Reports About The Future of The Canadian Paper Products Industry Will Remain Gloomy

Reports about the future of the Canadian paper products industry will remain gloomy until a viable new application for wood fibre is found, an analyst said Monday. The Conference Board of Canada reported Monday the soaring popularity of e-readers and tablet computers has cut into book sales and cut into profits in the beleaguered paper products industry. A shift in consumer preferences toward electronic information sources has gone beyond print media and is now taking its toll on demand for paper to produce books, reported the board. “The industry is likely to remain under pressure until some different ways of getting money out of the raw product are developed, ” board analyst Michael Burt said in an interview. The advent of digital reading devices, combined with ongoing global economic turmoil, presents a weak outlook for the paper products industry over the next few years, said Burt. “The prevalence of e-readers and tablet computers has achieved a critical mass, indicating books are set to follow the same path as newspapers over the past decade, ” he said. The tentative status of the paper products industry was brutally demonstrated in Nova Scotia in mid-June when Resolute Forest Products idled its mill in Brooklyn, putting about 320 mill employees out of work. Over the past 10 or more years the Canadian industry has struggled to redefine itself by trying to access new international markets and searching for new uses for wood fibre, said Burt. He said there were was some success with development of a dissolving wood pulp to be used in the production of rayon thread, for example. However, the conference board said industry production and revenues fell in 2011 and that trend is expected to accelerate in 2012 and into the future. “Declining North American demand for paper products continues to be a fundamental weakness for the industry, ” said the conference board in its spring 2012 outlook for the industry. The board said prices have fallen for three consecutive years. “New markets in Asia provide some opportunities for growth, but pulp and paper demand in China is slipping due to global economic uncertainty, ” said the board. Source: thechronicleherald