Finnish paper company Stora Enso has announced plans to invest EUR1.6bn to build plantation-based integrated board and pulp mill in China, banking on growth in the Asian market.
The mill site at Beihai city in Guangxi, for which construction is expected to commence in the second half of 2012, will initially include a 450,000t per year paperboard machine and pulp capacity of 900,000t per year, including energy plant and auxiliary facilities.
To expand the paperboard capacity to 900,000t at a later stage, the new mill will be integrated with wood supply from 120,000ha of eucalyptus plantations.
The operations will be 85% managed by an equity joint-venture company established by Stora Enso and 15% by the Guangxi Forestry Group, a state-owned company under the Guangxi provincial government.
Production at the new mill is scheduled to start in the fourth quarter of 2014.
Stora Enso said that the company's strategic focus is on the fiber-based liquid packaging board segment and the investment is consistent with the group's announced strategic guidelines.
Stora Enso seeks to benefit from the forecast future growth in demand for fiber-based packaging solutions for food in China, which is set to grow at a compound annual rate of over 10% during the next ten years, as forecast by several researchers.
