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Inside America's Oldest Continuously Operating Paper Mill

Thu, 07/03/2014 - 1:00am
Tia Nowack, Associate Editor, IMPO - @TalesFromTia
 
New Hampshire is a beautiful state, full of mountains, swaths of forests, and rivers behind every corner. The notion that a manufacturer can exist cohesively in such an environment is impressive. And the fact that one has done so for almost 200 years is shocking. 
 
Monadnock Paper Mill (MPM) is nestled along the Contoocook River in the 1,400-person-town of Bennington, NH and has been in continuous operation since 1819 — the longest of any paper mill in the United States. The company is family owned, and it's loyal ties to local community and environment are apparent at every step. 
 
Monadnock understands that the community depends on it, and they don’t take that responsibility lightly. This loyalty, coupled with wise investments and risk taking, has allowed MPM to remain profitable across three centuries. 
 
The Early Days
 
The mill was founded following the War of 1812 when an embargo was put on English goods, including paper. The people in the area decided they needed an indigenous source of paper. The first mechanical equipment was installed in 1835 and the mill has been churning out paper ever since. 
 
The mill has been family owned throughout its life. The most recent family – the Verneys – purchased the mill in 1948. Richard Verney, the current Chairman and CEO of Monadnock Paper Mills, relays the tale of his father’s purchase so fondly and comfortably that you can tell it’s a popular story.
 
When Colonel Pierce, the previous owner of the mill and brother of the 14th President of the United States Franklin Pierce, passed away, the mill went up for sale and Verney’s father, a textile worker, made the biggest purchase of his life.  
 
“Colonel Pierce was sort of the last of the robber barons, so when my dad bought the mill he bought the entire town,” says Verney. 
 
Not a real estate man, Verney’s father sold the houses to the people who lived in them for no profit and began investing in the necessary upgrades to the mill. The war years had been hard on the company, and the mill was only operating on one machine and turning out low-quality, commodity paper. 
 
The decision to continually upgrade the product mix, moving from commodity papers to high-quality publishing papers, paid off for the company and has allowed them to thrive. 
 
The Shift to Specialty Products
 
“In the late 1960s, my dad said there were going to be some really great printing papers made on wide, fast machines, and we wouldn’t be able to compete, so we’d better get into the specialty paper business. The problem was no one knew what that meant,” says Verney. 
 
At first, “specialty paper” came in the form of vacuum cleaner bags – a traditionally paper product. After three years of research and development, the company created a vacuum cleaner bag that outperformed other products at the time, and made their first commercial product for companies like Electrolux and Hoover. Eventually, however, most production moved to China, where 98 percent of vacuum cleaner bags are made today. 
 
Even though this trend was only a passing success for Monadnock, the move to specialty products was still ultimately a good one. “If we were dependent on our printing paper business alone, we’d be out of business,” says Verney. Eventually the company’s focus became customizing products to meet a specific customer or end use application – often of an industrial nature. Their customized industrial products can be found as the backing of sandpaper, medical packaging papers for sutures, and more. 
 
The other key to MPM’s survival was developing a mentality of doing the unusual to stay alive.“Along with this goes an undercurrent of a theme of sustainability, or a belief that if you’re going to live and operate in a small community, you ought to give back,” says Verney. 
 
MPM gives back through environmental stewardship, information sharing with other industries, input on legislation, and by providing jobs to area residents. It’s clear that the mill and the community are tied intricately together. 
 
The mill currently operates with 180 workers. The proudly unionized product personnel are 98 percent local, with as many as four generations of the same family working at the facility at the same time. In such a small community, well-paying jobs with benefits are in short supply, making MPM an important part of the economic community. 
 
“The Verney family lives less than a mile from the facility, so they understand the importance of the environment, the facility, and the community coexisting peacefully,” says Michelle Hamm, MPM’s environmental programs manager. “That made my job really easy.” 
 
“Enlightened Self-Interest”
 
“One thing we started early on was trying to do a better job than the industry with the environment,” says Verney. When it became clear in the 1970s that the Clean Water Act was coming and that they were going to be forced to put in new water systems, the company decided to get proactive. 
 
Because it was a time of high inflation and they knew the project would be expensive, the Verneys decided the best option was to bite the bullet. They designed a facility that would meet the most stringent regulations, and with a little “enlightened self-interest,” made a big step towards reducing their environmental footprint. 
 
This initiative to be better than the industry is apparent everywhere at the mill. Every person you talk to is in on the mission, and no detail is ignored. This strict attention to detail starts with every product that enters the premise. 
 
Hamm is responsible for analyzing every raw material that arrives via truck, and everything must get her approval before it has a shot at becoming paper. “I’m looking at its environmental constituents — if it’s hazardous, don’t even talk to me. And the suppliers already know that.” Examples of hazardous materials that wouldn’t meet Hamm’s standards include latexes that contain formaldehyde or styrene materials. After a material gets her approval, it is sent to the safety director before it heads to the technical services director for final approval. 
 
Sustainable Waste 
 
Monadnock also operates its own water treatment plant to process the massive amounts of water that are used in paper making, as well as byproducts. First, the solids – known as short fiber paper – need to be separated from the water. The filtration system separates out the fibers and sends it to the treatment plant. This short paper fiber is the largest byproduct of the facility. 
 
Originally, and at many other facilities, this product is sent to a landfill. But not so at Monadnock. In a solution that epitomizes the facility-community-environment connection, they have come up with an ingenious use for this “waste.” 
 
MPM has teamed up with New Hampshire farmers and reclamation teams to put the material to good use. Farmers use the nitrogen-rich product to hold seeds in place in their fields, while other crews use it for gravel pit reclamation projects. 
 
Monadnock assumes all expenses for the initiative, even paying for the trucking to deliver the material to farmers. MPM is even an EPA SmartWay Partner, which means it contracts with carriers that use clean diesel fuels and anti-idling technologies to reduce the carbon footprint of the entire operation. 
 
The fiber is tested extensively before it’s applied to fields because the state of New Hampshire is very dependent on its expansive aquifers for drinking water. In fact, 75 percent of water for residential purposes in the state comes from the ground. This significant tie to groundwater has shaped the way MPM views this precious natural resource. 
 
What About the Water? 
 
After water is used to make paper, it is sent to the clariflocculator where the solids are filtered out. The clarified water is then sent to the on-site lagoon system.
 
The system is made of four lagoons that hold a total of nine million gallons of water. They are activated sludge lagoons, meaning the first two lagoons have bacteria in them to digest any remaining material in the water. Those bacteria require oxygen to stay alive, and therefore require surface and subsurface aeration — a potential efficiency nightmare. 
Last year, however, Monadnock made the decision to invest almost $50,000 to upgrade their aeration technology to reduce energy consumption.
 
In traditional lagoon systems, sediment builds up at the bottom of the lagoon, necessitating dredging every ten to twelve years. The plant’s new technology, called a sludge sled, uses a rail system that’s elevated above the lagoons. The sled goes back and forth across the rails, scraping up material from the bottom as it goes. Through this system, the lagoons will never need to be dredged again. This initial equipment investment will save Monadnock almost $1.5 million every ten years. 
 
“You really can teach an old dog new tricks here, because we are always looking to optimize our own operations,” says Hamm. 
 
Once the water is ready to be discharged, it is as clean as river water. If it weren’t for the wildlife that call the lagoons home, the water would be as clean as drinking water. The land surrounding the mill is in conservation to protect the aquifer below. 
 
The mill also has a water conservation team, which was worked to decrease overall water consumption to the lowest level it’s ever been. They’ve already cut consumption from 1.2 million gallons of water per day to just 600,000 — but Hamm says they still have room for improvement.  
 
Not only does Monadnock use water for paper production, they also use it for power production. MPM owns five hydroelectric turbine facilities, considered “low-impact” energy sources, which they have continued to invest in to improve their efficiency. Today, these turbines provide up to eight million kilowatt hours of renewable energy on-site — roughly half of MPM’s current power needs. 
 
The company is also looking into other renewable energy sources, including biomass, but for now they are offsetting the energy that they purchase with Renewable Energy Certificates (RECs). These RECs are used to fund renewable energy projects in the region, including a wind farm in New York. 
 
In total, Monadnock owns more than 750 acres of New Hampshire forests, rivers, and streams. Monadnock's forest lands are operated and sustainably managed under the American Tree Farm system. All of the pulp used for paper production, however, is sourced from highly regulated and protected forests off-site. 
 
Business Today
 
Back in the seventies, the paper industry was perceived as polluting the water and mucking up the air. But according to Verney, that's not the case anymore.
 
He says that some of the steps they’ve taken are in recognition that there is a commercial value to these efforts. “Companies will want to do business with you, they’ll want to buy your products, and at the end of the day you’ve done something for the company, the environment, and your customers,” he explains. “It’s not that we’re all just altruistic —  this is not a nonprofit.”
 
Having a watchful eye on the bottom line is crucial in a competitive and global market like the paper industry. The growth in the industry is now concentrated in the Far East and South America, as Western Europe and the United States struggle. The main hurdle, according to Verney, is competing with big, brand new, government subsidized operations in China, Indonesia, and Korea. These facilities may not boast the same sustainability initiatives as paper makers like Monadnock, but they are turning out a competitive product extremely quickly and cheaply. “I don’t think you’re going to see any major investments in this industry in the U.S. ever again,” says Verney. 
 
So what's their plan to compete? Customization.
 
A global retail brand owner came in a few years ago and wanted to make a paper alternative to plastic gift cards. The caveat was that it needed to perform, appear, and when dropped, even sound like the traditional plastic card — but it also had to be recyclable and made with renewable resources. After years of R&D, MPM was able to make a product that fit exactly what the client was looking for. 
 
The R&D seemed to pay off and they knew they had a great product on their hands that should be easy to sell — it’s obviously more environmentally friendly than what companies are using today and it tells a great brand story. It’s even a little less expensive to make. Should be a no-brainer, right?
 
“I was wrong,” says Verney. “And the reason I was wrong is that when you introduce new technology or disruptive technology, one of the hurdles is getting people to change what they’re used to doing and what their equipment is set up for.” The same hurdle was true for their 100 percent post-consumer waste beer bottle label. 
 
The massive amount of time and money that goes into R&D is a big barrier to entry, one that bodes well for a well-established company like Monadnock. Because they are privately held, they can take bigger risks in R&D and wait longer for the return on investment because they don’t need to worry about every quarter’s performance. This allows them to think longer-term, which has proven invaluable. 
 
“Sometimes it’s frustrating,” says Verney. “You know that you’ve got a good product, you know that the customer would have a better story if they used it, but they’re also business people and no one likes change. Don’t rock the boat. Fortunately, we’ve found customers that are willing to rock the boat.” 
 
The Future Of Monadnock
 
“I think the future will be challenging, and I don’t deny that. We’re a small guy in a big industry,” says Verney. Luckily for them, he says, the company is well established in a market that’s consolidating. “I don’t think it’s necessarily easy being a manufacturer of anything in the United States today. There’s too much global competition,” he says. 
 
“But I do think that if you try to stick to something that’s relatively specialized, limit the number of competitors you have, and make a quality product consistently, there’s a place for you. It’s nothing but traditional hard work and having good people who work with you.”
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