Exclusive and in-depth analysis of all the issues in business with The Daily Reporter’s R Dempsey.
Speculate to Decorate
MOST across the world are familiar with the merry adornment that brightens homes, stores and streets, gladdening hearts with it’s dazzling hues, however, in recent times, tinsel has become a problematic substance, not only because rising demand is tipped to outstrip supply. In this exclusive overview, investigative journalist R Dempsey gets some big questions answered about the scintillating future of tinsel.
If we are to understand the present and future state of global tinsel production and demand, it’s to the past we must look first, and no one in the world is more knowledgeable about the history of tinsel than Professor Hans Lipmank, Chair of Festive Mineralogy, University of Berlin. As a world-renowned expert in tinselogy he was recently invited to address the International Colloquia on Festival Production in Chicago, where I caught up with him. He explained since the early 1600s tinsel has been a vivid expression of festivity, and a leading indicator of increasingly developed economies.
‘It’s a reflective metallic substance, which usually distributed throughout built-up areas of historically Christian lands, as it’s associated with the ritual celebrations of Christmas, and the Yuletide season generally. Through out the year, tinsel miners, busy in deep tinsel tunnels around the cooler Northern climes of the world, quarry multi-coloured tinsel ore,’ said Professor Lipmank.
‘Since it is a labour intensive product, it requires a sophisticated industrial society to produce and process it. This in turn demonstrates inequities in distribution, as less developed economies cannot afford it, for instance, Eastern European nations generally have invested little in tinsel markets.’
Professor Lipmank went on to outline how the natural ore is shipped further north for processing and claimed traditionally, tinsel is silver in colour, but ore in different regions reflects different mineral influences, with naturally occurring green, red and gold coloured ore discovered so far.
Professor Lipmank said the processing plants use various methods of cleaning the ore of impurities and emphasised while lead was once used in the processing of tinsel, growing health concerns in the 1950s boom allowed a shift in how the substance is treated so now it is toxin free – with the industry compensation fund paying out some $100b US to tinsel miners world-wide. He went on to explain how tinsel ore is pressed and cut into long strings of highly reflective and strong material.
‘Processing is usually completed by September each year, so tinsel is ready for shipment for commercial use and the Christmas season, although, I understand, there are many interested in utilising tinsel beyond it’s traditional Yule associations,’ added Professor Lipmank.
Senior partner of New York based Celebratory Stock Financial, Cyril Urshart, outlined his overview of the current investment market for tinsel and was generally positive. Said Mr Urshart, ‘Yes, I agree there is some concern over whether tinsel supplies have reached peak production as most reservoirs of the ore have been tapped. As yet though, it has not resulted in a downward trend for the stock. In fact, demand is growing, mainly as marketers plan for earlier and earlier Christmas season openings and this is despite the downturn experienced during the course of the international global financial crisis. In fact I think its marketing use has grown as part of the deliberate strategy to trade out of the crisis, through a tinsel lead recovery. Also, we have been lucky in that tinsel investors generally were not exposed to the kind of practices observed in some merchant bankers, although the US market is slightly different after the collapse of T. Selman Brothers. As for the international compensation fund, companies have factored payments into profit margins and since it has been managed quite transparently and with open consultations with unions and governments, the industry has not suffered the kind of bad publicity witnessed in other kinds of industries, such as construction, with asbestos. ’
Mr Urshart was cautious about the potential for sourcing reserves in some areas, as local political entities are often in conflict with the interests of multi-national tinsel operations.
‘It is a positive for the industry, in that any US or UN attempt to resolve localised political and societal issues have flow-on benefits to consumers. The more readily and sustainably remote reserves can be accessed, the more confident investors will become’.
In response to this growing demand, a movement has developed to reuse and then recycle tinsel, via a method similar to that with which aluminium is reprocessed. This does, however, create a considerable energy demand, which has led various green groups to take their concerns to federal governments. Noted Mr Urshart, ‘Since the Shiny Wedge Coalition approached the Australian Government; trade has actually increased on the back of rumours of more Federal funding for research.’ In Australia, some State Governments have called for a Council of Australian Governments (COAG) energy review and the introduction of a national or even international Tinsel Trading Scheme (TTS), ahead of possible state ventures into tinsel recycling, but this would be years away. In the interim, the Australian Federal Government Research spokesperson Ali Humbaba last year indicated increased interest for the sector and possible extensions to research funding, but this has yet to be announced, and many will be awaiting their next Federal Budget for further developments which could aid tinsel carbon reduced recycling technology.
There is, therefore, considerable speculation in the tinsel share markets for this durable, lightweight metallic substance. In fact, only yesterday, in an effort to halt criticism from green groups regarding high-energy use recycled tinsel, the Armenian Government moved promptly, with the State Minister for Decorative Affairs and Trade, Dr Lydia Senisian, announcing substantive investment through a public-private funding model towards further developing recent moves to experiment with bio-tinsel to meet growing demands, after ABOFE (Armenian Bureau of Festive Economics) announced third quarter sales and production figures. Under the funding agreement, a new privately funded, but Government supervised organisation will utilise genetic engineering and recombinant DNA technology to undertake tinsel farming. Already, there has been some success with experimental tinsel vines; somewhat resembling giant grape vines, being grown right now. European research centres have reported good results.
Dr Jacques De-Icconai, from the French Tinsel Research Operations Group is on record praising tests conducted to date and describes the tinsel vines thus: ‘long tendrils of tinsel are wrapped around wires, which are then plucked of leaves, and when mature, harvested in the cool of the night, then cured in dry, dark warehouses, before being polished, and finally wound onto spools. The tinsel tendrils are then factory vacuumed packaged before shipment’. However, the independent, anti-genetic engineering lobby organisation, the World Wide Group for Tinsel (WoWiGfT) have voiced some concerns over cross-contamination and the potential for international sabotage, given the volatility of the market as a whole; in response, Governments have increased security at these farms and the locations remain secret. Currently, in New Zealand, the Federal Government is outlining a bio-security strategy for potential test crops, based on the European Union model, and will also create a New Zealand Tinsel Board (NZTB) – a single desk to manage international trade, with strict guidelines legislated to reflect the GM nature of the tinsel for local and international consumers. In response, the US Government and the Canadian Government have acted strongly against the development of a single desk system, labelling it as anti-competitive. In other parts of the world, notably northern Europe, smaller nations are hoping for subsidies to remain, however, if upcoming free trade talks (an adjunct of the Doha round), which will include tinsel, are scuttled, it may dash their ambitions.
So far, early responses to market testing show bio-tinsel may yet become a popular alternative to traditional mining and industrially intensive tinsel, despite trade and other barriers. According to the latest edition of Scientian Enquirer, the most recent harvest is more drought-tolerant and disease resistant, and comes in a wider range of colours, while current crops are flourishing in poor clay soils in cooler climates. Time will tell if there is potential for GM tinsel crops to flourish, but with demand soaring, the future does look to be joyfully bright