China's trash pickers scrap the farm for the city

SHANGHAI, Mar 2 (Reuters) In an open clearing on a sunny winter day, Mrs Liu looks as fashionable as any wannabe Shanghainese.

But her highlighted hair, black leather jacket, fake fur collar and high-heeled boots contrast sharply with the heaps of scrap rubber in a muddy hollow far from the city's skyscrapers, where several Sichuanese migrants strip soles from worn-out shoes.

Liu, 36, would not give her full name because she wasn't sure if work like hers was legal in Shanghai. But if sorting garbage is illegal, she and her family aren't the only ones doing it.

''People do this for glass, for plastic, for everything.

You'll notice that there is no garbage at the side of the road any more. There's a lot of competition,'' she said, as she served peanuts and tea on a makeshift outdoor table.

''We don't have a very big operation, but we feel fairly free and independent.'' With oil prices above 40 dollars a barrel for the past 18 months and historically high prices for natural rubber, even garbage is good value. And as China's economy roars along at more than 9 percent annual growth, the country's industries can re-use shoe rubber as fast as Shanghai's 16 million residents wear through it.

Liu's family pays a deposit of 4,972 dollars a year to a nearby garbage company for the right to reclaim rubber from discarded shoes. The company delivers about 100 tonnes of shoes each year to the reedy hollow where four families camp, then buys back the scrap rubber at roughly 500 yuan a tonne.

''It's a risk. If the price of rubber goes down, we could lose, but when it goes up, sometimes they raise the deposit requirements. It's much harder to persuade them to lower the deposit,'' she said.

The garbage business is enough to keep body and soul together for four couples and half a dozen children, who attend a school for migrants in a nearby town.

''One of us looked at Guangzhou. But you only make 500 or 600 yuan a month in the factories down there, so it's about the same.'' MIGRANTS The central government's plan for the five years up to 2010 prioritises a massive wealth transfer to the countryside, to try to stem the migration of people such as Liu to the booming coastal cities. But it's an uphill battle to keep farmers on the land when even garbage is more alluring.

Liu and her relatives come from the Three Gorges region, where farmers moving away from the rising waters of the dammed Yangtze river have increased pressure on their upland neighbours in steep and rainy Sichuan.

''We used to have a farm. But you can't make anything off the land, you can only survive. We have to provide for the kids and the older generation too, so our generation has to think of a way to make it work,'' she said.

Liu and her husband found jobs at a garbage company when they first moved to Shanghai three years ago. After about a year, they set up as scrap rubber subcontractors.

''We came and found a place first, then brought the kids.

When things aren't stable, it's not good for kids because it interrupts their schooling,'' she said.

The families cook, and sometimes sleep, in plywood shacks surrounded by bags of shoes and piles of blue rubber tubing.

When school is out, the children race bicycles around the clearing, making their mothers despair of keeping them clean.

A plastic tarp, weighted down by a sneaker, keeps rain off the work area but does nothing to prevent chillblains and achy hands. When it's too cold, or too hot, the workers sit out a day.

Despite the weather and the pressure to process enough shoes to clear expenses, Liu said there were some benefits to living far from farm or factory.

''We have more freedom this way. No one's bossing us around.'' REUTERS KD DS0945