The newspaper industry is undergoing a crisis. Printing houses are going bankrupt. Society is becoming more and more digital. So why, the question can be asked, has Södra invested SEK 4 billion to help the paper pulp mill on the island of Värö double its production?
Close your eyes and imagine a person who has recently lifted themselves out of poverty and is now part of the global middle class. Let us now guess what you see.
You see a smartphone in this person’s hand, you see a bright apartment filled with IKEA furniture, you see a flat-screen TV on the wall, you see a washing machine and a dishwasher and a car parked outside. But do you see paper? Ola Walin does.
“People think the paper industry is shrinking since print is being replaced by digital equivalents,” he says, “but paper has much broader areas of use. It is used in everything from packaging to diapers and different kinds of special paper.”
“Take, for example,” he continues, “a country like India, where the middle class is growing rapidly. Suddenly people want to go to the store and buy drinks in cardboard cartons. So the market grows.”
The reason that Ola Walin sees paper when he looks at the growing global middle class is that he is the plant and maintenance manager at Södra Cell Värö – the paper pulp mill that is currently undergoing an expansion unlike anything ever seen before in the Swedish paper industry. In order to meet the growing global demand for soft paper – toilet paper, paper towels, napkins, etc. – the Södra forestry group decided in 2014 to invest an impressive SEK 4 billion into the mill. And now this work is in full swing out there on the Värö peninsula in Halland.
“It is a little bit like musical chairs,” says Ola Walin. “It is business-as-usual at the plant while we are building at the same time an entirely new boiler house, new wood room facilities in parallel with the old facilities, a new turbine and a new biological treatment plant, and in addition to that we are supplementing with pipes and pumps in the pulp mill...so...things are moving ahead full steam, everywhere, in all areas of the plant.”
Unfortunately, it is not possible to complete some of the renovations while the plant is in operation, so at the beginning of May this year it will close for five weeks. The renovated plant will reopen at the end of this period and production will be ramped up as quickly as possible to the planned capacity. The paper pulp mill on Värö will then produce 700,000 tons of pulp per year instead of 425,000 – thus significantly increasing its international competitiveness.
Which, naturally, is needed. The Swedish paper pulp industry competes in an arena where its equivalents in more southerly latitudes are able to use eucalyptus trees, which grow faster than Swedish conifers. Despite this, the increase in the global middle class has proven beneficial for the Swedish paper industry in general and Södra Cell Värö in particular.
“For example, a rather durable pulp is needed for paper towels, and pulp with a long fiber like that which comes from firs and pine works well,” says Ola Walin.
“We are trying to find good areas of use for our pulpwood, so we are making a lot of pulp for paper towels here at Värö. Every third or fourth roll of paper towels in Europe comes from Södra, I think.”
As the world’s population adjusts to the new need for soft paper, this benefits the stronger pulp created using the long fibers of conifers.
But if competitiveness is expected to increase, the environmental impact of Södra Cell’s Värö facilities is expected to decrease, and in this respect it should be noted that the mill has already come quite far. In 2010, following a number of investments, the plant became the world’s first fossil-free pulp mill and things have progressed from there. For the past few years the mill has been producing more energy than it can use, and it is therefore providing all of close-by Varberg with district heating while at the same time selling its surplus electricity on the market and making biofuel from its waste products. Following the expansion, this will now occur on a larger scale.
“The energy surplus will increase, primarily in terms of electricity and biofuel. We are reducing the amount of electricity the plant consumes, which means we will have a significantly larger electricity surplus that we can sell in the network.”
There is another environmental aspect that can be mentioned here, and it is one that with great probability is going to become increasingly important for Södra Cell Värö and the paper industry as a whole. Following the climate change conference in Paris, the world has definitively committed to a fossil-free path, and this also includes packaging. There is good reason to believe that cardboard cartons will eventually replace plastic. New scientific discoveries have also shown that pulp and wood fiber have more potential areas of use than previously thought – the scope is actually mind-boggling – and without losing their environmental features.
So. A new global middle class is emerging – in India, China and Africa – and we are no longer looking the other way but instead watching with a careful eye and noting that this emerging class is surrounded by paper. This will become even more evident in the future, and everything that can be done with paper pulp and wood fiber will be found in these new middle class homes, in their electronics, in their cars – everywhere.
Never before has four billion felt like so little money.
Text: Johan Martinson