One of Sonoco’s competitive strengths is its vertical integration strategy. With 26 paper mills and 37 paper machines around the world, Sonoco’s paper operations provide the primary raw material for the company’s fiber-based packaging. The company’s paper operations serve such markets as converted paper products, spiral winders, beverage insulators, displays, gaming and paper manufacturing.

In 2006, Sonoco recycled paperboard manufacturing capacity was approximately two million tons. Of that production, the company sells approximately 550,000 tons annually of various grades of paper to outside customers. Completing the vertical integration strategy is the Company’s worldwide recovered paper operations which provide the raw material for the company’s paper manufacturing. With 45 primary collection facilities worldwide, Sonoco’s recovered paper operations sell approximately 70% of its collections to outside customers. In the fourth quarter of 2005, Sonoco’s North American paperboard mills operated at approximately 99% capacity.

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