POINT/COUNTERPOINT

Why don't more catalogers use recycled paper?

Jerry Cerasale, senior vice president of government affairs, The Direct Marketing Association

My response is based not on a strict study of our membership, but conversations with our members. If the [recycled-paper] supply got larger, the price would drop.

For most of the members with whom we talked, the price of recycled stock is greater than the price of virgin paper. Some of our members have been able to negotiate with certain vendors in certain areas. But with members having such tight margins, just that little bit is enough for them to make the economic decision to not use recycled paper.

From what we can gather in discussions with catalog members, generally the problems that were there five years ago with recycled paper aren't there anymore. We've come a long way in five years, and the remaining issue is price.

It may be that the price is higher because there's not enough demand. I think in time it's going to change. There already are laws in some states in which they're forcing localities (through the pricing of trash collection) to recycle. That may help produce more product, reduce prices and make it more economically feasible. We at The DMA think that's going to happen. I think concerns on the landfill side will push more product into it.

We actually think there's going to be more use of recycled paper [in cataloging]. It's a means of shopping that uses a significant amount of paper, yet it also reduces the amount of auto traffic and malls built, and I think all of our members are very much aware of this. A goal for them would be to use recycled paper. It just needs to fit the economic equation, and for some of our members it doesn't right now.

A final point is that for those catalogs that use recycled paper, some are starting to employ that as a marketing tool. If customers start shopping from certain catalogs because they use recycled paper, that'll change things, too.

Victoria Mills, project manager, Alliance for Environmental Innovation

The Direct Marketing Association has stated in the past that 'an adequate supply of recycled paper is simply not available.' This is not true. Almost all major suppliers offer sheets with 10-percent postconsumer recycled content or higher. Catalog companies usually have a choice of suppliers that can match their specifications in a recycled sheet.

And there's plenty of supply; there's significant overcapacity to produce deinked pulp, the key ingredient in recycled paper. In our capacity study last year, we found that North American deinked pulp producers were operating at an average rate of 73 percent. Almost all said they could easily expand their production to meet an increase in demand for recycled paper, and did not believe that sourcing the additional wastepaper would be a problem.

We also disagree with The DMA's statement that the use of recycled paper is not cost-effective at this time. Contrary to popular belief, recycled paper is not always more expensive than virgin paper. It depends on the grade, the supplier, tonnage and other factors. Prices for recycled paper are negotiated, just like prices for virgin paper. It's somewhat easier to find a price parity in coated freesheet than lightweight coated and supercalendered grades; however even there it's not impossible.

The DMA's statement implies that catalogers should wait for recycled-paper costs to come down before they switch. While it's true that in some cases recycled paper costs more to make than virgin paper, those cost differences are as much a result of the lack of demand as the other way around.

Only strong and steady demand for recycled paper will create the economies of scale that will bring costs down. To set this cycle in motion, catalog companies need to start buying recycled paper now.