We have worked hard on putting this list together. For the last three months we have been badgering and annoying industry professionals from all over the world with questions on just who they think should be on the list. The people we asked were consultants, economists, journalists - and it will not have escaped your notice - you, our readers.

The response has been phenomenal, not just the amount of nominations, but also the variety. From forest to pulp, to paper, and then into the world of the consumer - there is even a very high level politician nominated! But I am giving nothing away in this blog, I am not even going to list the top five, you are going to have to wait until PPI July lands on your own desk, and if you don’t get it, beg, borrow or steal a copy as it is vital reading if you work in this industry.

What I will give away however, is the names of two of the people on our separate list, the one of those influencers who are no longer with us, the masters of invention who have passed on. These two in particular passed away a long time ago, in fact one centuries ago, and the other millenniums ago, but they have - and still do in their own way - wield a massive influence, not only on the paper industry, but on the world as a whole with their inventions of pure genius.

At number two on the list of deceased greats is Johannes Gensfleisch zum Gutenberg, inventor of movable type and therefore the father of the mass produced printed word. This invention was one of the foundation stones of modern civilization as we know it, movable type allowed education, learning and methods of advancement to be communicated at a totally new level never before experienced. This is why the great man was voted as “Man of the Millennium” by American journalists in the book “1000 Years 1000 People” published at the turn of the millennium. The invention, of course, also transformed paper making into the mighty colossus it is today.

But the number one spot must be reserved for Cai Lun, or Ts’ai Lun, the Chinese court eunuch who in 105AD invented the stuff that every day we write on, write about, talk about and who some of us even make. In a very recent title, The Observer Book of Invention, Lun was given the first and foremost page in the book, under the title of “Fathers of Invention: great figures who shaped our world.” One quote from the page said: “This invention set China on a path that would make it the world’s scientific and technological superpower for more than a millennium. Whereas before the only writing medium had been costly silk or heavy bamboo, the cheap, lightweight paper invented by Lun, allowed the civilization to flourish……..”.

And this all goes to prove that history really does repeat itself.

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However, Canfor Pulp Limited Partnership (CPLP) is able to keep its energy costs low by generating power from bark and sawdust, which would otherwise have been wasted, and has an unexpected ally in the form of the mountain pine beetle. An infestation of these beetles is killing mature pine trees. This has significantly increased the level of harvesting, local fiber costs have halved, and CPLP is taking advantage of this short-term opportunity to invest in sustainable business improvements.

The company operates three mills in Prince George, BC, which have developed relatively independently and have their own working cultures.

Why Shell?

CPLP wanted to facilitate the sharing of best practices and introduce consistency to the asset management across its mills. In January 2004, when Canadian Forest Products acquired 100% ownership of the three mills, the company embarked on an asset management improvement program with Shell Global Solutions. When the program started, Chris Smith, central maintenance manager for CPLP, heard some cautionary voices. Smith says, “Some people initially asked what a member of the Shell Group, normally seen as an oil industry specialist, knew about the pulp and paper industry. But, not coming from our industry was actually an advantage.”

All industries, like companies, have their own cultures, and we all have our own challenges. The refining industry, in my opinion, has some of the best maintenance and reliability practices, and we have benefited greatly from its external perspective. Working in our industry was a new experience for Shell Global Solutions, and both parties gained from what was a real collaboration.

Shell Global Solutions has successfully introduced asset improvement propositions to the refining industry; these are proving to be transferable and are adding value to other process industries.

CPLP’s vision for its improvement program is to develop a world-class asset management system and best-in-class practices, and the cultural changes to sustain and improve these practices.

Smith continues, “We had planned to increase our mill turnaround interval from 12 to 18 months. Some regulatory and operating issues concerned us, and we wanted to make sure processes were in place that would enable us to sustain this longer interval. Some of the processes in the improvement program are already well established, but Shell Global Solutions brought focus and discipline to the exercise and challenged the way we worked – forcing us out of our comfort zone. They also brought in a risk-based approach by introducing us to the Shell risk-based inspection (S-RBI) and Shell reliability-centered maintenance (S-RCM) processes and the use of the risk assessment matrix for decision making.”

Improved reliability

The program has helped to improve the reliability at the mills through the application of the S-RCM and defect elimination processes, which have, in turn, facilitated product quality improvements. Minor failures do not necessarily result in lost production, but can upset a plant and influence product quality. Reducing these minor disruptions has made quality control easier and resulted in more high-value product.

The total maintenance costs have been reduced too, partly by extending the turnaround interval. Smith says, “We cut total maintenance costs by 20% in 2005, relative to the 2003 baseline. Doing the right work at the right time is important.

“By critically reviewing everything we do and asking whether the work is required and whether it can be done during plant operation or an area shutdown, we have reduced the volume of work undertaken in the turnaround. We can now set accurate duration targets for turnarounds and meet them.”

Pump maintenance is a good example of the change in working practices. People want to do a thorough job, and the tendency was to dismantle pumps to see if anything was wrong with them. But pulling a good pump apart unnecessarily can increase the risk of failure. Now, the maintenance engineers look at the pump’s performance and ask themselves what the likelihood and consequences of failure are before deciding whether the work is required.

Jamie Collis, maintenance and reliability project manager, Shell Global Solutions (US) Inc., says, “This is the first asset management improvement program that we have done with a pulp and paper company. The program has been a success, and we have learned a lot about the industry.”

Whether they are macro-stickies or micro-stickies, they produce sheet quality issues and runnability issues. They are a part of the package and they are not going away. Improving the control mechanisms for stickies continues to be a major goal for equipment and chemical suppliers.

One of the major issues when developing control methods for stickies is the fact that they are comprised of a wide range of chemistries. They have various melting points, tackiness, densities etc. The result is that there is not one method that will work on all stickies. In recent years the expansion of single stream recycling has resulted in recovered paper streams that are more mixed. With single stream recycling, the ONP will now contain OMG, MOW and OCC. Depending on location, some recycled newsprint mills report that they now run 100% ONP. The OMG that they used to add is now in the ONP that they purchase. In addition, more OCC and MOW in the ONP means more stickies. Not just more stickies but a more diverse mix of stickies.

Not only stickies

If you analyze stickies deposits you will find some wood pitch in almost every case. This is especially true in newsprint and other grades that include mechanical fibre.

A few years ago Buckman introduced the Optimyze product line. These innovative products are enzymatic stickies control agents. PVAs are one of the most common problematic stickies. The enzyme in Optimyze is an esterase that will catalyze the breaking of the ester bonds that make up the PVA chain. Breaking the chain creates smaller stickies and less "stickie" stickies.

While Optimyze has proven to be an effective stickie control agent, in some cases the nature of the stickies has not been predominately PVA. In these cases stickies control has not been fully achieved. What were required were products that had an effect on a wider range of stickie chemistry types.

One of the benefits of enzymes is their very specific action. An enzyme acts as a catalyst on one type of chemical reaction. This means that enzymes can be targeted to specific goals. On the other hand this can be a shortfall. Stickies cover a wide range of different chemistries so to act them all you need combinations of enzymes and or other chemistries that act on the stickies.

Targeting the pitch

Another factor in the use of enzymes is the fact that they work in a specific pH range. This varies for different enzymes but for Optimyze the effective range is 6.5 to 10. This places a limitation on the application of Optimyze. In newsprint mills that use deinked recovered fiber and TMP, the paper machine pH is the same pH as the TMP in many cases. This pH is below the effective pH range for Optimyze application in the stock.

At first Optimyze was applied in the stock system. As more was learned about the technology the “point of problem” application method was developed. Optimyze was applied directly to forming fabrics and press felts through the cleaning showers. By making the surface of the stickies less “stickie” the various cleaning showers in the forming and press section can more easily remove them. This application method removes the system pH as a factor.

Buckman has introduced the Optimyze Plus range of products. The first product developed includes the same enzyme as Optimyze but adds an enzyme that targets wood pitch. Both wood pitch and stickies can act as binders in deposits and by attacking both you increase your chances of success.

In addition to products that combine two enzymes Buckman is investigating products that combine an enzyme with dispersant chemistry. The dispersants can play two roles, dispersing and stabilize the stickies and also helping the enzyme to penetrate the stickies to work from the inside rather than just at the surface.

Stickies still remain a challenge. Market factors and the move to single stream recycling are making the problem more complex and harder to control. New applications of enzymatic stickies control agents and new combination products add new tools to help mills address stickies control.

To witness how much production has decreased since the housing bubble popped, one needs to look no further than the most recent statistics from the Western Wood Products Association (WWPA). In 2006, 1Q lumber production in North America was 19.40 bbf. By the 1Q this year, production had dropped to 13.71 bbf, or 29.3% below the 1Q 2006 figure. This decline is considerable, yet compared to declining housing starts over the same period it would appear short of what is needed to give producers a greater degree of leverage in markets.

This is not to suggest that production must peel back by 50% because housing starts are down that much. In 2006, when both production and consumption were at their height, prices were exceedingly strong. This suggests that North American lumber availability at that time tended to lag to some degree the rate of consumption during the housing boom. Therefore, production cutbacks do not necessarily need to keep pace with declining housing starts to solidify market prices. Furthermore, despite a slower economy, industrial usage of lumber has remained strong, absorbing a significant percentage of production.

This is an excerpt of a story that appears in Crow's Weekly Market Report, the longest-running source of pricing and market reports for the North American lumber and panel industry.

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According to Crows Weekly Market Report, their composite lumber price dropped from $264 to $261 for the week ending June 20, 2008. Lumber prices at this level are below the breakeven production cost for most dimension sawmills--even large capacity producers that enjoy significant economies of scale.

In this hyper-competitive environment, mills must squeeze every available efficiency out of their production process. Most large capacity producers have already embraced state-of-the-art sawing optimization technology to maximize their lumber recovery, so what else can be done? A lot.

Through research for its North American Lumber Cost Benchmarking Data, RISI has identified numerous mills that can provide valuable lessons in adaptation and innovation.

This is an excerpt from a full story that is available in RISI's Wood & Timber News Service.

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The statistics released in May were shocking: North American demand declined a whopping 13.5%. End-users had finally run out of room for inventory and started cutting orders sharply to match the performance of their true consumption of paper, which has been very weak all year.

The result of the slump in orders for May was a sharp rise in mill inventory of paper. Up until the last two months, all of the inventory build had been at the printer or end-user level, while mill inventories declined and remained very lean. During April and May, mill inventories jumped 85%, rising from 155,000 tons in March, to 289,000 tons in May. These inventories are still below year-ago levels, so they are not out of line. However, the speed with which these inventories are rising (2 months) is dramatic, and the fact that end-user and mill inventories are now both high while demand is weak is very disturbing to the market.

This is an excerpt from a full story that is available in RISI's Pulp & Paper News Service.

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Equally as disappointing was the fact that Mr. Fox would seem to diminish the importance of forest products in favor of ‘higher value’ cargo as a way to further increase export valuation. Citing examples of JCB earthmovers and Mercedes SUVs, his suggestion is to reshape the balanced approach the Georgia Ports Authority (GPA) have taken on imports and exports in favor of searching for more expensive products to ship overseas.

To his defense, in the larger scope of the U.S. trade deficit, there has been a growing gap of imports to exports in the past few decades. Despite some recent reductions in imports due to the economy, most U.S. ports still run a heavy deficit of exports. And it does appear the GPA indeed found a way to close this gap.

Through infrastructure investments, Georgia’s ports have worked closely with carriers to offer a diverse offering of both breakbulk and containerized cargo to increase their appeal, and their traffic. The Port of Savannah, now the fourth largest port in the U.S., has every reason to shoot for becoming number two, behind the combined Los Angeles and Long Beach operations.

Part of the reason for this growth, at least in the terms of exports, must be found in Georgia’s forest products. Georgia is still the leading producer of paper and pulp in the U.S. More than 10% of its total export valuation to world markets, over US $2 billion, is attributed to paper products, wood products and the forestry sectors.

This strength in forest products exports in Georgia is matched by the continued growth of the U.S. in world forest products exports, most notably to the Asian markets. As John Day, CEO of RISI, pointed out at the IFPTA Asian Regional Seminar in Shanghai, China, Asian demand and consumption for paper and board is climbing faster than any other region in the world. And the Americas, lead by U.S. production, looks to be their primary supplier for the foreseeable future. With the continued growth in the Asian economies, most remarkably China’s, this trend shows few signs of reversing anytime soon.

All of which brings us back to the subject of one port in Savannah. Why would Georgia want to start looking at more manufacturing support to increase exports of consumer goods overseas? Or more to the point, would the increasing global demand for forest products support Georgia in placing any less emphasis on the business of transporting forest products?

Within a global economy, the balancing act of imports to exports should not be shouldered by one port alone. More precisely, the valuation of the cargo for any one port does not to be measured against the total trade deficit of the country. The key to a completely balanced trade flow for any country is to let each region excel in its own area. It would be hard to imagine world demand for forest products being satiated by more U.S. manufactured consumer goods shipped out of Georgia.

The idea to promote a more balanced trade flow for the U.S. by increasing exports is correct. Overall, the U.S. should be concerned about its trade deficit. However, asking Georgia to further diversify, especially if it means at the expense of forest products, would be like killing the goose who laid the golden egg. The question should not be “What else can Savannah export?” but rather, “How can Savannah continue to lead the way in forest products exports?”

The business of transporting forest products is, understandably, neither one of the most popular nor glamorous subjects. Within the general audience, you might be hard pressed to find more than a few people outside the industry who grasp its significance to the overall U.S. economy. Current events, however, are changing this dynamic.

With the recent shifts in the economy, the focus on exports has taken over the discussion. Concerns over fuel prices have also brought the subject of transport to the forefront. In layman’s terms, it has become a perfect storm to talk about forest products transport and its effects on the overall economy. The mainstream press is no slouch. They have already started to pick up on this topic. Let’s hope they continue to give it the attention it deserves.

To read Justin Fox’s article in TIME magazine, go to http://www.time.com/time/magazine/article/0,9171,1810318,00.html

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The Best Record Award was sponsored by Pulp & Paper. This award specifically acknowledges the companies who had the best safety record of 2007. The recipients included:
Corrugated Converting: Weyerhaeuser, Bowling Green, KY
Paper Mill #2: Boise Paper Solutions, DeRidder, LA
Paper Mill #3: Weyerhaeuser, LA
Pulp Mill: Weyerhaeuser, Grande Prairie, AB
Recycle Collection: Smurfit-Stone, Oakland, CA
Recycle Mill: Weyerhaeuser, Hueneme (Oxnard), CA
Sawmill: Smurfit-Stone, Homerville, GA
Sheeting Converting: Boise, Jackson, AL
Specialty Converting: Temple Inland Graphics Resource Center, Indianapolis, IN.

Other awards presented included the Most Improved, which was sponsored by Weyerhaeuser Company. Winners were:
Corrugated Converting: Temple-Inland, Crawfordsville, IN
Paper Mill #2: Boise, Jackson, AL
Paper Mill #3: Weyerhaeuser, Pine Hill, AL
Pulp Mill: Weyerhaeuser, New Bern, NC
Recycle Collection: Smurfit-Stone, St. Louis, MO
Recycle Mills: Weyerhaeuser, Henderson, KY
Sawmill: Green Bay Packaging, Plumerville, AR
Sheeting Converting: Green Bay Packaging, Chickasha, OK
Specialty Converting: Mohawk Fine Papers Inc., Cohoes, NY.

Finally, the Award of Excellence, which was presented to:
Paper, Pulp, Tissue and Boxboard Mills: Smurfit-Stone, Hodge, LA
Corrugated Converting: Smurfit-Stone, Williamsport, PA
Woodlands, Sawmills, Wood Products, Plywood and Particle Board: Temple-Inland, Hope, AR.

The PPSA is an important organization that continuously highlights the importance of staying safe in the workplace. For more information about PPSA, check out their website at www.ppsa.org.

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Bridge reckons the total manufacturing cost of the bicycle would be around $30, cheap enough to allow poorer members of society to buy one and also cheap enough to deter potential bicycle thieves. Environmental friendliness is, of course, another advantage of this ingenious invention.

Creative new uses for paper are not limited to the transport sector. Some of our brightest minds have also turned their attention to the home.

Firms such as Sweden’s ReturDesign and the Paris-Based La Compagnie Bleuzen are designing and building cardboard furniture for everyday use. While their products are still firmly in the novelty category, rather than the norm, who’s to say that, 10 years from now, we won’t be sitting on linerboard rather than leather? After all, who, a decade ago, would have predicted the runaway global success of flat-pack self-assembly furniture?

The home is also the focus of an Australian project called ‘The Cardboard House’. Architects Stutchbury and Pape, in collaboration with the Ian Buchan Fell Housing Research Unit at University of Sydney, and using materials supplied by Visy Industries (recycled board and a waterproof roof made from HDPE plastic), have built a low-cost, 100%-recyclable house that is designed to be a genuine temporary housing option (e.g. for emergency housing or while a home is being renovated).

The Cardboard House follows on from the work of Japan’s Shigeru Ban Architects (SBA), which has been using paper tube structures as the basis for housing, civic and temporary buildings since the early 1990s, including, most notably, the Japanese pavilion at Expo 2000 in Hannover, Germany.

Paper wears well

While these cardboard structures aim for some kind of permanence, at the other end of the scale, paper’s strength is its disposability. “Did you hear about the cowboy who wore paper clothes? He was arrested for rustling.” Before it became a bit of a bad joke, disposable paper clothing was for a few years in the 1960s, both a fashionable and lucrative consumer product. By 1967, well-known names such as Kimberley-Clark, Scott and Hallmark were among more than 60 companies producing clothes made of paper, often worn at parties, until growing public concern about ‘throw-away’ goods led to a rapid decline in demand.

While the consumer market died, paper clothing found a niche in the medical sector and among painters and decorators. In hospitals, the battle between paper and cloth patient examination gowns is comfortably being won by paper. So much so that a leading US supplier of cloth gowns, Nixon Uniform Service and Medical Wear, has taken to throwing its weight behind a campaign group called ‘Patients against Paper’, an attempt to convince supplies purchasers that patients prefer cloth gowns!

What all these examples show is the amazing versatility and usefulness of paper, whether at home, at work or on the road. What other material gives designers and inventors so much scope? Let’s see what they come up with next.

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Chinese faces were rare at the biggest European exhibition and conference of the year. Meanwhile the passion for the Eastern market among suppliers is increasing.

When asking the main suppliers to the industry about the Chinese paper and pulp industry’s future amid higher fuel and labor costs along with fiber shortages, the answers were surprisingly positive.

Metso will expand its production capacity and office facilities in Shanghai, China, through an investment of Euro 20 million. The investment supports the company’s global presence strategy by increasing production resources in Asia’s growing markets.

Voith Paper is very optimistic too: “We have every confidence with regard to China’s paper and pulp industry as we know that the country is planting in the south and also working hard on paper collecting to solve fiber shortage issues. However, water is an issue and how to get Chinese mills to reduce water usage is something we would like to help with,” says Hans-Peter Sollinger, president of the company.

Other emerging areas the suppliers are watching include India and Russia.

“India is taking off, while the business in Russia still face challenges, especially political issues,” says Bertel Langenskiöld, president of Metso Paper.

“Several large projects are expected to be decided during the second half of 2008. We are actively quoting projects in Uruguay, Australia, Brazil, and China,” says Andritz.

While western suppliers are looking east, Chinese suppliers are going to the west to attract their clients. Chinese companies I met at SPCI included among others Zhejiang Linuo Valve Co, Ltd, Xuzhou Industrial Fabric Factory, Shandong Institute of Advanced Ceramics, Hebei Asian Sage Industry Co., Ltd, and Jiefeng Machinery.

“It’s the first time I have attended an exhibition in a Nordic country, I find it a bit quieter than I expected, compared to Chinese events but it’s good to be exposed to the western world,” says Zhang Feng, Jiefeng Machinery.

Fiber shortage

The other exciting event was the recent 9th RISI Asian Pulp and Paper Outlook Conference, held in early June, straight after SPCI.

Unlike the current western market, where people focus on energy efficiency and clean fuel, the Asian market keeps an eye on the crucial issue for further development – forestry and fiber, which China is especially short of.

Alternative fiber, including bamboo pulp lines are one of the solutions. Guizhou Chitianhua Paper Industry’s presentation aroused attention among the attendees. The bamboo pulp mill, Chitianhua, in inland China is the largest single-line bamboo pulp mill in the world.

“China has the richest bamboo resource in the word. The bamboo forest areas that are utilizable for papermaking are estimated at around 2 million hectares, while bamboo volume reaches around 135 million tonnes. China’s bamboo output is estimated to reach 1.7 million tonnes by 2015,” says Zhang Ding Jun, chief engineer of the company.

Lee & Man, one of the biggest containerboard players in Asia is also looking into building pulp lines to feed their paper machines. Now the company has one SBSK mill in Samoa, California and one BHK mill in Chongqing, China. The company is also looking into building pulp lines in Vietnam.

Clearly, East and West are becoming closer as both sides of the world tackle similar issues with regards to fiber and energy, it’s good to know that hard work is being done behind the scenes by both suppliers and producers to alleviate these problems.

RISI is the leading source of global news for the forest products industry.

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Numerous hot topics were addressed at the recently completed RISI Asian Pulp & Paper Outlook Conference in Shanghai including: the high price of oil and coal, the weakening US dollar and the seemingly non-stop rise in prices for recovered paper. But one additional topic I frequently heard from both Chinese containerboard producers and major international paper traders was how difficult it has become for Chinese mills to export their containerboard, especially since April 2008 when the Chinese government announced their latest policy on the so-called "process trade" practice.

Process trade, a very popular practice adopted by many Chinese containerboard mills, especially in the Pearl River Delta area, is divided into two forms of practice. The first is for those mills that import recovered paper/pulp, make it into containerboard and then sell their board to consumer products companies, who use the board to package their products for export. The other form is for those mills that import recovered paper, make it into containerboard and then directly export the containerboard in reels or sheets. According to the latest policy, this latter form of practice has been simply banned since April 2008. Of course, Chinese mills could always export their board under regular trade practice. However, under regular trade practice, mills have to pay 17% VAT for imported materials (OCC and pulp). Containerboard producers have needed to increase their export prices to cover this additional cost, making them uncompetitive on the international market.

Let us shift our attention back to Chinese containerboard exports. Compared with the other major Asian containerboard exporting countries (South Korea, Taiwan, Indonesia and Thailand), China's recycled containerboard exports (which includes both recycled liner and medium) grew from a very low base of only 20,000 tonnes in 2002 to 400,000 tonnes in 2007. This yielded a five-year (2003-2007) compound annual growth rate of 77%. RISI estimates that from 2002 to 2005, recycled liner and medium claimed an equal share of China's overall containerboard exports. However, a shift began in 2006, and by 2007, recycled medium exports accounted for more than 85% of China's total recycled containerboard exports.

This is an excerpt from a full story that is available in RISI's PPI News Service.

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Our first visit was to Holmen Paper’s Braviken mill in Sweden, where we had the chance to see the new Metso TMP plant. We took a very comfortable and glamorous ship to Turku, in Finland, where we visited Metso’s air and chemicals systems plant. At the same day, we went to a power plant at Pori Energy, which is quite different from pulp and paper mills.

One of the most interesting meetings to me was Metso Automation, in Tampere. That is the place where technology dominates the environment – lots of cables, wires, hardware stuff, and lights blinking all the time… Everything to make machines work independently!

The visit to Metso’s RDT and new pilot machine at Metso Paper Jyväskylä was a very good experience as well. That is a good example of how beautiful and pleasant a paper machine can be – you can even make and drink coffee while you pass through a huge machine!

At Stora Enso’s Varkaus mill we could see its revamped PM 3, the world’s first fully rope-less fine paper machine. We also had the chance to go to Botnia’s Joutseno mill, which produces 645,000 tonnes/yr of softwood pulp. Finally, we visited Metso Paper’s technology center in Anjalankoski.

Back in Brazil, I could better analyze my feelings about this great experience. I was very impressed with the cordiality and friendship that the Finns showed all of the editors on the trip. For a Brazilian like me, used to the “hot” Latin American way of dealing with people, it’s common to think that Swedes and Finns are “cold” like the ice and snow that dominates the region more than half of the year.

But I was wrong, completely wrong. Maybe they are a little bit more reserved and formal than Latin Americans, but people are very friendly and, in most cases, funny. I could feel the happiness in the atmosphere and see the smile in people’s face mainly because of the summer time. Everybody was enjoying the sun that “never sleeps”. As Metso’s guests, we could live part of their routine, enjoying their saunas, the beautiful view of the nature with thousands of lakes, and the really good food.

But the country is also well known for the technology. The largest industry is electronics, followed by machinery, vehicles and other engineered metal products. Then comes the forest products industry and chemicals. Tree plantations occupy approximately 60% of Finland’s surface and feed part of the demand of its pulp and paper mills; with most of the remaining wood supply coming from Russia and other European countries.

Finland has a population of around 5.5 million people. The most important companies in the country, which employs thousands of people, are Nokia, Stora Enso, UPM-Kymmene, Neste Oil, among others. Metso, for example, employs 9,400 people in Finland.

The pulp and paper’s industry center of gravity is shifting from Europe to Asia and Latin America where demand is rapidly increasing and production costs are much lower. But the technology still remains in Europe, where special people invent almost everything the world’s papermakers need to improve their business.

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- James A. Autry

One of my close friends is retiring after 42 years as a teacher and principal. She said to me recently, "From the time I knew I was re-retiring, I have had an overwhelming desire to tell the world how I feel about teachers." To do just that, she wrote for a publication, a piece describing the positive, life-giving colleagues with whom she's worked, and the challenges they face daily. She concludes, "I've been blessed by meeting and working with teachers who love children. What a legacy! Is there a better place to be than among people who truly love children?" Her question got me thinking about the workplaces where I've been and the hundreds of people I've met in those workplaces. Not all of them, of course, but those who stand out, even years later. What is it, I wondered, that makes them memorable? It's certainly not their title or status. It's not their brilliant intellects or their sparkling personalities. I've met my share of queen bees and drones, shooting stars and dim bulbs. No, I remember vividly those who connect with people. I don't mean "people" in general or people as "human resources." I mean those who connect with individual persons, and care deeply about their lives, hopes and aspirations. Loving others in the workplace is not the exclusive province of teachers and children. I recall most those who love without apology.

One of my favorite business books is James Autry's Love and Profit: The Art of Caring Leadership, a collection of practical advice, personal reflections and "how-to" pointers. Autry, a successful Fortune 500 executive, startled me years ago with the premise of his book, rooted in his experience. He unabashedly trumpets the need for love in the workplace. Even more startling to me at the time: he makes no apology for his belief that love and profit, the be-all measure of business success, are inextricably bound. The notion no longer startles me. It seems obvious.

Love and profit? I can almost hear the skeptics sneering, "Get real." So, what would be the impact on your workplace if everyone worked with passion and felt a deep connection to the organization, eager to move it forward? Conversely, what if they were basically "checked out," putting in their time but not their energy? Or worse, suppose those same people weren't just disgruntled themselves, but actively worked to undermine

everything. That's the difference between people who are engaged, not-engaged and actively disengaged. The impact on the bottom line, I suspect, would not be hard to measure.

According to a recent Gallup Management Journal semiannual Employee Engagement Index, the current percentage of truly "engaged" employees is 29%. A 54% majority are in the "not engaged" category. The "actively disengaged" comprise 17% of employees. And what makes the biggest difference? It is the depth, sincerity and quality of their relationships with peers and bosses alike. So many people are disengaged from their jobs, from the workplaces where they spend a third of their lives because of negative—or non-existent—workplace relationships.

My friend's retirement thoughts sent me searching for my dog-eared copy of Autry's book. I rediscovered in it a one-page reflection called "Threads" that includes these words:

Sometimes you just connect,
Like that,
No big thing maybe
But something beyond the usual business stuff.
It comes and goes quickly
So you have to pay attention...
Listen.
In every office you hear the threads of love and joy and fear and guilt,
The cries for celebration and reassurance,
And somehow you know that connecting those threads
Is what you are supposed to do
And business takes care of itself.

Call it what you like: "caring managerial relationships" or perhaps "positive personal interactions." I prefer "connecting and engaging with people." What's love got to do with it? Maybe everything.

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But to draw a direct parallel between housing and all forest products is inaccurate, however interesting it becomes in this instance. Without question, housing plays largely in the matter of imports, particularly commodities imports such as plywood, lumber—especially from Canada—and finger joint mouldings. Some of the countries that export these products also figure largely in the door and window markets, as well.

Housing has played a harsh role in reducing wood products imports, enough so that when housing does rebound some industry observers have voiced serious reservations with regard to offshore suppliers. So depleted have they become because of the current market downturn, finding sufficient supplies could be a major problem.

This is an excerpt of a story that appears in Crow's Weekly Market Report, the longest-running source of pricing and market reports for the North American lumber and panel industry.

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It’s no secret that over the years conferences have become smaller and fewer, a reflection of the fortunes of the industry as well as the decreased number of people who work in it. Finding the opportunity to leave the mill for any length of time can be difficult. And, there is the soaring cost of transportation. Still, these events can be valuable places to network and exchange ideas. As is often said, just finding that one idea that would work for your mill more than pays the costs.

Sometimes, it is difficult to say what makes an event successful: good program, right time at the right place. But, whatever the reason, the recent PaperCon was a success with more than 1,000 delegates registered and, it has to be said, a very high percentage came from producing companies, a very welcome change from recent years at many conferences when suppliers could outnumber mill delegates by as much as four to one. Not that there is anything wrong with suppliers, but even they will say they do not want to attend events when the only people they talk to are other suppliers. And, without supplier support, most conferences would be dead in the water.

Not so different

I don’t know about you, but I was very taken with Gary Kelly’s keynote address. Kelly is CEO and vice chairman of Southwest Airlines, which helped revolutionize the aviation industry with its fare structure, no-frills operation and routing. Although it may seem like pulp and paper and aviation have nothing in common, Kelly was able to skillfully draw parallels.

He told delegates about the challenges facing his industry: high labor and fuel costs (accounting for 70-75% of Southwest’s operating expenses; it’s a cyclical industry; high fixed and capital costs; “brutally” competitive with new startups happening all the time; highly regulated. In many aspects it is very commodity-like: Travelers want the lowest fare. Does all of this sound familiar? Isn’t it nice to know we’re not alone?

How did Southwest succeed? As well as low fares, the airline became famous for its customer service, including on time delivery. Its employees are a very satisfied lot. Although 80% unionized, there have been no strikes and unlike most other airlines, job security has not been an issue. The pulp and paper industry is not an island. We can look outside to see if other business models can help. The long line up of delegates wanting to speak with Kelly after his talk was over attests to that.

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The rapid growth of low-cost pulp capacity in South America, due to the high yields of its plantations and the depreciation of the regional currencies at the beginning of this decade, has led producers to invest in new capacity in the region. BHK capacity expansion in Latin America averaged 10.7% annual growth from 2002-2007. Even so, operating rates have been above the 95% level since 2002 and are expected to remain averaging 94% from 2008-2012. For the next five years, capacity growth will slow down to 6%, peaking at 19.4 million tonnes in 2012.

Most of the new large-scale market pulp capacity additions already expected to come online by 2012 will occur in Latin America. Brazil accounts for roughly 70% the new capacity, followed by Uruguay. European companies are increasing their interest in South America, attracted by local low cost fiber. Besides the recent expansion by Finnish, Botnia, into Uruguay, the Spanish, Ence, the Portuguese, Portocel Soporcel, and the also Finnish, Stora Enso, are all planning future expansions. The new Votorantim Celulose e Papel (VCP) mill with 1.3 million tonnes per year in Três Lagoas, Brazil, is the next project to be started up in the region.

This is an excerpt from a full story that is available in RISI's PPI News Service.

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At the outset I should put my cards on the table; I believe that one should never miss an opportunity to use paper. I am one of those individuals lost for many years in the paper, publishing and printing industry. I began my career, like so many in the paper industry, with a hands on apprenticeship at Wiggins Teape fine paper mills. This was one of the two "schools" which despatched trained people into the wider industry. As with many before me, I eventually left to become an agent, subsequently working for a number of European mills, selling and marketing fine, niche, speciality and value added papers but always maintaining a strong interest in publishing.

It was in the, mid 1980s that I began to take an interest in environmental matters. As I wasn't a trained forester or environmentalist, I took a somewhat more practical view - at that time some one pointed the finger at me and said "It's you paper makers who are destroying all the trees and spoiling the environment". In response to such a charge you can either bury your head in the sand or as I did, ask questions and find out the facts. What I found strengthened my commitment to both the environment and the papermaking industry and an ongoing campaign to spread the message of how good we are but how poorly we have promoted ourselves.

Over the past five years, papermakers have worked hard to consolidate and manage manufacturing, to balance supply and demand and therefore protect returns. As we started to see the small buds of success beginning to sprout, we were hit from the left field by the weakness of the dollar and the subsequent problems it caused. Most of the European manufactures readjusted their aim back home and unless US customers were prepared to pay significant increases, supplies were curtailed. Many breathed a sigh of relief, and redistributed tonnage across Europe, at the very time at which the credit crunch pushed Sterling off the European shelf - from Treasure Island to Poor House in under six months.

These fluctuations in the currency market will bring both positive and negative factors for different segments of the industry. Many businesses will have to consider point of supply, location of print, distribution cost and the location of the end use, balanced against currency and environmental impact.

UK Print PLC has the opportunity, price wise, to win back print orders from continental Europe, who in turn have the opportunity to offer better prices and faster turnaround than the Far East, without bearing increased transport costs, whilst maintaining a lower carbon footprint. These opportunities arise just as one of our oldest and leading book printers has closed its doors and others have recently been bought by groups and merged.

The environment has become one of the most talked about areas of our industry and to quote a recent catch phrase we have "good times and bad times" ; it is of course good times that so many are concerned with and every day more people learn more, but we still suffer too much from "Greenwash" and some appalling misinformation. We hear TV and radio presenters describing their multi-page scripts as "a forest" - which is of course, rubbish. Recently two FTSE 100 companies have been promoting paperless transactions with their companies to customers, this is dressed up as good for the environment, but cynically, is this in reality more about reducing transactional cost within the business? Paperless transactions were promoted by showing pulp being sourced from illegally logged forests and those who still want paper bills are portrayed as polluters who must pay. These are therefore not only bad times but very misinformed times. How frequently do we promote the fact that European forests are growing by almost 6,500 KM2 (an area the size of Cyprus) per year?

Collectively, we have an obligation to ensure we communicate effectively with the market and promote the use of paper as sustainable and - when carefully crafted as a piece of print - the most effective of marketing tools.

As a director of PEFC UK , I am committed to the distribution of correct and relevant information, to highlight the importance of sustainable forest management and to support and promote Chain of Custody certification to demonstrate that a product has originated from legal and sustainable sources. With only 9% of the world's total forest and 25% of industrial forests are currently certified, we must work together to increase these percentages and not get sidetracked by disputes as to which is the "greenest" sustainable forest management certification scheme. If we allow these divisive disputes to continue we will drive customers away from making an environmentally responsible choice towards the easy option of just not bothering and this must not be allowed to happen.

We, in pulp, paper and the downstream business, mostly operate in a very responsible and sustainable manner and we should be proud of our record and promote our environmental credentials to our customers.

One thing that jumped out at me more than before was a spirit of collaboration between suppliers. This was especially obvious at the joint event held at the Grona Lund funfair (a nice change from the usual black-tie dinners and parties on boats). At the business end, collaboration was also in evidence with a number of announcements of joint venture agreements (e.g. Voith Paper Automation and Vacon). Perhaps this collaborative spirit is a consequence of the hard times the industry has been facing in Europe. Whatever the reason, it is nice to see.

Another example of collaboration is offered by the Paper Industry Dealers Association, a first-time exhibitor at SPCI. Founded three years ago in Prague, PIDA represents 13 companies buying and selling second-hand pulp and paper machinery (located in Germany, Sweden, Czech Republic, Italy, Spain, Austria, Finland, South Korea and USA). According to Christian Einarson, managing director of one of the members, GEIN-Maskiner, the association's main aim is to set basic standards for the trading of second-hand equipment so that customers can avoid the 'horse traders' and know that they are dealing with trustworthy companies.

PIDA members are also able to collaborate on larger projects and hope that by banding together they will be in stronger position to negotiate with the Stora Ensos and UPMs of the world.

Trend spotting

Alongside a growing spirit of collaboration, I've been impressed by a growing awareness among supplier companies of the need to spot future trends in order to anticipate the needs of customers. For instance, Voith's Hans-Peter Sollinger spoke of his company's expectation that the global recovery rate for paper would reach 70% within a few years, driven by trends such as biofuels and competing uses for wood. Knowing that more recovered fiber (potentially of lower quality) will be used by papermakers should enable the development of technology capable of meeting the industry's future needs.

The industry is also rapidly moving to address the energy and environmental issues that are going to shape its future, whether that be going fossil-fuel free (as Södra Cell is planning for its day-to-day production at the Varö mill in Sweden by 2012) or developing lignin as an alternative to coal and oil in pulp mills' power generation and lime kilns (as Metso intends to do with the LignoBoost technology it has purchased from STFI-Packforsk).

It is great to see that despite the current challenging business climate, the industry is preparing to meet the bigger challenge of climate change and develop world class technology and businesses of the future.

Producing alternative fuel is much of what is occurring now in 2008. The biofuel boom is prevalent, and many companies are searching for options other than petroleum fuel. The process to produce Woodex by converting organic materials into usable fuel starts with the biomass being pulverized then dried to about 20% moisture content. It is then compressed at extremely high heat pressures. Friction produces the heat of about 325° F to 350° F. The heat works with the pressure to rearrange the fiber's molecules to make more of the carbon available for burning. When that process is completed, the result is instant coal. Gunnerman commented in the article that the plant, which produced this fuel, consumed about 12% of the energy it produces to run itself. That left 88% of the energy in the organic material available in Woodex. The first plant used Douglas fir bark to make Woodex. The name combined "wood" with the Latin "ex," which means "from." So Woodex is a fuel "from wood."

Woodex, at that time, could have been considered a super fuel because as noted in the article, the production process is simple, and it uses inexpensive, off-the-shelf equipment. It was receiving positive reviews, even before it had been on the market long. Early users reported they saved money by burning it. Western State Hospital in Steilacoom, WA, gave details of a savings of about $60,000/yr in fuel costs by switching from coal to Woodex, and eliminating the need to install $20,000 worth of pollution controls because Woodex burned cleaner than coal.

Unfortunately, all good ideas don't always pan out. In 1983, Bio-Solar and Gunnerman were trying to avoid bankruptcy. The Small Business Administration was preparing to sell the fuel/pellet manufacturing equipment if Gunnerman did not pay off a $23,000 debt. Gunnerman eventually paid the debt, then announced that he had a 25 year contract to sell electricity produced by his fuel pellets to Pacific Power and Light Co.

Where is he now?

Rudy Gunnerman is now the chairman and CEO of SulphCo, Inc., a company that develops a technology designed to use high power ultrasound to alter naturally occurring molecular structures in hydrocarbons, which are the predominant molecular components of crude oil and crude oil fractions. The company recently announced that Gunnerman received the Businessman of the Year Award from The Business Advisory Council of the National Republican Congressional Committee.

Actually, it gets better; there is good news to report this month on the promotion of print and of course subsequently paper (one day I hope to report that paper has actually got itself into the news, or at least into the media, on its own for once!) The first one is a classic; at least a five minute feature on UK television in promotion of '2008, The Year of Reading'. Here, well known British celebrities were given five second slots each to read a line from a book or magazine on whatever subject they wished and from a medium of their choice. But the best part was that not one of them read from a computer screen, laptop, eBook or any kind of electronic device - it was all print on paper.

The other piece of good news is that a very clever printer in Europe, with his company called Moonpig, is advertising personalized greetings cards on television. These cards are ingenious because the person who receives them can actually be featured on the front, inside, or all over the card as part of the theme. More good ideas for print on paper that are actually being promoted in the mainstream media, and are being well received.

Print – what's happening?

Which leads me onto one of the themes in this issue: What is happening in the world of print? This is obviously an important subject for papermakers as the vast majority of paper and board has to go through a printing machine at one stage or another during its existence. What we did find out when talking to experts was that the printing industry is going through colossal changes and upheavals mainly due to the amazing technology that is being introduced. Like papermaking, printing used to be something of an ancient black art, where skills were the key and knowledge was of the essence to getting ink on paper. But the introduction of digital technology into print means now that anyone off the street, with quite literally no more than 10 minutes training, can push a green button and have superb quality print coming out the back of a digital printing machine. At the moment this technology is limited to A3 sized sheets, but nothing stands in the way of progress, and in just a few years, many more upheavals will be taking place.

This entrance of digital into the printing industry has opened up a lot of opportunities where papermakers could be focusing on R&D, some of them quite high value areas like special coated products for greetings cards, specialty papers that carry embossing, and other coatings for packaging or wide format applications. The secret is to keep close to the customer, watch what technology they are adopting and make sure you are ahead of the game. In fact a good opportunity to see what is cutting edge in print is drupa, which is held this month in Germany.

Still room for new products

But there is still a lot of room for new products from papermakers, not only in the new digital world, but also in offset, which is still by far the most popular way of getting ink on paper and is way ahead in terms of volumes of paper passing through presses. In fact one new offset printing machine recently released will print 3.5 million pages per hour - that's 84 million pages a day! So here, papermakers need to keep up with the pace, as well as pioneer revolutionary new products that make a difference on press. As a clear example, take Sappi's Tempo range, which we featured last month in our innovation feature, it really is having a massive impact with printers and for the simple reason that it dries a lot quicker allowing faster production, more jobs off the press, and of course more invoices at the end of the month.

Now that's a clever way to endear yourself to your customers.

RISI is the leading source of global news for the forest products industry.

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Real GDP growth has averaged a staggering 9.9% per year since 1990 and has exceeded 11% in each of the last two years. The Chinese economy exited 2007 with a considerable amount of momentum and has remained robust in the first half of the year (year-over-year real GDP growth came in at 10.6% in the first quarter). This strong growth came despite a series of adverse shocks to growth such as severe storms, surging energy prices and more recently, a devastating earthquake in Sichuan province, and it virtually guarantees that real GDP growth will hit double-digits once again in 2008. However, an accumulating body of evidence suggests that the Chinese economy has passed the peak of its growth cycle. Our analysis points to a reduction in real GDP growth from the supercharged rates of the last few years to a more moderate rate of growth in the 8-9% range over the next few years. What are the sources of our relative pessimism?

For starters, we expect net exports to decline markedly over the next few years. Given that net exports have accounted for about two-thirds of China's real GDP growth since 2005, this slowdown will have clear implications for real GDP growth. The reasons for the slowdown are similarly clear. First, the US economy is at stall speed and will remain weak for at least another four to six quarters. On top of that, both the euro area and Japanese economies are on the front edge of a substantial slowdown (possibly a recession in the case of Japan). Moreover, China cannot rely on its other Asian neighbors as sources of demand growth. In fact, import growth from non-Japan Asia is now growing more quickly that export growth to emerging Asia.

This is an excerpt from a full story that is available in RISI's Pulp & Paper News Service.

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