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South America: Rich in resources

South America is exceptional in that it is almost the only area where new greenfield mills or lines are built — but there is a good reason for this, namely, “raw material”. South America does not enjoy unlimited resources, but the situation is not too far from that. Added to this, labour costs are low and there is plenty of space in which to build.

Mention pulp and South America and the ABC countries immediately spring to mind, with the main focus on B and C, namely, Brazil and Chile. Nevertheless, potential for growth exists outside the ABC countries, particularly in Uruguay, while the rest of South America is of less importance as the pulp and paper industry there is not as developed.

Brazil

Brazil dominates the eucalyptus market: together with softwood pulp, annual capacity was roughly eight million tonnes in 2001 (FAO). Expansion of the country’s pulp and paper industry continues unabated.

Recently, Aracruz started up its third line, line C, of 700,000 tonnes reaching a total annual production of 2,000,000 tonnes. The plant is set to attain premier position in the world market for eucalyptus pulp, removing Riau in Indonesia from pole position.

Votorantim Celulose e Papel, VCP, will also start up a new line, in two steps, reaching 3,200 tonnes per day in a single cooking system. The target became a reality after changing both cooking system and supplier!

Riocell and Cenibra have also concluded major upgrades and further new projects are under way.

Veracel in Bahia, owned 50/50 by Aracruz and Stora Enso, is making plans for a new pulp mill of 900,000 tonnes. Purchasing may start in early 2003, but only after final approval of the boards has been received. Feasibility and pre-studies are in full swing.

Chile

Two major forest companies, CMPC and Arauco, dominate the Chilean market. CMPC has a large number of integrated mills, while Arauco is concentrating on market pulp. At this stage, CMPC does not have any plans to build another pulp mill, but is choosing to concentrate on modernising and expanding existing paper mills while upgrading their pulp mills in Pacifico, Santa F and Laja.

Arauco, on the other hand, is fully occupied with a new green-field mill of 600,000 tonnes hardwood/softwood in Valdivia, scheduled to start production in February 2004, and they also have plans for another gree-field pulp mill north of Concepcin. They will also continue to upgrade the pulp mills in Arauco, Constitution and Licancel.

Argentina

The A in ABC, Argentina, has much smaller production figures, with Alto Parana the only major player in the market. Both CMPC and Arauco have large forest resources in Argentina, in the provinces of Misiones and Corrientes, and both companies have also indicated that they plan to build new pulp mills in Argentina. Although the current economic situation has put a damper on these plans, their day will certainly come.

Case study: Alto Parana S.A.

Alto Parana S.A. is located in the northern Argentine province of Misiones. Just a stone’s throw away and separated from Paraguay by the river Paran, the plant lies approximately 50 km from the point at which Brazil, Argentina and Paraguay intersect. The mill, based mainly on Scandinavian technology, was put into operation in 1982 and is now part of the Arauco Group in Chile. The raw material used is a species of pine from the south of the USA, having superior physical properties when cultivated in Argentina.

Alto Parana has made its reputation as a quality pulp supplier for mainly wood-free coated papers. The pine fibres of the raw material are less resilient and have superior performance during the refinement process, producing an extremely smooth and even pulp. Some 70% of production is exported, with Brazil taking half and Europe the remainder. South Africa receives only a modest portion. The European pulp goes to France and Germany for the production of art papers, while Brazil takes virgin pulp for tissue paper, coffee filter paper, medical paper and newsprint.

The mill recently undertook a serious and thorough modernisation program involving the elimination of bottlenecks, renewal of equipment and increased productivity.

“At the initial stage,” Alto Parana Mill Manager Martin Macjus explained, “we increased production by 10-12%, reaching an output of close to 300,000 tonnes annually. The project included an oxygen delignification stage with wash filter, reactor and wash press, basic rebuilding of the continuous digester and an upgrade of the evaporation plant – all from Kvaerner (formerly Kamyr) under a partial EPC contract. The results of the whole project were extremely good and we easily meet international standards on our ecological pulp,” said Macjus. Thanks to the excellent support provided, we were even able to have the water runs during a planned shut-down and the result was a very smooth start-up on pulp.”

“We also managed to reduce the BOD value by more than 90% to 20 mg/l, as well as AOX and total water consumption. Altogether we have reduced production costs by approximately USD 5 dollars per tonne,” Gustavo Traini, Production Manager, added.

After fine-tuning and operating the mill for a period of time, remaining problems were easy to identify, but squeezing out extra tonnage from an overloaded pulp mill is not a simple task.

The latest upgrading project with Alto Parana was initiated following a mill study which presented solutions to existing problems in a number of minor bottlenecks in the cooking and recovery boiler areas. As the supplier, you really have to be able to work with the employees of the mill, backed by your own broad experience, to come to a joint understanding on what to do.

“But it won’t be easy for you or anybody else to get a full picture of what we have been doing,” Macjus explained. “as more or less everything done in the cooking plant is done inside the existing digester.

“It’s a tough market-place and you have to keep up with demand. As a high proportion of our exports are to customers producing wood-free coated papers, we have to pay close attention to the physical properties of the pulp, the main focus being on pulp viscosity. Modification of the digester was a success, thanks to a great deal of preparatory work ahead of the planned shut down. This was made possible thanks to the close coordination of operations between supplier, their sub-suppliers and the mill. By the time the shut down took place, we had all the access we needed from the outside, while work inside the digester progressed efficiently although we had to apply extra pressure to their subcontractor to be more safety-conscious. However, nothing untoward happened and all the work was completed on time,” Macjus said.

“The mill is now up and running at full capacity, according to schedule,” Traini added, “and, almost immediately, savings of 25% were apparent in medium pressure steam, down to 19 tons per hour with 1,135 tons per day in the blow-line. The top temperature of the digester was lowered by 7C with maintained alkali charge, and the cooking zone was expanded when the screens were lowered by 10 metres. We have also achieved more efficient washing, thanks to the wash liquor flow being increased by 25%. Ahead of the digester, we have been able to maintain a more even chip chute level, all parameters resulting in more even runnability of the digester.”

Relations paved the way

“It is extremely important in projects of this kind to establish good relations, because there is always a human being behind the technology when something goes wrong. Misunderstanding, misinterpretation, lack of interest and so on, are just some of the factors that have more of an effect on results than the technology itself,” said Macjus.

“Kvaerner Pulping has maintained a steady customer-oriented performance over the years.

Future resources / Bright future

On the other side of the border from Argentina, in Uruguay, there are large areas of forest land owned by Ense, the Spanish company which also has plans to set up a pulp mill in the area. However, Ense is also likely to be taking things slowly for the pre
sent. Another player, FNC of Uruguay, has a single pulp mill in Uruguay and recently took over control of the company formerly known as Celulosa Argentina in Argentina.

With low labour costs and plenty of space, Brazil is quite advanced in the pulp and paper industry and has been planning for the future from the early ’70s, when reforestation programs were launched using government subsidies. The Brazilians were really thinking in the long-term and Aracruz was the first plant to go into operation as a result of this new approach. At a later stage, similar initiatives could be seen in Argentina. Another contributing factor was the research and development of eucalyptus fibre and, in this respect, Aracruz was again in the lead. The company has succeeded in developing an extremely clean, strong fibre on their plantations, having brought in fresh fibres from South Africa, Thailand and Australia. Also Alto Parana did about the same, but experimented with the pine, when they brought in the southern US species Taeda pine.

All ongoing investments and those in the pipeline will, no doubt, make South America known also for pulp and paper.