China’s Sun Paper, Arkansas EDC sign MOU to build 700,000 tonne/yr greenfield fluff pulp mill (RISI)

China’s Shandong Sun Paper Industry announced Monday that it’s signed a memorandum of understanding (MOU) with the Arkansas Economic Development Commission to build a $1.36 billion, 700,000 tonnes/yr fluff pulp mill.

Sun Paper said the fluff pulp project would build “the world’s largest, most advanced and most efficient single fluff pulp production line” in a statement, adding that commissioning of its fluff pulp production capacity would represent 12% of total world fluff production.

“Fluff pulp, an important liquid adsorption material, is widely used in diapers and women’s health products, medical products, dust-free paper, and nonwovens production. Fluff pulp market has great demand in China, however (it) is totally dependent on imports,” said Sun Paper chmn/GM Li Hongxin in a translated statement.

With project planning to invest $1.36 billion dollars, half of the financing is expected to come in a combination of equity and debt, Sun Paper said. According to the plan, an Arkansas location will be finalized in the first half of 2016 with construction to break ground in the second half. A target ramp-up for the new mill was slated for the end of 2018.

After the project is completed, its 700,000 tonnes/yr of fluff pulp output is to achieve sales revenue of $500 million, Sun Paper said in its release.

Sun Paper noted it has total assets of 27.5 billion yuan and annual pulp production capacity of 4.5 million tonnes/yr, ranking it among the top 500 Chinese enterprises and one of the world’s top pulp and paper makers. The firm said building a greenfiend mill in Arkansas would allow Sun Paper to draw from raw materials internationally, expand its fiber chain and boost its output capacity.

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