The industry of paper production remains strong as demand for paper products continues to be high. This trend is expected to be the same in the near future even with the popularity of electronic documentation. Currently, the United States is the biggest producer, and at the same time, the biggest consumer of paper products in the world (Eldred, 2005). Most of the paper mills in the United States are concentrated in areas where there are extensive forest harvesting activities. These are usually in the Southeast, Northwest, Northeast and North Central regions (U.S. Environmental Protection Agency [EPA], 2002, p. 10).
Generally, paper manufacturers produce printing and writing papers, newspapers, sanitary tissue, industrial type papers, containerboard and boxboard.as finished products. The production involves the production of pulp from wood from trees or from used paper, matting the fibers into paper and then cutting and shaping the paper into the finished product. During the first part of paper production, the wood chips are dissolved and turned into fibers using chemicals or through mechanical means. The process used in dissolving the wood chips depends on the end product that the manufacturer would produce, but the majority of pulp produced is made through the bleached and unbleached kraft processes (EPA, 2002, p. 7). After the wood is converted into pulp or paper sheet, the material is laid out on a screen to remove the water, and the remaining layer of fiber is compressed into a series of rollers. The resulting type of paper is dependent on the cellulose content of the pulp and also on the thickness of the paper.
The economic status of the paper industry relies heavily on the market demand for paper products. The health of the business is dependent on the overall economy, as a decline in the economy would also mean that there would be lesser office workers requiring paper (Eldred, 2005). The industry is also dependent on the condition of the newspaper, book and journal publication business, although this is not to say that the popularity of document access via the Internet would mean a decline in paper use. In fact, the easy access to materials through the Internet allows users to produce and print out materials onto paper without much effort. Because of the strong market demand, the paper industry makes it among the top 10 manufacturing industries in the United States in terms of shipment value (EPA, 2002, p. 9).
Paper production requires huge capitalization on the part of operators, especially in terms of investments for plant facilities and equipment. These capital outlays are essential in eventually lowering the overall production costs of the facilities and thereby increasing the profitability of the operations. Aside from the costs incurred through facilities and equipment, paper manufacturers are also faced with costs related to environmental compliance. The environmental compliance-related costs could negatively affect the profitability of paper manufacturers as well as their competitiveness against producers based in countries with less stringent environmental laws. These additional costs could also cause increases in paper product prices
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