turbulent times and we are in the midst of
an irreversible shift in the dynamics of the
industry. There are bright spots to focus on
but there are also areas where the industry
will need to get used to working in a no
growth environment with all that entails.
Up until the start of the new millennium
the established mature markets of Europe
and North America could count upon more
or less continual growth in demand for
paper and printed products and on the back
of this the paper industries in both regions
grew steadily. Since 2000 however this
demand growth has stalled both as a result
of new screen based technologies taking
share from printed media and a common
perception that there are question marks
around the environmental sustainability of
paper consumption. Now, after the impact
of the global recession, both the North
American and European paper industries
have significantly more production capacity
than is required and we have seen a wave of
paper mill closures in both regions which
will probably continue until a better balance
between supply and demand is reached. The
fiercely competitive climate in North America
and Europe is likely to remain for some time.
In spite of this these regions will undoubtedly
remain very significant producers of paper
and hence very important markets for IMERYS.
European and North American markets, but
by contrast in other markets there is real
and sustainable growth potential. In China,
India, Indonesia and South America the
paper industries are growing quickly based
upon not only increasing domestic demand
(albeit from a lower base) but also by
potential for export from their low cost
production facilities. This will speed up the
shift in production, with demand and
production falling further in mature regions
and growing in emerging regions. Significantly
the shift from mature to emerging markets
will soon reach some major milestones for
example China is expected to overtake
Western Europe as the largest net exporter
of coated woodfree papers during 2010 and,
if trends continue, within a few years it will
be the largest printing and writing papers
exporter in the world. This growth is driven
by a large number of new paper machines
which are coming on stream in the next few
years with many more in the planning
phases.
For example, between now and 2013,
over 7 million tonnes of new capacity is
announced in China and almost 2 million
tonnes is announced in India.
needs of papermakers in the different
geographies and different market segments
will become even more diverse. Developing
regional strategies based on local market
dynamics together with technical
innovation will be central to future success.
To this end IMERYS has strengthened its
marketing function by strongly increasing
regional resources capable of adapting our
technology and product offerings to the
different commercial landscapes. At the
same time our R&D activities are focused
on developing new differentiated products
for the mainstream paper sectors which
leverage our unique mineral portfolio and
processing capabilities and focus on giving
our customers an improved competitive
edge. In many cases this will mean providing
low cost solutions which are tailored to an
individual customers needs.
much attention in the industry, is the drive
to replace expensive fibre with lower cost
mineral fillers. The limitation in increasing
filler loading is often paper strength. If this
can be overcome then there is significant
potential for cost savings in paper making and
also the potential to grow mineral volumes.