Nippon Paper and Opal to Discontinue Graphic Paper Production at Maryvale Mill in Australia

Opal's Maryvale Mill in Victoria, Australia, operates two recycling plants, three pulp mills and five paper machines.

Feb. 15, 2023 - Nippon Paper Industries Co., Ltd. announced its decision to discontinue production of graphic paper at its Australian consolidated subsidiary, Paper Australia Pty Ltd. ("Opal"). Opal manufactures and sells paperboard, kraft paper, graphic paper, corrugated board, and folding cartons in Australia and New Zealand.

Opal's Maryvale Mill in Victoria, Australia — one of Opal's manufacturing sites — manufactures and sells graphic paper, paperboard, and kraft paper. The Maryvale Mill had sourced eucalyptus wood produced in Victoria's state-owned forests as the raw material for bleached pulp — the main ingredient of graphic paper — from VicForests, a Victorian state-owned forestry business.

VicForests had been contesting a combined court case involving the Environment East Gippsland and Kinglake Friends of the Forest environmental groups since 2021 regarding its timber harvesting activities. On November 11, 2022, the Supreme Court of Victoria, Australia, issued orders against VicForests, which impacted the timber company's ability to continue its timber harvesting operations, and thus making it impossible for Opal to procure eucalyptus wood from VicForests.

In response to this sudden and unexpected suspension of supply, Nippon Paper and Opal have been considering alternative wood supplies in order to continue graphic paper operations, but concluded that alternative procurement is not feasible and decided to discontinue the graphic paper business at the Maryvale Mill, which will result in the permanent suspension of some manufacturing assets, namely paper machine 5 (M5).

M5 has the capacity to produce 220,000 tonnes per year of graphic papers, such as copy, printing and inkjet grades.

Nippon Paper said the completion date of withdrawal from the graphic papers business will take place within 2023.

Nippon Paper noted that moving forward Opal will focus on the packaging business, which is expected to grow in the future, and will strengthen its integrated packaging supply strategy in Oceania by transitioning the MV Mill into a sustainable packaging paper mill.

The Maryvale Mill

The Maryvale Mill opened in Victoria's Latrobe Valley in 1937 and has since grown to be one of the largest employers in the region, manufacturing close to 600,000 tonnes of paper and board annually. The mill site operates:

• two recycling plants - cardboard (brown) recycling plant; and a wastepaper de-inking plant for white recycled paper.
• three pulp mills - pine kraft mill; eucalyptus NCCS mill; eucalyptus kraft mill and bleach plant.
• five paper machines - M1 (bag and sack papers); M2 (machine glazed bag papers); M3 (inkjet, printing, envelope, copy papers); M4 (kraftliner); and M5 (copy and printing papers).

SOURCE: Nippon Paper Industries Co., Ltd.

Go to a related article: Opal Considers Closure of White Paper Operations at Maryvale Mill Due to Wood Fiber Supply Shortage - Jan. 24, 2023.