The original setup simply used a ping))) ultrasonic sensor, arduino, sparkfun ProtoScrewShield, and SSR.  There was minimal processing going on.  When the material came within a certain range of the sensor the relay would switch and the stock would be uncoiled.  Once the stock was a certain range from the sensor the relay would be switched back off.  

The problems that I saw with this design was that when the material would bounce around from being fed into the press the sensor would not always register that more material needed to be paid out.