The Forest Through the Trees
Yardley, however, says there isn't necessarily a correlation between the two, and should the economy improve it doesn't mean a price hike will follow. "I think pricing will be relatively flat, but if you look at the returns the paper industry has received, [it] needs a price increase."
What publishers can count on is the development of digital papers in the coming year. Domtar is currently working aggressively on the concept in its other divisions and Eastern Paper, based in Amherst, MA, is beta testing its Inspire product specifically designed for digital offset presses that print 70 pages per minute to 100 pages per minute. As installations of digital short-run presses increase, manufacturers turn toward technologies that will produce paper capable of running on machines and deliver a high quality performance.
"[Inspire] is absolutely made for this kind of thing," says Joe Torras, chief executive officer of Eastern Paper. "It is an uncalendered, uncoated grade with wonderful archival quality."
Torras said International Paper is another company that will introduce digital papers. As well as conceptualizing digital papers, Domtar is also looking at other opportunities in the book business for the coming year, including deploying lighter weight bulking papers into the market. The company, for instance, manufacturers a 45-lb. paper stock with the characteristics of a 50-lb. stock. A publisher now purchasing 100 tons of 400 ppi 50-pound stock can purchase 90 tons 400 ppi in a 45-lb. stock and get the same advantages.
Reduction of capacity
For an industry trying to right itself, reducing capacity and getting the most out of the equipment available makes the market more competitive. Rather than operating more machines and offering new lines, some paper manufacturers are content to improve the lines they already have.
"The paper industry has shut down millions of tons of capacity and there really isn't anything new coming [on board]," Torras says. "So the paper industry has an opportunity to balance itself if the economy grows favorably."