Technology boom – a potential threat to industry

The technological boom poses a potential threat for the pulp and paper industry in that, globally, more people are turning to digital media rather than newsprint. Pulp and paper producer Sappi is responding to this threat with its own initiatives.

While the increase in digital advertising spend by companies has negatively affected coated paper [used for glossy magazines] in the short term, Sappi believes that balanced media campaigns will improve the efficiency of marketing campaigns and that advertisements printed on coated paper will remain a key component of marketing in the future.

Digital media has been shown to be most effective when combined with targeted direct mail and print advertisements, says Sappi group head of corporate affairs Andre Oberholzer. It has been shown that consumers exposed to printed material have a three-times higher buying intention than those exposed to television and a six-times higher buying intention than those exposed to Internet-based advertising, he says.

Sappi views emedia as a significant opportunity for some of its businesses. For instance, cellulose acetate, made from dissolving cellulose, is used to make display screens, he says. To this end, Sappi has continued to invest in its Saiccor mill, near Umkomaas, in KwaZulu-Natal, undertaking a R3,5-billion expansion project for the mill, enabling it to increase its chemical cellulose production by 300 000 t/y and strengthening its global leadership position in chemical cellulose.

Sappi reports that it has also developed leading market positions in several speciality pro-ducts, including casting release paper and security papers, with many based on proprietary technologies, which have applications beyond graphics, packaging and paper.

Meanwhile, Sappi has closed its unprofitable mills, namely Kangas, in Finland, and Usutu, in Swaziland, and has restructured its operations at several mills to reduce fixed costs, manage capacity and improve profitability.

It also embarked on strategic actions such as the €750-million acquisition, in 2008, of the European coated graphic paper business from Finnish primary fibre paperboard producer and paper supplier M-real.

“Sappi’s main focus for the year remains the integration of the M-real acquisition in Europe, for which positive synergy generation is already ahead of schedule and the complete ramp-up of the Saiccor expansion project, which is also progressing well.

“Conditions in Sappi’s main markets are expected to improve gradually this year, resulting in rising demand for its products. The strong demand for pulp and chemical cellulose, accompanied by rising prices, is expected to have a favourable effect on its Southern African businesses,” says Oberholzer.

Mitigating Climate Change

Meanwhile, Oberholzer says that Sappi is noticing the impact of climate change on its forests. He explains that climate change can negatively affect forests through higher average yearly temperatures, altered precipitation patterns and more frequent extreme weather conditions. Sappi continually monitors and reviews forest best practices in the light of changing practices and environmental factors, including climate change.

The paper manufacturer keeps an eye on the potential for future rainfall changes, pathogen and pest infestations, alien invasive control, emergency responses and fire protection, besides others. Other avenues of risk mitigation include tree cloning and alternative fibre sources that are more resistant to pests, diseases and drought.

The ‘Sappi and Sustainability 2008’ report states that the company has conducted research for up to 20 years into the effect of reduced rainfall on the yearly increment yield of sample eucalyptus plants to assist its long-term planning.

Oberholzer explains that, in Southern Africa, mainly euc- alyptus and pine species are used as wood sources for paper. There are also research efforts to incre-ase the yield from its raw materials, both in energy and in fibre, for papermaking, he says. These efforts include tree propagation to increase fibre yield; improving pulping processes to increase yield from digesters, and papermaking innovations to reduce the amount of fibre required for its sustainable products.

Meanwhile, in the past five years, the company’s global specific use of water has dropped by 10%, says Oberholzer.

“In Southern Africa, where forestry is often accused of being a major water user, commercial forestry accounts for a little less than 3% of total use and plantations bind soil, thereby reducing runoff into rivers and streams,” he says.

Regarding future water shortages, he explains that Sappi already has several programmes in place to reduce its water use. “Water is essential in papermaking to produce the fibre that makes paper. It is also an integral part of the stream systems that generate energy. “Sappi recognises the pressure on a finite resource that is core to its processes and focuses on reducing consumption, recycling extensively within the manu- facturing process and improving the quality of the effluent it discharges,” he says.

He explains that all but two of Sappi’s mills in South Africa abstract water from rivers. The Adamas and Enstra mills use 70% and 50% recycled sewage water respectively, and pay for municipal water. All the mills have started ‘at source’ water reduction projects, where about 90% of the extracted water is returned to the environment, mostly to the rivers, where it is extracted or used for agricultural irrigation purposes, he says. “The quality of the effluent that is discharged is constantly improving, as indicated by the fact that, globally, over five years, total suspended solids and chemical oxygen demand have decreased by 18,5% and 3,8% respectively, in the effluent Sappi discharges,” Oberholzer says.

In other news, the company’s greening efforts in South Africa have been consolidated under one brand, Sandisa Imvelo (Zulu for growing nature), and its main focus is planting indigenous trees on Sappi-owned land to help promote and protect the country’s biodiversity. Of the 369 000 ha of land owned by Sappi in the country, about 34% is unplanted and managed for biodiversity conservation, and it is in appropriate parts of these areas where indigenous trees are planted, Oberholzer says.

“The Trees for Life programme, an initiative of the Wildlands Conservation Trust, introduced a seed collection and a tree-growing programme last year in the Bulwer community, who live adjacent to the Marhutswa boardwalk. The programme involves the harvesting of indigenous seeds from the forests, which, in addition to eco-tourism, provides the community with another reason to actively conserve this resource. To date, Sappi has sourced and planted 15 000 indigenous trees from this programme. Its target is to eventually plant one-million trees,” concludes Oberholzer.