The emergence of personal computers and office automation thirty years ago has led many to predict the onset of a "paperless" office. With the shift in consumer habits/behavior and the ever growing digital solutions (e.g. E-reader, smart phones, social media, etc.), what would the future hold for cut-size paper until 2025? Would challenges from digital solutions, e.g. the increased use of electronic filing over traditional hard copy in office environment, bring about the eventual demise of cut-size copy paper?
Pöyry has been actively following the developments within the paper industry, and is one of the most authoritative sources of knowledge regarding the future forecasts of paper demand globally. For this research, Pöyry research in seven countries(Singapore, Malaysia, Thailand, India, Indonesia, China, Japan).
1. Asia: Cut-Size Paper Future –
Is the “Paperless” Office Just Around the Corner?
November,2010
2. 2
OBJECTIVES
This multi-client study is to present an assessment of the likely development of the Asian
cut-size paper market up to 2025.
This report focus on:
Recommendations for
Value Chain Players
Market Overview &
Development
Value Chain Analysis
Driver Impact Assessment
Product Life Cycle
Analysis
Cut-size Paper Demand
Forecast
• To review the market overview and development
• To provide an understanding of the cut-size paper value chain with its
competing value chain and hence potential impact on paper demand in Asia.
• To examine the various drivers affecting cut-size paper and their impact on
the competing value chain and hence potential impact on paper demand in
Asia.
• To examine the product life cycle of paper and its implications
• To construct a base case scenario of the most likely development of cut-size
paper in the region
• To give recommendations on how the industry needs to adapt to the current,
emergent and future value chains.
3. CONTENTS
The key elements of the study are:
•Executive summary
•Introduction to cut-size paper
•Introduction to cut-size market
•Macro-drivers & Geographically bundling
•Market Trends
•Cut-size paper supply
•Value-chain analysis
•Cut-size paper value chain
•Value Chain Dynamics
•Decision making criteria
•Value chain competitiveness
•Driver impacts assessment
•Paper function/value/driver analysis
•Technology Drivers
•Legal & political drivers
•Business Drivers
•Demographic & Social Drivers
•Product lifecycle assessment
•Outlook for cut-size paper
•Recommendations and conclusions
Geographical market coverage is focused in the
Asian region, with an in-depth review of:
•China
•India
•Indonesia
•Japan
•Malaysia
•Singapore
•Thailand
India
China
Indonesia
Malaysia
Singapore
Thailand
Japan
Pöyry is a global expert in consulting and engineering. We offer our clients in-depth industry expertise,
innovative solutions and lifecycle engagement. Our knowledge extends across hydropower, oil and gas ,
power and heat, renewable energy, pulp and paper industry, chemical process industry, transportation, water
and environment , and construction services.
4. METHODOLOGY
PRIMARY DATA
COLLECTION
• Primary data
collection
through in-
depth
interviews and
site visits to
complement
the already
vast pool of
proprietary
Pöyry
knowledge
STRATEGIC
ASSESSMENT
• In-depth
analysis of the
primary input
and strategic
assessment of
the key
questions for
the cut-size
paper markets
and industry.
EXPERT
REVIEW
• Evaluation of
the findings by
an industry-
leading panel
of Pöyry
experts in all
the key
regions.
CONCLUSIONS
AND OUTLOOK
• Strategic
conclusions to
be presented
in a graphic-
rich document.
The analysis
will deliver the
Pöyry
perspective
on the future
availability,
players and
competition.
4
This study will be the first-ever presentation of a comprehensive, in-depth and strategic review of
how technology affects the cut-size Asian market and industry.
5. 5
PREFACE
Pöyry Management Consulting has been actively following the developments in cut-size paper, and is
one of the most authoritative sources of knowledge regarding the future forecasts of paper demand
globally.
Asia today is, by far, the fastest-growing region in terms of cut-size consumption. We expect this to
continue for at least the next few years but the long-term future remains unclear. Pöyry has therefore
decided to provide what is probably the first comprehensive strategic review of the future of cut-size
paper in Asia to determine the most likely demand forecast by 2025, and the underlying reasons behind
this. We have also set out to answer two main questions: When will cut-size paper consumption in Asia
begin to decline?, and is the ”Paperless Office” around the corner?
Throughout the summer of 2010, Pöyry interviewed more than 1 200 respondents, and conducted over
50 face-to-face interviews across the region, to try to answer these questions. Our key experts within
pulp and paper have also analysed macro-economic factors, key drivers, end-uses, the product
lifecycle, and the competing value chains.
We trust this study will provide useful background and a point of reference, and invite you to contact us
if you would like to investigate further business opportunities in the cut-size paper value chain.
Pöyry Management Consulting
Singapore, November 2010
ASIA: CUT-SIZE PAPER FUTURE: IS THE “PAPERLESS OFFICE” JUST
AROUND THE CORNER?
SAMPLE PAGE
6. 6
CONTENT PAGE
Preface 3
Objectives and Methodology 6
List of Abbreviations 8
Key Messages 9
1 Introduction 18
2 Market Overview & Development
2.1 Macro-economic Drivers and Geographical Grouping 24
2.2 Market Trends 39
2.3 Cut-size Paper End-uses and Functions 46
2.4 Uncoated Woodfree & Cut-size Paper Supply 57
3 Value Chain Analysis
3.1 Cut-size Paper Value Chain 65
3.2 Value Chain Dynamics 73
3.3 End-user’s Decision Making Criteria 82
3.4 Evaluation of Competing Value Chains 88
3.5 Impact of Drivers to Value Chain Competitiveness 91
4 Driver Impacts Assessment
4.1 Technology Drivers 100
4.2 Legal & Political Drivers 114
4.3 Business Drivers 118
4.4 Demographic & Social Drivers 123
Page
SAMPLE PAGE
7. 7
CONTENT PAGE (CON’T)
5 Product Life Cycle Analysis
5.1 Technology Development 133
5.2 Cut-size Paper Life Cycle in Developed Markets 136
5.3 Cut-size Paper Life Cycle in Selected Asian Countries
146
6 Cut-size Paper Demand Forecast in Asia
Demand Forecasts 154
7 Recommendations for Value Chain Players
Overall Summary 163
Appendices
A Country Profile
A.1 China 170
A.2 India 184
A.3 Japan 197
A.4 Southeast Asia 204
B Asia Poyry Panel 216
C Key Supplier Profile 236
D Macro-economic factor 241
E Capacity Expansion 254
F Legislation 256
G Data Source 260
H Glossary 263
Page
SAMPLE PAGE
8. KEY MESSAGES – ASIAN MACRO ECONOMY
Source: UN Population Prospects
China
India
Indonesia
Japan
Rest of Asia
0
1000
2000
3000
4000
5000
1990 1995 2000 2005 2010 2015 2020 2025
Million
8
7
6
5
4
3
Real GDP growth
until 2025, %/a
5.2
4.8 4.64.2 4.2
7.4
1.3
Ø 4.7
Share of GDP in 2009, %
0
1
2
7.6
Source: Concensus Forecast,
Pöyry
India
China
Indonesia
Other Asia
Malaysia
Singapore
Thailand
Japan
• Macro-economic factors such as
economic growth, population growth,
increasing literacy and increasing usage
of technology have direct influence on
the consumption of cut-size paper. The
impact is mainly positive.
• The population grows at an average rate
of 1.2%/a through 2025.
• Japan and China are the biggest
economies, whereas India and China
are expected to have the highest growth.
Long-term GDP growth rate is expected
to average 4.7%/a.
• However, in more developed regions,
cut-size paper consumption per capita
has shown to decouple from GDP. This
phenomenon is also expected to happen
in the studied region, but peaking at a
lower consumption per capita. This is
due to the competition from electronic
devices.
Forecast GDP growth
Forecast population growth
8
SAMPLE PAGE
9. KEY MESSAGES – CUT-SIZE PAPER END-USES AND FUNCTIONS
• Cut-size paper is mainly (60-65%) used for
office (photocopying included) and home
printing. Other end-uses are copying in copy
shops, invoices, e-tickets and manuals.
• Main end-users of cut-size paper are
government offices, multinational and large
corporations and small and medium sized
companies.
Cut-size Paper End-use Segments
• Main functions of cut-size paper are archiving
(copies for record purposes), sharing
(documents for reviewing) and learning (prints
for creation and reading).
• The most used function for cut-size is archiving
(~40%), then sharing (~35%) and learning
(~25%).
• Digitalisation will have different effects on each
cut-size paper function but archiving is
expected to experience the largest impact in
the next 15 years.
• Learning and sharing of documents in print
format will decline slower because of the
current consumer preferences. Especially
sharing of information will increasingly move to
electronic format during the next 15 years.
• In the learning purposes, paper still has good
functional properties for writing and drawing.
9
Government
offices (incl.
govt.
schools and
health
centres)
37%
MNC/ Large
Corporations
34%
Small/
Medium
enterprises
14%
Individuals/
SOHO
5%Printing/
Copying
shops
10%
SAMPLE PAGE
10. KEY MESSAGES – VALUE CHAINS
• Cut-size paper and digital solutions are the
alternative value chains in fulfilling the need for
archiving, sharing or learning purpose.
• In the solution selection, the most important
decision-making criteria are access, legal
requirements and economic benefits.
Functionality is also important. Environmental
benefits or brand image are not considered as
significant.
• There is no big difference in decision making
criteria between countries.
• In Asia, the access to paper solution is much
easier than for the digital solution but in the
future, this will slowly change along economic
and social development, developing legislation
and price erosion of devices. The difference in
solution accessibility between developing and
developed countries is big.
• According to our research, printing technologies
and devices have a positive impact on current
paper consumption. The research also showed
that there are solutions that influence cut-size
consumption negatively. Such solutions include
e.g. PDF, scan-to-email software and e-readers.
• In order to have a major impact on current cut-
size consumption patterns, the competing
solutions need to be accessible, functional, cost
effective, and legal in use.
End-user
Paper Mill
Merchant
Retailer
Wholesaler
Paper Value Chain Digital Value Chain
Hardware
Provider
Software
Provider
Content
Provider
Distributor
End-User
10
SAMPLE PAGE
11. KEY MESSAGES –PRODUCT LIFE CYCLE ANALYSIS
• Cut-size paper in the developed market is in the
maturity stage of the product life cycle whereas
in Asia, cut-size is in the growth stage.
• Cut-size paper consumption in developed
regions was growing modestly in the 2000s.
The high demand until 2005 can be explained
by economic growth, a slow learning
curve/costs of digital archiving and current
consumer preferences.
• The main reasons for a decline in demand in the
USA after 2005, have been consumption trend
changes due to the growing impact of electronic
media and changes in economic activity and non-
farm unemployment.
• In Asia, the economic growth, increasing business
activity and population growth are much faster
than in the developed countries. The growth is
estimated to continue strong next 15 years.
• However in the future, access to technology, new
technology platforms and above all, the adaptation
to the new technologies is expected to be much
faster in Asia than in the developed countries.
Thus, this development will start to have faster
negative impact on cut-size paper consumption
and the regional maturity stage is reached around
2025.
• There are differences between countries as
Japan’s market is expected to move to declining
stage already in the coming years but Indian
market is foreseen to grow beyond 2025.
Time
Infancy Growth Maturity Decline
Cut-size
Asia
Cut-size Paper Product Life Cycle
2010
2025
Cut-size
USA
2005
11
SAMPLE PAGE
12. ORDER FORM
ASIA: CUT-SIZE PAPER FUTURE – IS THE “PAPERLESS” OFFICE JUST AROUND
THE CORNER?
Contact: Peter J Kahn or Ryoko See
Pöyry Management Consulting (Singapore) Pte Ltd
50 Raffles Place #38-05, Singapore Land Tower Singapore 048623 Tel: +65 6733 3331, Fax: +65 6734 6198
E-mail: peter.kahn@poyry.com; ryoko.see@poyry.com
To order, please complete and
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Multi-client Study – for
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