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First, your just assuming that the only use for pulpwood is toilet paper. "Wasted" is figurative with the context above.

No... i assume its all paper produced by wood pulp.

36% is small trees that could still be in the ground. Sometimes this is from those surrounding old growth, but it is commonly from out-skirting areas or the way in, and could be avoided.

In managed tree plantation, one stratgey is to plant trees very densely so the planted trees smothers out any competition. Once they get about 15-20 years, the forest is thinned, producing tons of pulpwood. Leaving the rest to mature for lumber. Some managed forests are exclusively grown for pulpwood and clear cut every 20 years, but those are less common.

Environment wise, young trees consume more CO2 than old growth forests. The downside it creates large vast monoculture forests devoid of a diverse ecosystems.

So again, its not the problem of paper production... its the lumber industry and their unsustainable practices.