In short
The cardboard “corrugated packaging” supply chain is shifting: Americans use fewer boxes per person, and pulpwood prices have collapsed, threatening Southern U.S. tree farms that once relied on pulpwood as early income.
Guests/backgrounds
No formal guests. Host/producer is Ryan Knudsen (The Wall Street Journal). Reporter Ryan DeZember (WSJ) interviews Bill Howard, a fourth-generation sawmill/forest owner in Statesboro, Georgia, whose family has worked timber for 130+ years.
Key claims
Box-within-box packaging has shrunk due to e-commerce and logistics; more packaging is lighter and sometimes plastic. Pulpwood demand fell as paper mills closed, including International Paper facilities in Savannah and Riceboro, Georgia. Cheap eucalyptus pulp from South America further undercuts prices, sometimes dropping to near zero per ton.
Notable examples
Bill Howard says thinning paydays became bills; his family reduced planting from 650 to 550, then 450 trees to avoid excess pulpwood. A major seed supplier reported loblolly seedling sales down 20%. Possible substitutes: OSB, cellulose-based aviation fuel, lyocell/modal fabrics, and smokeless gunpowder.
Written by AI. May contain mistakes. Listen to the episode to check what was said.
Chapters
Tap a time to open that second in VOThe Decline of Cardboard Usage
2:59 to 3:19
Discussion on the decrease in cardboard usage and its implications for the pulpwood market.
“Coming up on the show, little trees, big problems.”
The Decline of Cardboard Usage
4:08 to 4:25
Discussion on the decrease in cardboard usage and its implications for the pulpwood market.
“Ask yours at claude.ai slash the journal.”
The Impact on Southern Tree Farmers
4:25 to 13:20
Exploration of the economic challenges faced by southern tree farmers amidst pulpwood market decline.
“Ryan DeZember has a way of visualizing this.”
Emotional Attachments and Future Decisions
13:21 to 14:01
Discussion on the emotional connections farmers have to their land and the tough decisions ahead.
“If you go through your shirts, if you have a silky one, it might be made out of something called lyosel, which is made from cellulose.”
The Emotional Toll on Tree Farmers
14:01 to 16:06
Explore the emotional connections tree farmers have with their land and livelihood.
“But along the ways, you know, you see it at every age.”
Transcript
Automatic transcript. May contain errors.0:05Okay, I'm Ryan Dezember.
0:07Ryan Dezember:I am a reporter for The Wall Street Journal.
0:09Ryan Knutson:That's a great name you have there, Ryan.
0:11Ryan Dezember:Yeah, it is. Good one for you, too.
0:16Ryan Knutson:Two Ryans in two different studios. Here to talk about one cardboard box. You're holding one in your hand right now.
0:25Ryan Dezember:Yeah, I grabbed one because they're everywhere these days. The technical term is a corrugated packaging. Cardboard is actually like your paper cup, but we don't have to quibble about that.
0:37Ryan Knutson:We won't. Cardboard, container board, you know what I'm talking about. The brown shipping box is maybe the least exotic object in the world. The stuff is everywhere, crammed in recycling bins on doorsteps, stacked inside e-commerce warehouses. Yet if you thought we were living in the era of peak cardboard, you'd actually be wrong.
1:04Ryan Dezember:So you probably wouldn't guess it, but we're actually, on a per capita basis, America's using a lot less cardboard than we used to.
1:12Ryan Knutson:Really?
1:12Ryan Dezember:Yeah. When you break it down of boxes per person, we peaked in 1999, which is sort of hard to believe.
1:20Ryan Knutson:Hmm. I'm surprised that there's less container board being used now in an era of, like, online shopping than there was 20 years ago.
1:27Ryan Dezember:Think about, like, when you used to get a delivery from Amazon and you'd open it, it'd be like a box inside another box with another little box with the small thing you ordered. Technology and, like, a lot of sort of work on their end has gotten rid of that, right?
1:42Ryan Knutson:Not only did the box inside the box inside the box start disappearing, but boxes themselves have also gotten smaller and lighter. More stuff started showing up in plastic mailers. And more boxes are getting made from old, recycled ones. So, I mean, like, overall, like, this sounds good. There's less waste. There's more recycling. But there obviously must be a downside here to somebody, otherwise we wouldn't be talking.
2:08Ryan Dezember:Yes. The downside is if you were selling trees.
2:13Ryan Knutson:Specifically, pulpwood. That's a type of wood used to make cardboard. And recently, in the pulpwood market, like a poorly taped box, the bottom fell out.
2:26Ryan Dezember:It varies highly, you know, by market. But some markets, you might have gotten$16 a ton,$15 a ton, and now you might get zero. Zero dollars a ton? Yeah.
2:37Ryan Knutson:So basically you're saying this stuff is worthless. Yes. What does this mean for the tree growers, the people whose livelihoods depend on selling these trees? It's an existential crisis.
2:52Ryan Knutson:Welcome to The Journal, our show about money, business, and power. I'm Ryan Knudsen. It's Thursday, September 3rd.
3:05Coming up on the show, little trees, big problems.
3:18Ryan Dezember:Amazon Health AI presents Painful Thoughts. I, um, I can't stop scratching my downtown. Mm-hmm. Yeah, but I'm not itching to go downtown and tell a receptionist I'm here to talk about my downtown. Some things you'd rather type than say out loud. There's no question too embarrassing for Amazon Health AI. Chat your symptoms and get virtual care 24-7. Healthcare just got less painful.
4:07Ryan Dezember:does about them, and where they might not have the answer just yet. There's hope in hard questions. Ask yours at claude.ai slash the journal.
4:24Ryan Knutson:In many parts of the American South, a forest isn't just a place where towering pine trees grow wild. Trees are a crop. Ryan DeZember has a way of visualizing this.
4:38Ryan Dezember:Go to your Google Earth or your online map, set it into satellite mode, zero in on the south, find something that's green. Not like a wildlife refuge or a national park, but any other stretch that's green. And as you zoom in, more likely than not, you're going to find that the trees are all planted in neat rows.
5:01Ryan Knutson:Neat rows of carefully planted loblolly pines. Tree farms. In the timber industry, the big money is in lumber. That's the processed wood that comes from mature 20 - or 30-year-old trunks that eventually turn into 2x4s and telephone poles. And like any crop, there's a tried-and-true way to get the best harvest.
5:21Ryan Dezember:They say plant them thick and cut them quick.
5:24Ryan Knutson:The goal is to get tall pines with few branches.
5:29Ryan Dezember:So you plant the trees really close together, and that forces them to sort of compete and race up to the sky, to the sun.
5:35Ryan Knutson:The idea is that the trees chasing sunlight will shoot straight up and shed their lower branches in the process, which means fewer nuts in the wood and taller trunks. The problem is that eventually the trees get overcrowded and tree farmers have to do some thinning.
5:51Ryan Dezember:After a while, the soil only supports so many mature trees, so you have to go in and kind of select the ones that are the worst specimens or misshapen trees or maybe just every other one or whatever your plan is. And you have to take those out to make room for the best specimens to keep growing into lumber. So if you were to go to one of these pine plantations and look around, you might see trees that are pretty unremarkable. Maybe they're crooked or, you know, otherwise not the best specimens, and you can't really envision them becoming a big utility pole. But they're very important to the whole system.
6:33Ryan Knutson:Important to the system because those dinky, crooked trees can still be sold as pulpwood and turned into paper and cardboard boxes.
6:42Ryan Dezember:And they basically make it into a mashed, almost like an oatmeal, and that becomes pulp. And then they roll it out in flat sheets and basically dry it, and it becomes paper.
6:52Ryan Knutson:In other words, if the farmer's main goal was lumber, pulpwood was basically a profitable byproduct. In a business where farmers had to wait decades for big trees to mature, pulpwood provided the first financial return and a steady trickle of income.
7:07Ryan Dezember:And then you let the trees remaining grow for, you know, another 25, 30 years, and they become lumber, and that's your big payday.
7:14Ryan Knutson:For almost a century, that was how it worked. But now, as we mentioned earlier, the system is breaking down. Americans are using less paper. Cardboard demand is falling. And tree farmers are getting hit from another direction. Cheap foreign competition.
7:33Ryan Dezember:A flood of cheap eucalyptus pulp from South America. The eucalyptus tree grows faster, the labor's cheaper.
7:41Ryan Knutson:And then the paper mills that buy pulpwood started shutting down. International paper is closing its facilities.
7:49Ryan Dezember:Very recently, just last year, we had a big rash of pulp mill closings across the South. Georgia's kind of ground zero. the big mill in Savannah, another one in a crossroads out in the country called Riceboro. These mills started closing. Communities are rocked after learning international paper facilities in Savannah and Riceboro will soon shut down permanently. The impact is cutting even deeper on businesses that depend on the timber industry.
8:22Ryan Knutson:All of these forces have helped drive down the value of pulpwood. The price for those little trees is now so low that instead of selling them, some farmers are now paying to have them hauled away.
8:33Ryan Dezember:You still need to make room, so you go and take out every third tree, right? And those go to the pulp mill. And you used to be able to make money off of that. Yeah, that used to be a big payday. Now for some, it's a big bill.
8:44Ryan Knutson:That changes the economics for a lot of southern pine farmers. Because if pulpwood no longer pays, what are you supposed to do? That's the question confronting Bill Howard. He's a fourth-generation sawmill owner in Statesboro, Georgia. Yes, sir. It's a way of living down here. Bill's family has been in timber for more than 130 years. Now, he worries that his way of life is in jeopardy. It's scary. It's a scary moment. Something we've depended on all of our life. Something we just thought would always be here. Without a market, people won't be planting trees. But if growing trees stops making sense, what happens to the farmers in the forests that they depend on?
Read the full transcript
9:34Ryan Knutson:That's next.
9:45Ryan Knutson:Not long ago, my colleague Ryan DeZember went down to Georgia. He wanted to see what the collapse of the pulpwood market looks like for people growing the trees. that's where he met Bill.
9:57Ryan Dezember:Bill Howard's family is very indicative of this whole crisis.
10:02Ryan Knutson:Yeah, Bill Howard, Statesboro, Georgia, fourth generation, saw Miller. As I say, we turn round things into square things. Bill can't imagine doing anything else. The old saying is if you get sawdust in your veins, you can't ever get out of it.
10:20Ryan Dezember:His great-grandfather turned up around Statesboro, Georgia, in 1898 with seven brothers.
10:28Ryan Knutson:In 1898, my great-granddad moved into Statesboro, had a portable sawmill.
10:35Ryan Dezember:And they showed up and started sawing, and eventually the next generation built a permanent mill in town.
10:41Ryan Knutson:And then in 45, we moved where we're at now, and we have bought...
10:45Ryan Dezember:And, you know, and they've expanded into sort of like a contractor yard, sort of a builder supply business. You know, all of a sudden, they've got, you know, 300-some employees.
10:56Ryan Knutson:For years, the Howards could count on the first thinning of the forest as a payday. Now it's a burden. The mills that make newsprint in boxes are buying less and less of Bill's pulpwood. And then those paper mills started closing. When he saw that happening, Bill started worrying about what it meant for his business, both as a farmer and the owner of a local sawmill. Well, we still have paper mills in our area. So what keeps me up at night is that we lose another one. That fear is already changing the way Bill is planting his forests. So we used to plant 650 trees, Breaker. We've gone to 550. And then here recently, we've gone to 450, just trying to avoid having more pulpwood to take out.
11:48Ryan Knutson:Across the South, farmers may already be planting fewer trees. One of the region's biggest suppliers of pine seedlings reported that, over its last two fiscal years, sales of loblolly seedlings have fallen 20%. So it's bad for him as a tree grower, and I'm guessing it's also not great for his sawmill business.
12:07Ryan Dezember:You know, when I talked to him, he said, look, if people don't plant trees, I won't have anything to cut.
12:13Ryan Knutson:Pulpwood is the first step. But if we don't have a manufacturing base to sell our trees into, we won't have a forest. Some farmers are considering a much bigger change, not planting trees at all. You know, they have alternatives. They could turn it into ag land. They could turn it into solar farms. They could develop it. They're going to do something with that land for best use. We want it to be growing trees. One grower in the region told Ryan that instead of replanting pine trees on part of his land, he planted blueberries instead. Others are leasing their land for solar or considering selling off parcels as little ranches.
12:55Ryan Knutson:Is there a chance there could be a new market for the pulpwood? Like, could they use it for something else?
13:00Ryan Dezember:Yes. There's a lot of things happening and a lot of efforts. Like OSB, it's called oriented strand board. It's basically like the floor or the roof of your house. manufactured panels. And then there's like more sort of interesting new things. People are trying to develop like sustainable aviation fuel, jet fuel made from cellulose. There's fabrics. If you go through your shirts, if you have a silky one, it might be made out of something called lyosel, which is made from cellulose. Or modal is basically a member of the rayon family, which is made from pulp. You know, smokeless gunpowder for the military is made at a plant down in Georgia out of wood pulp.
13:39Ryan Dezember:So there's all sorts of new things.
13:42Ryan Knutson:If you're a timber farmer, though, these are a lot of really interesting ideas that, you know, it's hard to say at this point if they're going to pay off, but you need to make a decision you're going to be beholden to for decades.
13:52Ryan Dezember:Exactly. And that's sort of the conundrum. It's like, do you bet on that or something like that happening? Or do you do something else?
14:00Ryan Knutson:Emotionally, sort of on a human level for these farmers What do you think is going through their mind As they're trying to make a decision about whether or not to plant A tree Or even stay in this business at all
14:10Ryan Dezember:I mean, I was thinking about that And like, you know, I live in the city So like, my assets are In stocks and bonds I have zero emotional attachment to those I don't wake up and go look at them Out my window I don't take a walk through them I don't hear the birds chirping in them I don't have my family over for, like, you know, a turkey hunt or whatever. And that's what these people do.
14:33Ryan Knutson:We hunt and fish and camp out. We manage it to grow salt timber. But along the ways, you know, you see it at every age.
14:44Ryan Dezember:So there's like an aesthetic attachment to the land and to the trees and the forest itself.
14:49Ryan Knutson:It is.
14:50Ryan Dezember:It is beautiful. I think that makes it a lot harder than if, say, you or I had some need for money, and we said, oh, well, we'll just sell those bonds or sell those stocks. But if you take my 1 ,000 acres of pine trees, that's going to materially probably change my life and how I live it.
15:12Ryan Knutson:Bill isn't ready to pull the plug on the family business yet. He now has two sons that have joined the company, a fifth generation of tree farmers. And they have kids too, meaning there's already a sixth generation running around the family timberlands. Bill helps they'll join the family business too when they grow up and one day harvest the trees he planted this year.
15:34Ryan Dezember:He, like a lot of other people down there, these are very hardworking people. They have a lot of faith. They tend to be optimistic. Right now, it feels like the sky's falling a little bit, but in the end, I think we'll prevail. And so he, like a lot of other people I talked to, were kind of like something's going to turn around here for us if we can just kind of wait it out.
15:59Ryan Knutson:We've been in this going on 130 years sawmill and so. It's not going to end on my watch. We're going to figure it out and keep going.
16:24Ryan Knutson:That's all for today. Thursday, September 3rd. The Journal is a co-production of Spotify and The Wall Street Journal. If you like our show, buy The Wall Street Journal newspaper made from pulpwood. And follow us on Spotify. We're out every weekday afternoon.
16:45Ryan Knutson:Thanks for listening. See you tomorrow.
From the publisher
America is using less cardboard, which is bad news for the farmers who grow the pulpwood trees that get turned into paper products. WSJ’s Ryan Dezember explains how the cheapest, smallest trees in the forest hold up a much larger timber industry. Ryan Knutson hosts.
Further Listening:
- The Bean at the Center of the Trade War
- Is Jane Goodall Fighting a Losing Battle?
Sign up for WSJ’s free What’s News newsletter.
Learn more about your ad choices. Visit megaphone.fm/adchoices