Springhill® Coated Cover
26 x 40
332M - 12pt C1S
(11427)
Ream 500 Sheets

Introduction
On the threshold of the 21st century, International Paper is a diversified, global company with manufacturing operations in the western hemisphere, Europe, Asia and Africa. Its international presence is the result of long-term changes that evolved since the company's founding in 1898. Starting as a pulp and paper company based in the northeastern part of the United States, IP expanded into Canada and the American South during the 1920s. Three decades later, the company began expanding beyond North America. This was followed during the 1980s by the acquisition of subsidiaries operating in Europe, Africa and Asia.


Origins and Growth, 1898-1940
Incorporated in Albany, New York, on January 31, 1898, International Paper was a merger comprised of 17 pulp and paper mills.* Production facilities ranged from a small mill in Turners Falls, Massachusetts - which produced 11 tons of paper per day - to the Hudson River mill in Corinth, New York, one of the most advanced in the industry with a daily output of 150 tons. Holdings also included 1.7 million acres of timberland in the northeastern states and Canada. During its early years, IP was the nation's largest producer of newsprint, supplying 60 percent of all newsprint sold in the United States and exporting to Argentina, England and Australia.

The company became an industry pioneer under the leadership of Hugh Chisholm, who served as president from 1898 to 1907. Milestones included the construction of the first laboratory in the American pulp and paper industry in Glens Falls, New York; the industry's first collective bargaining agreement and an innovative timber harvesting system that protected young trees. Operating in the northeastern United States, the heartland of the turn-of-the-century pulp and paper industry, IP employed some of the nation's most experienced papermakers, many of whom had honed their skills during decades of shop floor labor. These workers knew their pulpwood grinders and paper machines inside and out and rarely needed the advice of managers, who usually concentrated on administrative and financial matters.

The company's newsprint business declined after 1913, when the United States Congress eliminated tariffs on low-cost Canadian imports, which flooded U. S. markets, eroding IP's market share. Moreover, the company became embroiled in a labor conflict in 1921 that disrupted its system of collective bargaining. IP was subsequently led by Archibald Graustein, president from 1924 to 1936. Graustein reinvigorated the company's newsprint operations by forming Canadian International Paper, an IP subsidiary that acquired vast tracts of timberland in Canada and constructed some of the world's largest newsprint mills in the Province of Quebec. Within the United States, the company diversified into Southern kraft paper production by acquiring two mills in Bastrop, Louisiana, and one in Moss Point, Mississippi, and by building new mills in Camden, Arkansas, and Mobile, Alabama. Consolidating its operations in the northeastern part of the United States, IP sold or closed several older mills and converted the remaining ones
from newsprint to book and bond grades. The company also built up an extensive hydroelectric power business in the Northeast and Canada. This venture had to be dissolved when congressional legislation prohibited the combination of manufacturing operations and electrical power production.

In addition to providing jobs in many small mill communities, the company created an extensive system of employee benefits. This included employee stock options, company housing in several locations and the Employees Mutual Benefit Association, which offered life insurance and disability programs to employees. IP also hired nurses who rendered first-aid services in the mills and served as community health care providers. In 1937, the company resumed negotiations with labor organizations representing pulp and paper workers, machinists, electricians and other workers employed in company mills.

The Great Depression of the 1930s marked a difficult period. Like most manufacturing companies, International Paper suffered severe financial losses due to the unprecedented economic downturn, forcing the company to reduce output and lay off workers. In addition to selling off poorly performing subsidiaries, the organization weathered these hard times by introducing a range of new products and, later, by branching out into the packaging business. In 1931, IP became one of the first paper companies to manufacture linerboard on the Fourdrinier machine, which produced inexpensive, high-quality grades for use in corrugated containers. Major customers for this product included a leader in the corrugated container industry, the Agar Manufacturing Corporation, which was acquired by IP in 1940. This transaction made the company one of the first integrated linerboard manufacturers in the American pulp and paper industry.

Other efforts to develop new business followed the same pattern. In 1939, IP pioneered bleached kraft grades for folding cartons, tags and file folders and supplied the first bleached kraft paper grades that were suitable for milk carton production. The company sold the bulk of its milk carton board output to Single Service Containers. Determined to expand its presence in the converting sector, IP acquired Single Service in 1946 and later turned it into an integrated liquid packaging operation.

The company also laid the foundation for its specialty products business during the Great Depression. During the early 1930s, it formed Arizona Chemical as a joint venture with the American Cyanamid Company. Arizona Chemical refined crude liquor turpentine, a by-product of the sulfate pulping process, and later became a specialty chemicals producer with operations in the United States and overseas. In 1939, Canadian International Paper teamed up with the Masonite Corporation to build a hardboard products plant in Gatineau, Quebec. Almost five decades later, IP acquired Masonite with operations in the United States, Europe and Africa. The quest for new technologies, products and markets during the Great Depression of the 1930s was initiated by Richard Cullen, who served as president from 1936 to 1943, and as chairman of the corporation from 1943 to 1948.