Musings from Montreal.

I had the good fortune to attend the recent PAPTAC/EXFOR conference and exhibition in Montreal at the end of January. On the plane ride up, I realized that this would be my 16th time attending this event, something of a record for me. It is a good conference and has its well-established rhythms, and I could probably attend the conference without a program. Here are a few random thoughts based on presentations and discussions during my five days in brutal, sub-zero weather (both Centigrade and Fahrenheit). Thankfully, I've figured out how to get around through the maze of tunnels and subway stations in Montreal and rarely had to venture outside!

[ILLUSTRATION OMITTED]

Toss it! We've become accustomed to throwing out old technology. Got an old cell phone? Chuck it, and get a free new one with a new service package. Old computer? Send it to a recycling center and buy a faster, smaller and newer one. But do we apply this rule to paper machinery? Hardly. In the U.S. and Canada we try to keep old machines running with chewing gum and baling wire. Why? New technology is always better, faster, and more efficient. Several people at the conference noted that, with the exception of tissue manufacturers, privately held companies (like Kruger), and foreign investors in North America (Stora Enso), there is almost no new capacity being built or old capacity being thoroughly rebuilt in North America. China and Europe are now the undisputed technological leaders in the paper industry due solely to investment and reinvestment. I've belabored this point in previous columns, but from my conversations in Montreal it's even clearer that North America must reinvest soon or go the way of the steel industry.

Tracking the trends. Despite my rantings, capital expenditures remain leveled off in North American (and Europe) while the Chinese rocket continues to soar. Tissue demand is growing in all areas of the world, paperboard demand is growing everywhere but North America, and graphic paper demand is flat in North America and Europe (while up in Asia, of course). With 90% of new papermaking capacity being installed in China, North America (and to some extent Europe) has become mostly an aftermarket business for equipment suppliers. Suppliers at the conference noted that they have reorganized to accommodate this shift, upgrading their maintenance and service offerings while moving manufacturing to areas where investment activity is still growing.

Ah, the good old days! I am not an overly sentimental person and I accept that the paper industry has changed. Still, I found myself thinking back to my first trip to Montreal, way back in January 1989. That was at or near the peak of the last North American paper boom and things were rocking. The show floor was packed, the restaurants were full, and the promotional money was flowing freely. It was an exciting time for a young journalist with no gray hair. This time, the conference and show were still relatively well attended, but things seemed a lot quieter. The Canadian Pulp and Paper Association has been split up into many different parts, and the events were, like the association, fragmented. Some weren't in Montreal at all. The owner of my favorite restaurant, Le Mas des Oliviers, complained about low traffic, comparing it, again, to the old days. Of course we all know the "old days" aren't coming back, but it's still nice to remember them sometimes.

Camaraderie. One of the truisms about the paper industry is that we are a tight-knit bunch, and that people like to stay in this industry once they are in it. That is still true. One of the great things about conferences like this one is the chance to see friends and colleagues that I see only at these events. Comparing notes, learning some new things, and taking stock of the industry with these people gets you charged up about doing your job, even in these downsized times. Two annual events, hosted by Andritz and Metso Paper, honored the paper industry press, and it was good to be a part of them. Events like these are less common these days, and that makes them particularly welcome.

And now a word from our sponsors: Speaking of camaraderie, it's one of the key reasons you should attend two U.S. based shows in the coming months. TAPPI's Paper Summit, May 3-5 in Atlanta; and PIMA's Joint Leadership Conference, June 27-30 in New Orleans. Both conferences have great programs (take a look at page 32 of this issue for more Paper Summit details), but perhaps more importantly they provide an opportunity for camaraderie and maintaining the strong relationships that keep us going in tough times. Without connections with people outside our immediate workplace, we're just a bunch of companies, not an industry. Come on down and keep the spirit alive!

Alan Rooks

Editorial Director

Contact Alan at [phone], or by e-mail at [e-mail].