New York Times on The Great American Cardboard Comeback

 

A Special Feature in the New York Times published on March 22 goes into an in-depth discussion about the re-surgence of the paper industry for packaging paper grades...

As he watched PM 7 hiss and hum for what he thought was the last time, Rick Strick felt a lump well in his throat.

It was Sept. 21, 2017, and the paper mill that had employed Mr. Strick, his father and his grandfather was shutting down after 128 years. Demand for the glossy white paper that the mill produced for brochures was plummeting as advertising continued its flight to the internet.

The village of Combined Locks, Wis., founded when the mill opened in 1889, braced for the loss of its largest employer and feared that the community would be left with a hulking industrial wasteland, just like the other failed paper mills dotting the state. And for the first time since high school, Mr. Strick, who was then 58, started looking for a new job.

Then something unexpected happened: Amazon and China, two forces that are often blamed for destroying American employment in retail and manufacturing, helped Mr. Strick get his job back.

"No one is shocked when a paper mill closes anymore," said Kyle Putzstuck, the president of Midwest Paper Group, which bought the Combined Locks mill soon after it was shuttered. "The shocking thing is when one reopens."

The reason for the revival has to do with the millions of packages that Amazon and other online retailers ship around the world — specifically, the humble cardboard used to construct them. Over the past five years, e-commerce has fueled demand for billions more square feet of cardboard.

An industry that has struggled mightily during the digital age has a rare opportunity for growth. Since reopening, the mill in Combined Locks has switched most production from white paper to brown, installed equipment that can crush used cardboard to make new paper, and hired back about half of the 600 workers laid off during the shutdown.

The smooth brown paper they produce goes to cardboard-making vendors, who sell it in turn to Amazon and other retailers, who ship them to your doorstep.

Brown paper sales slowed following the Christmas e-commerce rush, but industry analysts say the conditions are still ripe for long-term growth. That’s where China comes in. Until early last year, much of the used cardboard consumed in the United States was being shipped to China, where it was recycled into new boxes.

Then, in January 2018, China stopped accepting most used cardboard imports. The material was mixed with so much trash and food contamination that it was causing serious environmental issues.

The policy change has disrupted residential recycling programs across the United States, forcing some communities to bury or burn materials they previously recycled. But for American paper companies that make new cardboard out of used boxes, China’s clampdown has been a boon. It has created a glut of cardboard scrap that is allowing American mills to obtain their most vital raw material at 70 percent less than it cost a year ago.

In Combined Locks, paper drives not only the local economy, but the mill’s identity. Its workers almost never say they are "manufacturing" or "producing" paper. They say they are "making" paper, reflecting how the process is still thought of as a craft with a history that dates back to China in 105 A.D.

Rick Strick, an employee of Midwest Paper Group. "Brown is the future," Mr. Strick said one morning this winter, where he had resumed his job on the maintenance staff.

Rick Strick, an employee of Midwest Paper Group. "Brown is the future," Mr. Strick said one morning this winter, where he had resumed his job on the maintenance staff.CreditWhitten Sabbatini for The New York Times

The mill has a powerful presence — as if a sci-fi city has landed in a blue-collar suburb. The facility comprises 1.2 million square feet of cavernous buildings, winding tunnels and snaking railroad tracks. It operates 24 hours a day, its lights blazing and towering stacks steaming even in the dead of night.

Across the street is the Lox Club, one of Wisconsin’s traditional "supper clubs." The bar and restaurant was founded in 1965 by a retired paper mill worker and his wife in a space attached to their house, and the club still has the warm feeling of someone’s home. There are soft reading lamps standing next to comfortable armchairs and an oil painting of two white-tailed deer.

Sitting at the bar one night were Steve Gilsdorf and his wife, Karen. They were sipping the club specialty: Old Fashioneds garnished with brussels sprouts. They both work in the paper industry.

"Around here, we’ve got the Packers and paper," said Mr. Gilsdorf, 54, who works for a supplier of paper sheets used to cover exam tables in medical offices.

One woman at the bar said she worked part-time for a hand surgeon whose clients often include patients injured in the mills. Another patron bragged about the local high school football team, the Paper Makers, winners of multiple state championships.

On some days, the odor of rotten eggs hangs over the village, a smell some residents attribute to another mill in a nearby town that uses sulfur to break wood down into pulp.

"I’ve heard," said Ben Fairweather, head of operations at the Midwest Paper mill, "some people say that is the smell of money."

A few miles down the Fox River, in the city of Appleton, sits the Paper Discovery Center museum and the Paper International Hall of Fame. Located in a former mill, the modest shrine honors those whose "accomplishments have truly revolutionized civilization." Johannes Gutenberg, the inventor of the printing press, has a plaque on the wall. So does Wang Zhen, creator of the world’s first mass-produced book in 14th-century China.

Wisconsin has contributed its share of greats to the pantheon of paper. Morris Kuchenbecker, a retired package design engineer from the city of Neenah, patented a series of frozen-food cartons. Ernst Mahler, a chemist, invented the technology that makes tissues soft.

The region’s paper history dates to the years following the Civil War, when mills sprung up on along the Fox River to feed the industrializing nation’s demand for reading and writing material and disposable towels. "It was like the Silicon Valley of its time," said Dan Clarahan, a board member of the Paper Discovery Center. One owner’s home was the first in the nation illuminated by Thomas Edison’s light bulbs.

You can still see remnants of paper’s glory years. Stately Victorian homes line many Appleton neighborhoods. The adjoining village of Kimberly is named after one of the founders of Kimberly-Clark, the maker of Kleenex and Huggies.

Wisconsin remains one of the nation’s largest paper producers, and much of it is still made in giant mills along the Fox. Today, huge conglomerates like Georgia Pacific, along with a handful of smaller companies, produce paper in the Fox River Valley area. But the industry has been contracting for decades, and it is not only because of the internet. Pricing pressure from giant retailers depressed the profit margins on brand-name paper towels, tissues and toilet paper.

In 2000, there were roughly 49,600 paper manufacturing jobs in Wisconsin, according to state figures. By 2017, that work force had declined to about 30,000; the paper industry in the Fox Valley shed half its workers over that time period. Last year, Kimberly-Clark closed one of its Wisconsin plants and received a $28 million state tax subsidy to help keep another location open.

In her 23 years in the industry, Airica Hendriks has watched the changes at the mill in Combined Locks with growing unease. Ms. Hendriks, 44, worked her way up from the lowest rank to the role of "coating tender," applying the starch that make paper more rigid.

"Was this my dream job? No," Ms. Hendriks said. "But it is a job I learned to love. This is just what I do now. I am a paper maker."

Over the years, the mill’s products reflected the world’s evolving uses of paper: phone books, carbon-copy paper, paper for large inkjet printers. The company also had a string of owners. A cash register company. A British tobacco conglomerate. A French investment firm.

In recent years, demand for glossy brochures, the mill’s biggest moneymaker, kept falling. Ms. Hendriks said she knew the situation was dire in summer 2017, when her supervisors started "harping" on her not to waste any starch.

"They have never cared about these things," she remembered thinking. "What is going on?"

That August, the bank called its loan and required immediate repayment from the mill, citing a technical term in its loan agreement. The paper company filed for receivership, and all 600 workers were told that they were out of a job.

The shutdown was a shock. The mill had never closed for more than a week of maintenance, not even during two world wars.

Ed Ver Voort, 50, started working at the mill when he was 18. His first job was as a "broke hustler" who scrambled to pick up sheets of paper that would spew off the machine when a roll unexpectedly broke.

"I owed everything to this place," said Mr. Ver Voort, now an assistant superintendent at the mill. "My car, my food, my home. I was able to send my daughter to college working here."

When the mill closed in 2017, most of its workers were able to find manufacturing or warehouse jobs. But these typically paid less than their unionized jobs at the paper mill.

Ms. Hendriks got a position at a plastics factory earning about $17 an hour, about $11 less than she made at the paper mill. She canceled cable, quit smoking and sold her plasma to a blood bank for $300 a month. She did that as long as she could — until her arm got sore.

Paper mills owe their revival to the surge in e-commerce and the millions of cardboard shipping boxes it generates.

 

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The mill appeared destined for the scrap heap. In September 2017, it was purchased out of receivership by a pair of companies that specialized in liquidations.

The village quickly passed an ordinance seeking to prevent the new owners from abandoning the property and leaving an environmental mess. The union representing the paper makers and the county executive also filed legal petitions seeking to keep the mill running.

The mill’s new owners, who called themselves Midwest Paper Group, eventually agreed that it should be in operation. Across the country, failed white paper mills were being converted to brown to feed the cardboard-box boom, and Midwest followed suit..

 

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