Ilim Group Mulls New Pulp Line, Paper Machine

Oct. 13, 2009 - At the 11th International Forestry Forum held in St. Petersburg, Russia, Ilim Group's CEO, Paul Herbert, said that during the economic downturn his company implemented a number of measures which have helped it to weather the storm.

Herbert also said that Ilim is considering the installation of a new pulp line and possibly a new paper machine.

“Following the recovery of demand for softwood pulp in China, Ilim Group intends to focus on the technical parameters of constructing a new pulp line in Bratsk. Moreover, due to the prospects of growing demand for office papers in Russia, the company considers the option of installing a new paper machine in Koryazhma,” Herbert said during his presentation at the forum.

Herbert's presentation, “Ilim Group Strategy Through the Crisis Period” described measures the company has taken to maintain liquidity and financial stability during the global financial crisis. Key efforts include: cutting back on production, refinancing 20% hard currency loans into rubles, and focusing on new products demanded in the market.

Herbert said the plan allowed Ilim to improve its market position, fulfill all commitments to workers, partners and state budgets, and implement its previously initiated investment plans, including the purchase of more than 200 pieces of forestry machinery in Siberia and start-up of the world's largest NSSC pulp plant in Koryazhma.

The total amount of funds allocated by Ilim Group for priority investment projects implementation in 2008-2009 was over RUR 6 billion, he added.

In his presentation, Herbert also talked about Russia's pulp and paper industry, emphasizing insufficient capital investments as a major problem. Among the causes of inadequate funding, Herbert mentioned the country's underdeveloped infrastructure, difficult access to forest resources, hard questions of property, and high country risks.

However, Herbert pointed out that the Russian pulp and paper industry retains its highly competitive position on the global scale.

Looking ahead, Herbert indicated that Ilim intends to continue equipment modernization and cutting costs.

SOURCE: Ilim Group

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» » Ilim Group Opens NSSC Pulp Mill in Russia (9/23/2009)

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