The U.S. went from shipping boxes to China… to shipping them to Pratt.
For most of the late 20th century, the U.S. paper and packaging industry resembled an old, well-run family estate—formal, predictable, dominated by a handful of names everyone in the business could recite by heart: International Paper, Georgia-Pacific, Weyerhaeuser, Willamette, Temple-Inland, Smurfit-Stone, Mead, Westvaco, Scott Paper. Mills stamped out containerboard, turned it into boxes, and reliably earned steady returns for pension funds and long-tenured executives.
Then something unexpected happened, and it came not from Memphis, Norcross, or Stamford, but from China.
Beginning in the late 1990s and accelerating through the 2000s, the United States became the launchpad for the largest export surge of recovered fiber in modern history. What Americans thought of as recycling—pushing bins of old Amazon boxes, cereal cartons, and shipping containers to the curb—became the raw material for China’s meteoric manufacturing rise.
At first blush, it was hailed as a triumph of globalization:
America shipped scrap to China, China turned it into packaging, and then shipped products back to American consumers in new boxes.
It looked like efficiency. It was dependency.
The Great Hollowing Out
As China paid more and more for old corrugated containers (OCC), the economics inside the U.S. quietly flipped. American mills that once relied on recycled fiber suddenly found themselves priced out of their own raw material. Why invest in domestic recycling capacity when Chinese buyers would pay a premium for the waste, haul it away, and save U.S. mills the mess?
Industry logic went like this:
- If China will pay top dollar for OCC…
- And haul it away at their cost…
- Why should we bother running old, labor-intensive recycling mills?
So one by one, U.S. recycled mills shut down. Entire regional recycling systems atrophied. Mill towns lost shifts, then machines, then entire facilities. The country exported billions of dollars’ worth of used boxes rather than turn them back into new ones at home.
In hindsight, it was the same strategic mistake the U.S. made with steel, microchips, and pharmaceuticals—ceding a foundational capability because the short-term economics seemed easier.
While the legacy companies tightened their belts, cut costs, and optimized shareholder presentations, Anthony Pratt was building something the rest of the industry had stopped believing in.
Pratt’s Contrarian Bet
Pratt looked at the same trend everyone else did—but he drew the opposite conclusion.
Where the incumbents saw an opportunity to exit recycling, Pratt saw a coming void that someone would eventually need to fill. He believed that the U.S. giving up its recycling infrastructure to China wasn’t efficient—it was a strategic vulnerability. So he began buying, upgrading, and building recycling-based paper mills across America, long before anyone else thought it made sense.
He wrapped his pitch in patriotic language—American boxes, made from American recycled paper, supporting American jobs—but beneath the flag was a clear-eyed understanding of economics:
If the U.S. ever lost the export outlet to China—and it would—domestic recycling capacity would instantly become valuable again.
He didn’t need to be right immediately. He just needed to be right eventually.
The China Door Slams Shut
In 2017, Beijing announced National Sword, a policy that effectively banned most imported wastepaper. Overnight, the fiber flywheel that had spun for nearly two decades seized up.
The U.S., which had spent 20 years dismantling its own recycling mills, now had mountains of OCC and nowhere to send it.
OCC prices collapsed. What had been expensive, scarce feedstock became nearly free. For most of the industry, this was a crisis. For Pratt, it was the moment he had been building toward for years.
Pratt’s mills were already in place, already modernized, already integrated with box plants—and now they had access to low-cost fiber that competitors had spent a decade exporting out of the country.
The Punchline: A Complete Reversal
Here is the twist that would make even a hardened industry veteran stop and blink:
The U.S. went from shipping boxes to China… to shipping them to Pratt.
China didn’t set out to accelerate the rise of a major U.S. packaging competitor. But by cutting off the export market that had hollowed out America’s recycling base, Beijing unintentionally made Pratt Industries indispensable.
What others treated as trash or a cost burden, Pratt turned into a competitive moat.
An Australian investor saw the strategic opening in America that complacent incumbents missed.