Sappi Alfeld Mill to Focus Production on Release Liner and Flexpack Paper

Sept. 25, 2012 (Press Release) - In response to strong growth and positive market forecasts for the packaging market, Sappi Fine Paper Europe has begun the process of converting its Sappi Alfeld Mill in Germany to focus exclusively on producing one-sided coated paper for packaging, labels and technical applications.

The project will take 12 months to complete.

At the same time, Sappi will actively manage its graphic paper capacity by transferring the current coated paper production of the Sappi Alfeld Mill to other Sappi Mills in Europe in close consultation with these customers. This action will further improve Sappi’s cost position in coated woodfree paper in Europe and elsewhere.

The strong growth and improved margins in this market are due to the growth in the demand for paper packaging and a lack of standardization; high degree of customization; and the long qualification times imposed by customers. Sappi has also been successful in the development of innovative and sustainable solutions for this market in close cooperation with end-use customers and converters.

Commenting on the conversion, Sappi Fine Paper Europe CEO Berry Wiersum said: “Our decision is in line with the Sappi group strategy to invest in higher growth and higher margin businesses. In addition, it will further improve Sappi’s cost position in coated woodfree paper in Europe and elsewhere.”

The decision will entail the conversion of paper machine number 2 (PM2) from producing 150,000 tons of coated fine paper per annum to producing 135,000 tons per annum of speciality paper. Paper machines 1, 3, 4 and 5 at Sappi Alfeld Mill already produce jointly 165,000 tons of speciality paper and board per year.

Once the conversion is complete, the Sappi Alfeld Mill will benefit from increased margins, improved quality, increased efficiencies on raw material consumption and an optimized fixed cost profile. The mill will become the biggest and lowest cost producer of these one-sided coated speciality grades globally; with the converted PM2 the fastest and most productive speciality machine in the world. The PM2 product range will focus on one-sided coated grades from 40 – 180gsm for packaging, technical purposes, liner and label applications.