The seaweed economy
Happy Sunday {{first_name}},
There are a lot of humans on this planet, which means that our species consumes a vast amount of stuff.
And unless you’re living under a rock right now and only emerging once a week to read Weekender (we wouldn’t blame you for this), you’ll know that the headlines are currently filled with unpleasant things about energy security and oil.
It’s true that the world’s geopolitical structures are largely dependent on energy supply. But it’s also true that we are really good at finding new uses for some of Mother Nature’s gifts, like seaweed.
It can’t keep Europe warm this winter and it’s not powering our cars right now, but you’ll find seaweed in far more places than you might expect. In her column this week, Dominique explains why Big Seaweed is an industry that most of us heavily underestimate.
A product that needs absolutely no introduction is coffee. Thanks to the good people at Bootlegger, you can now enjoy your coffee fix at a 10% discount if you buy it online. Best of all, they will share that love with Dominique, so you get to support your favourite Sunday writer AND score yourself some great coffee at a discount. Talk about a win-win situation!
To get this offer, go to the Bootlegger website and use the code GHOST10 at checkout. Happy shopping!
If you thought seaweed was the unexpected agricultural hero of the day, then get ready to learn about the economy of guano. Aside from a reminder that you can find value in unexpected places, the bird poo economy of the 19th century is also yet another great example of a boom and bust cycle.
In the Fast Facts, you’ll find a few other other examples of trash being turned into treasure.
Enjoy the rest of your Sunday - and go buy some coffee!
The Finance Ghost (follow on X) | Dominique Olivier (connect on LinkedIn)
Like my jacket? Thanks, it’s seaweed
It's in your yoghurt, your toothpaste and possibly your next pair of boots.
Dominique Olivier explains how seaweed moved from slimy beach nuisance to one of the planet's most valuable - and greenest - economies.
Filthy, stinking rich
TL;DR: For a brief period, the most valuable commodity of the 19th century wasn't gold, or coal, or oil. It was bird droppings, and more than one nation went to war to get their hands on them.
In the 1840s, the young Republic of Peru was flat broke. Independence from Spain had left it buried in debt and with little that was worth selling to the world. And then, almost overnight, Peru realised it was sitting on a fortune - one that had been accumulating, layer by layer, for thousands of years.
The fortune was guano, also known as dried seabird droppings.
On the Chincha Islands off Peru's coast, countless generations of cormorants, boobies and pelicans had been doing their business on the same few rocks, and because it almost never rains there, none of it washed away. The result was mountains of the stuff, piled more than 50 metres deep in places.
Disgusting as it was, guano turned out to be the richest fertiliser anyone had ever found, packed with the nitrogen and phosphorus that exhausted farmland craves. As the fields of Europe and America wore thin, guano became the miracle cure that brought them roaring back to life. Demand exploded, and between 1840 and 1880 bird muck scraped off rocks almost became Peru's entire economy. At its peak, the export of guano supplied around 60% of the government's revenue.
Naturally, where there's that kind of money, there's trouble.
In 1856, the United States passed the bizarre Guano Islands Act, which declared that any American who found an unclaimed island covered in droppings could simply claim it for the US. Americans went on to stake nearly 200 such claims around the globe. A handful remain US soil to this day.
Then, in 1864, Spain sailed a fleet across the Atlantic and seized the Chincha Islands outright, hoping to use the droppings as leverage over its former colony. That sparked one war; a second, even bloodier one would follow in 1879 as Peru and its neighbours fought over the same sort of riches. Men killed each other, quite literally, for the right to control bird poo.
Labourers - many of them Chinese workers bound in near-slavery - hacked at the guano deposits in appalling conditions until, by the 1870s, the Chincha mounds were nearly stripped bare.
Chile's nitrate fields offered a temporary alternative, but then, in the early 20th century, German chemists figured out how to pull nitrogen straight out of thin air. The one thing guano provided that nobody else could supply was suddenly being manufactured.
The price collapsed overnight.
Peru had wagered its whole future on droppings, frittered the windfall away, and limped out of the century with startlingly little to show for it. And what was, for a fleeting and weird moment in time, the most precious substance on earth went back to being exactly what it had always been: bird poo on a rock.
Dominique’s Fast Facts - “Trash to treasure”
In February 2021, fishermen off the coast of Yemen cut open a dead sperm whale and found a 127-kilogram lump of ambergris inside. This waxy substance forms in the guts of sperm whales (practically whale faeces) and has been prized by perfumers for centuries as a fixative that helps scents linger. The fishermen sold their grisly find for more than $1.5 million.
In around AD 70, the Roman emperor Vespasian, hunting for ways to refill an empty treasury, hit on an unlikely revenue stream: he taxed urine, which launderers and tanners bought by the potful from public latrines for its cleaning ammonia. When his son objected that the tax was beneath an emperor's dignity, Vespasian held a coin to the young man's nose and asked whether it smelled. This gave us the phrase pecunia non olet, "money doesn't stink".
The world's priciest coffee has already been through a digestive system. Kopi luwak is made from coffee cherries eaten, partly digested and then excreted by the Asian palm civet, a small cat-like creature. The beans are collected from its droppings, washed and roasted. Wild-collected, it sells for as much as $600 a pound, though plenty of critics insist it tastes no better than an ordinary cup. We suggest you stick to Bootlegger, especially at a 10% discount.
When oil drillers in 1860s Pennsylvania grumbled about the waxy gunk clogging their pumps, chemist Robert Chesebrough took an interest. The workers had noticed the residue, known as "rod wax", seemed to soothe their cuts and burns. Chesebrough refined the stuff, patented it in 1872, and sold it as Vaseline, now a bathroom-cabinet staple the world over.