Industry consolidation and contraction is a response to this dismal financial performance. It is balanced by increasing efficiencies, decreasing demand (remember, we’re talking about book-publishing papers), and a growing global marketplace––especially in Northern Europe, China, Indonesia and elsewhere in Asia––that is leapfrogging U.S. protectionism and shipping imported papers, especially coated stocks, when needed to meet demand.
According to Jack Miller—a senior consultant in North America for Pira International, a global provider of information, testing and consulting services to the paper, print and packaging industries and their supply chains—“net capacity in the United States is still diminishing, although it is partly made up for by upwards efficiency creep of 1 [percent] to 2 percent per year.”
Yet, he also notes that, “in the last 25 years, paper prices have trended flat and, if inflation-adjusted, they have actually been going down. This year, paper prices are up, but the question is: Will they cycle down as in the past, or will they stay up? If the market is now truly global, then lower-cost competition overseas will push prices down,” continues Miller. “Short term, however, factors such as the weak U.S. dollar and high transportation costs are holding down competitive imports.”
It is also useful to note that U.S.-publisher paper consumption is, to an extent, independent of North American mill capacity. Books printed in Asia and Europe for U.S. publishers and shipped back for sale do not draw upon North American mills.
Where the Paper is “Greener”
One of the great stories of behavioral change in recent years in paper-making and purchasing is the growing commitment by the publishing industry supply chain to environmentally friendly practices in paper manufacturing and usage, edged along by organizations such as the Green Press Initiative (www.GreenPressInitiative.org) and the Canadian Markets Initiative (www.MarketsInitiative.org), which help publishers improve their environmental impact. Guidelines for such improvements, as well as lists of paper mills, printers and publishers taking part in these initiatives can be found on the organizations’ Web sites.
Eugene G. Schwartz is editor at large for ForeWord Reviews, an industry observer and an occasional columnist for Book Business magazine. In an earlier career, he was in the printing business and held production management positions at Random House, Prentice-Hall/Goodyear and CRM Books/Psychology Today. A former PMA (IBPA) board member, he has headed his own publishing consultancy, Consortium House. He is also Co-Founder of Worthy Shorts Inc., a development stage online private press and publication service for professionals as well as an online back office publication service for publishers and associations. He is on the Publishing Business Conference and Expo Advisory Board.