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$19 million investment will keep paper mill competitive

Although there's been much written about Sappi Fine Paper's ongoing $170 million conversion from producing paper pulp to chemical cellulose, there hasn't been as much fanfare about the company's investment on the paper side of things.

Recently, Sappi Fine Paper North America announced the completion of a $19 million investment in the coated papermaking operations at the Cloquet mill. The announcement of the paper project's completion came just a few days before Boise Inc. announced it will close two of four paper machines at its paper mill in International Falls by October, which will result in a loss of one third of the jobs there.

"I think Cloquet is very strong and very lucky to have [Sappi]," Mayor Bruce Ahlgren said. "As long as they keep investing in the mill, the long-term forecast looks really good."

Rick Dwyer, managing director of Sappi's Cloquet mill, said the investment will help Cloquet remain competitive in terms of cost, service and quality, adding that the Sappi company is a worldwide leader in the coated paper market.

"We remain very committed to the coated paper business," Dwyer said. "Our investments in the production of high-end paper will allow Sappi to serve this market into the foreseeable future and enable more agility and efficiency within our papermaking process. We are making this strong commitment on the paper side of the business to ensure that quality paper continues to prove its value in publishing and advertising, especially when used strategically with digital counterparts."

All paper produced at Cloquet carry both a Forest Stewardship Council and Sustainable Forestry Initiative chain of custody certification. The Cloquet mill also continues to have one of the lowest carbon footprints in the industry with over 85 percent renewable energy.

Dwyer said the Cloquet mill supplies paper for a range of products and prices, from fashion magazines to coffee table books. Coated paper from the Cloquet mill has been used in magazines, corporate brochures, glossy flyers and even a Lady Gaga book.

According to a press release issued by Sappi Fine Paper North America, the upgrades to the coated papermaking operations in Cloquet include a dry fiber handling system as well as new refiners and a former upgrade on PM4 (Paper Machine No. 4). The changes to PM4 allow the local paper mill to manufacture -- at the same high standard -- all grades and weights of paper using dry fiber rather than the slush fiber previously used and produced by the Cloquet pulp mill.

Dwyer said the goal was to make the transition from slush fiber to dry fiber without impacting the company's coated paper customers, something he said they've done successfully by creating a highly automated system to keep the paper machines running effectively and efficiently.

He also noted that the conversion project has gone very smoothly and is on time, pointing out that the company has also put a lot of time and energy into training the employees.

"It's important that they know how to run those new systems," he said. "That training has gone very well."

In the meantime, the Cloquet Sappi pulp mill is nearing the end stages of the conversion from producing pulp to producing chemical cellulose.

Dwyer said the conversion is essentially complete. As of Monday, employees started working with the new machinery but they were making pulp rather than chemical cellulose.

"We'll start up making the product we've been making -- kraft pulp for paper -- for about three weeks, then convert to chemical cellulose [production]," Dwyer said. "Because we know how to do that, it gives us a chance to check out the new equipment on a product we know."

The mill manager figures the Cloquet mill will begin producing chemical cellulose after Memorial Day weekend, if things continue to go as planned.

"When we shut down the paper mill in three weeks, [we will] begin making paper with completely dried fiber," he said. "Before we were selling 1,000 tons of paper pulp into the market and using the rest [here]. Now the paper mill will purchase paper pulp."

The process of making chemical cellulose is similar to making kraft paper pulp, so the renovated machines in Cloquet are actually capable of making either. However, paper is a shrinking market while the chemical cellulose market is growing, so it made sense to make the switch, Dwyer said. Plus the price per ton of chemical cellulose is higher.

"[It's] the same raw material, but you take a few more things out of it to get to pure chemical cellulose," he said, noting that the mill will use the same fiber source from Minnesota to make the new product.

The mill already has buyers for its chemical cellulose. So far, all of them are located in the Far East, Dwyer said, noting that the bales of product would be shipped there via rail and boat.

Sappi has three mills in North America, here in Cloquet plus two in Maine. They chose to invest in converting the Cloquet mill because of the design and modernity of the pulp mill.

"We have batch digesters," Dwyer said. "They convert very well to chemical cellulose."

Sappi Global is already the world's leading manufacturer of chemical cellulose, he added.