with its stunning growth. That’s more than $4 billion a year, a number that is growing. The entire annual payroll for all of Wisconsin’s mills – including those making paper towels, tissue and cardboard – is $2.4 billion.
In China, there is government support at every step of the process – money to create plantations, import raw materials, build new equipment and power the mills.
Subsidies support 30% of the total annual output of Chinese paper mills, according to Usha Haley, a New Zealand economics professor and author of “Subsidies to the Chinese Industry: State Capitalism, Business Strategy and Trade Policy.”
She notes raw materials represent 35% of the production cost of Chinese paper: “If the Chinese are buying those at world prices, how is Chinese paper selling at a substantial discount compared to U.S. or European paper?”
To be sure, there are grants, loans and tax breaks in the United States, typically aimed at boosting individual operations. The largest, in effect from 2005 to 2010, was for an alternative fuel known as black liquor, a byproduct of the pulping process. The subsidy averaged $280 million a year when it was in effect, about 7% of the size of the annual Chinese subsidy to its paper industry.
Here’s a link to more information and photos on the same subject from the Pulitzer Center.