Sappi starts plant expansion

JOHANNESBURG – The world’s largest maker of fine paper, Sappi, has started the expansion of its chemical cellulose plant to lift output by 300 000 tonnes, of which 75 000 tonnes will replace existing, higher cost capacity.

The group said in a statement on Thursday that strong global demand was behind the US$460 million expansion of the plant. Sappi’s Saiccor plant is already the world’s largest chemical cellulose producer.Sappi, which makes the paper used in glossy magazines, said the plant at Umkomaas in South Africa’s KwaZulu Natal province is expected be operational in April/May 2008.Almost all of Saiccor’s production is exported to clients in Asia, Europe and North America.Chemical cellulose is used as a raw material in the production of a wide variety of consumer goods ranging from viscose fabric to pharmaceutical products and food additives.The plant’s mill and existing equipment and processes will also be updated and upgraded, Sappi said.Strong market demand for chemical cellulose means the project’s funding will be done from Sappi’s internal resources.Sappi earlier this month posted a wider third-quarter headline loss per share, mainly due to an accounting charge, but said it would turn a profit in the fourth quarter and beyond.Nampa-ReutersSappi’s Saiccor plant is already the world’s largest chemical cellulose producer.Sappi, which makes the paper used in glossy magazines, said the plant at Umkomaas in South Africa’s KwaZulu Natal province is expected be operational in April/May 2008.Almost all of Saiccor’s production is exported to clients in Asia, Europe and North America.Chemical cellulose is used as a raw material in the production of a wide variety of consumer goods ranging from viscose fabric to pharmaceutical products and food additives.The plant’s mill and existing equipment and processes will also be updated and upgraded, Sappi said.Strong market demand for chemical cellulose means the project’s funding will be done from Sappi’s internal resources.Sappi earlier this month posted a wider third-quarter headline loss per share, mainly due to an accounting charge, but said it would turn a profit in the fourth quarter and beyond.Nampa-Reuters

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