Projects

Future Printing Trends

Identification of Future Printing Industry Trends

Full Description

Research Strategy and Methodology

This project takes advantage of the combined expertise of the Printing Industry Center at RIT, the Center for Paper Business and Industry Studies at IPST @ Georgia Tech, and the University of Florida to conduct an overall systems assessment of printer technologies and both printing and papermaking processes from the forest to the reel to the end product of printed material -- related to basesheet improvement for future printing applications. Detailed understanding will be achieved related to current printing needs and future trends in printing industry technology from a substrate (paper, board) standpoint. It is essential to understand printing trends so critical paper properties (and research needed) can be identified for current and future print applications. These analyses will require detailed direct contact and feedback from printers, manufacturers of print equipment and inks, as well as from paper producers and consumers.

One concern is the large variety of papers available in all segments of the market in combination with variable selection criteria:

+ Printers often carry inventories of common grades likely to satisfy many incoming jobs.
+ Printers may use one of these common grades to service the fast turnaround required, but with compromises on end print quality; in other cases that same paper may be drawn from inventory on the basis of technical specs alone, or it could be the only one with the appropriate color to match another grade used in a mixed-grade job.)
+ Other specialty grades are inventoried for specialized jobs or customers, or reserved for particular technologies (e.g. Xeikon printers require pre-coatings on most grades).
+ Some grades are used because they work on more than one print engine within a particular shop, even though the paper may not be optimal for either technology.
+ Some papers cannot be used simply because they don't come in the right sized rolls for a given printer, even if price and tech specs are right. These effects would add complexity to a demand model which identifies only a limited number of purchase drivers.

Accordingly, it is proposed that a survey approach focus on digital printing, and include both high end printing papers (coated papers including coated freesheet grades: Superpremium and Nos. 1-3) and UCFS grades within the analysis. This will allow an assessment of the deficiencies in currently available paper grades for both the specific market segment of production digital printing, as well as those segments using UCFS. Deficiencies will be identified in areas including technical specifications, availability, price, cross-engine applicability, etc., and reasons for downtime or waste. The results of this survey will be analyzed to identify opportunities for future product development in the digital printing market, and an integrated analysis of economically viable approaches in areas of likely high value potential joining roles of biological and printing technologies for improving paper properties that will enhance printing performance and quality while reducing costs in both combined papermaking and printing systems.

The work will be conducted as follows:

(Task 1) A survey approach for external feedback from commercial printers and printer device manufacturers (RIT data base) will be completed. RIT has excellent relationships and rapport with digital printers, with experience indicating a significant response rate when a phone survey is used to poll the RIT digital printer database. The size of the RIT digital database is approaching 200 companies. The sets of questions to be asked will relate to (1) demographic responses including company size, length of time in business, printing technologies available (print engines, productivity range, software), primary market segments and print applications served, and other relevant defining parameters and (2) unique specific questions relating to (a) the technical deficiencies in current papers for digital printing, (b) the availability (or lack thereof) of the range of stocks for digital printing, (c) the basic limitations of paper in the design of digital printers and (d) what digital printers would like to see in new product offerings or product improvements. Additionally, the relative importance of price relative to other parameters will be assessed. A state-of-the art analysis of current business and future technology trends in the printing and paper industries will be completed as part of this work. This includes understanding of consumer needs, identification of new market opportunities and status of acceptance of modified papers for printing; these trends will be directly linked to improvements both in the paper substrate and in the print quality (Figure 2). Pending results from the Year1 survey, a second RIT graduate student would be involved with a follow-up survey or additional in-depth case studies in Year 2.

(Task 2) Printer device manufacturers will be interviewed to understand which paper properties limit innovation in printing devices.

(Task 3) Based on the survey results, constraints to printer performance and quality will be identified, in terms of critical paper property requirements affecting digital printing. Paper quality issues identified could include:

+ Web transport (web fed printing)
+ Sheet transport
+ Web breaks (related to paper tensile, elongation)
+ Sheet feeding (dimensional stability, two-sidedness, stiffness, curl)
+ Linting (charge, surface strength)
+ Printability (uniformity, roughness)
+ Print-through (bulk)

(Task 4-A) Using the survey results, firms' decisions to enter the digital printing market will be analyzed. A binary choice model of econometrics will be used to link firms' entry timing to various economic factors. Important factors are demand for digital printing in the previous period, prices of both printing equipment and printing paper at the point of entry, and the number of firms already operating in the digital printing industry. The analysis will help us understand what has driven the development of the digital printing industry in the recent years and also help us predict the future development of the industry. There are two studies we can refer to regarding modeling firms' entry decisions. The one is Greenstein (2004). This study uses the Poisson model to estimate the probability of new product introduction conditional on market conditions. The other is Pesendorfer (2004). This study uses the probit model to estimate the probability of firms' entry. The dependent variable is an indicator variable whether the firm is active in a period. The explanatory variables include the number of other active firms in the preceding period and the level of gross domestic product. The data requirement for this type of study is not too demanding, and data on firm demographics obtained in the survey will be adequate.

(Task 4-B) The survey results will also enable us to estimate profitability of the digital printing industry, based on its demand and cost structures. The demand structure is identified by relating firms' market shares to price they charge to consumers and product attributes such as quality of paper used, quality of printing, etc. The cost structure is identified by relating each firm's printing costs to both product and firm attributes. Both the demand and the cost structures will be estimated based on a notion of equilibrium, either Cournot or Bertrand, which determines how firms behave in the market. An important advantage of this approach is that it is not necessary to acquire data on actual costs of digital printing since the equilibrium notion identifies the unit cost as a function of price elasticity of demand. Profitability (or the price-cost margin) will be identified at a firm level using the estimated demand and cost structures. By making profitability a function of both product and firm attributes, we can predict how the market structure and profitability of the digital printing industry would be affected by innovation in the paper industry. A challenge of this task is to obtain data on revenue at the company level in the survey as business owners are generally not willing to reveal this information. In this case we may make a use of the economic census data which provide state level information on the number of establishments, total revenue, the number of paid employees, and the total payroll in the digital printing industry in both 1997 and 2002. By integrating the census data with our survey results, we can approximate total revenue of digital printers whom we survey.

(Task 5) A platform will be developed for economic analysis of fiber supply chain cost and quality improvements, with specific focus on digital printing papers including both coated and uncoated freesheet grades. This will involve:

+ Executing a literature search on fiber property effects as related to sheet properties. Some guidance in this regard will be provided by use of the Nanko/Challagalla CPBIS market pulp project results including the Market Pulp Resource Book, which will contain a detailed description of distinctive properties and applications for over sixty market pulp fiber types. Successful completion of this work will identify which fiber types and fiber properties are best suited for sheet properties related to printing performance.
+ Review and enhancement of the existing IPST UCFS model. The IPST model will be used to evaluate the profitability of wood trait changes through the entire production process, tree growth to finished UCFS (Figure 3). Evaluations will be made of the potential impact of both papermaking processing technologies and of fiber property change
+ Adding a cut-size uncoated freesheet converting facility to our UCFS model
+ Adding a coating capability to our UCFS model
+ Including both a "forest cost component" and a "pulp and paper mill cost component" in our production model.

(Task 6) Subsequent analysis will consider biotechnological feasibility to enhance specific fiber properties, possibly in combination with increased wood growth rate. Wood uniformity will also be considered. This will include identification of the impacts of altering specific wood/fiber traits (individually and simultaneously) and key process and pulp furnish conditions, on production costs of UCFS. The most likely targets for fiber property improvement include improvements in wood density in softwood and cellulose/lignin ratios, fiber stiffness and strength, fiber length, fiber uniformity and forest yield (growth rate, moisture content) in both softwood and hardwood species. Studies will determine the biological feasibility of substantially altering/improving raw material supplies from increased growth rates and altered wood and fiber properties, as well as uniformity of the wood supply entering the mill. The range in genetic variation of specific traits will be assessed for loblolly pine and specific hardwood species. The feasibility of capturing these genetic gains through asexual propagation methods and further enhancing these gains through genetic engineering will be assessed. A comparison will be made of the biological feasibility assessment versus the economic valuations to provide a basis for deciding on the direction and viability of forest genetic improvement strategies from a value/profit per land unit basis.

(Task 7) Once the feasible set of changes to fiber properties has been identified, an estimate will be made of the impact on costs to pulp and paper manufacturers that result from these changes; e.g., bleached kraft pulp yields and finished paper properties that impact sheet print quality. Areas for investigation include:

+ Sensitivity analysis of hardwood and softwood pricing; use of recycle fiber at various levels; use of higher filler levels
+ Improved pulp (and sheet) uniformity afforded by clonal propagation. Estimates of increased efficiencies and decreased losses due to wood and fiber uniformity will be included whenever possible.
+ Wood density and chemical content (cellulose/lignin ratios)
+ Improved sheet brightness, extended optical permanence - Using the forest and mill models, calculate economic impact of reduced wood lignin content (higher pulp kappa, yield; shorter pulping time; reduced chemical use; higher strength; higher brightness ceiling).
+ Improved sheet bending stiffness, dimensional stability, surface strength - Effect of wood density, fiber microfibril angle, fiber modulus as affected by growth rate, forest management strategy, and forest tree species and genetics.
+ Benefit of sheet basis weight reduction.

(Task 8) Implications of the research include potential evaluation of integrated scenarios of new fiber supplies/future pulping and papermaking and printing technologies and clarification of the role that biotechnology can have on changing global competitiveness. There is a natural synergism in the modification of raw materials and changes in processing technologies and final customer needs that must be understood.

The above activities will take advantage of significant existing resources already available at IPST @ Georgia Tech. Under Project ROCIT (Reinventing our Core Industry Technologies), IPST subcontracted with Jaakko Pöyry Consulting (JPC) to develop an integrated mill cost model that enables us to understand the capital and operating cost structure of the U.S. paper industry and evaluate the impact of new technologies on mill level operating and capital costs (Appendix 3). Three products/mill types are modeled in spreadsheet format: linerboard, UCFS, and newsprint facilities - from the woodyard to the warehouse. In addition, an existing CPBIS grant resulted in enhancement of the IPST economic model to include (a) the loblolly pine forest cost model, (b) JPC-based input trend pricing information, and (c) predictive pulp yield and black liquor heating value equations (Peter et al (2001)). The inclusion of the forest model into the mill model was essential since there is limited forestry economics literature attempting to evaluate the profit potential of changing wood traits, and this literature deals primarily with tree breeding impacts and not biotechnology (Greaves and Borralho (1996), Greaves et al (1997), Bridgewater et al (1999), Chambers and Borralho (1999), Peter et al (2001)).

The result of the ROCIT/CPBIS work is a unique, powerful analytical tool currently being used to evaluate the economic impact of altered wood fiber traits (accomplished either with breeding or biotechnology) on overall mill profitability. This model includes the costs of wood growth, harvesting, transportation, processing and papermaking and is able to determine the value of alterations in specific wood and fiber properties (Figure 4). This tool is currently being used in a) two IPST MS student thesis studies, one evaluating wood fiber trait changes as optimized with an integrated pulp/fine paper mill producing UCFS - which ties directly to this proposed study - and one assessing the impact of wood fiber trait changes on corrugated box plant economics and b) UGA Ph.D. research related to the CPBIS grant.

Desired Outputs & Contributions to Theory & Research

Outputs of interest to academic and industrial researchers include (1) academic publications focusing on technological innovation, e.g., the analysis of printing paper properties and biotechnological economics relating to forest output and wood quality, (2) preliminary analysis of future printing industry technological trends as related to substrate requirements, (3) an integrated cash flow UCFS spreadsheet model used to calculate economic impacts of individual and multiple softwood and hardwood fiber traits on forest and pulp and paper mill operation efficiencies, and (4) analysis of profitability functions examining impact of fiber and wood changes on printing paper economics.

We anticipate several publications in academic journals, targeting the International Journal of Biotechnology and for the econometric studies, in order of priority: (1) International Journal of Industrial Organization, (2) Review of Industrial Organization, and (3) the Journal of Industrial Economics. The multidisciplinary nature of this work is also expected to result in publication in additional journals such as the Tappi Journal and journals focusing on printing technology (peer reviewed journals include the GATF (Graphic Arts Technical Foundation) Technology Forecast, GATF Research and Technology Report, and NAPL (National Association for Printing Leadership) Tech Trends). Appropriate non peer-reviewed trade journals with wide reach in the industry which have published articles on digital papers include Print on Demand and Electronic Publishing.

The printing industry technological trend analysis will be linked to substrate requirements. Commercial printers' requirements for digital papers and critical paper property improvements for current and future print applications will be identified.

In combination with this result, a biological feasibility study will list the feasible wood trait changes that might be possible to achieve using biotechnology, as it stands both today and in the near future. The third output is identification of technological trends in printing, based on survey results and the literature search. The fourth output is an integrated spreadsheet model that will estimate forestry, pulp and paper mill costs for UCFS, and will relate changes in specific softwood and hardwood traits to changes in profitability of U.S. pulp and paper mills producing printing papers. The fifth output will be an analysis of profitability functions that examine the impact of natural and potential variations in single and multiple genetic changes for log, slush pulp, and finished UCFS.

The spreadsheet-based models can evaluate the direction of desired changes for traditional breeding and potential genetic engineering research for single- or multiple-trait changes. Using the spreadsheet-based model researchers can pinpoint biotechnology applications that have the greatest potential for the paper and printing industries and therefore the greatest potential for funding.

The results of this research will also be of use to researchers who work to develop novel processes for pulp and paper manufacturing, since the economic impact of potential biotechnology changes on wood traits of tree species will help to illuminate the potential direction these changes will take, opening up the potential for new production processes to take advantage of these alterations in wood and fiber property traits. Biotechnology applications that present the most profit potential for industry are also likely to be those most quickly developed.

At the completion of the study, output includes (1) the printing industry technological trend analysis, and (2) the assessment of the ability of biological technologies to create trees with sufficiently altered wood and fiber quality traits to have substantial economic advantages in printing applications for other grades besides UCFS. The results will help to advance concepts and provide technical foundations for printing system development while identifying areas for biotechnology research that offer the greatest potential benefit for U. S. industry.

Overall this research is expected to identify the applications of biotechnology in the forest that possess the greatest potential for improving the profitability of the U. S. pulp and paper industry for printing applications. This research can then be used to guide the spending of future resources towards forest biotechnology research in government, academe and industry.

Desired Outputs & Contributions to Industry/Other Groups

Research into the deficiencies of currently available paper grades for digital presses, and an increased understanding of market trends related to paper usage would support new product development. An analysis of this type of information would be of significant interest to the paper manufacturers, digital press manufacturers, and printers. In addition, this research will provide the U. S. forestry, pulp and paper industry and the printing industry with a valuable tool for assessing the potential economic impact of biotechnological changes that can be used in part as a guide for the strategic investment of research funds. Key future printing industry trends will be identified and related to substrate requirements. Critical paper property improvements for current and future print applications will be identified.

Results of the surveys will provide understanding of consumer needs, new market opportunities and acceptance of modified papers for printing - as directly linked to improvements both in the paper substrate and in the print quality. Survey evaluations will identify (1) the technical deficiencies in current papers for digital printing and (2) the availability (or lack thereof) of the range of stocks for digital printing.

Using the spreadsheet-based models, the U. S. industry will be able to ascertain how significant increases in profitability from biotechnology research might be achieved and in what traits they are likely to occur. For specific biotechnology advances that are expected to yield high returns, the model will be able to clearly investigate the avenues for decreasing paper costs or producing papers with improved printing properties. Forest products industry, printing industry and government funded research will be valuably aided as they proceed - or elect not to proceed -- with an emphasis in these specific areas. This information would also benefit biotechnology suppliers as a guide for the most profitable avenues for research. It identifies the genetic alterations that would be most desirable for industry and thus the advances most likely to be purchased by industry.

For U. S. manufacturers, which use wood as an input, an outline of likely changes in genetic traits of wood inputs in the future will be valuable. Since manufacturing processes will evolve along with the changes in the properties of the wood inputs, this effort will potentially provide a valuable guide for future investment in the industry and for future research in manufacturing of printing processes.

The above findings will be communicated via specific regular updates to CPBIS member companies including company presentations and status reports.