The Power of Digital Transformation for the Paper Manufacturing Industry

The paper manufacturing industry has evolved alongside every major industrial revolution since the 18th century. As industry has developed, so has the manufacturing of paper. As we enter the fourth industrial revolution, otherwise known as industry 4.0, paper manufacturers will need to adapt in order to stay ahead of the competition.

Let's take a look at the power of digital transformation for the paper manufacturing industry:

The paper manufacturing industry: vital statistics

Paper is one of the most important resources in the world. In fact, it would be virtually impossible to go through a single day without having to use some form of paper. In 2017, the world produced around 419.7 million metric tons of paper and cardboard. The three biggest paper producers were China, the U.S., and Japan. The leading paper importing and exporting countries were the U.S. and Germany. The leading companies in the forestry and paper industries include Brookfield Infrastructure and UPM Kymmene based in Canada and Finland, Asia Pulp and Paper, Svenska Cellulosa based in Sweden, Stora Enso and UPM-Kymmene from Finland, and Oji Paper and Nippon Paper Group from Japan.

As paper is a renewable resource, the recovery of it is crucial. Paper has one of the highest recycling rates of all recyclables. In 2018, paper had a recovery rate of 68% in the U.S. The paper industry in the U.S. is forecasted to grow by 25% over the course of 5 years, from 63 billion USD in 2019 to 79 billion dollars in 2024. Despite greater adoption of digital media and growing environmental concern, the paper industry is still growing; manufacturers will need to adopt new technology to stay ahead of their competitors.

What challenges face the paper manufacturing industry?

Due to the digitalization of communication and media, the global consumption of graphic paper is down. However, this is counterbalanced by the growth in packaging and hygiene paper products. This market shift will mean that manufacturers will have to take a step away from mass production, and a take step towards mass customization; the same plants will have to produce a variety of increasingly complex graphics and packages under the same roof.

One of the biggest costs in the manufacturing of paper is raw materials. As paper is so recyclable, collecting recycled paper will be key. It is more important than ever for the paper manufacturing industry to ensure that there are efficient and effective paper collection, recycling, and sorting systems in place. Another problem facing paper manufacturers today is the increase in energy prices.

Transport, energy, and environmental policies against the manufacturing of paper will have a huge impact on the way paper is produced. If the industry is to move towards being a low-carbon, bio-economy by 2050 as suggested by the sector’s 2050 roadmap objectives, then energy saving techniques will prove critical for the sector.

How can digital solutions increase efficiency in the industry?

Industry 4.0 is going to play a key role in the digital transformation of the paper manufacturing industry. In the future, paper mills will not have isolated functions and processes. Instead, assets along the whole value chain will continuously send and receive information. Key data from raw materials suppliers to manufacturers to customers will be harvested and utilized. This will result in greater energy efficiency and less waste.

Trees will be able to communicate when they are ready to be harvested, decreasing wasteful logging practices. Suppliers will be able to communicate directly with customers. They will be able to deal with requests promptly, and immediately spot the need for stock replenishment. They will also be able to offer comprehensive sales and stock forecasts. In production, machines will require minimal human interaction. They will be able to maintain themselves and report malfunctions instantly, dramatically decreasing the chance of any machine downtime.

The logistics of the manufacturing of paper will also be vastly improved. Shipping routes will be optimized, inventory counts will be more accurate, and real-time information can be shared from recycled-paper pickups. And most importantly, changes in demand can be communicated instantly by the customer, allowing manufacturers to adjust their output accordingly. Manufacturers and suppliers will be able to plan their output, further reducing resource waste.

What technologies will contribute to the digital transformation of the paper manufacturing industry?

Smart equipment

The implementation of the Internet of Things will mean that all assets in a manufacturing line will be able to communicate with one another. They will be able to adapt to their surroundings, maintain themselves, and make better decisions than humans.

Networking and connectivity

By connecting these smart products to a centralized server, the vast quantity of data can be instantly analyzed from anywhere, allowing for instant decision-making and a dramatic streamlining of manufacturing plant processes.

Value chain integration

By connecting every step of the supply chain—from the raw materials to the customer—paper manufacturers will be able to react instantly to a change in demand, dramatically cutting down on resource waste.

Data analytics

By harnessing the power of the data gathered by a chain of smart equipment and smart products, manufacturers could eradicate the need for storage, allow for predictive maintenance, and inform a more flexible business strategy.  

Faster time to market and growing product complexity are just a few of the drivers pushing manufacturers to urgently modernize through digital transformation. Fortunately, the paper manufacturing industry is poised to benefit from smart equipment—including the implementation of IoT—and value chain integration, among other advances. With the increase in demand for hygiene paper products and packaging, paper manufacturers that embrace digital manufacturing solutions will be better prepared to thrive in an ever-evolving market.