The Paper & Packaging value chain covers a broad spectrum of processes, encompassing everything from agricultural activities to discrete manufacturing tasks. This field is split into various key steps: forestry, pulp mills, paper mills, and converting plants.
Forestry, the initial process, shares many similarities with agriculture. It involves planting and harvesting trees after several years, longer than most typical farming cycles. Alongside pulpwood, the forestry step also converts tree trunks into different wood products, such as construction timber, furniture, and pallets.
Next, pulp mills are involved. This step is akin to process industries and chemicals as it heavily involves chemical and mechanical treatment of fibers obtained by shredding the pieces of wood into wood chips. Additional processes are required to treat recycled fibers. Beyond pulp, other by-products like lignin could also be processed. Sub-processes under pulp mills include utilities, where energy from waste materials and waste heat is sold, and waste and recycling, which involves collecting and recycling waste paper. In biofuel production, the processes are similar to those of traditional oil and gas companies.
Paper mills process pulp into large paper reels of different paper types known as "jumbos," including additional processes like coating or calendaring. These jumbos are further processed into smaller rolls or sheets, tailoring to the customers' specifications. This entails careful consideration of the dimensions of the individual pieces and the customers' demand/inventory planning requirements.
Finally, the converting/finishing process takes place, a step that aligns closely with discrete MTO (Make To Order) with batch-processing. This process called converting, transmutes the rolls into customer-specific end products. This could involve cutting, punching, gluing, or printing. Despite the input products being dimension-based, the processing performed is akin to a discrete MTO or, in some cases, an MTS (Make To Stock) process.
In conclusion, the paper and packaging value chain encompasses a wide range of activities—from forestry and tree cultivation through pulp mill processing, paper mills converting pulp into sheets or rolls, and the final conversion into customer-specific products.
Lesson Summary
Value Chain Scope: The Paper & Packaging value chain includes forestry, pulp mills, paper mills, and converting plants, covering agricultural to manufacturing processes.
Forestry: involves long-term tree cultivation and harvesting, producing pulpwood and other wood products, similar to agriculture
Pulp Mills: employ chemical and mechanical treatments to process wood into pulp, handle recycled fibers, and manage byproducts like lignin
Paper Mills: convert pulp into large reels (jumbos) of various paper types, which are then cut into smaller rolls or sheets based on customer specifications
Converting/Finishing: transforms paper rolls into customer-specific products through processes like cutting, gluing, or printing, operating as Make To Order (MTO) or Make To Stock (MTS)