Paper Usage — Making the Grade

Still, Kullman points out that North America will never become self-sufficient when it comes to coated groundwood, thus, at least sustaining the import levels for that category.

Cheap and Available
According to Andrew Paparozzi, chief economist for the National Association of Printers and Lithographers (NAPL), paper is just one of many commodities that are finding their way into North America.

"Certainly, with the weakness in the international economy, we're seeing a whole lot of imports of everything, including paper," he says. "As with the economy at large, we're seeing very modest inflation. In fact, pretty much for all commodities—which paper is—we're not seeing inflation, but deflation, in large part because much of the world economies where these commodities are produced are depressed. To put it simply, America is kind of the market of last resort, the demand of last resort."

Paparozzi also points out that the increase in foreign paper supply is coming at a time when the source of demand—North American printers—are seeing growth rates that are slower than recent years.

The Asian economy has created some interested spectators, including Cadmus Communications Chairman, President and CEO

C. Stephenson Gillispie. "The paper market continues to be influenced by an influx of foreign paper being diverted from the Asian markets," he says. "We plan is to keep an eye on this activity. A turnaround in the Asian economies will have a direct impact on the supply of paper available to the United States and Europe. If the demand suddenly increases in Asia, we will experience subsequent increases in paper prices here."

For those printers who use foreign paper, price and performance are two of the most critical factors that pass the grade. Diane Peters, who purchases paper for Southfield, MI-based Grand River Printing & Imaging, notes that her company—which predominantly purchases domestic paper—can save money buying foreign paper in certain grades, particularly coated free sheet.