Selective Cuttings

Paper exports in decline

May 3, 2013

Canada’s leading paper exports are in long-term decline since 2001, with tissues an important bright-spot in recent years.

Canada’s paper export trends (1995-2012)

This line graph shows the value of Canada’s paper exports for the 1995-2012 period, including newsprint, printing and writing paper, packaging, tissues and other products. The export value has been in decline since 2001, but with a slow increase in tissues.

The rise of electronic media has indisputably had a major impact on global demand for graphic papers (such as newsprint and printing and writing paper), with a particularly strong affect in North America. Newsprint has been in secular decline since the late-1980s – driven initially by the shift of advertising dollars to cable television, but increasingly driven by the rise of internet advertising. Indeed, in 2012 Canada’s newsprint export revenues were only 28% of their 1995 level.

While printing and writing paper wasn’t affected as quickly as newsprint, continuing to expand until the early 2000s, it has been in a rapid decline since 2005, and for the same reasons.  As a result export revenues for this sector have fallen by 53% since 2005 (relative to 56% for newsprint).

Packaging, on the other hand, has been relatively stable, although demonstrating a slow overall decline. Tissues are a bright spot, having expanded modestly over the period. However, the overall picture for the paper sector remains negative. Total sector exports have declined by more than 50% from the 2001 peak value of $18.3 billion, to $9.1 billion in 2012. At the same time, packaging and tissues, which accounted for only 17% of total export revenue in 1995, accounted for 39% of revenue in 2012.

As traditional revenues continue to decline in prominence, and given the relative stability of Canada’s pulp sector, investments in additional revenue streams and additional wood pulp based products (e.g. pharmaceuticals, bio-products, bioenergy, nano-materials, etc) become increasingly important components of the transformation of the sector.