The Implications of a Changing Raw Material Outlook and its Effects on Containerboard Production, Products and Manufacturing in the Future

Transcription

1 The Implications of a Changing Raw Material Outlook and its Effects on Containerboard Production, Products and Manufacturing in the Future ICCA/WCO GLOBAL SUMMIT May, 2011 Outi Juntti, Pöyry Management Consulting

2 ICCA/WCO GLOBAL SUMMIT 2011 PRESENTATION CONTENTS Containerboard trends and outlook Global Fiber Challenges Containerboard Technology Development Nanotechnologies Conclusions ICCA 2

3 PÖYRY INTRODUCTION ICCA 3

4 GLOBAL EXPERTS IN CONSULTING AND ENGINEERING Pöyry is a global consulting and engineering company dedicated to balanced sustainability and responsible business experts in about 50 countries Project experience in over 100 countries projects annually Net sales in 2010 EUR 682 million Listed on the NASDAQ OMX Helsinki ICCA 4

5 WIDE RANGE OF DEEP EXPERTISE URBAN & MOBILITY Urban planning Real estate development Transport planning Rail infrastructure Road infrastructure Construction management Building design WATER & ENVIRONMENT Water Wastewater Waste Environment INDUSTRY Pulp and paper Chemicals Minerals processing ENERGY Hydropower Thermal power Bio-renewables Oil and gas Nuclear energy Transmission and distribution ICCA 5

6 CONTAINERBOARD TRENDS AND OUTLOOK Market Development and Characteristics ICCA 6

7 DEVELOPMENT OF GLOBAL CONTAINERBOARD MARKETS BY REGION BY GRADE Mt Latin America China Japan Western Europe North America Rest of the World Other Asia Eastern Europe Emerging markets Mature markets 40% Mt Recycled Semi-chem 60% Kraftliner 70% 30% ICCA 7

8 CONTAINERBOARD MARKETS BY REGION IN % 20 % 4 % 4 % 7 % 66 % 68 % 12 % North America 28 million tons Europe 25 million tons 92 % China 32 million tons 7 % Virgin White-top 59 % 36 % 52 % 42 % 3 % Recycled 5 % 6 % 90 % Latin America 9 million tons Rest of the world 5 million tons Rest of Asia Pacific 25 million tons ICCA 8

9 MARKET AND INDUSTRY CHARACTERISTICS NORTH AMERICA Dominance of traditional products Virgin fibre based still close to 70% of the market High basis weights 40 Mt Capacity development Crusial role in the global markets/ industry Kraftliner exports to Asia and Europe 20 White-top Recycled Fibre source for the Chinese Role of corrugated Higher share of transportation packaging Virgin Lower share of white-top ICCA 9

10 MARKET AND INDUSTRY CHARACTERISTICS EUROPE Rapid industry development since mid 1990 s Capacity development New recovered fibre based machines, shut down of old capacity Development in corrugating technology Clear trend towards higher quality and consumer packaging Mt + 6,1 mt + 6,3 mt White-top Recycled White-top and coated products, Micro-flutes, light-weighting and multi-wall structures 0 Virgin Environmental and sustainability awareness Packaging reduction Recycability ICCA 10

11 MARKET AND INDUSTRY CHARACTERISTICS ASIA Massive industry boom 200 new machines built since 2000 Capacity development Fibre is the key industry challenge Impact on global trade flows Product development driven by export industry Large share of transport packaging Light-weigting and higher quality packaging in development phase Mt + 12 mt + 32 mt White-top Recycled Virgin Domestic consumption expected to pick-up ICCA 11

12 CONTAINERBOARD TRENDS AND OUTLOOK Trends and Outlook ICCA 12

13 KEY TRENDS LIGHT-WEIGHTING Containerboard & Corrugated Estimated RCF-fluting grammage breakdown in EU25 Corrugated board basis weight 100 % Share of total 33 % 25 % > Average weight g/m 2 China 75 % 50 % 25 % 50 % 40 % 35 % < USA Europe Japan 0 % 17 % E 500 Germany ICCA 13

14 KEY TRENDS SMALL FLUTE AND MULTIWALL Tightly linked to light-weighting. Single-wall still dominating structure, but the other constructions grow faster. Double wall 25 % Triple wall 1 % B-flute 37 % E, F, G, N Small flute 10 % C-flute 24 % A-flute 3 % ICCA 14

15 KEY TRENDS WHITE-TOP, HIGH-QUALITY PRINTING, SHELF- READY PACKAGING Shelf-ready packaging provides new opportunities for corrugated and has brought it closer to the consumers. Required high-quality printing has increased used of white-top linerboards. White-top Liners by End Use Fresh food Beverages Nonfood Consumer durables Paper good, direct mail Industrial 50 Processed food 25 0 Share of total corrugated markets ICCA 15

16 MARKET OUTLOOK UNTIL 2020 Healthy growth prospects globally Demand in Asia and other emerging markets still growing New packaging solutions provide opportunities in mature markets Prevailing product trends will continue Increasing demand on white-top grades Increasing demand on recycled based grades Increasing demand on lightweight grades Good growth prospects; CAGR 3 %/a Increasing quality requirements ICCA 16

17 FIBRE CHALLENGES ICCA 17

18 DEVELOPMENT OF GLOBAL FIBRE MARKETS million t/a Total Fibre Demand Total CAGR %/a 100 % RCP Share of Total Fibre Pulp 0.3 %/a 75 % Pulp % 53 % RCP 4.7 %/a 25 % RCP % ICCA 18

19 RCP USE IN PAPERMAKING Consumption of RCP Grades RCP Consumption by Paper Grades High grades 10 % Mixed 18 % OCC 50 % Other Tissue Newsprint Cartonboard 16 % 16 % 17 % 15 % 7 % 13 % 7 % 3 % 9 % 13 % 10 % 18 % 19 % 13 % 11 % 12 % 51 % 50 % 46 % 54 % Deinking 22 % Containerboard Global North America Europe China ICCA 19

20 DEVELOPMENT OF GLOBAL RCP TRADE FLOWS IMPORTERS EXPORTERS North America Europe China Other Asia Rest of World Million ton/a ICCA 20

21 COLLECTION RATE BY MAIN REGION % Forecast W. Europe 70 N. America World average Asia E. Europe 40 Latin America ICCA 21

22 IMPLICATIONS ON CONTAINERBOARD INDUSTRY Better products from lower quality raw material Increasing collection rates impact on both production process and technolgy as well as on production efficiency and economics Lower yield, more fibre needed More fines lower strenght, more chemicals needed Quality fluctuations, focus on stock preparation Increasing global competition affect on local availability Price pressure Volatility Larger sourcing areas Middlemen ICCA 22

23 NEXT GENERATION CONTAINERBOARD MILL MEETING THE NEEDS AND EXPECTATIONS ICCA 23

24 CONTAINERBOARD PRODUCT DEVELOPMENT IN EUROPE -LINERBOARD UNBLEACHED Trend from testliner 2 to testliner 3 Typical basis weights: 90 g/m 2 onwards Increasing share of mixed paper Kraftliner substitutes WHITE-TOPS Trend towards better print quality 1-2 layer coating Cartonboard liners ICCA 24

25 CONTAINERBOARD PRODUCT DEVELOPMENT IN EUROPE -MEDIUM LIGHT-WEIGHT RECYCLED From light weight (below 100 g/m2) to ultra light-weight down to 65 g/m 2 Furnish up to 100% mixed paper (EU 1.02) SEMI-CHEMICAL SUBSTITUTES Diminshing share of virgin fibre based production - >Semi-chemical substitutes for eg. Frozen food Furnish: pre-consumer (kraftliner) clippings ICCA 25

26 DEVELOPMENT OF CONTAINERBOARD MACHINE CONCEPTS IN EUROPE Start-up Year Technical concept W-type HB 2 Foudriniers Conv 3 nip press Converflo Bel Baie (horizontal double wire) Extended nip Dilution control HB Gap former Shoe press Hydraulic HB two ply High speed gap former Double press shoe Dimensions Trim Design speed Capacity 4 900mm 450 m/min t/a mm 1000 m/min t/a mm m/min t/a mm m/min t/a Typical weight basis g/m g/m g/m g/m 2 ICCA 26

27 CURRENT STATE- OF- THE-ART CONCEPT STOCK PREPARATION Fractionation Better yield, lower contaminants HB & FORMING Hydraulic HB and Gap Former Formation, runnability PRESS SECTION Two Shoe presses Dry content, productivity SIZE PRESS Film sizer Higher speed, better control ICCA 27

28 RECENT PROJECTS AND FUTURE OUTLOOK ICCA 28

29 A FEW RECENT PROJECTS GLOBALLY PROPAPIER Germany 2010 SAICA UK 2012 VISY Australia 2009 ICCA 29

30 PROPAPIER, EISENHÜTTENSTADT PM2, GERMANY Largest RCP based machine in the world t/a DIMENSIONS Testliner and fluting in the grammage g/m % recycled fiber Trim width after winder mm Design speed m/min CONCEPT Dilution HB (OptiFlo) High Speed Gap Former (OptiFormer) Double Shoe Press (OptiPress) Film Sizer (OptiSizer) On July 23, 2010 PM2 produced 2,099 tonnes of corrugating medium and testliner 3 at an average basis weight of 109 g/m2. Machine efficiency reached 99.2 %. ICCA 30

31 SAICA PARTINGTON PM11, UK A greenfield mill of t/a with a CHP DIMENSIONS Testliner and fluting in the grammage g/m 2 Raw material: Recovered fibre Trim width after winder mm Design speed m/min, operating speed 1600 m/min CONCEPT Dilution HB (OptiFlo) High Speed Gap Former (OptiFormer) Trinip with shoe Film Sizer (OptiSizer) Lower energy and water consumption Start-up scheduled beginning of ICCA 31

32 VISY, TUMUT PM10, AUSTRALIA - KRAFTLINER Most recently started kraftliner machine started in the end of a year DIMENSIONS Unbleached and white surface kraftliner; g/m 2 Raw material: virgin (plantation softwood) and recovered fiber Trim width mm Design speed m/min CONCEPT Hydraulic HB 3 Fourdriniers 2 shoe presses ICCA 32

33 WHAT CAN WE EXPECT FROM THE FUTURE DIMENSIONS Width: Four corrugator roll machine a maximum; Speed: Size press and fiber quality are limiting going forward from 1600 m/min onwards CONCEPTS - NO MAJOR CHANGES Gap former Shoe press Film sizer ICCA 33

34 WHAT CAN WE EXPECT FROM THE FUTURE (CONT.) PRODUCTS Light-weighting will grow, BUT New machines eaching the limits around 60 g/m 2 Limited capabilities of the existing machines Better printability White-top Coating, 1-2 layers Fibre furnish: Deterioration of fibre quality; focus on stock preparation Flexibility Sizing helps but strenght properties can not be compensated Need for kraft ICCA 34

35 NEW TECHNOLOGIES NANOTECHNOLOGY ICCA 35

36 R&D IN FOREST CLUSTER RELATED TO NANOTECHNOLOGY Main drivers Cost effectiveness Application areas Pulp/fibre Chemicals Improved product quality, i.e. value-added products Pulping and paper machine technology Paper, packaging and tissue Completely new products including different by-products Wood processing and products Specialties ICCA 36

37 TIMELINE FOR NANO-ENHANCED FIBER BASED PRODUCTS Printability, e.g. control of surface structure, printing ink consumption Optical properties Dimensional stability, homogenous structure Thinner/lighter paper Strength/stiffness properties Speciality papers Self-adhesive labels Smart packaging, e.g. food packaging, use of visible indicators Barrier properties Replacement of unit operations Odour and taste properties Antibacterial papers Integration of new materials into paper web Catalytic properties Self-release papers Printing surface, which learns Mouldability Sandwich structure Active packaging Active barriers Value-added and quality New products Cost effectiveness/ process improvements ICCA 37

38 NANOTECHNOLOGY A FEW EXAMPLES OF APPLICATIONS Papermaking machinery Reinforced composites Nano-structured surfaces Nano-sensors Pulp and paper Nano-fibres to form extraordinary properties Nano-sensors for enhanced recycling Functional paper coating Smart paper Metso Packaging Active packaging Security applications ICCA 38

39 CONCLUSIONS ICCA 39

40 INDUSTRY OPPORTUNITIES AND CHALLENGES Healthy growth opportunities Industrial production and retail development on emerging markets New packaging solutions in mature markets Fibre challenges vs. quality requirements Increasing recovery rates and lowering RCP quality Inreasing containerboard quality requirements -> need for kraft Focus on margin improvement Capacity and capex optimisation Efficiency throughout the value chain Other costs: energy, fixed Sustainability a Key Succes Factor Against Plastics ICCA 40

41 Thank You! CONTACT: NAME: OUTI JUNTTI TITLE: PRINCIPAL MAIL: PHONE: ICCA 41