Harmac pulp used for fans, wrappers
Chinese markets are contributing to rise of product

The Star
Published: Friday, April 16, 2010

The pulp produced at Nanaimo's Harmac mill is used for a lot more than making paper products and toilet tissue.

With a major decline in the use of paper around the globe, Harmac and its many Chinese customers are discovering a number of non-traditional uses for the northern bleached softwood kraft pulp the mill produces.

Harmac president Levi Sampson has just returned from a business trip to visit the mill's Chinese customers, with traditional Asian fans and Chinese candy wrapped in shiny lacquer paper made from pulp from the mill.

He said they are just a few of the products that Chinese companies are making by using high-quality NBSK pulp and are contributing to the rapid rise of pulp prices internationally.

The growing demand has seen Harmac's sales blossom and has led to the decision by Catalyst Paper to reopen its Crofton pulp mill.

"The soft texture of the NBSK fibre is highly favoured because it's considered the highest grade of pulp for many products," Sampson said Thursday.

"We're seeing a real shift away from traditional paper products so our customers are expanding the use of the pulp to a diversity of products, including wallpaper, house siding and technological uses such as coating wires for computers and other electronics.

"I don't think that many people are aware of the variety of uses for pulp used in everyday life."

Sampson said he expects the price of pulp will reach $1,000 per tonne (almost double what it was when Harmac reopened in 2008) by the fall and likely continue to rise for some time.

He said Harmac officials knew that pulp prices would rebound, but they are surprised by how fast it happened.

"It's a cyclical business, but we don't expect to see the low price levels we experienced to return for at least another few years mainly due to increasing demand, particularly in China," Sampson said.

Sampson said he expects the "wild pricing swings" that have traditionally caused such instability in the global pulp industry are now a thing of the past.

He said after the latest dramatic drop in pulp prices (which saw pulp selling at $460 per tonne two years ago) the industry's producers and customers agreed to co-operate in efforts to keep prices as level as possible, which should give much-needed stability to many mills.

Sampson said Harmac is not concerned about increased competition for sales now that Catalyst Paper's Crofton mill is preparing to reopen its second line due to better market conditions.