Foreign wood-pulp industry and international trade in wood pulp.

World production of wood pulp has been expanding rapidly. In spite of considerable decline in the first years of the depression, the total output in 1934 was about 5 percent greater than in 1929, and between 40 and 45 percent greater than in 1925. The 1934 production amounted to about 20,000,000 short tons. Further increases in world production have undoubtedly occurred since 1934, as has been conspicuously the case in the United States. Following the United States the largest producers of wood pulp are, in order, Canada, Sweden, Germany, Finland, and Norway. Japan and the Soviet Union also have substantial pulp industries and a number of other countries, mainly European, are of some importance. In recent years expansion has been particularly marked in Finland and the Soviet Union.

The important pulp-producing countries all have large paper industries, some of which, especially those of Canada and the Scandinavian countries, produce principally for export markets. There is, however, a very large international trade in wood pulp itself, since a number of countries, notably the United States, Great Britain, France, Italy, and Japan, produce much less than their requirements. International trade in wood pulp as such amounted to about 5%1⁄2 million tons in 1934. Sweden, Finland, Norway, Canada, and Germany, in the order named, are the most important exporters.

About 80 percent of the wood pulp entering international trade is chemical pulp, and much the greater part of this chemical pulp is sulphite. The international movements of ground wood are mostly to countries relatively near to the exporting countries.

Of pulpwood, wood pulp, and paper taken together, Canada is the world's largest exporter. In the exports from Canada there has been a marked shift from the cruder to the more advanced forms; exports of both pulpwood and pulp have declined while exports of paper have markedly increased. Exports of paper and board, principally newsprint paper, in recent years have probably accounted for around 70 percent of the total cut of pulpwood in Canada. The United States is the outstanding market for Canadian exports of pulpwood, wood pulp, and newsprint paper, and probably takes, in one form or the other, three-fourths to four-fifths of Canada's total output of pulpwood.

Classes of sulphite pulp.

SULPHITE PULP

The main classes of sulphite pulp are the unbleached and bleached. Small quantities of pulp acquired by converters in unbleached form are bleached before further manufacture; these quantities are disregarded in the statistics of this report. The proportion of bleached pulp in the total domestic consumption of sulphite, as well as in the total production, has been increasing during recent years. In 1936 about 52 percent of the apparent consumption (i. e., production plus imports minus exports) and 63 percent of the United States production was bleached by the producing mills.

Both unbleached and bleached sulphite pulps are further subdivided into a number of grades and subclasses. Chemical and highly purified grades of bleached sulphite are made by only a few mills; they are used in the manufacture of rayon and transparent cellulose sheeting and for other special purposes. The several grades which are used for paper and board vary considerably in characteristics, some being more

suitable than others for a given final product. These grades show a material divergence in prices. Moreover, the pulps of different mills, even though designated by the same grade name, are not always regarded by purchasers as of equal quality.

Production, imports, exports, and consumption.

Unbleached.-There was a downward trend in the domestic consumption of unbleached sulphite even before 1929, and, after a further drop of nearly one-third from 1929 to 1932, the consumption had recovered by 1936 to only about seven-eighths of the 1929 volume. This situation is attributable chiefly to the decline in the production of newsprint paper. Since newsprint is made almost entirely in integrated pulp and paper mills, this decline is reflected principally in diminished domestic production of unbleached sulphite rather than in falling imports. Domestic production was almost one-fifth smaller in 1936 than in 1929. Imports of unbleached sulphite fell by a smaller percentage in the early years of the depression than domestic production, and by 1936 had recovered to a volume slightly above that of 1929. In 1935 and 1936 imports were about 15 percent greater than total domestic production, and nearly five times as great as the domestic production sold (including exports). Exports of this pulp have almost doubled since 1929, and in 1936 over 10 percent of the domestic output was shipped to foreign markets.

Bleached. The domestic consumption of bleached sulphite declined slightly less than one-fourth from 1929 to 1932, and between the latter year and 1936 increased to a volume about one-fourth greater than in 1929. This increase was in part caused by larger use of sulphite pulp in the manufacture of rayon and other chemical cellulose products, but in much greater part by the larger production of higher grade classes of paper made from sulphite pulp. Domestic production and imports have increased roughly in the same proportions; imports supply about one-third of the consumption and are slightly in excess of the domestic output sold as pulp (including exports). Exports of bleached sulphite increased almost ninefold from 1929 to 1936, and in the latter year accounted for over 10 percent of the domestic output. The following table shows the domestic production, imports, exports, and apparent consumption of unbleached and bleached sulphite pulp in 1929, 1932, and 1936.

Sulphite wood pulp: Production, imports, exports, and apparent consumption of unbleached and bleached sulphite pulp, in specified years

Trends of production in the several regions.

There have been substantial increases in the proportion of total domestic output of both unbleached and bleached sulphite produced in the Pacific coast region. In that area, the output of bleached increased almost continuously throughout the depression, and in 1935 was about two and one-half times as great as in 1929. There was a considerable decline in the Pacific coast production of unbleached sulphite from 1929 to 1932, but by 1935 it was about one-tenth greater than in 1929. In the other three main producing regions the output of both unbleached and bleached sulphite declined markedly from 1929 to 1932, and in the case of unbleached, the 1935 production remained considerably smaller than in 1929. The 1935 output of bleached sulphite in the Lake region was somewhat greater than in 1929 but in the Northeastern and Southern regions the opposite was the case.

Figures for the production of unbleached and bleached sulphite pulp by regions in 1936 are not available, but with substantial increases in the total domestic production in that year over 1935, preliminary information indicates some increase in both classes in all four of the regions. The Pacific coast region is probably continuing to gain in relative importance.

The domestic production of rayon and chemical grades of pulp, which has increased about tenfold since 1929, in the past few years has constituted 10 to 15 percent of the total production of bleached sulphite. A smaller proportion is of highly purified grades for other special purposes. The recent large expansion in the production of rayon and chemical grades has occurred principally in the Pacific coast region. Some of the rayon and chemical pulp, and most of the other highly purified pulp, is produced in the Northeastern region. Utilization and sales by pulp-producing concerns in different regions.

A large part of the domestic production of both unbleached and bleached sulphite is converted in plants integrated with the producing pulp mills, although the proportion is much smaller than for sulphate and ground wood. In recent years 70 to 80 percent of the unbleached has been so converted, and 55 to 60 percent of the bleached. In addition, approximately 5 percent of the output of both classes is converted in mills affiliated, though not physically connected, with the producing mills. In 1935, including exports, about three times as much bleached as unbleached sulphite was sold by domestic pulp mills to unaffiliated converters.

Some mills on the Pacific coast produce exclusively unbleached sulphite for sale, but even in that region well over half the total output of such pulp in 1935 was converted in plants integrated with the producing mills. The bulk of the remainder was sold in this country or abroad. West coast mills accounted for over two-thirds of the total sales of unbleached sulphite by United States mills in 1935, their share in exports being even higher than in domestic sales. Moreover a large new mill on the Pacific coast producing unbleached sulphite for sale began operations in 1936. The relatively small quantities of unbleached sulphite shipped by mills in the Northeastern and Lake and Central regions are for the most part produced by plants the bulk of whose output is used in integrated paper manufacture; substantial proportions of the total shipments are transfers to nonintegrated but affiliated converting mills.

About three-fourths of the sales of domestic bleached sulphite, including exports, is also accounted for by the Pacific coast region. Its production for sale has been rapidly increasing, and in 1935 almost four-fifths of the total output of West coast mills was sold at home or abroad; there are five large pulp mills producing bleached sulphite entirely or mainly for sale. In each of the three other regions the greater proportion of the bleached sulphite produced is converted into paper in integrated plants, and a considerable part of the remainder is shipped to affiliated paper mills. There are, however, substantial sales of bleached sulphite in domestic markets by mills of the Northeastern region, and all or a major part of the business of some mills in that region, as well as of one mill in the Lake and Central region. consists of producing bleached sulphite for shipment to separate converting mills.

Approximate disposition of domestic unbleached and bleached sulphite pulp in 1935 [In thousands of tons of 2,000 pounds]

The bulk of the intracompany shipments of sulphite pulp goes to mills in the same regions as the producing mills; the principal exception is the movement of bleached sulphite from the Southern region to the Lake and Central region. The sales to unaffiliated concerns by pulp mills in the Northeastern and Lake and Central regions are also principally within the respective regions, though there are considerable sales of bleached sulphite by Northeastern mills to the Lake and Central region and the Southern region, their sales in the South being principally of rayon and chemical grades. On the other hand, only a small part of the sulphite sold by mills in the Pacific coast region goes to converters within the region. Substantial proportions are exported, mainly to the Orient; the bulk of the bleached sulphite exported is of rayon and chemical grades. There are in addition considerable sales of rayon grades by West coast mills in the Southern region, but the bulk of their sales in the domestic market, as well as of the sales by mills in the other three producing regions, goes to paper and board manufacturers in the Northeastern and Lake and Central regions.

Domestic unbleached and bleached sulphite sold to converters in different regions of the United States in 1935

Unbleached sulphite pulp is imported principally from Europe. In recent years Sweden alone has supplied over half and Finland about a fifth of the total. Canada, Germany, and Norway follow in the order named. In the case of bleached sulphite, Canada supplies well over half of the imports, with Sweden and Norway contributing the greater part of the remainder; Finland, Norway, and Germany are also minor

sources.

United States imports of unbleached and bleached sulphite from the principal countries in 1936

About a fifth of the bleached sulphite imported from Canada in recent years has consisted of rayon and chemical grades. Only small quantities of these grades have been imported from Europe.

Most of the rayon and chemical pulp imported goes to the Southern region, but nearly all sulphite pulp, both unbleached and bleached, imported for use in the paper industry goes to the Northeastern and Lake and Central regions.

Distribution of imports of unbleached and bleached sulphite from Canada and Europe