Company history

In February 1873 Shibusawa Eiichi and his backers put up ¥150,000 to found Shoshi Kaisha, a mill built at Oji village on the northern edge of Tokyo and finished in June 1875. The problem it existed to solve was straightforward: Western-style paper was cheap, imported and everywhere — early Meiji government notes were printed on German paper, bond certificates on American — and Japan, without tariff autonomy, had no way to shut imports out. The only available answer was to import the technology instead. The venture lost more than ¥40,000 before it produced anything worth selling, and what carried it were state orders for land-deed and stamp paper.

The material was the harder constraint. European and American mills ran on rags, and rags had run out. In 1879 Oji sent Okawa Heizaburo to the United States, and he came back with a method for mixing in straw; Shibusawa admitted later that he had never imagined straw could become paper. A straw digester was running by 1883, and in 1890 the company completed Japan’s first wood-pulp mill in the upper Tenryu valley — the shift from rags to timber that would tie the company to forests for the next century. It took the name Oji Paper in 1893. Control changed at the same time: an approach to Mitsui for expansion capital in 1893 let Nakamigawa Hikojiro prise the company out of Shibusawa’s hands, and when Okawa was demoted in 1898 some 150 workers struck. The dispute ended with both Shibusawa and Okawa resigning, and Oji passed into the Mitsui orbit under Fujiwara Ginjiro.

Mitsui money did not fix the business — Masuda Takashi complained that he had had enough of papermaking, and capital was written down from ¥2m to a quarter of that. What changed things was the Russo-Japanese War, which produced a newspaper boom and a paper famine. Suzuki Umeshiro pushed Mitsui, over years, to build a newsprint mill in Hokkaido; the Tenryu mills had been flooded out repeatedly, and the north offered both hydro power and timber. Tomakomai was chosen in 1906, capital was raised at a stroke to ¥6m, the budget nearly doubled, and workers scavenged beach gravel for concrete before the mill opened in September 1910 with a 142-inch machine — the largest and newest anywhere, including America. With Tomakomai and Ebetsu running, Japan supplied its own newsprint for the first time. The company then followed the forests into Japanese-held Sakhalin, where Fujiwara refused an offer of free timber — nothing, he said, is more expensive than free — and signed instead for a cheap twenty-year contract, the base of the extraordinary wartime profits that paid a 50% dividend in 1920.

The 1920s ended in a capacity war. Okawa, out of Oji, had founded Karafuto Kogyo in 1913 and taken the presidency of Fuji Paper in 1919, and the three companies answered each other mill for mill until Canadian newsprint arrived in 1930, dumped at 20% below the domestic price, and the big Tokyo dailies took it. Even Tomakomai ran losses. Fujiwara Ginjiro read the cause as three-way division, and with Mitsui behind him merged Fuji Paper and Karafuto Kogyo into Oji in May 1933. The result was a company of ¥150m in capital and 34 mills holding 80% of Japanese paper output and 95% of newsprint — one of the largest paper makers in the world, and the centre of a concentration of some fifty affiliated firms.

Defeat took most of it. Six-tenths of Oji’s assets sat outside the home islands, and the loss of Sakhalin — better equipped than anything in Japan, and the source of roughly 40% of its pulp — was the heaviest blow. In January 1946 GHQ applied the corporate restriction order to Oji and forty affiliates; the overseas assets and 23 related companies were stripped away, leaving fifteen domestic mills. In July 1947 the occupation proposed cutting those into nine companies. Oji negotiated for eighteen months — countering with a seven-way plan, then a five-way plan, then, as the deconcentration policy softened with the changing international mood, pushing a three-way split through before the window closed. In August 1949 the company was divided.

Oji itself was refounded as Tomakomai Paper: $1.1M (¥400m) in capital and a single mill, the smallest of the three by staff preference. A 67.5% share of the Japanese paper market at war’s end fell to 37.7% for all three successors combined by 1950 and 27.7% by 1955. What rebuilt it was the Korean War boom, which made paper one of the “three whites” and lifted the industry’s return on capital to twice the manufacturing average in 1951. The company took the name Oji Paper Manufacturing with its Kasugai mill in 1952 and recovered the old name, Oji Paper, in December 1960. Then it did the one thing it knew how to do: concentrate. Investment went into Tomakomai — a 274-inch machine in 1964, Japan’s largest, and by 1970 the biggest dedicated newsprint mill in the world. It was not enough at world scale. In 1966 International Paper alone out-sold every listed Japanese paper company put together, and the three ex-Oji firms combined earned under an eighth of its profit.

On 21 March 1968 the three heirs of the old Oji — Oji, Jujo and Honshu — signed a memorandum to merge and undo the occupation’s split. Chairman Nakajima Keiji had run the approach himself, without consulting the three presidents, after a private sounding of the Fair Trade Commission produced the words “go ahead and file it.” Even reunited the company would rank only thirteenth in the world, and MITI supported it as a way to face capital liberalization. The FTC was initially warm, untroubled even by a 60% newsprint share. What killed it was elsewhere: on 16 April Yawata and Fuji Steel announced their own merger, and large-scale consolidation stopped being a company matter and became a national political question. Ninety economists issued a statement against it; on the 183rd day, tipped off that the FTC was about to refuse, Oji withdrew.

The lesson Oji drew was procedural. If it could not restore itself in one motion, it would shrink the unit of review — take one company at a time, so that share arguments broke down by product grade and the antitrust wall came down to a height it could clear. Kita-Nippon Paper (1970) and Nippon Pulp Industries (1979) followed, the second at the target’s own request; not one objection was filed. Through the depressed late 1970s the industry lived on recession cartels for containerboard and kraft, and in 1981 the four big paper firms added vice-presidents’ councils to their presidents’ club. Toyo Pulp, rescued in the crisis of 1980–81, was absorbed in 1989. The pace of the outside world then forced the endgame: in April 1993 Jujo merged with Sanyo-Kokusaku to form Nippon Paper and took first place, and that October Oji merged with Kanzaki Paper as New Oji Paper, ranked eighth in the world against Nippon Paper’s fifth.

The Kanzaki merger came with a hidden $67.5M (¥8bn) loss: an ex-Kanzaki finance director had run off-book futures and options in the six months before the deal closed. The ex-Kanzaki chairman resigned, and with him went that faction’s weight — which left decision-making unified under the old Oji side just as the final target came into reach. Ohkuni Masahiko, appointed in June 1995 and the first engineer to run the company in 120 years, announced the merger with paperboard leader Honshu Paper nine months later. Honshu had sold its Kushiro mill to a subsidiary in 1988 to pay down debt, and its chairman had said flatly that there would be no merger until Kushiro came home; Honshu bought it back for $805.4M (¥88bn) first. On 1 October 1996 the two combined and the surviving company took back the name Oji Paper — 47 years after the split, and the first Japanese paper company past $9.2B (¥1tn) in consolidated sales.

Restored scale lasted three and a half years. A 1999 rescue of the insolvent containerboard maker Chuo Paperboard lifted the group to 28% of the board market and first place; then in March 2000 Nippon Paper and Daishowa announced a holding-company merger that passed Oji on both share and sales. There was no larger domestic partner left to buy. In 2001 president Suzuki Shoichiro set the answer outside Japan — Asian local production from about 50,000 tonnes a year to one million in five years and three million in ten, with essentially all future growth sourced abroad. At home the work was consolidation by product line: a joint containerboard company in 2001, seven regional corrugated subsidiaries folded into one, household paper into Oji Nepia in 2003, specialty paper and film in 2004.

Growth abroad proved slower than rivals at home. Chinese approvals stalled, and while Oji waited, Nippon Paper, Daio and Hokuetsu each announced 300,000-tonne coated-paper additions. In July 2006 Oji went for the shortcut: a public tender for a majority of sixth-ranked Hokuetsu Paper at $7 (¥860) a share, a 35% premium and the first full-scale hostile bid between major Japanese companies. Hokuetsu answered with a placement to Mitsubishi Corporation, which became its largest shareholder at 24.44%; Nippon Paper bought 8.85% of the target purely to block; Oji gave up on 4 September. In October 2007 it went ahead alone in China, founding Jiangsu Oji at Nantong — around $1.7B (¥200bn) planned for integrated pulp-to-paper production of 1.2 million tonnes.

Nantong depended on a wastewater pipeline that the city itself was building, at roughly $125.3M (¥10bn), to carry 150,000 tonnes a day to the Yellow Sea. On 28 July 2012 a crowd converged on the government offices in Qidong, and the city cancelled the pipeline the same morning; Oji halted the mill that day. Integrated production slipped to 2015, and the Chinese operation took a $506.2M (¥55bn) impairment in the year to March 2016. The investment map was redrawn after that — away from building mills to chase demand, toward owning fibre and end-uses: corrugated in Japan (2005), packaging in Malaysia (2010, 2011), thermal paper and the CENIBRA pulp business in Brazil (2011, 2012), and Carter Holt Harvey’s pulp and paper arm in New Zealand and Australia (2014). In October 2012 the group moved to a holding structure as Oji Holdings. Adampak’s Asian label operations followed in 2022 and Europe’s sustainable-packaging maker Walki in 2024, the same year Oji stopped making children’s disposable nappies in Japan. The portfolio now cuts both ways: in the year to March 2024 domestic operating profit rose sharply while the overseas businesses fell by $384.2M (¥58bn) on weak pulp prices and storm damage in New Zealand, and by March 2025 overseas sales had reached 40.8% of the total.