With the advent of radio, television, and then computers and the internet, some experts persistently predicted that paper, as a communication medium would disappear. Television advertising did hit the paper sector hard, particularly newsprint and magazine paper segments, yet technological progress has now produced digital video recorders that allow consumers to skip TV ads. Leading consumer goods players like Procter & Gamble or Kraft Foods have been quick to react by shifting their advertising budgets away from television and into magazine ads over the past few years, according to the International Federation of the Periodical Press (FIPP).

The paper industry is alive and growing, though overall performance is hardly spectacular. After the previous peaks in 1995 and again in 2000, the paper sector as a whole slid into a trough, following a global economic trend. According to Datamonitor, the compound annual growth rate (CAGR) of the industry’s volume between 2000 and 2004 amounted to just 1.4%, and actually is slipping into the negative in 2001. The Pulp and Paper International Report of Paper and Paperboard Production in 2004, however, showed a healthy 5.5% increase to nearly 360 million tonnes from the previous figure of 339 million tons.

Pulp production in 2004 increased by just over 3% to reach a total of over 188 million tonnes, compared to just under 183 million tonnes in 2003.........