Swedish forest owners association and forest industry major Södra has disclosed that Finnish forest industry major UPM is among the first customers for kraft lignin following Södra's investment announcement regarding kraft lignin production at Södra’s Mönsterås site.
Announced in June 2024, the kraft lignin plant is expected to be in operation in 2027 when it will be the first commercial kraft lignin production facility in Sweden and one of the largest of its type in the world.
The investment is financed with support from the Swedish Energy Agency and is part of the EU Recovery and Resilience Facility (RRF) and Next Generation EU.
Biochemical feedstock
UPM has a leading position in lignin technologies and markets based on 15 years of intensive development, which has resulted in a strong patent portfolio. Lignin applications are growing fast, driven by market demand for sustainable materials and solutions.
UPM will use lignin sourced from Södra to produce more sustainable products and materials in several segments. This includes resin for the plywood and MDF industry and binders for the insulation sector.
Apart from positive performance characteristics, customers are drawn to lignin thanks to its renewable content, reduced carbon footprint, and biodegradability.
It is also abundant, being nature’s second most common polymer after cellulose.
From 2027 Södra will play a major role in the growth of kraft lignin as a renewable and sustainable substitute for fossil-based materials. With UPM as a customer, we will be part of a value chain that can deliver climate-effective solutions for the green transition. UPM, in turn, can trust in our responsible forestry and the low carbon footprint of our pulp mills. UPM’s experience and knowledge of the sector make it an ideal customer and we look forward to a fruitful partnership, said Johannes Bogren, EVP of Södra Bioproducts.
Well matched agreement
Södra and UPM are ideally suited to such an agreement, with Södra’s access to the forest raw material through its more than 50,000 family forester members and ambition of being a raw material provider, combined with UPM’s application knowledge.
Södra also brings scalability, with the potential to produce up to 250,000 tonnes per annum of kraft lignin, if the technology is applied to all three of its pulp mills.
Kraft lignin is a key raw material for UPM to provide commercially viable decarbonization solutions to industrial and consumer markets. Applications for kraft lignin are expanding quickly and offer growing markets. We are excited that Södra takes the step to scale kraft lignin extraction from its pulp mills, and we believe that Södra is the ideal partner for UPM to support our own growth ambitions by providing high-quality kraft lignin with an unquestionable sustainability footprint, commented Winfried Schaur, EVP of Technology & UPM Biorefining at UPM.
In 2020, one of the world’s first commercial biomethanol plants started operations in Mönsterås and thus strengthened Södra´s position as a growing supplier of green alternatives to fossil ones – kraft lignin is another step on this journey.
