Pulp and Paper Canada

Chinese Rayon Producer Buys Minority Interest in Neucel Specialty Cellulose

March 24, 2010  By Pulp & Paper Canada

The partnership with a Chinese rayon producer will help Neucel Specialty Cellulose to expand capacity.

Zhejiang Fulida Ltd. has taken a direct minority investment in Neucel Specialty Cellulose Ltd. and signed a long-term supply agreement to procure Neucel’s chemical cellulose product. Fulida is one of the leading producers of rayon in the world.

Neucel plans to use the investment to accelerate its capital plan targeted mainly at capacity expansion in addition to cost and quality improvements.

“This partnership will enable us to gain an improved market presence in China and solidify our strong position in both the viscose and specialty markets,” said Bob Taylor, president and CEO of Neucel.


“Viscose rayon fibre production capacity has increased greatly in China and competition has become intense. With the relationship with Neucel, Fulida gains a smooth and stable supply of dissolving pulp materials,” said Jainer Qi, CEO of Fulida.

Neucel plans to deploy the available capital immediately to keep pace with the high customer demand in the chemical cellulose market. The company notes that this capital will complement the funding provided by the Government of Canada’s Pulp and Paper Green Transformation Program to further reduce its energy consumption.

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