Paper Forecast — Consolidation Cuts Through

"The recent wave of mergers is predictable given the chronic poor earnings of the forest products industry and relatively low growth rates of markets," states Brian Kullman, paper supply chain strategist for Chicago-based R.R. Donnelley & Sons. "It is what happens when an industry fails to make its cost of capital and investors bid down stock prices. The industry will be able to realize cost savings in procurement, freight, production schedules, trim optimization, among others, as a result of these mergers."