The earliest known paper, still in existence, was made from cotton rags around 150 AD. Around 800 AD, paper made its appearance in Egypt but was not manufactured there until 900 AD. The Moors introduced the use of paper to Europe, and around 1150, the first papermaking mill was established in Spain, followed by England in 1495, and the US in 1690.

During the 17th and 18th centuries, the increased usage of paper created a shortage of cotton rags, which were the only source for papermaking. The solution to this problem lead to the introduction of the ground-wood process of pulp making in 1840 and the first chemical pulp process 10 years later.

Today, the paper and paperboard industries, including newsprint, are economically sensitive. As the economy strengthens, paper use increases, and as the economy weakens, paper use declines.

Prices – The index price for paperboard was on track to fall –0.6% to 163.3 in 2003, but remained above the 10-year average of 160.4. The producer price index of standard newsprint paper was on track to rise +5.4% to 111.5 in 2003 from the 17-year low of 105.7 posted in 2002. The 2003 price was still well below the 10-year average price of 132.1.

Supply – US production of paper and paperboard in 2002 rose slightly by +0.4% to 81.792 million metric tons from 81.438 million in 2001, which was an 8-year low. The US is by far the world’s largest producer of paper and paperboard, followed by Canada with 20.226 million metric tons and Germany with 18.526 million metric tons.

US production of newsprint rose to 428,000 metric tons per month in 2003, up from 330,800 metric tons per month in 2002. US production of newsprint is second, next to Canada, which had production of 718,100 metric tons per month in 2003.