How FSC Certification Is Shaping Printing & Packaging: Export Demand, Regional Clusters and Untapped Domestic Use

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From SIG Combibloc’s launch of China’s first beverage carton carrying the FSC certification mark to Tetra Pak China’s plan to introduce FSC-certified paper packaging; from Mengniu’s upcoming use of new FSC forest-certified packaging materials to Jielong Art Printing and Hunan Tianwen Xinhua Printing both starting FSC certification... In the first half of this year, the Shanghai World Expo’s promotion of green, environmental protection and low-carbon ideas sparked a fresh round of FSC certification across the printing and packaging sector, creating a green wave for “forest packaging.”

Consultancies: FSC certification covers the paper side of environmental performance

To understand FSC certification, start with the organization itself. Public information shows that FSC stands for the Forest Stewardship Council, a non-profit non-governmental organization. It certifies pulp mills, paper mills, printing plants, flooring plants and furniture plants that meet strict forest management standards, confirming that the wood and paper used in their products come from sustainable, legal and harvestable forest resources.

Beijing Dacheng Xinhua Certification Consulting Co., Ltd., which focuses on certification consulting for the news, publishing and printing industries, offers this definition through its general manager Qian Lei: “In green printing, FSC certification can only address the environmental performance of paper among printing materials. For a printing and packaging company to achieve green printing in full, it must adopt cleaner production, improving everything from equipment use, process selection and material choice to the discharge of the three wastes.”

What changes does FSC certification bring to a company’s production management? Shanghai Qiangsi Enterprise Management Consulting Co., Ltd. has advised more than a dozen printing and packaging companies on FSC certification. Its general manager Li Jianbiao explains that FSC certification currently has two types: forest management certification and chain-of-custody certification. Printing and packaging companies need the latter. “After chain-of-custody certification, the biggest change is that the company must supervise the entire supply chain of FSC products—procurement, warehousing, production, processing, packaging and sales—through the whole process,” he says. “The goal is to clearly separate FSC products from non-FSC products and assure buyers and consumers that the certified goods they purchase come from well-managed forests.”

FSC certification is not a one-time achievement. Li Jianbiao notes that once certified, a printing and packaging company may use the FSC mark on products printed with FSC-certified materials. However, the company must follow the principle of integrity. If it places the FSC mark on products printed with non-FSC-certified paper and the certification body discovers this, its right to use the FSC mark will be suspended.

In addition, FSC certification does not mean that all of a company’s products are FSC-certified. Qian Lei explains: “Certification is only proof of capability—it shows that the company can produce FSC-certified products and can make the entire procurement and production process traceable. Whether it actually produces FSC-certified products still depends on customer requirements.”

Statistics: certified companies cluster in the Pearl River Delta and Yangtze River Delta

What is the current state of FSC certification in China’s printing and packaging industry? A search on the FSC website, using keywords such as “china” and “print” in the relevant section, shows that from 2007 to now, 151 printing companies in China have obtained FSC certification. An analysis of these certified companies reveals the following patterns.

First, certified companies are concentrated in the Pearl River Delta and the Yangtze River Delta. Among all certified companies, those in Guangdong—an important base for China’s printing exports—account for half. Dongguan, Shenzhen and Guangzhou each have around 20; Hong Kong, where printing is one of four major industries, has more than ten. In the Yangtze River Delta, Shanghai has nearly 20, Zhejiang more than ten and Jiangsu nearly ten. Fujian has about ten, Beijing fewer than five, and Shandong and Jiangxi each have one or two. Second, large printing companies with Hong Kong or foreign investment backgrounds were certified earlier.

Data shows that as early as 2007, C&C Joint Printing (Guangdong) Co., Ltd., Heshan Astros Printing Ltd., Hung Hing Printing (China) Printing Co., Ltd., Shenzhen Artron Colour Printing Co., Ltd., Starlight Printing (Shenzhen) Co., Ltd. and Leefung-Asco Printers Shenzhen Ltd. had already obtained certification. Some groups certified multiple companies across the country. For example, all RR Donnelley companies in Beijing, Shanghai and Dongguan were certified, while C&C’s Guangdong companies and its Safety Printing company in Hong Kong were also certified.

Why are certified companies clustered in these regions and among these businesses? Qian Lei told China News Publishing and Printing News the root cause: “In the past, printing companies pursued the same old three certifications—ISO9000, ISO14000 and ISO18000. Now Europe and the United States place great importance on environmental issues, so printing companies that want export orders need FSC certification.” As the main regions for overseas orders, the Pearl River Delta and Yangtze River Delta naturally see strong local interest in FSC certification.

Printing companies: certification to win export orders

To learn how printing and packaging companies approach FSC certification and related business, we spoke with companies certified at different times. When discussing their reasons, they usually cite two: protecting the environment and securing export orders.

C&C Joint Printing (Guangdong) Co., Ltd. obtained FSC certification as early as 2007. Luo Haiping, the company’s technical director, said certification responded to both environmental protection and market expansion. “Before certification, we had very few orders in this area, but after certification they grew rapidly. In the year we were certified, FSC-certified product orders were worth several hundred thousand yuan; last year they surged to tens of millions of yuan,” he said. Still, he noted that FSC-certified business remains a small share of overall business. Export orders make up 70%–80% of the company’s total business, while FSC-certified business accounts for only 5% of export volume. At present, the company’s FSC-certified products mainly include instruction manuals for electronics brands such as Apple and Sony, along with albums, hardcover books and some commercial printed materials. The company has set up dedicated areas for storing FSC paper and finished products, uses dedicated machines to print FSC products, and keeps records of the entire FSC production process.

Guangdong Zhongshan Zhongrong Paper Printing Products Co., Ltd. passed FSC certification this May. Lei Zhile, manager of the company’s overseas expansion department, said: “The company hopes to meet customers’ environmental requirements, because many European customers require materials made from wood from renewable forests when placing orders. So we pursued FSC certification, first to win more overseas orders, and second to demonstrate our contribution to environmental protection.” He also admitted that demand for FSC-certified paper comes basically from foreign customers; domestic customers have no such requirement.

Industry call: domestic customers should use certified products

Manager Guo of Jiangsu Suzhou Shida Printing Co., Ltd. expressed a concern. Although the company passed FSC certification in August 2008, its FSC business volume is relatively small, so when buying FSC-certified paper it usually cannot reach the minimum order quantity required by paper suppliers. If the company buys paper at that minimum order quantity, it will inevitably create paper inventory and tie up capital.

Analyzing the cause, Manager Guo said the main issue is that too few printing and packaging companies have FSC certification and too few orders require FSC printing, so purchases of FSC-certified paper fail to reach a certain scale. Without enough volume, paper mills will not produce it specially. She said: “Jiangsu Suzhou Shida Printing Co., Ltd. is a Japanese-backed company, mainly printing electronics manuals for more than 130 Japanese brand companies such as Sony, Canon, Hitachi and Toshiba. Our FSC business is also concentrated among these foreign customers; basically no domestic customers require related printing.”

Li Jianbiao, general manager of Shanghai Qiangsi Enterprise Management Consulting Co., Ltd., also said that although he has handled FSC certification for many companies, he rarely sees related products in daily life. “I have only seen two companies using FSC products: all paper products at HSBC in Hong Kong carry the FSC mark, and I saw it at a five-star hotel in Lujiazui, Shanghai. Usually it is foreigners who drive the use of FSC-certified products; very few domestic companies use them,” he said. In his view, only when companies embrace social responsibility and want to protect the environment can FSC certification truly spread, giving printing and packaging companies more related business.

—Reprinted from pack.cn (China Packaging Network); original link: http://news.pack.cn/show-362181.html