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Stora Enso invests EUR 94 million to grow in renewable materials

Global forest industry major Stora Enso Oyj has announced that will invest EUR 94 million in Finland to grow in renewable materials and to increase competitiveness in consumer board and biomaterials. EUR 52 million will be invested to increase the dissolving pulp production capacity at Enocell Mill and EUR 42 million to enhance the availability of the chemi-thermomechanical pulp (CTMP) at Imatra Mills.

Dissolving pulp is used as a material to replace cotton and fossil-based materials like polyester (photo courtesy Stora Enso).

We continue to drive our transformation to a renewable materials growth company. While investing in our Finnish mills, we expect the competitiveness of Finland’s export industry to be ensured and further improved globally, said Karl-Henrik Sundström, CEO of Stora Enso.

Renewable materials to substitute fossil-based alternatives

According to a statement, Enocell Mill, part of the Biomaterials division, will be converted to focus entirely on the production of dissolving pulp. The softwood pulp production will be gradually discontinued after the investment. The mill will have a total capacity of 430 000 tonnes dissolving pulp annually, whereof 185 000 tonnes hardwood and 245 000 tonnes softwood dissolving pulp.

The investment is scheduled to be completed during the second half of 2019. It is expected to exceed the Biomaterials division’s profitability target, operational return on operating capital (ROOC) of 15 percent, and to have a positive impact on sales.

Dissolving pulp is used as a raw material replacing cotton and fossil-based materials, such as polyester. The dissolving pulp product segment is, according to Stora Enso, growing above the industrial average. The growth is driven by increased demand for non-woven applications, and viscose-type fabrics in the textile industry.

We aim to improve our pulp mix to differentiate and secure competitiveness in the long term. At our Nordic pulp mills, this means focusing on special grades, such as fluff and dissolving pulp. The investment also supports Enocell Mill to become an integrated biorefinery plant for new bio-based chemicals, said Markus Mannström, Head of Stora Enso’s Biomaterials division.

The investment at Imatra Mills, part of the Consumer Board division, includes a new CTMP drying and re-pulping plant as well as an extension of the pulp warehouse. This aims to enhance the availability of CTMP and to drive the commercialisation of micro-fibrillated cellulose (MFC). Due to its high strength and 100 percent renewable raw materials, MFC is designed to outperform fossil-based materials, such as plastics, in a variety of applications.

The project is scheduled to be completed in the first half of 2019. The investment is expected to exceed the Consumer Board division’s profitability target, operational return on operating capital (ROOC) of 20 percent, and to have a marginal impact on sales.

This investment drives further growth and competitiveness in liquid packaging and food service board. It also supports the ongoing MFC investment which will meet customer demand for products made with less raw materials (source reduction), enhanced strength, lightweight and renewable barrier materials, said Annica Bresky, head of Stora Enso’s Consumer Board division.

Both of these investments are included in Stora Enso’s capital expenditure guidance.

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