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Monday, 14 November 2016

E-commerce to drive the pulp & paper industry

In an interview Nichlas Kavander, Senior Vice President, Pulp & Paper – APAC, Kemira with Chemical Today magazine delves into the factors, trends and challenges that are driving the global pulp & paper industry. He also talks about how APAC is fast becoming the strongest market for this sector.
By Shivani Mody
Latest development in speciality pulp & paper chemicals segment.
Due to the decreasing quality of recycled fibre, especially when it comes to strength, there is a growing need for strength chemicals. Our new innovative EcoFill strength concept, based on an engineered cellulose additive and uses 100 percent recycled fibre, has been very successful especially in closed mills. Also, our latest FennoBond synthetic dry strength chemistries have gained a wide acceptance among packaging and board producers. Another growing area is papers for high-speed inkjet printing. Here we have successfully launched our KemPrint technology, delivering excellent image sharpness, high densities, wide gamut values and best-in-class ink setting speed.
In APAC we will continue to build our business on the newly launched Kemira TCM (Total Chemistry Management) concept. Our strong portfolio of pulp, functional and process chemicals, a well-covering production network, combined with our skilled and experienced application team, enables us to offer TCM packages for our key customers, bringing savings and other benefits to our partners.
We will continue to introduce new, innovative and sustainable products in the areas of strength, surface sizing, retention & de-watering, wet strength, surface treatment and biocides.
Company’s global footprint for functional paper chemicals products.
Our business in pulp & paper market is around EUR 9 billion. The biggest growth is in APAC region, where all types of sizing and functional chemicals are growing in demand. Our new Nanjing Pulp & Paper chemical plant is supplying ASA for the Asian Pacific market and we also have production plants in all the major Pulp & Paper producing countries in APAC, like Indonesia, Thailand, Korea, Australia, to support the need of AKD, cationic rosin as well as surface size in the market.
Global trends in functional and bleaching chemicals.
There is a growing demand for strength chemicals due to decreasing quality of recycled fibre and higher filler loadings in both graphical paper and board grades.
In sizing chemicals, the trend is moving towards surface functionality, while in binder chemicals the replacement of standard SB binders with starch and high binding power chemistries continues.In bleaching chemicals, the trend of the Chemical Island concept, i.e. on-site production of bleaching chemicals, continues.
Key market drivers supporting the growth of the pulp & paper industry.
Pulp and paper business will grow mainly through packaging grades and tissue. The key driver for growth in packaging grades is clearly the rapid increase of e-commerce, driving the need for packaging material. Also, the growing concern over food safety is driving the growth for high-quality liquid packaging board and food service board.
In tissue and towel, growth is driven by the higher standard of living in Asia-Pacific. There is also a healthy growth of pulp production in all regions. This will lead to an increasing demand for bleaching and pulping chemicals.
Sectors with high growth potential in emerging markets for this industry.
As said, especially food service board and liquid packaging board have significant growth potential in emerging markets, with CAGR of 2 to 4 percent. Also, tissue and towel production is growing by > 5 percent in all emerging markets. But in general, we target bigger and more complex entities where our TCM (Total Chemistry Management) concept will have full benefit. Our company is present in all major pulp & paper producing countries in APAC and have a target to grow even above the market growth. We specialise in successfully supporting new machine startups.
Challenges in the pulp & paper chemicals industry.
The challenge is always to ensure that we have the most cost-competitive raw materials in the market, with high-quality standards required by us. Another challenge in APAC is to train our key experts and TCM account managers to manage the full range of applications. We provide these capabilities through extensive training programmes conducted in all countries.
The impact of raw materials supplies on the pulp & paper industry.
As part of our activities, the company’s sourcing organisation is continuously monitoring the development of the market situation of raw materials as well as actively negotiating with our raw material suppliers. In general, we can say that the crude oil market has been fairly stable now for quite some time and this has helped us to maintain competitive prices for oil-related chemicals. But there is a clear trend now for increasing crude oil prices, including ethylene, natural gas and FA products.
Pulp & paper manufacturing and chemical business of the company.
Our pulp & paper segment represents around 60 percent of Kemira’s turnover. We are the only global company offering both pulp & paper chemicals to this industry. The company aims to be the undisputed leader in pulp & paper chemistry and we are fully committed to the industry. We have unique expertise covering the whole process from pulping to coating, which we use to create value both in the customer’s production process and for the final product. We have a strong position in bleaching chemicals, and our paper chemicals portfolio covers both functional chemicals such as sizing, coating agents, colourants and wet/dry strength agents, as well as process chemicals such as programs for retention, MB & deposit control and defoamers.
For the pulp & paper segment, we have 27 production sites globally, 11 in EMEA, 9 in the Americas and 6 in APAC. In APAC, our company was traditionally present in Indonesia, China, Taiwan and South Korea. However, through recent acquisitions of AkzoNobel global paper chemicals business in 2015, we now cover the whole APAC market very well.
Focus on R&D and innovation activities.
As the leading chemical supplier to the pulp and paper industry, we take great pride in our R&D and innovation focus. We have 3 global R&D centres, in Finland (Espoo), US (Atlanta) and China (Shanghai), employing around 250 experts. We aim at growing the ratio of products less than 5 years old by 2 percent every year. Our patent portfolio is the widest amongst the pulp & paper chemical suppliers.
Maintaining sustainability in the pulp & paper chemicals segment.
We put significant efforts in the continuous development of our corporate responsibility performance, and have rated high scores by external third party evaluators, such as EcoVadis and CDP. Our corporate responsibility focus areas are sustainable products and solutions, responsible supply chain, manufacturing and business practices, as well as responsibility towards employees and the communities where we operate.
Our company is a proud participant of the Responsible Care programme, a voluntary initiative of the global chemical industry that aims to continuously improve the environmental, health, safety and security performance of chemical products and processes. We have also integrated sustainability criteria as part of our New Product Development (NPD) process. Successful projects must demonstrate both improved sustainability and business benefits to justify the project’s continuation. The NPD process also aims to identify more sustainable alternatives for raw materials in terms of safety and sources.
Read More: E-commerce to drive the pulp & paper industry

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