Investing in the potential of paper
Since ancient times, paper has been used to communicate and record marvellous discoveries, historic events and letters to loved ones. We now live in a world where the power of paper extends far beyond a means of communication.
From the use of fluting and board for packaging food, tissue and cellulose in hygiene products, to the various types of paper used for schoolbooks, street-side posters, movie tickets and the latest edition of Manufacturing SA, paper is very much a part of our everyday lives.
Pulp, paper and the economy
According to the Department of Trade and Industry’s Industrial Policy Action Plan of February 2011, the forestry, timber, paper and pulp business has the potential to contribute greatly to rural and economic development by contributing to the country’s gross domestic product (GDP) and creating job and income generation opportunities in poor rural communities. These industries accounted for 170,000 jobs in 2008 and forestry’s contribution to the GDP was 1,1% in 2009. Product exports came to R12,5 billion while imports totalled R9,6 billion.
During 2009, the manufacturing value-add was R23 billion, equating to 1,4% of the GDP, with the manufacturing employment figure reported as 207,967 people. The sector’s contribution to the country’s balance of trade was R3,1 billion.
According to the Paper Manufacturers Association of South Africa (PAMSA), the industry has been making a steady recovery since the 2008 recession which resulted in a decline in pulp and paper demand, driven mostly by packaging and tissue grades.
Imports for paper and packaging grades (except for tissue products) continue to rise strongly, showing a 28% increase since 2006, outstripping domestic production which has declined by about 4%. This is partly due to the relatively strong rand in recent years. The lack of trade tariffs also make South Africa an easy target for dumping which, even when not in great quantities, disrupts local markets with the introduction of unsustainable pricing points.
Improving efficiency, investing in local capability and reducing environmental impact
Industry players – with a combined asset value in excess of R21 billion – continue to invest in research and development, operational improvements and process optimisation, not only to meet the needs of their customers but to ensure the sector remains sustainable and reduces its environmental footprint.
A recent example is the planned upgrade and modernisation of Sappi’s Ngodwana mill which will generate an additional 210,000 tons per annum of chemical cellulose boosting Sappi’s total output to over a million tons per year. The improvements promise greater energy and chemical efficiency as well as a reduction in effluent and odour levels.
As part of its five-year expansion strategy, Kimberly-Clark South Africa (K-CSA) launched a new diaper machine worth more than R120 million at its Epping mill in Cape Town with a view to growing its production capability by 400 million units per year. The leading technology applied to this asset enables 99% filtration efficiency, environmentally-friendly air generation and a reduction in energy usage.
This is K-CSA’s second major investment in two years and follows the launch of its premium tissue converting line at its Enstra mill in Springs. The new machine has created jobs for 65 people.
Significant investment has been made into speciality coating for paper packaging grades over the years, especially by Mpact Limited (formerly Mondi Packaging South Africa). Mpact Limited developed a strong research and development focus in partnership with Stellenbosch University where polymer research was undertaken to enhance products for niche markets. The development of recyclable coating was one of the successes of the partnership.
The sector is continually devising innovative ways to lower its draw from the national grid. Some 42% of the power used in the paper industry is generated in-house and around 40% comes from renewable fuels. In addition, the paper manufacturing industry has invested significant resources and skills into combined heat and power generation technologies and the reduction of CO2 emissions. With the hosting of COP17 in Durban in December 2011, it remains focussed on addressing its impact on the environment and its commitment to sustainable development.
An independent study published by the Confederation of European Paper Industries shows that ‘using wood as a resource for paper products first, and only using it as a source of energy at the end of the product life cycle, adds four times more value to the economy and retains six times as many jobs than simply burning wood for energy’. For this reason, the sector promotes fibre for paper before fibre for fuel.
A wealth in waste
Paper recycling is a strategic imperative for the industry. Ursula Henneberry, operations director for the Paper Recycling Association of South Africa (RecyclePaperZA), notes that a major challenge is the recovery of paper from homes and businesses. The recovery rate of available paper* in South Africa is approximately 58% (*Not all paper can be recycled, for example, toilet tissue and wax paper). “We need to increase this to more than 61% by 2015,” she says.
With 65% of recovered paper used as raw material in paper mills, more than half of the country’s paper mills depend on recycled fibre and many of them use it as their only fibre source.
Paper can be recycled at least seven times and for every one metric ton of paper recycled, three cubic metres of landfill is saved. Further to this, paper recovery and recycling reduces costs to local municipal authorities, decreases the need to import raw materials and frees up space at landfill sites.
Recycling also contributes to poverty alleviation with a vast network of informal collectors sourcing paper from domestic waste and refuse dumps and selling on to recycling centres. In partnership with the Fibre Processing and Manufacturing (FP&M) Sector Education and Training Authority (SETA), RecyclePaperZA has established entrepreneurship training courses aimed at assisting people to set up small recycling businesses. To date, 151 people have been trained in Johannesburg, Potchefstroom, Port Shepstone and Durban.
“The potential for further investment is massive but only if we can guarantee recovery rates,” says Henneberry. “We desperately need the support and commitment of local, provincial and national government.”
Pitting paper against digital communication
Contrary to popular belief, paper and print are renewable and recyclable and thus have a distinct advantage over electronic and digital mediums which use new and additional energy every time they are opened or read from a computer screen.
Sir Nicholas Stern, Head of the Government Economic Service in the United Kingdom (UK), released the Stern Review on the Economics of Climate Change in 2006. This tackled the effects of climate change and global warming on the world economy. His 700-page document is the perfect example of how paper and print have a better environmental footprint than electronic communications. (Source: Stern Review on the Economics of Climate Change, 2006)
Investment in the future of paper
While the country’s principal paper manufacturers focus on applied research within their own centres, they also fund fundamental and academic research at tertiary institutions.
The industry provides numerous opportunities for young people to follow a career in the fast-paced world of forestry, pulp, paper and packaging.
Through the Umfolozi and Ekurhuleni East Further Education and Training colleges, PAMSA offers a National Certificate (Vocational) qualification in process plant operations and pulp and papermaking technology from levels two to four. The NCV 4 qualification, equivalent to a matric, offers learners university exemption on completion.
The pulp and paper industry, in conjunction with the FP&M SETA, has developed qualifications and learnerships in a range of fields. At national level, degrees in forestry are offered by several universities. UNISA and the Durban University of Technology offer a National Diploma in Pulp and Paper Technology.
The industry, through PAMSA, spends R1 million a year on precompetitive research. Its Process Research Unit facilitates bursaries for post-graduate BSc chemical engineering students to take their studies to a Masters level.
Busting the myths
In South Africa, and in many parts of the world, paper is produced from sustainably farmed trees – just as we plant corn for our cereals, wheat for our bread and tea for our morning ‘cuppa’. The majority of the 1.6 million hectares of trees are planted for specific use as pulp and paper, with some timber being reserved for mining support, poles and furniture. One-and-a-half saplings are planted to replace every tree harvested. Trees are thus a renewable resource and commercial plantations and natural forests absorb carbon from the atmosphere.
Interestingly, plantations only use 1% of the land in this country and only 3% of the water compared with other forms of agriculture which use 80% of the land and 62% of the water. Further downstream, pulp and paper manufacturers have initiated water re-recycling technology to reduce the industry’s water footprint.
It was the former chairman of the UK Sustainable Development Commission, Jonathan Porritt, who said, “There aren’t many industries around that can aspire to becoming genuinely sustainable. The pulp and paper industry, however, is one of them. At its best, this industry is inherently sustainable.’’