“The UK seems to be the area with the most growth in Europe,” says Saica project director for its UK mill Erkki Savolainen. “We saw that UK recovered paper arisings would support a large mill so, rather than transporting material from the UK to be reprocessed in our mills in mainland Europe, we felt it was better to build production here.”
Spain has been home to Saica for a long time. But it has gradually expanded its footprint across Europe and it is scheduled to open its first UK mill at the start of 2012 in Partington, Manchester.
The completion of the containerboard mill will be the last piece of the vertical integration puzzle for the UK operations. Once complete, the 420,000-tonne capacity mill will make containerboard for use in corrugated boxes to package food and drink products.
Saica bought UK box plants in 2008, announced the new mill at the start of 2010, and began securing more paper supply for the plant with the acquisition of recycling firm Futur last November.
Savolainen explains: “The boxing plants will provide 70-80% of the material supply for the mill - we collect boxes from our customers when we make deliveries, so it is actually a closed-loop process. We are hoping to make more acquisitions in the collection field to secure supply. The acquisition of Futur will provide us with 80,000 to 100,000 tonnes but we will need almost 500,000 tonnes a year.”
Savolainen is accepting of the paper quality he receives, although 15-20% of it is rejected because of contamination. He says it is not only the UK that has this problem but “everywhere in the world”. So the company is looking at building a MRF at some point, but in the meantime it uses core-drill devices which obtain a sample of material from deep inside a bale. The sample is then tested for moisture levels and contamination, while the bale undergoes a visual check, ensuring the quality of the paper that is used.
Recovered OCC and newsprint will be reprocessed by the mill, which is currently having the equipment installed. Construction of the plant began 12 months ago and 80% of the steelwork has been completed, which is ahead of the scheduled February 2012 target. According to Savolainen, the mill machine is top of the range technology.
Within all this, energy generation also plays a big part. “It is a cost issue,” he adds. “We are building a combined heat and power plant which will provide up to 37MW of electricity. We will use 25MW, with the rest going to the National Grid.”
The £290m that Saica is investing in the mill made it the fourth largest investment in the UK from a foreign investor in 2010. Around 200 jobs will be created from the mill’s construction and later its operation, so Saica has been welcomed with open arms. “The local authority and residents have been very welcoming,” says Savolainen. “We are going to be situated in their area for a long time, so it is important the community can see the benefits we will bring.”
China is a huge recipient of old corrugated containerboard (OCC) produced in the UK, so will the Saica mill have an effect on this? Erkki Savolainen believes not.
“Until the collection rate in China reaches the same level as it is in Europe, we will be forced to supply China with recovered paper,” he says. “But this does not mean we consider this to be a good situation. Recycling paper in Europe that has been collected in Europe is the way to ensure that our waste paper is managed in the best environmental manner.
“This is the case at our new Partington mill. Even if the UK continues to export to China, there will be 450,000 tonnes collected here that is going to be recycled in our mill. It will improve significantly the environmental balance of the management of UK waste paper.”