BY MARK SMITH
Predictions of the paperless office may have lost their edge, but not the threat of a paperless printing plant. One only has to go as far back as 1995 to find the last time some printers were faced with shutting down their presses for a lack of paper to run through them.
The buyer's market of recent times saw printers, and their clients, being doubly blessed with a ready supply of paper at historically low prices. Everyone knew it was just a matter of time before the market swing came, though. In the case of paper, the more apropos saying would be: what goes down, must come up.
Lester Samuels, co-managing partner of Pictorial Offset in Carlstadt, NJ, says he can pinpoint exactly when the market for web papers turned. "It happened on Friday, November 15th," he recalls. "We started getting calls from the mills to notify us that they were going on allocation. Paper that was immediately available for shipment from a mill went to having a four-, six- or eight-week delivery date. The change seemed to happen at all the mills at the same time."
Samuels qualifies this observation by pointing out that, in the web grades, Pictorial almost exclusively buys number one and number two coated stocks. The organization also has an extensive sheetfed printing operation. "Sheetfed paper is not tight at all right now," the company exec notes. "There is a lot of foreign competition and imports in that market segment—with more than 50 percent of the sheetfed paper imported today—which helps balance supply and demand."
There is some element of a self-fulfilling prophecy at work here. "Everybody in the system, including mills and printers, had brought their inventories down over the last two-and-half to three years," Samuels notes. "Suddenly, printers saw they could be stuck with no paper and started placing orders. Supply concerns have triggered a certain amount of hoarding of paper."