Although the word paper comes from
the word papyrus - the sheets of marsh grass used
by the Egyptians 5,000 years ago - the origins of paper as we
know it today can be traced back to the Han Dynasty (207BC-9AD)
Early papermakers experimented with
a wide variety of materials such as mulberry, fishnets, old
rags and hemp waste. As the art of papermaking crept out of
China, the methods and materials used in production also
Paper underwent a series of
evolutions as papyrus went out of fashion in the 9th
century in response to demand for smoother parchment. Though
animal skin was used to make parchment in Europe, this was an
expensive material and the paper and printing industry
underwent a rapid development when moveable type was invented
in the 15th century.
Spurred on by the growing printing
industry, paper producers moved through a series of materials -
cotton, linen, straw, even cabbage and wasp nests - before
finally settling on wood. Huge growth in paper demand required
mass production, which eventually became a thriving industry in
Europe and North America.
The origin of fillers
In a quest for the perfect blend of
cost and quality, paper producers have added various minerals
such as kaolin, calcium carbonate and titanium dioxide
(TiO2) to their products and an entire industry has
grown up around mineral fillers for paper.
The age of digital technology,
however, has reversed this growing trend, and demand in these
thriving regions has seen a decline. Paper demand is falling
annually in North America and Europe, and will continue to do
so for the foreseeable future, while both demand and production
in Asia grows. This has left some paper manufacturers and
filler suppliers in declining regions in a difficult position,
and in search for alternative long-term solutions.
According to D.J. Monagle, senior
VP and MD of the precipitated calcium carbonate (PCC) business
at Minerals Technologies, this is not necessarily bad news for
filler mineral producers, but it perhaps means that its
time for paper production to undergo another evolution.
Filler levels are becoming
increasingly important, Monagle told IM.
Its all driven economically. PCC is less expensive
than pulp, so you can replace pulp with PCC up to a certain
Right now the average filler
level is about 20% in North America and Europe, and the more
you increase that percentage, the more the papermaker saves.
Thats the driver here, he added.
Monagle explains that just because
papermakers have continued to use wood pulp in production, this
doesnt mean that paper production hasnt undergone
changes in recent history, as both filler levels and materials
In the past in North America,
someone might make a piece of copy paper with clay at roughly
12-14% filler levels. We then converted that industry [to PCC]
and immediately rose to 15% filler levels, then to 20% filler
levels, and in some cases 23-24%, he said.
Now youve probably got
a brighter piece of paper, which translates to quality.
Its less dense, and you can use a little bit less fibre
still and make it smoother. Higher levels of opacity will also
add to the quality, he added.
PCC is the most common filler
choice for US paper producers. Figures from Minerals
Technologies indicate PCC accounts for 75-90% of fillers in
uncoated wood-free paper production. Also according to
independent consultant Ian Wilson, the choice of filler mineral
depends largely on the geographic location of the individual
The choice is somewhat
dependent on where you are in the world. In the US the main
filler mineral was kaolin supplied from Georgia, US,
Wilson explained to IM.
However, as paper makers
moved from an acid system to an alkaline system, calcium
carbonate became the main filler in the US replacing
kaolin, he said.
The switch in the processing route
was partly a decision based on cost, enabling paper producers
to use lower cost filler materials while at the same time
having the advantage of being more environmentally
This was significant for the kaolin
industry because it saw the use of the mineral fall. The paper
grade, or beneficiated, kaolin market has changed since the
1980s because of this switch - as the alkali-based process was
gradually introduced in Europe and then North America, paper
makers gravitated away from paper-grade kaolin to carbonate
In 1980, 87% of the paper market
used kaolin but, by 2010, 65% of the market used ground calcium
In the US the main filler
pigment is PCC. This is mainly due to the presence of high
quality limestone suitable for making PCC, Wilson
He added that the development of
the satellite plant also influenced the choice of PCC for
The marble deposits in the US
are present in some areas but logistics are not good and paper
mills have preferred to have a satellite facility. SMI
[Speciality Minerals Inc.] is the leading company for PCC
satellite plants and other plants, he explains.
Other regions have also made filler
choices based on the availability of raw materials.
In China and Western Europe
there are abundant sources of marble, calcium carbonate, which
have high brightness and low abrasion. So, here the filler GCC
is mainly based on marble, and in some cases on chalk and
limestone, Wilson told IM.
Talc is still used as a
filler especially in some countries, such as Finland, where
there are talc deposits. Again kaolin is still sold as a filler
but has been replaced mainly by GCC and PCC, he
According to Minerals Technologies,
public estimates are that 85% of fillers that go into paper are
made up of calcium carbonate, comprised of both PCC and GCC.
This includes both fillers and coatings, and is used in
products such as packaging, printing and writing grades and
Of that 85%, Monagle says that the
majority used is GCC, making up about 80%. Much of this goes
into coated paper grades.
As a ball park lets say
theres around 35m tonnes of minerals into paper, 18-20m
of that is coating minerals and powders, and 16m or so is the
filler application, he told IM.
Focusing on uncoated wood-free
paper grades, where PCC has the greatest impact, Monagle
explains that of the estimated 11m tonnes of mineral fillers
used in uncoated grades, PCC is most definitely the dominant
choice for paper producers.
In places like North America
and Europe, PCC accounts for around 75-90% of the mineral that
goes into paper. In Asia, its still developing so
youve got other minerals and carbonates, but basically
PCC is 10-15% of whats going into there, he told
With such low use of PCC in Asia,
and China in particular, its hardly surprising that
Minerals Technologies sees the region as such a growth
opportunity for PCC.
Rick Honey, vice president of
investor relations for Minerals Technologies, explains that one
major difference between PCC and GCC is particle size
It allows us to bulk this
sheet of paper. Its almost like putting ping pong balls
into a beaker instead of putting sand and rock into a beaker
where the sand packs, and thats one of the major things
that paper makers like, he told IM.
Monagle adds that this allows
papermakers to add bulk to their product as well as offering
other quality advantages.
People can then sell as a
lower weight paper that performs properly which is a key
advantage, and it adds better paper qualities like opacity and
smoothness. Particle size distribution and the shape allow the
paper maker a lot of flexibility, which just doesnt
happen with the other naturally formed pigment, he
In terms of coatings for paper, the
material in question needs to be at a very high solids level
containing very little water, which is why, Monagle explains,
GCC is ideal for coating applications.
But PCC offers other advantages,
which contribute to its popular selection as a filler mineral
in uncoated paper.
On the performance side
were able to design the shape of the particle. Were
not taking a rock and grinding it and separating it and working
on the particle size, were also changing the shape, the
density, the way that pigment behaves when it goes into the
paper process and gets crushed, he told
In those developed regions
where the paper maker has concentrated both on improving
quality and reducing costs, PCC has been the predominant answer
because of both the technology and the business model, he
Another advantage is the
development of the PCC satellite plant. The plant is built on
site, removing any transportation costs and delivers the
pigment at relatively low solids. Removing the transportation
costs has enabled Minerals Technologies to concentrate on
developing a better functional filler in paper.
PCC becomes a very economic
choice, but then theres also a performance advantage that
goes beyond just the dollar per tonne figure, Monagle
Survival of the
A problem for filler mineral
producers and papermakers alike, has been the decline in paper
demand across all developed regions. According to Alejandro
Mata, economist for European forest products at RISI Inc., this
decline is being seen in North America, Western Europe, and
even in Japan.
Mata explains that lower demand can
be observed at different rates across various paper products,
and paper production is falling in line with these
Yes production is also
falling. If you look at specific grades you see different
things. The steepest decline though has been in newsprint. You
can imagine the decline in demand has been quite significant;
obviously capacity will need to follow, he told
In other product groups we
dont see that much capacity reduction compared to the
demand declines. Producers are more or less following what
happens on the demand side, but theres no disconnection
in this case in the North American markets. They are even a bit
better than Europeans in trying to balance the supply and
demand forces a bit more, Mata said.
He added that in stark contrast,
countries within Asia, such as China and India, are still
growing rapidly both in terms of supply and demand, and China
has overtaken US production in various grades.
When it comes to uncoated
wood-free grades, China is already some years ahead of the US.
But, on coated wood-free grades the US is ahead. When it comes
to newsprint the US leads, although I dont think that
will last for too long considering the declines that
youre seeing in the North American market, Mata
According to Wilson, figures show
that China is now the leading producer worldwide of paper and
board, and has overtaken the US in terms of consumption.
In 2011 paper and board
production in China, the number one producer, was 99.3m tonnes
and in the US, the second biggest producer globally, was 75m
tonnes, he told IM.
This increase is also reflected in
consumption, which in 2011 in China was 97.3m tonnes and in the
US was 72.3m tonnes for paper and board. Wilson adds that the
US is still ahead of China in its pulp production, which in
2011 was 49.7m tonnes compared with Chinese production of 19.5m
Growth in Asia
Asia then, specifically China and
India, represents a great growth opportunity for companies like
Minerals Technologies, not least because demand and paper
production continues to increase, but also because many
producers are using a variety of mineral fillers in paper.
So theres terrific
growth in Asia in general and I would say for us what
weve been seeing is that growth of the industry is a
refreshment of the industry. Thailand and India have been
growing for us as well, and there is a shift from some GCCs,
talcs and clays to the bringing in of some PCCs, Monagle
Developed markets such as North
America and Europe are at the higher end of the spectrum in
terms of the percentage of filler mineral that goes into paper,
but, Monagle explains, in Asia there are opportunities to also
increase filler levels.
In India for example, papermakers
use a combination of GCCs, talcs and clays, at low levels of
around 12%. These levels can be increased to 15-16%, and in
replacing other materials with PCC, 20% filler levels, as seen
in developed regions.
One of the other things that
the Chinese government has been doing is theyre shutting
down the smaller production facilities and when these larger
facilities get established, Monagle told
Its a managed growth -
out with the old in with the new, which provides some
incremental capacity improvement. Those new machines provide a
business model, the ability to put a new PCC plant right into
the new operation. Its something that becomes very
economical for them, he added.
Opportunities in developed
It may seem then, with Chinas
increases and dropping figures in the US and Europe, that Asia
would be the obvious target for filler mineral producers, but
Monagle says there are still opportunities in developed regions
with the development of new technologies.
Monagle explains that using
conventional technology, North America and Europe have reached
their maximum filler levels.
The company produces standard PCC
at 55 of its satellite plants globally, however, it has also
developed a new type of filler technology, Fullfill, which has
been enhanced to offer paper producers further advantages,
including increasing filler levels further to up to 25%.
What Fullfill allows us to do
is, lets say you have a paper maker running along at 20%
filler level, we can help them make that same sheet of paper
with the Fullfill technology, and now all of a sudden he can
use up to 25% filler, Monagle told
The change for him is that he
goes up incrementally 3 or 5% filler level. The change to us
though, if you do the math, is about a 15-25% increase in the
demand of the filler, he added
Minerals Technologies believes then
that it can grow PCC in declining markets like North America
because of these new technology developments. Higher filler
levels for existing papermakers also makes sense because it
comes at a low investment cost.
The investment for
papermakers is minor. And when I say minor I mean very small,
and its an investment that works for us. I think that
theres a matter of prioritisation in the things that
theyre doing but weve gotten great interest from
our customers in Fullfill in these established regions,
Hope in a
Increasing filler levels from 10%
to 20%, and then up to 25%, will not only help support demand
for fillers, but will help to offset the declines that are
being seen in North American and European regions in paper
That increase of pigment
consumption will be helping offset the general decline of the
industry in these printing and writing grades in NA and Europe,
so theres a general equation for PCC in these established
regions, despite a decline of the years in the demand of those
regions, he added.
Minerals Technologies also produces
GCC, but it sells this to other industries, and has opted
instead to focus on developing the perfect filler, which will
help ease the plight of papermakers. The companys
overwhelming emphasis is that PCC is improving and becoming
more refined, with a vision to increase filler levels to
Thats where we would
like to take that platform. Were also experimenting with
other minerals, we just havent found anything yet that is
profoundly better than PCC for the papermaker, Monagle
Increasing filler levels also
allows paper producers to address the growing pressure felt by
most industries to be more environmentally friendly. Upping PCC
in paper offers producers a cost advantage in that the mineral
filler is less expensive than fibre, but also reduces expenses
as the filler is easier to dry than fibre is, thus further
reducing energy consumption and costs.
When youre talking
about sustainability its basically energy consumption,
water consumption and fibre consumption. PCC is helping to a
large extent with two of those things - helping with the cost
and reducing the energy consumption as well as reducing the
fibre consumption, Monagle told IM.
Mata told IM that:
Theres always a pressure to become more
green. Theres an ongoing battle between the
sustainability side of paper versus the sustainability side of
all the digital media and the new technologies. Some people
think that digital media is much more environmentally friendly
than paper, some people thing that paper is much more
environmentally friendly than digital.
He adds that while there are always
pros and cons regarding the sustainability of the paper and
digital industries, the importance of papermakers to stress the
environmentally friendly aspects of the industry - such as its
re-usability - is growing, especially in light of new
Theres a lot of
pressure, especially from legislation, that is coming to pass
right now and in the future relating to energy consumption, but
also related to CO2 emissions, and thats one
of the big topics in the industry, Mata said.
This is another area where
increasing PCC levels can help improve.
Monagle explains that:
Something which is helpful in China is that our business
model takes lime from the outside world - thats what we
ultimately convert into our PCC - and we take the
CO2 that is being put out from boilers or kilns. So
the PCC particle is also being seen as something that helps
with CO2 control in China.
The future of paper
But even with cost reduction and
energy cutting options in place, capacities in developing
regions have been shutting down. Options previously available
to producers in the graphic paper industries to move into other
products are also becoming less plentiful.
When demand began to decline for
paper makers and profits started to fall, producers opted to
covert to other products such as packaging and speciality
grades. However these markets are now, too, becoming
So that means not only the
capacity growth that you see naturally on those packaging and
speciality grades are saturating the market, but all the
graphic paper producers that are trying to define and find
better market segments are also overcrowding those
segments, Mata told IM.
Right now its not an
easy decision whether or not to move anymore. So even though
you have better margins and you have slightly better market
balances, that is probably also changing right now, he
Minerals Technologies believes that
consolidation will continue, at least temporarily.
If you look at the macro
trends, we believe there will be further rationalisation of
these printing and writing papers, the packaging applications
will still probably grow because it seems to be a sustainable
model for the world that these fibre based packaging
works, Monagle told IM.
But in printing and writing
papers we think there will be further reductions which is part
of why we think our technology is important just looking at the
pigment side of the business. We believe were capable of
growing in these declining markets, he added.
Producers are still converting
graphic paper facilities to speciality and packaging products
as the supply and demand balances are tighter in these markets,
and margins and profitability levels are higher, but this is
leading to more issues elsewhere.
According to Mata, the biggest
problem faced by the industry is the growing overcapacity, and
producers should be taking steps to reduce output.
Nevertheless, the decision to do so is fraught with uncertainty
and the risk of losing market share.
Overcapacity is having an
impact on several things such as the operating rates on the
industry, which are declining, and in turn impacting pricing
levels. This is an issue affecting not just papermakers, but
everyone within the paper and communications industry. So
everything is more or less interlinked, and everything is in
the end translated into poor profitability for producers,
Cutting capacity is a tricky
decision to make, but its a decision at the end
especially right now producers are being pushed into, and
weve already started seeing the financial results of the
different companies are suffering in profitability, he
Mata is, however, convinced that
paper producers have a future.
I do believe paper will
always be around not just in Europe but all over the world, the
industry will not disappear. We are still using paper quite a
lot and there are some regions that are still increasing the
amount of paper they use every day.
He forecasts that there will always be demand for paper in
Europe, and that the decline will stop in the future:
When that will happen, were not sure, and how much
paper will be left we are not sure yet, or in which shape, but
there will be paper.