Pulp and Paper Canada

News
Resolute will enter tissue market; adding to Calhoun mill


June 2, 2015
By Pulp & Paper Canada

Resolute Forest Products has decided to enter the tissue market. Traditionally known as a producer of newsprint and forest products, Resolute announced plans to diversify into the tissue business with a state-of-the-art facility to manufacture…

Resolute Forest Products has decided to enter the tissue market. Traditionally known as a producer of newsprint and forest products, Resolute announced plans to diversify into the tissue business with a state-of-the-art facility to manufacture at-home, premium private label tissue paper, including bath and towel, at its mill in Calhoun, TN.

“This is an important step forward for Resolute as we execute on our growth strategy in a way that maximizes our ability to capture synergies and deliver superior value,” said Richard Garneau, president and chief executive officer. “We have been studying this option to diversify into the tissue business for quite some time, and we will continue to look at opportunities to expand our presence in this growing market.”

Resolute’s tissue paper machine and converting operations will be built at the Calhoun mill in Tennessee. This $270 million project represents the largest investment made by Resolute since 2010. Garneau says Calhoun will be one of the most competitive and efficient tissue operations. At full capacity, the new tissue and converting facilities will produce approximately 60,000 tonnes per year of at-home, premium bath tissue and towel, focused on the growing private label market.

Market feasibility studies, technology selection and project engineering are nearly complete. Construction is expected to begin shortly, with ramp-up expected to start in the first quarter of 2017.

The tissue machine will use excess slush pulp over and above the additional dried market pulp capacity associated with a previously announced continuous pulp digester project at the Calhoun site.

Unlike many other paper products, tissue demand has grown steadily for the past 20 years, and it is expected to continue growing in the future. Over the next ten years, most of the sector’s growth is expected to be in the premium quality tier, Resolute’s target market.

The Calhoun has a strong working relationship with local labor unions. This investment will create 105 new jobs at the mill, in addition to the 50 positions associated with the continuous pulp digester.