Office Paper, Pizza Boxes, and the Pandemic

I wish I had known.

Last Saturday, I threw out my greasy cheesy cardboard pizza box. Then I found out that the recyclers wanted it.

Recycling Pizza Boxes

We need more pizza boxes and junk mail because we have less office paper.

When we recycle our everyday paper, we soon see it again as toilet tissue, coffee cups, and new cardboard boxes. Now though, without office paper, recyclers are happy to take my greasy pizza box. Reversing how they felt in the past, they want more mixed paper.

Actually, our story starts during 2017 when China told the WTO (World Trade Organization) that it will no longer take 24 kinds of waste. The decision was a whopper. China had become sufficiently affluent to say that they no longer had to make most goods from recycled waste.

This is what China’s imported solid waste looked like in 2013:

Because of China’s decision, the market for mixed paper dove from $160 to $3 a ton between March 2017 and March 2018. Whereas Franklin, New Hampshire had been getting $6 for each garbage bin, they found themselves paying $125 a ton.

Now though, our technology has become better at eliminating mixed paper’s glass and plastic contaminants. In addition, cardboard delivery box fibers make mixed paper pulp stronger. They make it possible for manufacturers like Georgia Pacific to use mixed paper pulp for Brawny Paper Towels and Dixie Cups. With demand on the rise, prices rose from zero to $30 a ton and recyclers started expanding plant capacity.

Our Bottom Line: Change in Demand

Who would have thought that a pizza box and office paper were substitute products?

As economists, though, we can look to the determinants that shift our demand curve to the right and left. They include changes in income, in utility, and yes, for substitute products. When the demand or quantity demanded for one product changes, it affects the other curve. So now we can say that less demand for office paper meant less paper to recycle. As a result, recyclers’ demand for used pizza boxes has gone up.

Below, I’ve shifted the demand curves in opposite directions:

The second graph includes the used pizza box that I will soon recycle.

My sources and more: Thanks to WSJ for reminding me it was time to return to cardboard recycling. Please note that several of today’s sentences were in a previous econlife post.