The deal outlines a plan whereby Lenzing – a company that specializes in manufacturing man-made cellulose fibres – will procure dissolving pulp from Sappi in order to manufacture its products. According to a press release issued by Lenzing, the deal “intensifies a long-time cooperation between the two companies.”
In the last year, Sappi has expanded its dissolving pulp production on a global scale.
According to an article written by Textile World, Sappi currently produces more than 800,000 metric tons of dissolving pulp per year at its primary mill in South Africa. Earlier this year, Sappi acquired two new mills – another in South Africa and one in Cloquet, Minnesota – with the intention of converting the facilities to accommodate dissolving pulp production.
By the time those conversions are complete, the company said, Sappi will have an annual dissolving pulp production capacity in excess of 1.3 million metric tons.
These acquisitions are part of a global strategy outlined by the company in November to diversify the company’s output from lower-profit paper pulp into higher-profit pulp used to make textiles.
“While the global market is crowded with paper pulp, especially with new South American mills coming on line, Sappi projects a huge shortage of chemical cellulose for rayon over the next 20 years,” the Duluth News Tribune reported.
“Our goal at the end of the day is to produce 100 percent chemical cellulose. That’s our most profitable future,’’ said Rick Dwyer, the managing director of the Cloquet mill. “You can move back and forth (between pulp types); it’s possible. … But we really feel like the future is going to be converting and staying with dissolved pulp’’ aimed at textiles.