Brazil’s Forest Paper Group, which owns paper converter Forest Paper and carton packaging recycler Revita Ambiental, is investing 60 million Reais ($12.11 million) to modernize its three industrial facilities in the country, Forest Group CEO Mário Romancini told Fastmarkets in an interview.
With this investment, Forest Paper will increase its installed conversion capacity by 25%, enabling the company to produce up to 300,000 tonnes of packaging paper per year.
In addition, Revita Ambiental will study the possibility of purchasing a paper machine (PM) to support its production of AmbiKraft, a type of linerboard made from the recycling of long-life post-consumer packaging.
AmbiKraft is made with Revitacel, a recycled pulp made with post-consumer carton packages such as those made by TetraPak and SIG Combibloc. Currently, Revita has processes to disintegrate and separate materials from these carton packages — which may contain layers of polyethylene and aluminium — to produce Revitacel, but it needs to lease PMs to produce AmbiKraft.
“We partner with paper producers using their PMs to produce our paper. The idea is to purchase our first paper machine to produce revitacel this year, expecting to begin operations in 2025,” Romancini said.
According to the executive, the company’s “key focus” is recycling packaging, which “addresses a need in the paper industry for softwood.”
In Brazil, most paper is produced using hardwood pulp from eucalyptus, and the supply of softwood products is limited. Softwood has longer fibers with technical aspects that improve paper performance, making it more resistant to tearing and able to hold heavier weights.
For example, the type of boxboard used on carton packaging, called liquid packaging board (LPB), has a higher content of softwood than regular boxboard.
“We get the product made of virgin fiber and do the first recycling cycle of it. The length of the softwood pulp remains intact, allowing us to have a high-quality fiber,” Romancini said of the company’s process. “We are increasing capacity and will be able to produce 60,000 tonnes of Revitacel in 2024.”
Paper core tubes, which the company also produces, are heavily used in the tissue paper, plastic and textile industries. All of these products are eco-friendly, 100% recyclable and reusable, according to the company.
Romancini added that demand for softwood-based products continues to grow, with Revitacel becoming a viable solution to meet these needs in a country where most products are hardwood-based.
“We have fiber availability, and our plan is to have a paper with a basis weight between 18g-60g, which is a niche product [used for lighter packaging and bags], with few existing providers worldwide,” he said.
In the conversion area, Forest Paper purchases paperboard from Klabin, Ibema, and Suzano.
“Now we will begin to bring imported boxboard for lightweight paper segments,” Romancini said.
He explained that one factor contributing to the company’s growth is the transition from plastic packaging to paper packaging.
“We are aware that we will never compete with industry giants such as WestRock, Klabin [and] Suzano; we want to produce paper for a differentiated niche,” the CEO said.
According to Romancini, the 60-million-Reais investment is a milestone for the company, which operates facilities in Lages, Santa Catarina state; Mairiporã, São Paulo state; and Telêmaco Borba, Parana state.
Funds will be allocated for pallet and tube production machines, two new cutters, two rewinders, and the retrofitting of the manufacturing area, aiming to increase the group’s revenues by 7% in 2024 to 305 million Reais ($61.61 million).
In 2023, Forest Paper distributed 5,000 tonnes of boxboard and 30,000 tonnes of kraft papers. In 2024, the goal is to reach 10,000 tonnes of boxboard and 30,000 tonnes of kraft.
Our cutting-edge Index Builder tool can provide valuable insights into how market volatility affects packaging costs, allowing you to make informed decisions and negotiate better deals. Learn more.
Learn how to monitor packaging prices using cost and price indices and understand the underlying cost drivers, from material cost to labor, energy and more. Examples include cartonboard, liquid container and paper bag.