Professional Documents
Culture Documents
Prepared for North South Market Development Group and Waste &
Resources Action Programme
Written by:
Published by:
ISBN: 1-84405-287-7
Contents
EXECUTIVE SUMMARY 6
APPENDICES 73
Appendix 1. Questionnaire 74
Appendix 2. Sector Listing 80
Appendix 3. Interview Listing 82
Appendix 4. ROI Imports 83
Appendix 5. ROI Exports 97
Appendix 6. IOI Base Year Calculation 100
Appendix 7. Mill Models and Options Assessment 102
Appendix 8. Environmental Considerations. 119
Appendix 9. Support Instruments for Proposed Paper Mill 129
Appendix 10. References 137
Converted Packaging and Paper. The conversion process usually involves taking paper raw
material e.g. in the form of reels, then through a manufacturing process involving, for example,
sheeting, cutting, laminating, impregnation, printing and packing, to produce product units which are
fit for end use. Converting processes include the production of; cardboard boxes and cartons, tissue
rolls, sheeted paper (e.g. copier), inkjet papers, plus technical papers.
Kraftliner and Kraft Paper. Paper made from wood using the kraft or sulphate chemical pulping
process (see below). It may be bleached or unbleached and produces a strong paper which is used
for wrapping and packaging. Kraftliner is used specifically in the production of cardboard boxes
(called Packaging Containers in this work), acting as the liners (outer layers). When recovered
paper is used this paper is called testliner. The rippled material or corrugating acting as filler
between the two liners is called fluting.
Kraft Pulp. A wood pulp produced by chemical pulping of the wood, also called the sulphate
process. This removes the lignin from the wood, leaving cellulose fibre used in high quality paper
manufacture. The removed lignin, called black liquor, is used for energy production.
Mechanical Pulp. Pulp produced by the physical (as opposed to chemical) treatment of the wood to
produce papermaking fibre. The process can be purely through the action of grinding the wood
(groundwood), to pretreatments of heat (thermomechanical, TMP) and chemical (chemothermo
mechanical pulp, CTMP). The remaining presence of lignin in the pulp causes yellowing through
reaction with light. Papers made from this pulp include newsprint and magazines, are termed
mechanical papers.
Mechanical Paper. Paper, the furnish of which contains a substantial proportion of mechanical pulp.
These papers can be coated (coated mechanical) with a thin coating to improve printability, and
called lightweight coated papers (LWC), used in magazine papers. Uncoated mechanical paper
includes those where the surface is smoothed and prepared across large rollers, called calendars,
again to improve printability, termed super calendered papers (SC). These are used in flyers, inserts
and magazines.
Newsprint. Paper intended for the printing of newspapers. Mainly produced from recovered paper
(through the recycling process) and also mechanical pulp.
Printing and Writing Paper (P&W). Paper grades which are used for books, commercial printing,
copying, business forms, stationary and laser and digital printing. These are often categorised as
coated woodfree and uncoated woodfree. Woodfree is a term which refers to papers using
chemical (see Kraft) pulps – where woodfree means the lignin is removed. In uncoated form these
can be copying paper and letterhead. Coatings refer to surface treatments and additives which
enhance printability. These papers are found in advertising, commercial printing.
Specialty Papers. A diverse group of products that are sold on their performance, technical or
appearance attributes. Examples include: filtration products; security and banknotes; decorative
papers; abrasives (e.g. sand paper); letterhead; tracing and greaseproof papers.
Testliner. Can be bleached and unbleached. The liner (outer layers) for corrugated container board
(cardboard boxes) made principally from recycled fibre furnish. The virgin fibre alternative, kraftliner,
Tissue Paper. Soft, lightweight paper, often creped, which is used for hygienic, household,
institutional and health purposes. The fibre furnish can be virgin and/or recovered paper.
White Lined Chipboard (WLC). Typically a multi-ply structure (for example 5 layers) in which the
top and back plies are made from bleached chemical pulp or deinked office waste. The middle ply can
be a mixture of recovered paper types. This is used for packaging applications e.g. cereal board, and
detergent board. (called Packaging Cartons in this work)
General
Converter. A firm that specialises in converting reels and sheets of paper and board into packaging
or finished goods for sale to the public.
Consumption – (as defined by FAO – the Food and Agricultural Organisation of the United Nations)
equals Production + Imports less Exports. In this work, production is the primary paper and
packaging materials produced, imports are these materials brought in across the Republic of Ireland
and Northern Ireland borders, and exports the reverse of this. In this work it was also necessary to
recognise the secondary paper or that paper and packaging produced, brought in or exported as part
of other products, e.g. shoe boxes and white goods packaging.
OCC( Old Corrugated Containers) - used printed or unprinted corrugated boxes and solid fibre
board boxes.
Recovered Paper (RCP) Paper (all types) that has been previously manufactured and/or used and
recovered for papermaking. This may involve cleaning and sorting.
Total Waste Paper Arisings. Waste paper and board materials derived from household and
commercial sources, which are recovered for recycling, landfilled or sent to waste (e.g. tissue).
Currency conversion
All prices have been converted to Euro. The following exchange rates were used based on average
for March 2005 (Financial Times): $-£ 1.9, €-£ 1.4
Executive Summary
The North South Market Development Group (NSMDG) in conjunction with the Waste and
Resources Action Programme (WRAP) have sponsored this project. The objective is to
Jaakko Pöyry Consulting (‘JPC’) together with Pira International (‘PIRA’), Circa and Initiative Economic
Development (‘IED’) have undertaken this work. This assessment is timely. The Regional Waste
Management Plans in ROI and NI contain targets to increase the availability of recovered paper for
use in indigenous industry or further export.
This work is nominated as Phase 1 and aims to provide the foundation for Phase 2, a possible
detailed feasibility study for preferred mill options (s). Phase 1 contains the following key elements:
Information obtained is evaluated to determine whether there is supply of recovered fibre and
demand for paper products to sustain a new paper mill in the IOI. The assessment of mill options
considers a number of factors to identify what type of mills(s) could potentially be viable. The results
will be presented at an Industry Briefing Session to determine whether there is sufficient interest in
carrying out a full feasibility study.
Methodology
To establish demand and supply data, the work has used a top down approach, beginning with high
level statistics and progressing to more detailed levels until a robust dataset was achieved. This often
involved commencing with government sources (e.g. EPA, Eurostat), then pursuing supply-demand
dynamics through face-to-face interviews (22) across industry and involved organisations. These
interviews have played a multiple role of; engaging sector participation in the work, on-the-ground
interpretation of statistics, and also resolution of data and sector interpretation. The interviews
included representation from across the whole supply chain in IOI.
There were data conflicts, sometimes between high level sources. This meant that data had to be
verified from additional and root sources or through feedback from questionnaires and interviews.
The data consistency was resolved by using:
Where high level sources substantiated their data, this was used, and this reliance on their
substantiation noted. In all cases, the integrity of the mill option assessment was paramount, to
ensure that while debate continues the option conclusions were robust. It is important to note the
sheer scale of world class paper mills and their RCP demand (see section 1.2) relative to the more
limited IOI RCP supply. Therefore, imprecision in the RCP supply estimate will not detract from mill
option assessment and its viability.
Projections of future paper demand and recovered paper (RCP) supply in IOI were prepared. The
results were used as key inputs into the paper mill options in terms of RCP availability and local
market fit. RCP supply scenarios were also prepared, to test the impact of success (or otherwise) of
waste management and IOI RCP promotion programmes on the mill options.
The mill options were subjected to examination using an established toolkit which can model various
mill configurations and relative competitiveness with the peer group delivering to a selected market.
The combined IOI population is small (5.6 million) but is economically active. GDP growth rates put
IOI in amongst the highest achieving regions. However the small population base, as it relates to
absolute paper consumption and the total paper arisings, is at the heart of the challenge to realise
world scale paper mill facilities.
The current industry structure comprises 2 primary paper producers and over 180 secondary
businesses (e.g. converting, printing, distribution). One major producer (Smurfit) has recently decided
to close its production facility, based on an ageing asset. This current work, offers a potential renewal
pathway for IOI paper manufacturing capability through installation of world class facilities.
Domestic paper and board production, plus paper and board imports, less exports, combine to give
consumption of paper for NI and ROI. NI then exports 73450 tonnes of converted paper product, and
ROI, 88374 tonnes. At the same time there are large amounts of secondary and converted paper
products e.g. shoe boxes, packaging for white goods etc., arriving. The primary paper consumption
plus net imports of these secondary and converted paper products gives total paper consumption.
The components of this were analysed individually to produce an assessment for IOI, NI and ROI
(see table below). These data establish the total markets available to mill options and also the fibre
potential available.
ROI NI IOI
Production 800 19,000 19,800
Imports 584,301 193,470 777,771
Exports 400 16,150 16,550
Consumption. Primary paper 584,701 196,320 781,021
Net imports of secondary 340,538 110,040 450,578
converted paper products
Total paper products 925,239 306,360 1,231,599
Total paper consumption was projected by major grade drawing on the social, economic and
technological drivers of paper consumption. The outcome is one of growing paper consumption over
the next decade, particularly in printing and writing (P&W – see glossary), which finds end uses in
office paper, communication, printed materials and magazines. The largest consumption is found in
packaging.
Mill
Grade 2003 2005 2008 2013
scale*
P&W: Uncoated mechanical 8,501 8,931 9,618 10,882 400,000
100-
P&W: Uncoated woodfree 83,712 90,542 101,848 123,914
160,000
100-
P&W: Coated woodfree 5,960 6,825 8,361 11,726
160,000
P&W: Coated mechanical 72,583 78,507 88,310 107,442 400,000
Kraft liner, testliner & oth.
265,049 275,756 292,634 323,092 400,000
packaging
Speciality paper 38,355 40,298 43397 49,099 10-50,000
Converted packaging
315,012 327,945 348,018 384,240 **250,000
products
Tissue and tissue products 82,548 85,546 90,250 99,642 15-50,000
Newsprint 216,691 221,045 227,743 227,743 400,000
Other paper products 143,188 148,248 157,322 173,695
1,231,5 1,283,6 1,367,5 1,511,4
Total Paper Products
99 43 01 75
*Mill scale. World scale facility to be competitive. Woodfree options represent current recovered
paper based initiatives. Speciality papers demand would represent many different grades with small
consumption levels e.g. labels, security, filters, abrasives, medical etc.
**Packaging for cartons, and also including converting into cardboard boxes
The assessment has used world scale mills as the basis for facility design. The difference between mill
scale and paper consumption is an indicator of the export required if such a mill was placed in IOI.
The total paper consumption is the underlying source for post consumer waste paper in IOI. This has
been estimated at 1,231,599 tonnes comprising 925,239 tonnes from ROI and 306,360 tonnes from
NI. Post consumer waste has increased 5-9% from 2001 to 2003 in ROI. The large percentage
increase noted for NI data between 2002 and 2003 is due to an improved estimate of 2003 waste
paper arisings.
Post consumer waste arisings on IOI-2003 (tonnes). Data sourced from EPA and DoE
2005
The majority of recovered paper collected in the ROI and NI is exported. China and India are the
fastest growing export destinations. Paper and board capacity in Asia is set to grow from 65 million
tonnes (2000) to 120 million tonnes (2015), with China accounting for half of the capacity growth.
Exports go from IOI, principally as mixed unsorted grades. The prospects for RCP export from IOI
would appear strong, and further supported by IOI initiatives to improve RCP infrastructure.
Such demands will clearly impact the prices any potential mill in the IOI will have to pay, to compete
for available raw materials. The close proximity of the IOI mill to the RCP supply and the presence of
a reliable end use market would be to the advantage of the local mill. Furthermore, exports to Asia
have a transport cost differential to meet.
Projections by main grade of RCP supply have been generated for ROI and NI. This has been
achieved by reviewing the ‘influencing factors’ such as policy, environmental aspirations, paper
demand and the waste supply chain. The projections show an almost 50% increase in supply
potential over the next 10 years, driven strongly by IOI initiatives. The difference between RCP
supply and total arisings is the waste paper sent to landfill, archived or lost e.g. tissue.
Future RCP supply projections by grade for the IOI through to 2015 (tonnes)
Two scenarios were created (high and low cases) to evaluate the impact of under- or over-achieving
in RCP supply programmes. These scenarios were then applied to the mill options to expose
sensitivities, risk and the impact of failure to achieve IOI RCP targets. The subsequent analysis in
The option process commenced with a total list of recovered paper based products. This included:
After an initial screening to identify a short list, newsprint and magazines were rejected due to
insufficient RCP supply availability, even in the ‘high’ case scenario. The assessment process then
moved to mill modelling of the remaining candidates. The criteria applied in mill design were:
• World scale. The facility should be recognised as world scale; capacity, process, configuration,
inputs and outputs.
• Product and market leadership – the option should focus on growth areas, import replacement
(IOI and GB) or value niches for IOI and where local market leadership can be achieved. The
technology should be such that the product specification can compete in export markets.
• Cost competitiveness. The facility should be able to achieve 1st or 2nd quartile cost
performance (lower half of all producers) and allow competitive exports to main markets in
particular to GB.
• Feasibility – can meet a 10% return on capital employed over the cycle.
• Environmental fit – the facility meets regulations and directives.
Packaging - Output: 200-400,000 t/a was IOI market for kraftliner and New IOI facility can be in 1st- Fits well with local converting A new machine in IOI is
Containers (cardboard examined. Full scale would testliner is 270,000t. 2nd cost quartile, but would but profitability requirement marginal. A supportive
boxes) require ‘all’ potential OCC have a large impact on challenged. Potential returns business climate would be
An IOI new facility would go
collected current installed capacity <5% required. Not a preferred
straight to top 10 European
(already in excess), leading option.
producers – big impact on
to capacity under-utilisation
existing capacity
and price erosion
Packaging - Output: 120-200,000 t was Total market in Europe New IOI facility can be in 1st- Specific but small volume fit As above.
Containers – as above examined. Full scale would around 1 mn tonnes, so a 2nd cost quartile. Small but with local converting. The
but white surfaced consume virtually all white new IOI machine would have growing market – an IOI new mill would easily take
high quality waste paper in high impact – almost all sales facility would have a large care of IOI consumption.
IOI would be outside IOI impact on current installed Potential returns <5%
capacity
Tissue Output: 15-50,000 t was IOI market is over 80,000 t Competitive in the IOI Fits well with local converting Opportunity is for local
examined. RCP supply is (tissue and converted market as transport cost and could serve the IOI producer, connected to local
sufficient – but would still product). Mill output could (imports) for these low market. Can potentially supermarkets, converters
need all white high quality have high IOI market share weight, high volume achieve profitability targets. and distributors, to replace
waste paper in IOI – would need to displace products can be prohibitive. more costly imports.
imported tissue
Packaging – Cartons Output: 120-250,000 t was An IOI facility would go into New IOI facility can be in 1st- Fits very well with local IOI could be potentially
examined. top 10 producers in Europe. 2nd cost quartile, but would converting and would easily attractive location. Market is
Imports into UK are around have a large impact on take care of IOI IOI and GB. Would also need
Flexible in terms of furnish
700,000 t. IOI market is over current installed capacity. consumption. Could achieve a positive business
grade mix – fibre supply
sufficient 300,000 t (total all converted around 5-10% return. development climate to
packaging) support investment.
Printing and Writing Output: 100-160,000 t was A new state-of-the-art facility New IOI facility can be in 1st- Can achieve profitability Potential, but less attractive
Papers (e.g. Office, examined. Requirement: Up would be amongst the 2nd cost quartile. Better targets, but highly exposed due to RCP resource and
Communication, Printers) to 100,000 t/a ONP/OMG/ largest in Europe. IOI market performers would be found to competitors in export exposure of such a mill scale
other white grades is around 90,000 t. in closer proximity to RCP markets who base their in European market context.
supplies and markets business on local market
Limited in terms of high
advantages. RCP availability
quality recovered office
in white and high quality
paper availability. Difficult
grades problematic.
option to realise
• Tissue – only the tissue mill option is well matched with local demand. Exports are potentially
minimal. The other options are required to be export competitive with much of the product
sold outside IOI.
• Packaging Cartons. A potential good link to local converters and IOI packaging needs.
• Printing and Writing papers. Requires high grade RCP collection. Exposed to existing and
potential mills in GB and the Continent
• Packaging Containers. Already large capacity in Europe.
• Newsprint. Excluded as insufficient fibre
• Magazines. Excluded as insufficient fibre
While the tissue option can stand on its own, the rest would likely require a supportive business
climate through which investment and operating challenges can be addressed.
The impact of the scenarios (over- and under-performance in RCP supply initiatives in IOI) is
presented below. The scenario RCP supply should be compared to the average fibre mix of the mill
option. The ‘high’ case, tends to secure the RCP supply allowing both local paper production and
export to take place. Even under the ‘high’ scenario there is insufficient RCP to double the paper mill
capacity at a later date. However the ‘low’ case of RCP supply under-achievement, leads to 3 options
failing with supply difficulties (Packaging Containers, Packaging Cartons and P&W Papers), leaving
only tissue. A number require support and development to establish a high quality RCP source –
white printer and office RCP.
Mill fibre requirement compared to scenarios (low, base, high) of RCP availability,
Tonnes.
• In essence this work is about identifying if a paper mill option exists which can substitute the
RCP export opportunity, and thereby keep additional value within IOI (commercial
• The IOI RCP streams are presently enjoying a growing export market, focusing on demand in
places such as China. This is supplied largely in unsorted form, as this activity can be
undertaken in the destination country, where lower cost labour is available. These export
streams can exist in their own right. The issue therefore becomes, does a new paper mill
facility in IOI offer additional advantage and benefit to IOI? The feasibility test shows that
some with the characteristics of tissue (good local demand, well connected to converting, and
transport cost dependent) have a potential role. Other options, while meeting a number of the
feasibility tests, fall short in fully achieving the profitability target.
• The second issue is why locate such a facility in IOI, when in a number of product cases, a
better location (RCP supply, market proximity) would be GB or even the Continent? In this
case the product match needs to have strong connection to IOI users, for example converters,
who subsequently supply the IOI industry with packaging and paper needs. Electronics, food
and consumer products are all large users of high value packaging, making Packaging
Cartons a possible candidate. In addition, a good fit is obtained with products that have a
high transport dependency, for example tissue with a low weight to volume ratio, or products
which are required close to customer – design based, small lots, just-in-time (JIT) service,
specialised on end-use etc. These again promote tissue and packaging cartons as the lead
possibilities.
• Optimisation of site (e.g. multiple site occupation), streamlined and world scale RCP flows,
rewards from bio-energy production, can all assist in improving profitability by reducing total
costs up to 10-15%. For example, tissue production and another option might be located in
close proximity.
• Triggering investment will likely require a supportive business environment which addresses
the capital and operating burden, at least in the initial phases. A supportive business
environment has allowed the construction of paper sector assets in other parts of Europe.
Both ROI and NI have established enterprise organisations and links to support measures at
EU and local level.
• After this, other benefits (not quantified here) would flow: the rationalisation of RCP supply
streams across IOI, a long term focal point for RCP streams in IOI (whether this is used as
mill furnish or subsequently exported from the site) and high profile visibility to encourage
increased recycling in IOI. It’s difficult to digest an outcome that for the very long term, the
IOI would only export RCP raw material, with little or no local processing (and value capture).
NSMDG to drive the commitments to RCP supply development in IOI. The scenarios show that a
number of mill options are lost if RCP supply initiatives under achieve their fullest potential.
NSMDG to take the essence of the report to respective agencies in IOI, seeking support and creating
a project team to ensure ownership. The project team to build a funding package – there is sufficient
indication that this can tip the balance in favour of investment.
NSMDG to promote the communication of the report and exposure to potential investors and
industry. Build target list.
NSMDG to support industry and investors in Phase 2 Feasibility Examination. Phase 2 should be with
industry and investor participation. Phase 2 would include:
1.1 Summary
To establish demand and supply data for the island of Ireland (IOI), the work used a top down
approach, beginning with high level statistics and progressing to more detailed levels until a robust
dataset was achieved. High level sources included for IOI; Eurostat and ROI Environment Protection
Agency and industry. For Northern Ireland (NI) this included Department of Environment and
industry. Northern Ireland data was often incorporated into UK information as a whole.
There were data conflicts, sometimes between high level sources. Those within the sector, like waste
operators and paper producers or converters also expressed some concerns from time-to-time about
data integrity. The data consistency was resolved by using:
During the work, issues and debate arose concerning differences in costs of landfill between NI and
ROI, the recent publicity surrounding illegal landfill and shipments, plus debate on data reporting.
Substantiation from high level sources was sought. Sources were referenced in this work (see
Appendix 10) to provide a data trail. In all cases, the integrity of the mill option assessment was
paramount, to ensure that while debate continues the paper mill option conclusions were robust. To
assist this, two recovered paper (RCP) supply scenarios were also constructed to show the impact on
achieving collection targets (or not) on the possible mill options.
From a total list of mill options, a screening process was employed to reduce this to a candidate
shortlist based on; RCP supply sufficiency, competitiveness, market opportunity and strategic fit with
IOI. The shortlist was then subjected to further examination using an established toolkit which can
model various mill configurations and relative competitiveness with the peer group. In almost all
products, the mill output would exceed the local IOI market demand, and such projects would be
required to compete in the export market. The options were assessed for this.
The total cost (including delivery and capital charge) calculated for the mill models, was compared to
market prices in a feasibility test. This shows the return on investment resulting from a new mill
facility. The hurdle applied was 10% return on capital employed over the business cycle.
Primary and secondary sources of information were used to review consumption of paper products.
Information on primary paper manufacturing was obtained from published CEPI statistics, trade
journals, and through direct discussion with manufacturers in IOI. Information on companies involved
in further paper processing (converting, corrugating, printing and publishing) was obtained through
established paper industry directory Birkner which lists industry participants worldwide, and the
company directory Kelly’s. These were categorised in a database to describe the supply chain. Further
information was requested from each Company by questionnaire (Appendix 1). The Sector listing is
provided in Appendix 2 and the interview listing in Appendix 3.
Separate published data for NI paper and board imports are not available since these data are
incorporated into the UK as a whole. Primary research from industry was used to provide estimates.
The Environmental Protection Agency (EPA) in ROI and Department of Environment (DoE) in NI were
the principal sources of headline statistics relating to the sources and volumes of recovered paper
(RCP) in the IOI.
Exports of RCP from ROI, by year and country of destination were obtained from Eurostat databases.
These data were presented to, and discussed directly with selected waste operators, who together
were responsible for handling over 233,300 tonnes of RCP available in ROI in 2004. Strategies to
improve collection and end-use -markets for waste paper were discussed with Dublin City Council.
In NI, initiatives through restructuring of councils within partnerships: Arc 21 (see Acronyms); North
West Region Waste Management Group and Southern Waste Management Partnership and their
Waste Management Plans, were obtained from the web site. Specific information relating to paper
collection targets was obtained by interview with arc 21 (This covers 25% of NI and approximately
57% of its population). Information on the collection and sorting methods employed was obtained by
discussion with Bryson House. Bryson House were awarded the contract to operate a kerbside
collection scheme for dry recyclables and materials recovery facility (MRF) by arc 21.
RCP supply scenarios were developed for the principal waste grades, i.e. old corrugated containers
(OCC), old newspapers and magazines (ONP/OMG) and mixed unsorted paper. These scenarios
considered new policy initiatives, infrastructural changes to waste management and collection,
growth rates and grade related factors. The scenarios were used to show impact on potential mill
options, for example, how exposed the options were to success in realising policy initiatives.
Unlike previous studies undertaken in IOI, this work opens the full range of RCP based paper
products to scrutiny. Other studies were limited in this regard, usually focusing on a single product.
Options rejected in this work, do not mean that the corresponding RCP supply streams have no value,
as the export alternative is well established, and assumed to continue. In essence this work is about
identifying if a paper mill option exists which can substitute the export opportunity, and thereby keep
additional value within IOI.
A mill modelling toolkit was employed to examine each possible product configuration. An
optimisation case was also undertaken, through combining products, to get full site utilisation. The
starting position for each option has been a ‘world class’ facility, which reflects both the scale and
technology regarded as best practice. Mill configurations are based on achieving accepted
environmental standards and best practice.
• To estimate the manufacturing, delivered and total cost (capital charges and profit margin) of
new mills located in IOI. To test for robustness, products were assumed delivered to London
markets, except for tissue which could be produced for home market consumption.
• To estimate the manufacturing and delivered cost (to market) of competing paper machines,
in order to position the IOI opportunities on cost curves.
• To compare total cost (including a 10% return on capital employed) with current prices, to
indicate feasibility of the new mill facility. This is a preliminary test to place the investment in
context, and allow identification of likely feasible options worthy of detailed examination in a
Phase 2.
The RCP raw material supply used in the mill models was that generated through section 2.2 above.
This has also been presented as scenarios to indicate how achievement of targets in IOI can
influence potential mill configurations. As part of exploring the full potential, the virgin fibre
availability in IOI was also examined to determine if an additional paper line might be possible, and
also if sufficient raw material for bio-energy exists. Coiltte and the Northern Ireland Forest Service
provided data for this.
RCP delivered costs (to mill) have been provided by local industry. Usage of other inputs such as
energy, chemicals and labour have been determined by the mill model, with local costs applied and
confirmed by industry in IOI. Currency exchange rates used in the mill models are those at Q3 2004.
The total listing of potential RCP product grades included: packaging papers for containers like
cardboard boxes (unbleached and white surfaced); packaging papers for cartons like food and
detergents; tissue; magazine grades; newsprint, plus printing and writing papers (this includes copier,
office and communication papers). The total list was reduced by screening through the following
criteria:
From this screening the resulting candidates are those with the best potential. This does not preclude
others, but industrial investors would need to deal with the additional hurdles identified. The results
of this analysis are presented in Section 5 of this report.
The overall economic situation for both the ROI and NI is good and is forecasted to continue
throughout 2005. The economic situation compares favourably on the global stage shown in Table 1.
(Quarterly Economic Review-Department of Enterprise, Trade and Investment-www.detini.gov.uk).
GDP growth and projections for 2005, from Economic and Social Research Institute for ROI are also
shown for comparison (in brackets).
Table 1: Real annual GDP Growth (%). ESRI data for ROI are shown in ( )
The combined population is small (5.6 million) but is economically active. In both countries the
market place looks positive for future development. Such prospects provide for a growing
consumption and demand for paper products in all the major end uses.
• There are 181 companies listed in trade directories, involved in paper related activities in both
the ROI and NI, ranging from corrugating, tissue, labels and printing and finishing operations.
There are likely to be a large number of small non listed enterprises as well. Primary paper
related manufacturers in IOI are restricted to just two operations both making moulded fibre
products
• Total paper and packaging used (including secondary paper which arrives in other forms such
as shoe boxes, white goods packaging etc.) in IOI is approximately 1.2 million tonnes, of
which almost half is packaging.
• With limited home primary production the majority of consumption is based on imports. The
largest grades are; packaging related, newsprint, tissue products plus printing and writing
papers used principally in offices and printers.
• Great Britain represents the largest exporter of paper and paper products to the ROI
accounting for over 335,000 tonnes in 2003 (57% of the total).
• Future projections estimate 7% growth p.a in coated printing and writing for direct mail and
promotional material etc., 4% growth p.a in uncoated printing and writing for direct mail,
promotional material and office use, plus 4% p.a in magazine grades. These are driven by
growth in GDP which stimulates consumption and in turn such activities as advertising. The
growth of the service economy in both ROI and NI will stimulate the demand for office
papers.
The ROI has a population of 3.96 million (July 2004 est. - www. worldwide-tax.com/ireland) and NI,
a population of 1.7 million (www.dardni.gov.uk). There are 1,288,000 households (2002) in the ROI
plus a further 627,000 in NI. 40% of the ROI population live within 97 km of Dublin and 66% of the
NI population live within 50 km of Belfast.
Few countries in the world can boast the economic achievements that ROI has shown in recent years.
The ROI economy is considered to have the most rapid growth of the EU and OECD states. Among
the many factors that have contributed to this growth are: the dramatic reduction in Government
expenses, collective labour agreements that encourage an increase in the labour force, considerable
investment benefits for overseas investors, a dramatic reduction in tax as well as reliance on a young
and skilled labour force. The average age of the working population in ROI is 30 compared to the
average age of over 40 in the rest of Europe. Unemployment has improved from 12.5% in 1996 to
only 4.6% in 2003.
The rate of GDP growth over these last years has remained stable, but has been over 8% per annum
in the years 1995-2002. The estimated per capita GDP for 2003 was approximately €22,000, a figure
similar to that of the European economic giants such as Germany, France and Holland.
The industrial sector contributes some 46% to the GDP and 80% to exports although it employs only
28% of the work force. The hi-tech manufacturing industry is particularly notable, mainly computers
as well as chemical engineering and textile industries. These are important users of paper packaging
materials for product transport and presentation.
The NI economy has been continuing to perform well against the backdrop of global recovery with
unemployment at the lowest levels since records began. For the period Oct-Dec 2004 seasonally
adjusted unemployment stood at 35000, 4.5% of the economically active. (www.dardni.gov.uk)
GDP growth in NI was 2.5% in 2003 and expected to increase to 3.0% for 2005. The per capita GDP
was around €18800. Manufacturing exports from NI were estimated to be worth €5.9 billion in
2003/4, which represents an increase of 9.4% over the year. The electrical and optical equipment
sector accounted for the largest share of exports (23.2%) followed by food, drink and tobacco
(16.3%) and transport equipment (15.3%). All these are significant users of paper packaging.
In 2000, turnover for ‘paper, pulp and paper products’ (Nace 21) was €800 million euro in ROI,
employing 4817 people, and €346 million euro in NI employing 2260 people. In the related ‘printing
and production of recorded media’ (Nace 22), ROI turnover was €9,642 million employing 18743, and
in NI, turnover was €416 million employing 4647 people (A North/South Analysis of Manufacturing
and Growth and Productivity-Dr Eoin O’Malley and Professor Stephen Roper –InterTradeIreland report
2001).
Smurfit’s Clonskeagh Mill closure means a loss of 45,000 tonnes of RCP processing into packaging
grades. This means that recycling capacity (processing of recovered paper into a reel of paper or
paper product) is now limited to two moulded fibre-manufacturing operations. The RCP earmarked
for Clonskeagh will now go to other Smurfit operations in the UK and Spain. This particular closure
• Huhtamaki-Lurgan, NI - manufactures 19,000 tonnes p.a. of moulded fibre products (mainly egg
boxes) from 19,000 tonnes of recovered paper comprising, 2,850 tonnes-unprinted news, 2,850
tonnes printed news, 10,450 tonnes clean mixed waste and 2,850 tonnes of virgin paper [Andrew
Rothwell, Pendle Pace Ltd, personal communication-December 2004]. 85% of moulded pulp
product is exported (mainly to GB), with 15% consumed in IOI.
• Erin Moulded Fibre, Birr, ROI – manufactures 800 tonnes p.a. of moulded fibre products (mainly
agricultural products e.g. hanging baskets, plant pots) from printed news [Andrew Rothwell
personal communication-March 2005].
Data from trade directories, Birkner (2005) and Kelly’s (2005), provide information on 107 companies
involved in paper converting/printing, corrugating, sack manufacture and paper merchants on the
IOI. A further 74 companies (mainly printers) were located through internet search. Of the 181
companies, 75 are located in NI and 106 in ROI. The majority of companies are printers (70) followed
by converters (51), paper merchants (43) with two companies involved in corrugating/sack
manufacture. These companies, plus direct sales (for example to retailers) form the major route to
market for paper consumption in IOI.
2.4 The type and quantity of paper/paper products imported into the
island of Ireland and subsequently consumed there.
With only limited primary paper manufacture available in IOI, nearly all paper consumption is met by
imports. To establish the type and quantity of paper/paper products imported into IOI, five main
sources of published information were consulted:
NI data are included in UK-wide statistics making it difficult to establish the type and quantity of
imports. Data were requested from industry during the interview process and have been used to build
up a picture of NI imports.
2.4.1 ROI
Eurostat data for 2003 indicates that ROI imported 584,301 tonnes of paper and paper products
(Table 2). Some paper import is converted (envelopes, wallpaper, exercise books etc. -Trade
Statistics Central Statistics Office Ireland 2003) and then exported, equivalent to 15% of imports
(88,374 tonnes). Industry information and interview indicates that a significant proportion of
imported packaging grades (in the form of reels) are converted in the ROI, but (as in one case) 65-
70% is then exported as secondary packaging with the goods.
Specific Eurostat information relating to imports by grade, origin and by year are shown in Appendix
4. These data indicate a stable but flat growth for printings and writings grades, a fact echoed by
The interviews showed a positive sector, with specific challenges but mostly looking forward to
growth. One major packaging converter indicated a marked reduction in demand for virgin-based
kraft fibre products with some tonnage loss offset by increased use of recovered paper based liner
and fluting. Despite an overall flat market, two paper sack manufacturers experienced strong growth
with one company experiencing 100% growth over the last 5 years and forecast a similar rate of
increase. Tissue imports recorded 30% growth between 1999 and 2003. New entrants, such as
Leicester Paper Company, have established own brands with local supermarkets.
The interviews also provided a confirmation and exploration base of paper importation into ROI. The
tonnage accounted for through interview was about 25% of the total Tables 2 and 3).
Table 2. ROI - imports (tonnes) by grade 2003 (Imports accounted for by industry
interview and questionnaire are shown)
Eurostat data indicate that the UK (58%), Sweden (14%) then Germany (7%) were the largest
exporters of paper/products to ROI in 2003 (Figure 1). The UK share of exports to ROI was 336,958
tonnes in 2003 - a small increase of almost 5% on 1999. Exports to ROI increased from Germany,
Italy and Spain and decreased from France (46%), USA and Finland.
2%
2% 3% Canada
3%
Finland
7%
France
2%
Germany
4%
Italy
3% Netherlands
2% Norw ay
Spain
Sw eden
58%
14% UK
USA
Industry perspective
Primary information was sourced from 22 face-to-face interviews with industry and involved
organisations. These were supplemented by questionnaire returns; 4 companies responded which
yielded information on 6 manufacturing operations. The interviews and questionnaires were used to
build understanding and to confirm the high level statistics on consumption and production. At the
same time this was an important vehicle to engage the industry in the work. The responses included:
Questionnaire respondents
Respondents to the questionnaire were from packaging converters with defined areas of sales. JR
Walsh Roscrea Ltd and AB Converters Ltd manufacture paper sacks and paper bags for retailers using
entirely virgin kraft grades (sack kraft, bleached kraft and grease resistant). Smurfit Corrugated
Ireland (SCC - part of Jefferson Smurfit Group) operate 14 manufacturing sites in IOI including 4
converting plants. Information was provided on the converting operations at SCC Dublin, Killeen (both
in Dublin) and SCC Cork and SCC Lurgan that sell to manufacturing and food and agriculture, using
both virgin kraft, and recycled testliner and fluting grade.
JR Walsh Roscrea and AB Converters had experienced sales increases from between 5 and 20% pa
over the past 5 years and forecast similar sales performances over the next 5 years respectively-all
based on current virgin fibre sources. Conversely, Smurfit Corrugated Ireland noted a reduced
demand for virgin packaging grades (down by between 20 and 26%) with usage expected to fall by
between 5 and 20% over the next 10 years. Demand for recycled grades (testliner and fluting) grew
by 8% over past 5 years with 4% further growth expected over the next 10 years.
Published information regarding the type and quantity or source of paper and paper products
imported by NI is not available. Eurostat data for ROI were used as the basis of the estimation of the
imports of paper and paper products by grade into NI (Table 4). Specific information on imports was
obtained from interviews with industry (Table 5).
A key assumption in this estimate is that the import of paper in ROI compared to overall total use is
the same in NI. The estimate basis is as follows:
• Eurostat ROI import data by grade (584,301 tonnes in total), divided by;
• ROI EPA data for total waste paper arisings (925,239 tonnes, section 4.1.1), multiplied
by;
• NI DoE data for total waste paper arisings (306,360 tonnes, section 4.1.2).
On this basis, NI imports are estimated at 193,470 tonnes. Individual grades tonnages were
estimated using the same approach but with ROI Eurostat data for each grade.
Discussion with four companies in NI (Appendix 3) provided information that accounted for 89,000
tonnes of paper imports, with the remaining imports used by 71 other companies identified from
trade directories (Appendix 2). The industry also indicated that over 60% of their converted
production was exported from NI, to either ROI or GB.
Overall, the industry interviewed revealed a growing business based on imported paper products.
Delta Print and Packaging Ltd plan to grow from £14 million to £22 million over the next few years.
Newcel Paper Convertors also expressed an optimistic outlook experiencing strong growth in 2004
(38%) with higher than expected growth of 10-12% in the next few years.
Table 4. NI- imports (tonnes) by grade 2003. Imports accounted for by industry
interview are shown
Accounted
Grade Import (tonnes)
imports
P&W: Uncoated mechanical 2,114
P&W: Uncoated woodfree 20,823
P&W: Coated woodfree 1,584
P&W: Coated mechanical 18,050 25,000a
Kraft liner, testliner & other packaging
50,934 45,000b
paper
Speciality paper 9,540
Converted packaging products 30,321 14,000c
Tissue and tissue products 20,534 5,000d
Newsprint 28,845
Other paper products 10,725
Total 193,470 89,000
aa
-liner sourced from Smurfit Townsend Hook; fluting previously sourced from Smurfit Clonskeagh Mill
now also likely to be sourced from Smurfit Townsend Hook
• Delta Print and Packaging exports 20% of products to ROI, with 50% going to GB, and 10%
to other European countries. 20% is used within NI. Key markets are fast food (McDonalds,
KFC), pharmaceutical, frozen food and retailers
• SCA Warrenpoint exports 85% (38,250 tonnes) to ROI. Dell is the largest customer (25,000
tonnes); others include Baileys, Baxter Healthcase and Tesco
• Robert Horne-all paper imports (25,000 tonnes) are sent to commercial printers-all consumed
on IOI
• Newcel-IOI main market.
2.5 The origins of paper consumed in IOI including mill location, the mill capacity, mill
furnish requirements
The potential origins of paper consumed in IOI, including mill location, capacity and mill furnish
requirement are shown in Table 6. Eurostat data confirm that the UK is by far the largest source of
imports into ROI (these data need to be taken with caution since Eurostat data does not differentiate
between manufacturing source and final country of dispatch). Paper supply to IOI is supported by
sales offices (e.g. M-real, StoraEnso, UPM-Kymmene) and converting operations (Georgia Pacific-
Ireland, SCA Warrenpoint and Smurfit), which serve the market using paper raw material produced in
company facilities outside IOI (Table 6). While shown as an import, this is more a sales stream
within a corporate supply chain. A new facility would need to displace this type of tonnage, plus that
imported independently, by offering a competitive local alternative.
Notes:
UPM-United Paper Mills, IP-International Paper
AW-Arjo Wiggins, SCA-Svenska Cellulosa Aktiebolaget
GP-Georgia Pacific, LPC-Leicester Paper Company
RCF-recycled fibre
• Virgin fibre-based grades form a significant source of imports (184,203 tonnes) to ROI for
pharmaceutical and food packaging applications and printings and writings.
• Specific import data for NI was gained form direct interview with industry. Based on the
spread of businesses within IOI and their activity, it is not expected that the ratio of grades
imported into NI will differ widely from ROI.
Industry trade directories estimate that 181 businesses are involved in paper converting, printing,
corrugating, sack manufacture and paper sales in IOI (Appendix 2), within which ROI had a turnover
of €10442m, and in NI a turnover of €762 million (Table 7).
Primary manufacturing is limited to moulding for egg boxes and agricultural products. Eighty five
percent (85%) of the egg boxes are exported to markets in mainland UK with 15% consumed by IOI.
Significantly, Huhtamaki Lurgan is the only UK egg box manufacturer and supplies 16,150 tonnes per
annum of product to retailers and egg producers based in mainland UK.
Consumption
Total paper consumption is the sum of domestic paper and board production, paper and board
imports minus exports. Paper imported into the IOI is from two sources, a) paper/card for converting
into paper products or as a final product, b) packaging around goods imported into the country, know
as secondary paper e.g. shoe boxes, packaging for white goods. No data on secondary paper is
recorded therefore compositional data from the EPA was used as the baseline for total paper
consumed. This data estimated that 925,239 tonnes of paper was either recycled or disposed of in
the ROI in 2003 (EPA, 2005). Table 8 illustrates how this total can be divided up into the various
paper sources, with secondary paper assumed to be total consumption minus known consumption.
These data enable the total markets available to mill options to be estimated and also the potential
fibre available for recovery. Total paper may even be slightly higher as the EPA waste data will not
include most tissue papers, archived and posted papers. Taking into account the limitations of waste
composition analysis results, these figures represent the best available data.
ROI production is limited to 800 tonnes at Erin Moulded Fibre. Imports at 584,301 tonnes represent a
significant proportion of total consumption, while 400 (estimated) tonnes of Erin Moulded Fibre
production is itself exported. ROI consumption is therefore estimated at 584,701. There are 88,374
tonnes (15% of volume of imports) converted into products (envelopes, wallpaper, exercise books
etc) and subsequently exported with a value of €205 million (Trade Statistics-Central Statistics Office
Ireland-2003). 18,000 tonnes of this is exported to UK (Trade Statistics-Central Statistics Office
Ireland-2003) of which (based on population) 513 tonnes is estimated as exported directly to NI.
For NI, it is estimated that 193,470 tonnes of paper/paper product are imported, which together with
19,000 tonnes of indigenous production, less exports, give consumption for NI 196,320 tonnes.
These elements, plus the net imports of secondary paper products, give the total paper consumption
in IOI (Table 8). These data establish the total fibre supply needs of IOI, the markets available to
mill options and also the fibre potential available to the mill options (paper that can be collected and
recycled). This is the basis for the projection in Section 3.6
ROI NI IOI
a
Production 800 19,000 19,800
Imports 584,301 193,470 777,771
b
Exports 400 16,150 16,550
c
Consumption 584,701 196,320 781,021
Net imports of secondary
340,538 110,040 450,578
converted paper productsd
Total paper productse 925,239 306,360 1,231,599
Notes
a. Erin Moulded Fibre 800 tonnes; Huhtamaki Lurgan 19,000 tonnes
b. ROI exports obtained from Trade Statistics-Central Statistics Office Ireland-2003; NI export
data obtained from industry interviews. Primary paper products.
c. Consumption (primary paper and board products) = Production + Imports – Exports
d. Net imports of secondary converted paper – the residual between total paper and primary
paper consumption estimates.
e. Total Paper Products. This is consumption of primary paper product plus secondary and
converted paper. This also forms the basis for the potential fibre base for the mill options and
corresponds to the total paper arisings - the total waste paper and board materials derived
from household and commercial sources, which are either recovered for recycling or landfilled
(EPA data 2005). Source data was EPA 2005 and NI DoE 2005 .
Using the data obtained from the research, the future consumption for the various paper grades has
been estimated for ROI, NI and IOI. In assessing this, a number of factors and drivers likely to
influence consumption have been considered. These factors relate to issues surrounding the future
consumption patterns for paper products in the key end use areas of printing and packaging.
PIRA has undertaken a number of studies examining the issues and drivers that may impact these
important sectors and reference has been made to such work in developing the future projections.
Reference has also been made to key economic and social factors that relate to both ROI and NI.
Living standards
• The ROI is now in the first level of the wealthiest countries for the first time. It is ranked 4th
(source: The Times Business Section Wed Jan 12 2005 p50)
• Real GDP growth of the ROI was 3.5% in 2003; 5.5% in 2004 and expected to be 5.5% in
2005. Forecasts through to 2008 show similar levels (source: www.detini .gov.uk; Social
Research Institute figures)
• The UK including NI is now in 11th place of the league of living standards (up from 17th in
1999) (source: The Times Business Section Wed Jan 12 2005 p50).
• Real GDP growth for NI was 2.5% in 2003; 3.0% in 2004 and expected to be 3.0% in 2005
Demographics
• In the developed world there has been an overall growth in older people and a decline in the
younger age groups notably the under fifteen year olds. While the UK including NI is
following this overall trend, it is not as marked in ROI. Despite this, the number of older
people (65+) has increased by third over the period 1971-2000, but only constitute 11.1% of
the population. In contrast the number of under fifteen year olds has declined by 12% over
the period 1991-2002
• The importance of this changing demographic pattern is that such population shifts will drive
changes in marketing, product and pack formats and distribution systems.
Women at work
• Over 49% of women are now employed in the ROI as compared to 30% in 1985
• Data for the UK including NI is similar, at just above 50%
• Such increases influence the overall family affluence and create changes in family eating
habits
• Women in work have also changed the frequency and mode of shopping to fit a more complex
daily schedule
• Women overall are more sophisticated consumers, more health conscious and more
environmentally concerned
• Statistical data for both the ROI and the UK including NI shows that there are more single
parents and one person households. It has been estimated that by 2016, 2 out of 5 will
be a single person.
• Families are smaller and more numerous
• There are more dual income families
• The changing family unit, pressures on time and an overall more mobile lifestyle has
meant considerable changes in eating styles
• These changes in family and household structure have implications for packaging in
particular which is needed to service ‘lifestyle’ changes. This results in volume increases
through smaller but more numerous packaging formats
• There will be a rise in home shopping via the Internet or TV as time pressures and
convenience factors increase the advantages of this form of shopping for many. Such
moves will increase transit related packaging e.g. corrugated
Consumer changes
With this rapidly changing world such influences will have implications for the major paper based
products used in packaging and printing.
• The greater consumption of snack food and food-on-the-go will lead to a variety of new
packaging formats. Paper based products are favoured in a number of areas and
environmentally related issues are particularly driving their use in fast food chains, etc.
• The changing nature of households will see the greater need for single portion packs and
smaller packs. This will lead to a disproportionately higher generation of waste.
• Changes in demographics will necessitate new pack formats with, for example, larger print
and easier opening formats
• There will be a continuing trend towards lower basis weight and down gauging of paper
packaging board in line with trends to reduce costs and to meet legislation related to
packaging waste minimisation.
• Paper-print based products will continue to decline as they are displaced by electronic
media
• There will be the continual migration of print to non production environments resulting in
the continued growth in cut sheet papers
• The volume of print production is strongly linked to advertising expenditure, which in turn
often reflects GDP. The projected growth in GDP should provide a good basis for increased
consumption of printed related products, for example direct mail, magazines, etc.
• Increases in the service sector in ROI (employee numbers rose 20% over the period 1999-
2001) will lead to increases in cut size office papers (predominately A4 uncoated printing
and writing grades)
• There will be similar increases expected in Northern Ireland, which will be linked to the
growth in the economy and standard of living. Differentials between NI and the rest of
the UK are diminishing
• The tissue sector can be considered to be more directly related to customer needs and
perceptions than other grades
• Demands for the more niche, higher premium products will increase with standards of
living and this will increase with the projected growth in GDP
• Cost issues, however, dominate consumer choice and there is a trend towards favouring
‘own brands’, etc.
• The changes in demographic patterns resulting in an increase in an older population will
increase the need for disposable products
These implications for the different end uses will influence growth rates for the different paper
grades. Therefore growth rates for each of the key paper grades used in these end use sectors were
sourced from a range of publications (Future of Corrugated Board Packaging for the European Market
(Pira Market Report 2003), Future of Print II (Pira Market Report 2004), Paperloop, CAP Ventures,
etc). Each figure was then viewed in light of the local market conditions prevailing and any known
Based on these influences and implications the percentage changes that might be expected for each
paper grade are shown in Table 9.
Grade Growth % pa
Uncoated mechanical 2.5
Uncoated woodfree 4
Coated woodfree 7
Coated mechanical 4
Kraft, testliner, etc 2
Speciality 2.5
Converted packaging 2
Tissue 1.8 to 2008; 2 to 2013
Newsprint 1 to 2008; 0 to 2013
Other 2
Notes
While demand of packaging grades is closely linked to economic growth and consumer expenditure on food,
beverages and other packaged items, this is being offset in tonnage terms by progression to lighter weights and
down gauging of the fluting in corrugated boxes currently used in many applications. It has been predicted that
similar down gauging will eventually occur with the liners.
Demand for many of the premium tissue grades is strongly linked with consumer spend. However while economic
conditions are favourable for this, much of the tissue purchases are dictated by cost (Tissue Report
www.euromonitor.com/disposable_paper_products_in_ Ireland).
Grades linked to advertising, promotion etc i.e. magazines; printing and writing, are showing attractive growth
rates linked to the good economic pointers in both ROI and NI
Printing and writing used primarily as cut sheet for office and business use is growing with a) the growth in
businesses and the service economy and b) with the development in inkjet/laser printing technologies
In projecting the likely future consumption by grade, data from the various sources referenced in the
study were used. The major source was Eurostat import data for ROI (Table 2) and estimated
imports for NI (Table 4). These were adjusted in line with known additions or circumstances.
Specifically
• the newsprint value for the ROI of 87,116 tonnes was increased to 162,800 tonnes to take
into account imported printed news
• kraftliner etc for ROI was increased to take into account the 45,000 tonnes no longer
produced by Smurfit
• converted packaging products was increased to take into account the imports of secondary
and converted products
• figures for NI were based on ROI consumption patterns for the each grade, then extrapolated.
The projections for future consumption for the ROI, NI and the IOI are shown in Tables 10 to 12
respectively. These projections are based on consumption which includes net imported secondary
paper product - for total paper consumption in primary and secondary form.
The data presented for paper consumption in the ROI and NI has been developed from a number of
sources and primary research then aggregated.
By way of checking the credibility of the data, per capita consumption of paper for the UK (this figure
includes NI) was compared against the per capita consumption for the ROI and the NI per capita
value that was calculated in this study (Section 3.5 and demographics - ROI July 2004 est. - www.
worldwide-tax.com/Ireland, NI - www.dardni.gov.uk). This is shown in Table 13.
On the basis of this comparison it would appear that the overall paper quantities may be overstated
in ROI. However, it should also be borne mind that the economy of the ROI as indicated by GDP
data is performing better than the UK which may lead to some increase in per capita consumption.
Notwithstanding this if we were to apply the UK per capita consumption of paper and board to the
ROI and NI population data, the likely level of overstatement for the ROI is 83,343 tonnes or +8.8%
(giving ROI paper risings for 2003 at 841,896 tonnes)
• Recovered paper is derived from the waste stream. The waste paper arisings in IOI are
estimated at 1,231,599 tonnes in 2003 (ROI 925,239 tonnes, NI 306,360 tonnes). At least
a third of this is recovered for recycling.
• The majority of recovered paper collected in the ROI and NI is exported for recycling. The
three main RCP grades are OCC, ONP/OMG and mixed unsorted.
• China and India are the fastest growing export destinations. Exports go from IOI, principally
as mixed unsorted grades.
• UK newsprint mills have established medium to long term contracts for the supply of
ONP/OMG in both the ROI and NI. These are relatively small volumes.
• Targets for ROI. Significant increases in the unsorted waste derived from households is
expected as a result of the payment scheme introduced into the ROI from January 2005
• Targets for NI. Increases in ONP/OMG derived from households in NI is expected as a
result of developing council based waste management schemes e.g. arc 21
• Projections of RCP supply have been generated for ROI and NI, by main grade. This has
been achieved by reviewing the ‘influencing factors’ such as policy, environmental
aspirations, paper demand and the waste supply chain. The projections show an almost
50% increased in supply potential over the next 10 years.
• 2 Scenarios were created (high and low cases) to evaluate the impact of under- or over-
achieving in RCP supply programmes. These scenarios were then applied to the mill options
to expose sensitivities, risk and the impact of failure to achieve IOI RCP targets. The
analysis in Section 5, shows indeed that the mill options are dependent on success with the
RCP programmes in IOI.
3.2 The sources, grades and quantity of post consumer paper currently recovered in
IOI.
3.2.1 Sources, grades and quantities of post consumer waste paper. ROI
EPA estimates for post consumer paper present in household and commercial sources in ROI are
shown in Table 14. Total waste paper and board arisings increased from 804,417 tonnes (commercial
and household) in 2001, to 925,239 tonnes in 2003.
Commercial sources account for nearly two thirds of paper, board and packaging materials in ROI.
This material stream increased from 502,062 tonnes in 2001 to 575,443 tonnes in 2003. The
proportion recovered from the commercial waste stream in 2003 was 50%.
The estimated quantity of paper recovered from ROI households increased from 22,229 tonnes in
2001 to 75,723 tonnes in 2003, an estimated 22% of total household paper and board arisings.
Table 14. Sources, fate and arisings of paper & board (Household and Commercial) and
paper packaging (Packaging) materials 2001-2003 (EPA 2005)
Estimates of local recycling prepared by EPA and shown in Table 15, indicate that two thirds of
recovered paper and board is recycled abroad (238,620 tonnes in 2003). EPA also show over 120,257
tonnes being recycled within ROI in 2003, at the Smurfit Clonskeagh Mill and as a pulp fibre
substitute, animal bedding and within composting operations. EPA have internally reviewed the
definitions and substantiated these numbers including the local recycling.
Table 15. Quantities of paper and board recycled in ROI or abroad (EPA 2005)
The main companies involved in waste paper collection, handling or are exporters of waste to other
countries, are shown in Table 16 (EPA 2005). Bailey Waste and Greyhound Waste made 4 and 3 fold
increases respectively in the quantities of waste handled since 2001, largely as a result of export
activities to China. (A number of smaller players that are not listed in Table 16, are involved with
recovering paper and board packaging and non packaging paper. These account for the difference
between 358,878 tonnes of total paper recovered and the 305,845 tonnes collected by 13 main
players on ROI).
ND = no data supplied
A current breakdown of waste collected by waste operators interviewed in ROI that handle over 65%
of paper and board collected in ROI is shown in Table 17. The main grades handled are OCC, news
and mags (newspapers and magazines), mixed office waste (MOW) and mixed unsorted waste. UK
and China were the principal destinations. UPM’s Shotton Paper Mill in GB, takes news and mags.
Notes
a-OCC originally sent to Smurfit Clonskeagh Mill and UK Smurfit operations; OCC is now
exported to Smurfit operations in Spain and UK
b-exported as 3-4 ‘loose’ loads per week
c-no information on current destination
A number of published data are available that enable an estimate of the sources, grades and
quantities of waste paper in NI. These data are discussed in relation to the waste paper arisings from
households and commercial and industrial sources together with information that has been gained
The Northern Ireland Household Waste Characterisation Study 2000 indicated that ‘Newsprint,
magazines and other paper’, contributed 10.6% of household waste, whilst ‘card, packaging and
other card’ contributed 6.1% (total paper and card ~16.6%). Applying this characterisation to the
household waste generated for NI in 2003 (901,201 tonnes) yields a total of 150,500 tonnes of paper
and card from households, 95,527 tonnes of ‘Newsprint, magazines and other paper’ and 54,973
tonnes of ‘card, packaging and other card’. Recent new estimations will likely see slight modification
to these and DoE NI consider using 900,000 tonnes and 150,000 tonnes as better reflection of
precision, for household waste generation and yields of paper and card, respectively.
An annex to the report ‘An All Ireland Approach to Developing Recycling Markets – a strategy for
Developing Recycling Markets in Ireland’ (EPA 2002), estimated that the total waste paper/card
arisings in NI for 1999/2000 was 238,994 tonnes with 142,069 tonnes generated by households.
Assuming growth mirrored ROI then the estimate for 2003 is 168,176 tonnes. These data were
considered as indicative only since only limited compositional analysis was carried out at that time.
DoE NI therefore consider the value of 150,500 tonnes to be more robust.
Data from NI District Councils show that 24,351 tonnes of paper and board were collected for
recycling as three main paper and board streams (Table 18); paper (newsprint and magazines), card
(mainly packaging waste) and mixed paper and card (mixed newsprint and packaging waste).
Table 18. Paper and board waste (tonnes) recovered for recycling from NI District
Councils 2003
Based on a total paper arising figure of 150,500 tonnes, this gives a paper recycling rate of just over
16%.
3.2.6 Paper and board arisings in commercial and industrial (C&I) waste
The report ‘Industrial and commercial waste production in Northern Ireland 2002: A final report to
the Environment and Heritage Service’, identified separate figures for ‘separately collected paper and
card’ (57,200 tonnes) and ‘paper and card packaging’ (38,200 tonnes). The survey also identified that
40% of all waste (257,000 tonnes) as ‘mixed’ waste which will include significant quantities of paper
so it is reasonable to assume the actual value of total C&I paper and card is more than 95,400
tonnes.
The EPA report (see above - EPA 2002) estimated NI C&I to be 96,925 tonnes. Assuming growth has
mirrored the ROI, the estimate for 2003 would be 114,737 tonnes.
None of these sources are viewed as particularly authoritatively by the DoE who suggest that a better
way to estimate C&I paper waste arisings is to estimate total paper waste arisings and subtract
household waste. This yields figures in the range of 155,000 to 170,000 tonnes for C&I waste paper.
Paper and board recovery and recycling from commercial and industrial waste
Official Producer Responsibility Packaging data for 2004 reveal that 41,431 tonnes of paper and card
were recycled by the 373 registered obligated companies in NI (obligated companies handle greater
than 50 tonnes of packaging material per annum and have a turnover greater that £2 million). Over
60,000 companies, the vast majority of which are SME’s, and that do not need to register, will
generate paper and board C&I waste. It is reasonable to assume therefore that the actual level of
C&I waste paper recycling will be higher than 41,431 tonnes.
Taken together, DoE make the following estimate of waste paper arisings (Table 19) from household
and C&I sources (DoE data 2005).
Details of NI waste operators interviewed are shown in Table 20. The main grades handled are OCC
and News and magazines. Huhtamaki Lurgan and GB paper mills are the principal destinations.
Notes :
Arc 21 expects significant growth in the collection of dry recyclables scheme yielding an estimated 60,000 tonnes
for collection and handling by Bryson House from 2008 onwards.
The Huhtamaki Lurgan operation occupies a residentially sensitive site but has potential to double capacity through
operation of an additional shift operation.
The quantities of post consumer paper in IOI are estimated at 1,231,599 tonnes comprising 925,239
tonnes from ROI and 306,360 tonnes from NI (Table 21). Post consumer waste has increased from
between 5-9% from 2001 to 2003 in ROI. The large percentage increase noted for NI data between
2002 and 2003 is due to an improved estimate of 2003 waste paper arisings.
Table 21. Post consumer waste paper arisings on IOI-2003 (tonnes). Data sourced from
EPA and DoE 2005
3.3 The current markets into which recovered paper is being sold, the end use and
geographical destination for the recovered paper, by grade.
The EPA estimates exports of recovered paper at 238,620 tonnes, a figure based on industry
information and substantiated by EPA in the work. Eurostat data indicate that 180,460 tonnes of
waste paper were exported from ROI. Statistical data published by Eurostat are provided by National
Statistical Institutes of Member States. Eurostat acknowledge that it is often difficult to reconcile
different statistical sources. EPA was used, based on its substantiation of data.
The Netherlands, UK, Spain, India and China were the destination for 93% of the recovered paper
exports from ROI with 55 other countries making up the difference (Table 22 and Figure 2). The key
OCC-Grade 1
• Spain is the principal destination with tonnage rising from 8,448 to 30,425 tonnes
• Exports to India increased from 1,325 tons to 13,937 tonnes
• Exports to UK decreased from 4,131 to 1,923 tonnes.
ONP/OMG-Grade 3
Unsorted mix-Grade 5
• Exports to India increased from 0 tonnes (2001), to 10,651 (2002) to 15,719 tonnes
(2003)
• Exports to China increased from 261tonnes (2001) to 4,296 tonnes (2002) to 30,469
tonnes (2003).
Table 22. Export of recovered paper from ROI in 2003 by grade and country of
destination, Eurostat.
Notes
NL-Netherlands; UK-United Kingdom; ES-Spain; IN-India; CN-China; ID-Indonesia; HK-Hong Kong; TW-Taiwan;
US-United States; JP-Japan
OCC-Old corrugated containers
P&W-printings and writings
P&B-paper and board
US Rest
ID HK NL
1% 2%
1% 3% 21%
CN
22%
GB
15%
IN
18%
ES
17%
Total 180,459t
NI data for the exports of recovered paper are not available as these statistics are included in wider
UK figures. Further, internal transfers of recovered paper to GB destinations are not listed in NI
statistics. However, through direct discussion with industry and involved parties it is estimated that
recovered paper exports are over 35000 tonnes based on the following data and Table 20:
• Bryson House collects 14,000 tonnes of paper and card of which 10,500 (75%) is news and pams
and 25% (3,500 tonnes) is card from kerbside collections for 9 of the 11 arc 21 councils and has
arranged 8-year contracts (from April 2005) for 10,500 tonnes to be exported to UPM’s Shotton
Paper Mill in the UK. Price ranges have been agreed. Arc 21 believes there is potential for further
collection to 60,000 tonnes of paper and card. Bryson House is establishing a new materials
recovery facility (MRF) to accommodate greater tonnage collected. ROI also participate in such
export flows, with Indaver exporting 7,500 tonnes.
• Kosmos Recycling Ltd collects 4000 tonnes of news and pams annually from the 2 remaining
councils within arc 21 (Newtonabbey and Ballymena). This material has been exported to
Bridgewater Paper Co UK for the past 6 years.
• SCA Warrenpoint-exported all recovered paper to Smurfit Clonskeagh Mill (it is now likely that this
waste will now be exported to Smurfit UK operations)
• Waste paper from converting operations at Newcel Converters and Delta Print and Packaging is
collected by waste management operators-no further information was made available as to the
ultimate country of destination.
3.3.3 The price and the volatility of process paper recovered from the island achieves
when sold to these markets
As recovered paper is now a traded global commodity, the price and volatility will be subject to global
influences. As a generalised trend the underlying movement is upward, in nominal and real terms
(Figure 3), plus there is volatility the magnitude of price cycles.
EUR / tonne
200
180
160
140
120
100
80
60
40
20
0
jul/91
jul/92
jul/93
jul/94
jul/95
jul/96
jul/97
jul/98
jul/99
jul/00
jul/01
jul/02
jan/95
jan/96
jan/97
jan/98
jan/99
jan/00
jan/01
jan/02
jan/91
jan/92
jan/93
jan/94
jul/90
jul/03
jan/03
jan/90
Month
The demand from Asian mills is now playing a pivotal role in the recovered paper market. Overall the
demand over the last 8 months has been steady rather than strong and aggressive. This has kept
OCC prices in a moderate band – well above the €85 low of 2003 and below the €130 high of 2002.
However, this state is likely to come to an end and the Chinese are expected to start buying in
earnest again. 2005 will prove to be a year of very competitive pricing.
China is expected to resume large scale OCC buying. In 2004 China added 3.46 M tonnes of capacity
and another 5.27 M tonnes is due to come on stream in 2005 – corrugated, boxboard newsprint and
printing & writing grades.
A further 650,000 tonnes of corrugated capacity is starting up in Germany. The 250,000 tpa Varel
machine came on-stream in December and on 11 February the 400,000 tpa machine of Adolf Jass
started up at the brownfield mill in Thuringia
Fears are being expressed in the UK that the growing overseas market for mixed grades could
undermine the primacy of some grades e.g. old kraftliner substitute (KLS), which traditionally has
sold at a premium of €15-€25 a ton. Today the price connection between the two is less clear and the
incentive for merchants to segregate is diminishing, and with it, the assured quality of raw material.
Within IOI, medium term arrangements have established strong export markets for RCP
• NI-8 year contracts arranged with Shotton Mill for news and magazine grades.
• ROI-dramatic increase in export of mixed unsorted paper to China and India from 2000.
These have been developed through contracts between ROI waste management companies and
involved organisations in those countries.
In NI, the amalgamation and centralisation of council waste management activity through the
formation of arc 21, SWaMP and NWRWMG has provided the economy of scale in resources needed
In ROI, significant unsorted paper is now exported to China and India. These routes are well
established and will remain key export markets for ROI for the next 10 years. In 2004 Dublin City
Council, working with Hannay’s established a dry recyclables scheme. Collected unsorted paper
(Grade 5) is sold to China.
The growth in the paper and board industry in China and India are the driving forces for RCP exports.
Paper and board capacity in Asia is set to grow from 65 million tonnes (2000) to 120 million tonnes
(2015). China is expected to account for half of the capacity growth.
Such demands will clearly impact the prices any potential mill in the IOI will have to pay, to compete
for available raw materials. The close proximity of the mill to the RCP supply and the presence of a
reliable end use market would be to the advantage of the local mill. The IOI mill should be in position
to displace export contracts and also consider import from GB as necessary.
• OCC (grade 1)
• ONP/OMG. Newsprint and magazines (grade 2)
• Unsorted (grade5)
The other grades have not been considered as their volumes are small and there is no real evidence
that these other grades are being sorted and separated.
The starting point for these projections is the data supplied by EPA for ROI (Table 15) and that
supplied by the DoE for NI (Table 18 and 19). The assumptions used for the projections of each
grade are based on information received through the interviews, PIRA’s own research and other data.
The data relates to 2003 and that supplied from the above sources does not always neatly fit the
grade definitions. Assumptions have therefore been made for each and then the data sources
combined to give a projected 2005 starting point, Table 23. The approach is described in Appendix 6.
Table 23. IOI Base Year Calculation for the supply of recovered paper, 2005, tonnes
Influencing factors
The future availability of the various grades of recovered paper is influenced by various factors, the
impact of which is outlined below.
3.4.1 OCC
Corrugated cases have been a major component in the distribution supply chain. However the
corrugated industry has been under sustained pressure from reusable plastic packaging, returnable
transit packaging (RTPs), for more than a decade now mainly on environmental and lifecycle cost
Based on PIRA research (Distribution Packaging in Europe Sept 2002) examining distribution
packaging in Europe it is estimated that the current global displacement (2005) of corrugated will be
around 400,000 tonnes. This is a lower figure than other estimates. On an annual basis, incremental
loss of volume due to global usage in RTP is forecast to be less than 20,000 tonnes, which will be
more than compensated for by higher levels of business flowing through European retailers in
general. Thus despite some in-roads into the market by RTPs, corrugated cases remain as a
preferred packaging medium in the medium to long term. This is based on the premise that the
product delivers functionality at a cost-effective price.
Environmental regulation such as the Packaging and Packaging Waste Directive also impacts on the
choice of transit packaging, as do environmental goals such as reduction in air pollution and traffic
congestion. Looked at overall, it is not necessarily obvious that environmental considerations favour
RTP use. The impact of extra road journeys as a result of less efficient filling and the transport of
empty crates, the greater weight of RTPs, and the impact of washing in terms of energy and chemical
use, as well as the eventual comparative recyclability of plastic and corrugated all have to be factored
in.
In addition, two other market related factors have to be considered which favour the use of
corrugated. One is the growth of home shopping via telephone, TV and Internet which uses primarily
corrugated as the distribution medium. The other is the continuing rise of Chinese imported
manufacturing goods throughout Europe, which in the majority of cases are packaged in corrugated.
These two issues are linked to the growth in GDP, which will see increased consumerism with
increases in GDP.
An issue which is likely to see a reduction in the actual tonnage of corrugated is that of lower basis
weights and lightweights, which is being driven by a number of factors including:
• companies seeking ways and means of reducing costs within the supply chain
• consumer ‘green’ pressure to see less packaging
There are significant investments occurring within Europe that are supporting the move to lightweight
materials and a number of papermakers and corrugators are producing such products. It has been
estimated (11th International Containerboard conference Oct 2004) that lightweight flutings will take
67% of the market in Europe by 2008. Lightweight liners is further off but will eventually take
market share.
• the closure of the Smurfit mill in Dublin – releasing a further 45,000 t pa on to the market
• the potential increase of OCC collected from smaller retailers as a result of improvements in
waste management systems
The effect of each of these factors on OCC availability as recovered paper is considered in
quantitative terms in Table 24 by year and its overall result in Table 25.
Year Tonnage
2005 226,254
2007 241,992
2010 262,581
2015 283,512
3.4.2 ONP/OMG
There has been concern in the newsprint world for a number of years that the newspaper as a media
item will decline in the face of growing competition from other types of media, e.g. the internet, TV
etc. Indeed any survey of newspaper demand over the last few years will show the relatively static
demand for newspapers (The future of Print 2 – Pira International 2004). The main driver for the
survival of the newspaper is advertising and indeed the pagination of newspapers is largely
dependent on advertising revenues. Unfortunately for newspapers, while advertising revenues are
growing overall, newspapers are losing market share, resulting in only very modest real growth.
Taking these factors into consideration, growth in newsprint is likely to be between 0 – 1.5% over the
study period.
• Page size. There is an overall view that page sizes will decrease, predominately from
broadsheet to tabloid (e.g. The Times, Independent in the UK). Other sizes may also reduce.
• Grammage. Grammage has reduced in recent times notably from 48 gsm to 45 gsm and it is
likely that this will remain as the most widely used grammage. However cost related
pressures and notably increasing mail costs may see further reductions in the medium term.
For the basis of the study it was assumed that there will be no further reductions.
Magazines overall remain a very successful sector in Europe and there has an increasing growth in
ad-hoc specialist-topic additions that have built on brand of a main title. This will be an increasing
trend as magazines become increasingly niche with smaller circulations. However the number of
titles will increase resulting in an overall increase in circulation.
The paper grade most used for magazines is coated mechanical and this has been predicted to grow
between 4-5% over the study period (The Future of Print 2 – Pira International 2004).
• Printed page area - This is likely to increase and will further increase in line with economic
growth.
• Grammage - No change in grammage is expected at this stage. This however may be
dependent on postal charges particularly for subscription based magazines
• Magazines are not as frequently recycled as newspapers. Newsprint mills are often seeking
additional supply of magazines to supplement their furnish. (The presence of magazines is
required to assist the deinking process)
Local issues
• Although there will be increased in material from households from Dublin with pay for use
scheme – all material is collected and mixed. Thus to increase ONP/OMG will require
additional sorting. Overall therefore only 1% increase is projected for the ROI component of
the figures.
• In NI the formation of the 3 waste management operations, arc 21, SWaMP and NWRWMG
will increase the amount collected from households. This will be separated at MRF (Bryson
House for arc 21). This will result in sizeable increase in ONP/OMG over the next 2-5 years
and will likely level off thereafter without introduction of incentives or punishments to
encourage recycling. Thus for period 2010 to 2015 a growth figure of only 1% is projected.
• Restricted access to available tonnage because of long term supply contracts already in place
The effect of each of these factors on ONP/PMG availability is considered in quantitative terms in
Table 26 by year and its overall result in Table 27.
Year Tonnage
2005 59,752
2007 84,913
2010 100,743
2015 105,882
3.4.3 Mixed
Mixed constitutes the largest grade of recovered paper. It will contain both OCC and newspapers and
magazines from households, together with a range of printing and writing grades derived from office
use, direct mail and other promotional based material. Other packaging grades notably folding
boxboard and other multi layered structured material e.g. cereal packets, detergent boxes will make
up the rest. The overall tonnage of this material will grow as incentives or infrastructure is put into
place to increase collection of such material from households. This was highlighted by discussions
with both Dublin City Council and representatives of arc 21 in Belfast. The issue in terms of the
acceptability of this grade will be the level of contaminants present. This may be an issue particularly
in ROI as there is likely to be no separation beyond that of the householder. In Northern Ireland
there are plans for newspapers and magazines to be separated out and sold on as a defined grade to
UPM’s Shotton Paper mill.
• an increase in mixed waste of 25% is assumed for the period 2005 to 2006 dropping to 10%
for 2006 to 2007 for ROI – based on the implementation of the pay per use scheme.
Thereafter an increase of 3% for the period 2007 to 2010 dropping to 2% through to 2015
• NI will increase as per ONP/OMG but with the mixed constituting the 25% of the total paper
and board collected.
Table 29: Future projections for the island of Ireland through to 2015 (Tonnes)
The development and viability of any planned mill will need continuity in recovered paper supply. To
provide a view on the future supply of the chosen recovered paper grades, two scenarios were
developed around the base case projections. The higher case scenario takes into account all the
positive impacts and drivers that will enhance the chosen recovered fibre grade availability. The
lower case takes the opposing view and considers all the factors that might lead to a reduction in the
selected recovered fibre grade. These are used later in the report to compare with the mill option
fibre requirements, and as such indicate how performance in recycling in IOI will impact the viability
of the mill options.
These have been developed by grade and then combined to give an overall picture. The various
factors taken into account in their development and the assumptions made are detailed by grade
below for IOI. Regional differences are noted where applicable.
3.5.1 OCC
Current - basecase
The vast majority of OCC currently collected has a developed supply chain. Large retailers and
businesses having OCC as a waste material are serviced by a waste management company or waste
merchants. The material in the main is separated at source and requires no further sorting.
The quantity collected via this established system represents 70% of the available OCC.
Higher case
Infrastructure is put in place that permits collection of segregated OCC from smaller retailers,
businesses and institutional operations. Such infrastructure collects a further 15% of available OCC
to be collected.
The infrastructure costs are likely to need a higher price of OCC to be achieved to justify investment.
Market pull from Far East might be an influence.
It assumes the additional 15% will be collected over the five year period 2005 to 2010. No further
growth in available material is expected.
Applying these assumptions gives the two scenarios, Table 30 and Figure 4.
OCC
350000
Current
300000
Higher case
250000
Tonnes
200000
150000
100000
50000
0
2005 2007 2010 2015
3.5.2 ONP/OMG
Although the introduction of the payment scheme in the ROI notably Dublin will affect household
derived material, the ONP/OMG collected will not be segregated and will be part of a co-mingled dry
recyclables collection.
It is estimated that the existing systems enable recovery of approximately 25% of available
ONP/OMG.
It has been assumed that the introduction of such a scheme would deliver similar results to that
expected by arc-21 over a five time period.
As in the case of NI no further increase would be expected beyond the initial 5 year timescale.
Lower case
The infrastructure developed in NI does not live up to expectations and only half of the expected
material is collected in the five period.
Readership in newspapers declines further than expected after 2010 and growth rates are only 0.5%
Applying these assumptions results in the following scenarios, Table 31 and Figure 5.
250000
Current
200000 Higher case
Low er case
150000
Tonnes
100000
50000
0
2005 2007 2010 2015
Higher case
More material is sourced from households in ROI as payment scheme takes effect. Further price
increases introduced to encourage people to recycle.
This assumes that ONP/OMG are not separated from the stream in the ROI.
Expectations of the waste management schemes developed in NI are exceeded, rising from an
expected 60,000 tonnes of dry recyclables in 5 years to 90,000 tonnes.
Overall growth is 5%
Lower case
All ONP/OMG are separated from mixed streams in the ROI and this tonnage is not replaced by
additional material.
The infrastructure developed in NI does not live up to expectations and only half of the expected
material is collected in the five period i.e. 30,000 tonnes of dry recyclables.
Overall growth is 1%
Applying these assumptions, results in the following scenarios, Table 32 and Figure 6.
Mixed unsorted
500,000
Base case
450,000
Higher case
400,000
350,000 Low er case
300,000
Tonnes
250,000
200,000
150,000
100,000
50,000
0
2005 2007 2010 2015
The overall implications for the chosen recovered paper grades are shown in Table 33.
Table 33: Potential availability of the selected recovered paper grades (in tonnes) for the
island of Ireland through to 2015
• Achievement of the OCC higher case is achievable but would require infrastructural
investment in collection and separation
• Significant increases in news and mags availability will result if the increased paper arising
from household collection is separated
• If the higher case scenario for the mixed paper is realised then there would be an impact on
the availability of news and mags
• Similarly, realisation of the higher case news and mags scenario will impact the quantity of
mixed grade as reflected in the lower case scenario for this grade.
The option process commenced with a total list of recovered paper based products. This included:
• Packaging containers (for cardboard boxes) – testliner (unbleached and white surfaced)
• Packaging cartons – white lined chipboard (WLC)
• Tissue
• Printing and Writing (for communication and printing) – uncoated
• Newsprint
• Magazines – supercalendered (SC)
After the initial screening process both newsprint and magazines were rejected largely because scale
requirements did not match with RCP availability. The remainder were then taken forward into a
more in depth analysis which included a feasibility test, comparing total cost (including a profit
margin) with market prices. The cost models were based largely on supplying a London market, to
test for export robustness.
The result of this is that tissue appears to offer some opportunity. The best of the rest is Packaging
Cartons, because it offers good connection to IOI converters and linkage to local established market
positions. However, it like the remainder, requires a supportive business platform in terms of
incentives and RCP infrastructure. The assessment points to options that can be profitable, but at
levels below the 10 percent return on capital employed target (ROCE), set in this analysis. This does
not preclude the option per se, but sends it back for review in a strategic context for IOI.
Tissue and Packaging Cartons are preferred products because they go some way to resolving a major
question, which is why should such a plant be situated in IOI when in many cases if would better to
build this in GB, or even on the Continent, closer to larger volumes for recovered paper raw materials
and also markets. Both these products have a local IOI market, and good connection to local value
added (converting), and/or do not travel well (e.g. low weight to volume such as tissue). This offers a
strategic justification for locating plant(s) in IOI.
Interest in IOI investment could well come from tissue producers with strategies that tie into close
relationship with buyers e.g. supermarkets, including ties through ‘own label’ production. Although a
tissue plant would use the least amount of recovered paper out of all the options, it is not an
insignificant amount. A tissue mill would benefit from market proximity (i.e. the tissue market would
be the IOI) and transport costs would be less than if relying on an export market as well. Any mill
would also bring high value jobs to the area, stimulate converting and encourage supply chain
efficiencies. A Packaging Carton mill would make a more significant contribution to the establishment
of scale in recovered paper streams, which would support building infrastructure. However returns on
investment of the modelled configuration are still challenged when using the full capital charge.
There could also well be an interest from current paper and packaging purchasers (e.g. converters) in
IOI based production, to secure and even participate in domestic production given that the capital
burden is addressed. The government agencies should also be interested in the potential
consequences, which include long term utilisation of recovered paper in the IOI, and therefore
development of collection, sorting and logistics streams, plus retaining value in IOI through local
Experience elsewhere indicates that agglomeration (multiple site occupation) is also important in
creating competitiveness. The various RCP grade streams will mean that a system, not single facility,
could well result. The paper mill site, should there be one, would be the focal point of recovered
paper streams in IOI, with appropriate streams feeding the mill, and the remainder being prepared
for export. Economies of scale for the export business could also be achieved in this way. Multiple site
occupation could reduce total cost by around 5-10%, which would bring the individual product lines
into contention again using the ROCE targets.
The use of bio-energy has also been considered, using wood fuel from the IOI forests and sludge
from the de-inking process. This would add additional capital cost, but through market based
incentives such as Renewable Obligation Certificates (ROCs - which are available in the UK including
NI), the net operating cost gain would be positive (depending on the ROC value assumption). ROI
does not have a comparable current renewable energy initiative, but is most likely to have some sort
of scheme in the future to replace the AER (alternative energy requirement), but there are no
timescales to achieving this. There has been an indication that a feed-in tariff arrangement would be
considered to replace the contract arrangement under AER.
4.2 The opportunities for existing paper production facilities in IOI to increase their
usage of recovered paper
This project represents the opportunity to renew the primary paper making base in IOI. In the
context of this study, the Smurfit site would not have offered an expansion possibility, even if it had
remained operational. The remaining two primary paper producers, Huhtamaki and Erin Moulded
Fibre, are recovered paper based businesses. Their scale is such that potential recovered paper
consumption increases through their market growth are marginal in the context of the new mill
facilities being considered.
The secondary paper producers (e.g. converters) indicated through the interviews, a positive growth
aspiration, and in some cases, an interest in a new paper production facility. This represents the good
platform for new mill options, as a supply source for secondary paper producers e.g. tissue
converting and cartons.
As a comparison of impact that a new facility can have on RCP based paper production in IOI, the
demand by grade and the mill scale are shown below. This highlights key issues and opportunities;
that local demand is small relative to outputs from world class facilities, but that such facilities can
provide a significant local supply of paper for current and future local converting.
2005
Mill Scale*
Island of Ireland Consumption
No specific mill site(s) were identified in this work. Should the feasibility analysis continue, this work
would fall to Enterprise agencies and planning authorities. Existing paper manufacturing and
converting sites should be given priority to explore on-site linkages and integration. General site
specification and environmental considerations are dealt with in Appendix 8.
Screening.
The RCP based paper mill options were screened to identify a candidate list. The screening
characteristics were:
• RCP Resources – are there sufficient resources to feed a world class facility
• Competitiveness – can an IOI facility compete in the UK and European market
• Market & Growth – is there space in the market (IOI, GB, Continent), through growth or
import replacement
• Strategic Fit – does an IOI facility fit with current paper making activities, in particular as a
supply source for converting and value added activities. Can the facility enjoy a local market.
• Summary – Blue-print feasibility. Is the option worth pursuing through more detailed analysis.
For example, the RCP supply projections from section 4 are shown in Table 35.
The paper mill options examined have the following RCP requirement (Table 36). The fibre mix is
representative of mills elsewhere, producing to specification. There is some room for variation (e.g.
within RCP grades and also introduction of virgin fibre – although more costly), but these fibre mixes
should be used as indicators in order to make a competitive product. Except for the last two cases,
the potential RCP supply (see above) can meet the mill furnish requirements, although the first case
(packaging containers) requires full potential supply. The cases where white and high quality RCP is
required create a collection and sorting challenge, as these levels are at maximum or all that might
be available in IOI.
There is a need for imported virgin fibre pulp in some of these furnishes to meet product
specification, which brings an additional cost per tonne (softwood kraft pulp is currently in the order
of €480-500 per tonne delivered), compared to recycled fibre prices around €80-100 per tonne
(Figure 3). Depending on the grade of recycled fibre a further €50-100 per tonne can be added for
processing at the mill. The potential advantage for an IOI facility comes from gaining access to local
recovered paper. Use of imported virgin pulp as RCP substitute sends competitiveness in the opposite
direction.
Table 36. Mill fibre requirements – average fibre mix by paper product (tonnes)
Product Mill Scale Total Fibre OCC ONP/OMG Mixed Other RCP – Virgin Pulp
white
printer,
office
Packaging -
400,000 433,000 237,000 0 196,000 0 0
Containers
Packaging -
250,000 270,000 59,000 70,000 98,000 18,000 25,000
Cartons
Tissue 50,000 75,000 0 56,000 0 19,000 0
P&W Uncoated 160,000 160,000 0 86,000 0 15,000 58,000
Newsprint 400,000 >400,000 0 >400,000 0 0 0
Magazine SC 400,000 >400,000 0 >400,000 0 0 20-50,000
Overall, the supply potential on current expectation grows to meet the fibre needs of the mill options
around 2007 and beyond (comparing Tables 35 and 36). However, aspiring to world scale facilities,
means that much of the fibre supply would need directing to the new mill. The options, packaging
containers and P&W uncoated would seem to struggle in this regard. The tissue and packaging
cartons options appear the most compatible with fibre supply. Some paper grades were eliminated on
this basis – for example, newsprint and magazine grades, largely because of the scale these facilities
now require, compared to the RCP raw material potentially available in IOI.
The screening process is described in Table 37 below, and summarised as ‘green’, ‘yellow’ and ‘red’
condition in terms of strength, weakness and whether in summary the option is worth further
No candidate option achieved a straight forward approval (‘green light’) through this screening, but a
number achieved enough support to warrant further investigation. These included; packaging
containers, packaging cartons, tissue and printing and writing - office, communication, printed
materials (uncoated paper).
Resources Competitiveness Market & Growth Strategic Fit with IOI Blue-print feasibility
Packaging - Requirement: 430,000 t/a of RCP Typical scale 400,000 t/a, European market is Fits well with local A testliner machine in IOI
Containers (cardboard packaging grades. could be competitive growing slightly. A new IOI converting and would easily or GB is possible, but a
boxes) against smaller machines in facility would represent a take care of IOI majority of market and RCP
the home market (since large increase in European consumption. Would supply is in GB, and
Raw material supply in IOI would be
closed), in GB and Central capacity, where excess consume virtually all the therefore better served by
challenged. Potentially possible for a
Europe as well. already exists. Exports from packaging waste in IOI a GB facility – some of
world scale mill of testliner and
IOI necessary which could be exported to
fluting.
IOI
Packaging - Requirement: 215,000 t/a total RCP. The competitor base has Small market growing at a Fits well with local Too much unused existing
Containers – as above Size restricted by low availability of smaller scale than in higher pace than converting and would easily capacity in the European
but white surfaced high quality white recovered paper. unbleached grades (High- unbleached grades, but take care of IOI market. Unlikely in IOI
end is 200,000 t/a). Even a volumes small and served consumption. Would
Recovered paper resources in IOI
smaller modern machine by mills in close market consume virtually all white
could feed a smaller scale machine
could be competitive in the proximity. Significant high quality waste paper in
local and European market. amount of excess capacity IOI. Would rely almost
exists. A new IOI facility exclusively on exports.
would take approx 15% of
the market
Tissue Requirement: 75,000 t/a white A 30-50,000 ton facility Consumption of tissue is Fits well with local Opportunity is for local
recovered grades and ONP/OMG. could be competitive in growing steadily in IOI and converting and could take producer, connected to
home market, replacing GB, but there is care of the whole IOI local supermarkets,
Recovered paper resources in IOI
imports, which are costly to overcapacity in the UK after consumption. Depending converters and distributors,
would be easily sufficitent to supply
transport. Quality several investments. GB on the grade, could to replace more costly
a tissue line.
dependent on high quality producers use IOI as consume all white high imports.
recovered paper availability export market. IOI market quality waste paper in IOI.
or use of chemical market is big enough to support Exports not necessary.
pulp new facility.
Packaging – Cartons Requirement: 245,000 t/a total. A competitive concept in Market is growing slightly Fits very well with local IOI could be potentially
Flexible in terms of grade mix. Europe. Can be integrated but significant differences converting and would easily attractive location for a
with a diversity of between niches. WLC take care of IOI producer of recovered
Recovered paper resources in IOI
converting operations. substituting more consumption. Good option paper based cartonboard.
would be sufficient to supply a WLC
Premium prices available in expensive grades. Would in terms of raw materials Market is IOI and GB
line
several niches. Very large be a huge increase in as flexible in regard to
capital investment and capacity. UK is importing grade mix.
hence low return in the over 0.5 Mnt. Would take
beginning care of IOI consumption.
Magazine, Inserts, Requirement: Up to 400,000 t/a A new state-of-the-art Market growing at ca 2% Not a good fit with the Not feasible due to lack of
Flyers ONP/OMG/ other white grades. facility (400,000 t/a) could per year, price level stable. local economy as most of raw material. Opportunity
be competitive. Start-up of a Few players dominate, no the production should be more likely addressed by
Raw material supply in IOI would be
new PM in Sweden by end of production in GB or IOI, exported and converted new machine in GB.
very tight for a competitive SC
year (400,000 t/a), lowering but new machine in abroad.
machine.
the competitive cost targets. Sweden will create
overcapacity for a while.
Newsprint Requirement: Up to 400,000 t/a A new state-of-the-art Market growing very Not a very good fit with Lack of sufficient amounts
ONP/OMG/ other white grades. facility (300,000 t/a) could slowly, a new line is being the local economy as most of raw material and weak
be competitive built in Spain by Holmen of the production would be newsprint markets main
Raw material supply in IOI would be
exported and printed obstacles. Opportunity
very tight for a competitive
Newsprint machine. abroad. more likely addressed by
new machine in GB.
Printing and Writing Requirement: 100,000 t/a white Competitive position of a Consumption of recycled Not a good fit with the Challenges are; creating
Papers (e.g. Office, recovered grades on ONP/OMG. smallish machine would be fibre based fine papers is local economy as most of sufficient amounts of raw
Communication, at average level. Quality very growing based on the production should be material, weak fine paper
Recovered paper resources in IOI
Printers) much dependent on the environmental mandate. exported and converted markets, and better served
could feed a small machine. Virgin
available high quality Fine paper markets are still abroad. Also too limited in by European and GB
pulp would also have to be used.
recovered paper (bottleneck very weak. RCP fine paper terms of high quality producers in close
in IOI) or use of chemical markets served by local recovered office paper proximity to market.
market pulp. producers. Market limited availability.
in IOI
The assessment process then moved to mill modelling of these remaining candidates. The criteria
applied in mill design were:
• World scale. The facility should be recognised as world class in scale, process, configuration,
inputs and outputs.
• Product and market leadership – the option should focus on growth areas, import
replacement (IOI and GB) or value niches for IOI and where local market leadership can be
achieved. The technology should be such that the product specification can compete in
export markets.
• Cost competitiveness. The facility should be able to achieve 1st or 2nd quartile cost
performance and allow competitive exports to main markets in particular to GB.
• Environmental fit – the facility meets regulations and desirability
Mill models (Figure 7) were constructed for the candidate options and analysed through the above
criteria. An example mill model for Packaging – Cartons is described below, while the remainder of
the mill models can be found in Appendix 7. The mill model shows major flows and configuration,
plus key inputs in terms of energy, raw materials, people and capital. Various cases by mill scale are
also described. The inputs and flows are modelled through JPC algorithms which provide
manufacturing, delivered and total cost (delivered cost to market plus capital charge).
The modelling illustrates which mill types are more likely to be profitable in the IOI and factors in:
Fresh water
water, emissions,
solid waste
Cartonboard
converters
National Grid
Packaging/Post consumer
waste recovery District heating
Consumptions - WLC
Capacity t/a 120,000 180,000 220,000 250,000
Market BHKP t/a 10,000 15,000 20,000 25,000
White office waste t/a 11,000 16,000 18,000 18,000
ONP/OMG for DIP t/a 33,000 50,000 62,000 70,000
OCC t/a 29,000 43,000 52,000 59,000
Mixed waste t/a 47,000 71,000 86,000 98,000
Kaolin/CaCO3 t/a 14,000 20,000 25,000 28,000
Power MWh/a 95,000 143,000 174,000 199,000
Power, nominal MW 12 18 22 25
Personnel person 260 310 350 370
Investment MEUR 360 390 430 450
JPC has mill models for most of the papermaking facilities in the world. This allows potential IOI
facilities to be compared with a peer group who would be competing in a chosen market. The process
described in Figure 8 is that used to generate competitiveness assessment
TECHNICAL
ANALYSIS
capacity CAPITAL
WEAK
min CHARGES
technical age max
- Technical age, years - min
furnish
DELIVERY
COSTS
FIXED
COSTS
FIM, SEK, DEM, CAD to USD
REGIONAL ANALYSIS:
8
EXCHANGE RATES
SEK
8
Competitors
unit prices 6 6
VARIABLE
FIM COSTS Delivery
Other manuf. costs
exchange rates 4 4 Personnel
location and delivery Energy
DEM
Chemicals
productivity 2
CAD
2
Wood
investment level 0
1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997
0
Dec.
ECONOMIC
ANALYSIS
In the example below, the new facilities have been competitively ranked using a cost curve comprised
of this peer group. Steps in the cost curve represent each machine in this peer group, the
accumulated total of which is the potential capacity that could target the chosen market. There are
two cost curves (Figure 9); manufacturing which is the mill gate cash cost (excludes delivery and
capital charges) and delivered, which includes delivery and handling cost to the target market, in this
case London.
400 4%
350
1) 250 000 t/a 2%
300 2) 180 000 t/a
Cost level 2004/III, Exchange rates September 2004 averages 3) 120 000 t/a
250
Delivered to London
0%
200 250 000 180 000 120 000
0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 t/a t/a t/s
- Allocated capacity to the market, 1000 t/a - - PM Scale -
The market opportunity was then analysed using local and UK markets as a lead indicator for scale,
competing capacity and import replacement. The European market opportunity was also assessed
(see Appendix 8). In this case, a Packaging Carton facility would target local and UK markets but
require capability to compete with and replace current imports (Figure 10). A world scale facility
would produce over 200,000 tonnes.
1200
1000
net imports
800
600
400
200
0
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
The final step in the analysis uses a combination of mill modelling and market prices to judge the
potential feasibility (Figure 11). In this case the total cost of the facility is used (delivered cost to
market, plus depreciation and a capital charge equal to 10% return on the investment). The total of
this (the height of the bar) should fall at or below the price (average over a cycle) to achieve this
profit target. Industry will often use a notional 15% return, but actual performance over the cycle can
be less. The four cases are shown in this format below (not related to the time-frame on the x-axis),
and indicate that new facilities are profitable, but not at levels of average10% return. On-going
depreciation will of course decrease the capital charge component, while support measures can often
target capital incentives.
900
250 220 180 120
kt/a kt/a kt/a kt/a
800
700
Fibre
600 Chemicals
Energy
500
Personnel
400 Other manuf. costs
Transport
300 Capital charges
200
100
Delivered costs to the UK Market (London), Cost level 2004/III
Capital charges contain of depreciation and 10% ROCE
0
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
While in this case, Packaging Cartons is of potential interest for IOI considering its link to existing
converting businesses and the supply of cartons to IOI industries, the financial case is not without
challenge. The role of government and development authorities in building the business environment
for the local use of RCP is compelling.
The results from the analysis of the shortlisted candidates are summarised below. (Table 38)
Packaging - Output: 200-400,000 t/a IOI market for kraftliner and New IOI facility can be in Fits well with local A new machine in IOI is marginal.
Containers (cardboard was examined. Full scale testliner is 270,000t. 1st-2nd cost quartile, but converting but profitability A supportive business climate
boxes) would require ‘all’ potential An IOI new facility would go would have a large impact requirement challenged. would be required. Not a preferred
OCC collected straight to top 10 European on current installed capacity Potential returns <5% option.
(already in excess), leading
producers – big impact on
to capacity under-utilisation
existing capacity
and price erosion
Packaging - Output: 120-200,000 t was Total market in Europe around 1 New IOI facility can be in Specific but small volume fit As above.
Containers – as above examined. Full scale would mn tonnes, so a new IOI 1st-2nd cost quartile. Small with local converting. The
but white surfaced consume virtually all white machine would have high impact but growing market – an IOI new mill would easily take
high quality waste paper in – almost all sales would be facility would have a large care of IOI consumption.
IOI outside IOI impact on current installed Potential returns <5%
capacity
Tissue Output: 15-50,000 t was IOI market is over 80,000 t Competitive in the IOI Fits well with local Opportunity is for local producer,
examined. RCP supply is (tissue and converted product). market as transport cost converting and could serve connected to local supermarkets,
sufficient – but would still Mill output could have high IOI (imports) for these low the IOI market. Can converters and distributors, to
need all white high quality market share – would need to weight, high volume potentially achieve replace more costly imports.
waste paper in IOI displace imported tissue products can be prohibitive. profitability targets.
Packaging – Cartons Output: 120-250,000 t was An IOI facility would go into top New IOI facility can be in Fits very well with local IOI could be potentially attractive
examined. 10 producers in Europe. Imports 1st-2nd cost quartile, but converting and would easily location. Market is IOI and GB.
into UK are around 700,000 t. would have a large impact take care of IOI Would also need a positive
Flexible in terms of furnish
IOI market is over 300,000 t on current installed capacity. consumption. Could achieve business development climate to
grade mix – fibre supply
(total all converted packaging) around 5-10% return. support investment.
sufficient
Printing and Writing Output: 100-160,000 t was A new state-of-the-art facility New IOI facility can be in Can achieve profitability Potential, but less attractive due to
Papers (e.g. Office, examined. Requirement: Up would be amongst the largest in 1st-2nd cost quartile. Better targets, but highly exposed RCP resource and exposure of
Communication, to 100,000 t/a ONP/OMG/ Europe. IOI market is around performers would be found to competitors in export such a mill scale in European
Printers) other white grades 90,000 . in closer proximity to RCP markets who base their market context.
supplies and markets business on local market
Limited in terms of high
advantages. RCP availability
quality recovered office
in white and high quality
paper availability. Difficult
grades problematic.
option to realise
• Tissue – only the tissue mill option is well matched with local consumption. Exports are
potentially minimal. The other options are required to be export competitive with much
of the product sold outside IOI.
• Packaging Cartons. A potential good link to local converters and IOI packaging needs.
• Printing and Writing papers. Requires high grade RCP collection. Exposed to existing
and potential mills in GB and the Continent
• Packaging Containers. Already large capacity in Europe.
• Newsprint. Excluded as insufficient fibre
• Magazines. Excluded as insufficient fibre
While the tissue option can stand on its own, the rest would likely require a supportive
business climate through which investment and operating challenges can be
addressed.
The 2010 RCP supply scenarios (low, base and high) developed in Section 4.4 have been
compared with the mill furnish requirement, in Table 39 below. This indicates for the various
options whether the conditions applied to create the scenario are sufficient to impact the viability
of the mill option.
Table 39. Mill fibre requirement compared to scenarios (low, base, high) of RCP
availability, Tonnes.
The Packaging Cartons option shows that OCC supply is not limiting. The largest impact on the
option comes through ONP/OMG availability. Failure to achieve government targets and
investment in infrastructure put this option at risk, and increase the exposure to ONP/OMG export
demand. Increasing the ONP/OMG available (high scenario) is still not enough to consider a
second line in the future, although exposure to exports are greatly reduced.
The Tissue option is a low volume user of RCP. The ONP/OMG furnish requirement is met under all
scenarios. The challenge will be that part of the furnish required from white printer and office RCP,
as this collection and sorting needs development in IOI. Other pulp grades could fill a role here.
There may be opportunities to combine the tissue option with another, for example Packaging
Cartons.
Printing and Writing option is similar to Tissue in its scenario interpretation. There is a sense that
the supply scenarios indicate potential for combining two options, chosen from 3 alternatives –
Packaging Carton, Tissue and Printing & Writing.
Overall, it is important to note that achievement of RCP targets, support for infrastructure, sorting
capability and real results from Government initiatives, do have an impact on the viability of mill
options. A general underperformance of targets will eliminate some options, while high
performance opens the way for multiple options (for example through site sharing) and reduced
exposure to the RCP export market.
Mill models have also been subjected to sensitivity analysis, particularly for RCP prices, to address
the impact of increasing prices driven by demand in places such as China. First, if RCP prices
increase, then all producers including those in China face increasing production costs and need to
decide if production curtailment or delayed investment is necessary. Behaviour so far indicates that
the Chinese withdraw from the RCP market at prices around Euro 130/tonne for mixed grades. In
addition the Chinese face a transport differential of around USD100/ton. Purely increasing the cost
of RCP in the IOI mill model is pointless unless done in the context of other producers and their
relative ability to pay increased RCP prices.
The mill models have been used to measure exposure to this issue. The case below shows how
ROCE is impacted with rising RCP prices. The ‘breakeven’ shown is when these prices reach Euro
130/tonne. At this point, the mill option, while less profitable is still positive, whether delivering to
IOI markets or London.
- ROCE -% -
12.0%
Initial delivered prices, EUR/t:
OCC 56
10.0%
Maximum price for Mixed Waste 53
mixed waste in China Office waste, ave.104
8.0% ONP/OMG 59
6.0%
4.0%
2.0%
0.0%
0% 50% 100% 150% 200% 250% 300% 350%
-2.0%
Transport to Dublin
Transport to London
-4.0%
Optimisation. A case for multiple site occupation was examined assuming a Packaging
Containers mill was combined with a tissue plant. Savings potential was assessed across all the
major manufacturing inputs (RCP, energy, chemicals, personnel, maintenance, handling and other
costs), and capital. The major items where cost savings are achieved include capital, through
sharing of utilities and site infrastructure, maintenance, scale impacts in purchasing and logistics
and central personnel. The total gains through such multiple site occupation are in the order of
Euro 15-20/t, or between 5-10% of total cost. This takes a good step towards recovering the profit
target position. A further optimisation available is the final market mix. The mill models assume
delivery to London, except for tissue. Robustness is the key criteria in this case. However, it is
clear that some of the production will be sold in IOI, and therefore reduce transport cost on some
part (minority) of the output.
Bio-energy. The mill models applied in this work are based on natural gas. However recent
support for renewable energy and growing concerns about global climate change, have led to the
emergence of bio-energy as a potential alternative. Two cases were addressed, one drawing on
100,000t of biomass material (produces about 24% of the mill needs) , and the other using 100%
bio-energy at the plant, but drawing on 0.5 Mn tonnes of biomass. The bio-energy requires
additional capital, but also attracts (in GB and NI) a renewable obligation certificate (ROC). In this,
its value is assumed as £40 per MWh or Euro 59. The bio-energy plant produces both heat and
power, but only the latter attracts the ROC. In the two cases, it is feasible to consider bio-energy,
as the benefits in reduced energy cost outweigh the increased capital charge. Without the ROC,
the natural gas option is economically better. The first case, requiring 100,000t should be
achievable from NI and ROI forest resources (NI Forest Service, Coillte). The case requiring
500,000 tonnes would require wood to be redirected from other uses. However, the wood paying
capability of bio-energy plants is usually quite high because of the ROC.
The relevant Directives and environmental objectives include the EIA Directive (Environmental
Impact Assessment) , the IPPC Directive (Integrated Pollution Control) and the BREF Documents
(Best Available Techniques Reference) for this industry sector. These and other environmental
aspects are elaborated in Appendix 8. The mill options have assumed that these environmental
guidelines are the basis for design and implementation.
It is concluded that any proposed mill, irrespective of location within the IOI, will firstly require
development consent in accordance with established EIA procedures. Secondly the emissions from
that facility will require comprehensive emission controls and limits as represented by BAT and are
to be regulated in accordance with IPPC licence procedures.
Local authorities both north and south apply charges on industry for water supply and wastewater
treatment. Currently however there is no uniform basis for these charges and consequently these
vary widely throughout the IOI. It is concluded that irrespective of location it is to be expected
that a paper mill, as a major water user and wastewater generator, would have to engage in such
cost negotiations. The alternative to these charges is for the enterprise to provide its own water
from groundwater sources and to provide full wastewater treatment on site
It is also common practice for local authorities to apply development levies. As with environmental
charges there appears to be no uniform approach in deriving the values. It is concluded therefore
that development levies are only likely to be determined by direct consultation with the local
authority in whose jurisdiction it is proposed to locate.
One of the key findings is that almost all of the mill options require a positive business platform
through support and encouragement. The following are brief descriptions of such platforms in NI
and ROI. Further details are provided in Appendix 9. Each investment project is assessed on its
own merits, and this support assessment should not be interpreted that funding would be
automatically forthcoming or the amounts involved.
Experience elsewhere in Europe shows that such initiatives can qualify for investment support. Like
projects in UK can attract 20-30% of the capital investment in high priority areas. Recent industry
investments on the Continent have attracted investment support from EU and national
programmes.
• investment in a priority development area of the EU (the project has an investment capital
of €150-380 Mn – more if multiple site occupation) – through the structural and
European Funding. For the current round of funding (2000-2006) Northern Ireland exceeded the
qualifying criterion having a per capita GDP greater than 75% of the community average. However
Northern Ireland was able to avail of newly introduced transitional arrangements that provided
former Objective 1 regions access to the 4 Structural Funds but on a declining basis so that by the
end of the funding period, the Region would have adjusted to the lower and more limited financial
support likely to be made available to an Objective 2 Region. Northern Ireland therefore secured
funding for a Transitional Objective 1 programme “Building Sustainable Prosperity”
Invest NI. The primary agency of interest for this project falls under the remit of the Dept for
Enterprise Trade and Industry, that being, Invest Northern Ireland (Invest NI). In addition to grant
funding, Invest NI can offer debt facilities and equity (ordinary shares) capital to assist business
towards faster growth.
Corporate Funding. The amount of Invest NI funding available is to a large degree dependent
upon the financial requirement of the company, anticipated employment creation, export potential
and location. The funding is accessible via a client executive supported by specialist advisers.
Corporate funding is available to those enterprises that satisfy the eligibility criteria and are
considered viable.
The roles and support available through the International Fund for Ireland and InterTradeIreland
are covered in the Republic of Ireland section.
4.8.2 ROI
For the purpose of deciding maximum funding rates (in compliance with EU rules) for industrial
development, the ROI is divided into three regions:
Agencies
The Department of Enterprise, Trade and Employment (DETE) works through two principal
agencies responsible for implementing policy with regard to industrial development:
• Enterprise Ireland (EI), which is responsible for the development of indigenous industry
• Industrial Development Agency Ireland (IDA Ireland), which is responsible for foreign
direct investment (FDI) i.e. foreign-owned companies in Ireland.
In the case of a major investment, such as is contemplated in this feasibility study, requests for
assistance would be considered by the Boards of EI and IDA Ireland and, given the size and
political thrust of the project, almost certainly at Cabinet as well. Funding is usually in the form of
redeemable preference shares rather than a grant. Redemption of the preference shares is
generally on the fifth anniversary of the investment.
This is an organisation established by the British and Irish governments in 1986 to promote
economic and social advance and to encourage contact, dialogue and reconciliation between
nationalists and unionists throughout Ireland. The fund gives priority to projects located in the
most disadvantaged areas in Northern Ireland and the six Southern border counties
InterTradeIreland:
This is the cross-border trade and business development body, established under the international
agreement between the governments of Ireland and the United Kingdom signed on Good Friday
1998 and commonly known as “The Belfast Agreement”. InterTradeIreland has a strategic vision
“To lead the development of the island economy through distinctive knowledge-based
interventions which will produce significant returns in the areas of cross-order trade and business
development.”
Appendix 1. Questionnaire
Appendix 9. Support
INTRODUCTION:
The management of municipal, commercial and industrial waste on the island of Ireland is a critical
environmental issue. Government policy on both parts of the island seeks to reduce the amount of
waste being generated and to endeavour that waste that is being produced should be reused and
recovered. Paper is a major component of domestic and commercial waste sector, however to
increase levels of recycling within the island of Ireland a sufficient number of stable markets are
required to manage the materials removed from the waste stream. As an internationally traded
commodity, the majority of paper recovered from the waste streams is predominantly exported for
recycling overseas. At present, paper reprocessing is carried out at Smurfit in Dublin and
Huhtamaki in Lurgan.
The North South Market Development Group formed by the Department of the Environment in
Northern Ireland and the Department of Environment, Heritage and Local Government in Ireland,
in conjunction with the Waste and Resources Action Programme (WRAP), has developed a project
with the overall objective of determining the feasibility of situating a papermill or mills on the
island of Ireland.
The study is being carried out by Jaakko Pöyry Consulting, UK; Pira International, UK; Circa Group;
Dublin and Initiative Economic Development, County Armagh. We would therefore be grateful if
you could answer relevant parts in the questionnaire below and return by fax to Pira International
on +44 (0) 1372 802249. All answers will be treated as confidential.
As part of this study we are seeking to assess the demand and consumption of paper products on
the island of Ireland through contact with paper related companies in the island of Ireland.
For further information, please contact Martin Kay, Pira International tel +44 (0) 1372
802000.
Company Information:
Date established:
Estimated turnover 1999 – 2005:
Total no of employees:
No of sites and location of sites:
Production and capacity per site:
Market share island of Ireland:
Recent changes:
Future changes:
About manufacture
Paper products/types
1 2 3 4
About your paper/paper
products
made/converted/sold
Types of paper
Tonnage of paper
Types of paper product
Tonnage of paper product
Raw material used in paper
or products (virgin or
recycled)
Tonnage of raw material
used (virgin or recycled)
Demand changes – last
five years
Predicted demand changes
forecast in next 2, 5 and
10 years
For each of the paper products/types above, please rank between 1 and 5, where 1 is a
strong influence and 5 has no influence, the key influences on predicted demand for
each product
Paper products/types
1 2 3 4
About paper/paper
products consumption
What are the main end use
sectors for paper/paper
products you
make/convert/sell
i) Manufacturing
ii) Retail
iii) Commerce
iv) Food and agriculture
What percentage is
exported
What percentage is
exported with goods eg
packaging
Demand changes – previous
five years
Predicted demand changes
– forecast in next 2, 5 & 10
years
For each of the paper products/types above, please rank between 1 and 5, where 1 is a
strong influence and 5 has no influence, the key influences on predicted patterns of
consumption for each product
Paper products/types
1 2 3 4
About your paper/paper
products imported
Types of paper
Tonnage of paper
Types of paper product
Tonnage of paper product
Raw material used in paper
or products imported (virgin
or recycled)
Tonnage of raw material
used in imports (virgin or
recycled)
Changes in imports over last
five years
Predicted changes in imports
forecast for next 2. 5 & 10
years
For each of the paper products/types above, please rank between 1 and 5, where 1 is a
strong influence and 5 has no influence, the key influences on predicted demands for
imports of each paper type
Paper products/types
1 2 3 4
Manufacturer
Country of origin
Sole supplier or several
sources used
Influences on choice of supply of imports. Please rank between 1 and 5 where 1 is
strong influence and 5 no influence for each paper product
i) meeting
specification/quality
ii) company reputation
iii) recycled fibre content
iv) country of origin
v) cost
vi) historical links
vii) other
END OF Questionnaire
NB: Please PRINT the information below CLEARLY (one character per box).
Job Title:
Company
Address:
Country
www.
Company
E-mail:
Tel. No:
Fax No:
Direct
E-mail:
Tel. No:
Fax No:
40000
1999
2000
30000
2001
tonnes
20000 2002
2003
10000
0
Canada
Sw eden
UK
Spain
Finland
France
USA
Germany
Italy
Netherlands
Norw ay
2002
20 2003
10
Germany
Italy
Finland
France
USA
Graphic: coated woodfree Ireland imports 1999-2003
1999
2000
2000
1500 2001
tonne s
2002
1000 2003
500
UK
Finland
Franc e
Canada
Spain
Sw eden
Germany
Italy
Netherlands
Norw ay
USA
Graphic: uncoated woodfree imports – Ireland (tonnes)
19 9 9
3 0 00 0 20 0 0
20 0 1
tonn e s
2 0 00 0 20 0 2
20 0 3
1 0 00 0
UK
Canada
Finland
Franc e
Spain
Sw eden
Germany
Italy
Netherlands
Norw ay
USA
G ra p h ic u n c o a te d w o o d fre e im p o rts - Ire la n d
1 999 -2 003
12000
1999
10000
2000 Imp o r ts < 1 2 0 0 0 to n n e s
8000 2001
tonne s
2002
6000
2003
4000
2000
0
Spain
Canada
Franc e
Sw eden
Finland
Germany
Italy
Norw ay
Netherlands
USA
2002
10000 2003
5000
0
UK
Canada
Finland
Franc e
Spain
Sw eden
Germany
Italy
Netherlands
Norw ay
USA
6000 1999
5000 2000
2001
ton n e s
4000
2002
3000
2003
2000
1000
0
UK
Spain
Canada
Finland
Franc e
Sw eden
Germany
Italy
Netherlands
Norw ay
USA
2002
800 2003
400
0
Canada
Finland
Franc e
Spain
Sw eden
Germany
Italy
Netherlands
Norw ay
USA
Tissue and tissue product imports to Ireland (tonnes)
50000 1999
2000
40000
2001
to n n e s
30000 2002
20000 2003
10000
UK
Canada
Finland
Franc e
Spain
Sw eden
Italy
Netherlands
Norw ay
Germany
USA
T issu e a n d T issu e p ro d u ct im p o rts - Ire la n d
1999-2003
3500
1999 Imp or ts < 3 0 0 0 to n n e s
3000
2000
2500
2001
ton ne s
2000 2002
1500 2003
1000
500
0
Finland
Canada
Franc e
Spain
Sw eden
Italy
Germany
Netherlands
Norw ay
USA
100000
80000 1999
2000
60000
tonn e s
2001
2002
40000
2003
20000
0
UK
Franc e
Canada
Finland
Spain
Sw eden
Germany
Italy
Netherlands
Norw ay
USA
14000
12000 1999
Imp o r ts < 1 4 0 0 0 to n n e s
10000 2000
2001
ton n e s
8000
2002
6000
2003
4000
2000
0
Canada
Finland
Franc e
Spain
Germany
Italy
Netherlands
Norw ay
USA
Converted packaging products (corrugated board, sacks and boxes) (tonnes)
60000 2000
2001
tonne s
40000 2002
2003
20000
UK
Canada
Finland
Franc e
Spain
Sw eden
Germany
Italy
Netherlands
Norw ay
2002
4000 2003
2000
0
Spain
Canada
Finland
Franc e
Sw eden
Germany
Italy
Netherlands
Norw ay
USA
25000 1999
2000
20000
2001
tonn e s
15000 2002
10000 2003
5000
0
UK
Franc e
Spain
Sw eden
Canada
Finland
Germany
Netherlands
Norw ay
Italy
USA
2000 2002
2003
1000
Spain
Canada
Finland
Franc e
Sw eden
Germany
Italy
Netherlands
Norw ay
USA
Other paper product imports
30000
1999
25000
2000
20000
to nn e s
2001
15000 2002
10000 2003
5000
UK
Canada
Spain
Sw eden
Finland
Franc e
Germany
Italy
Netherlands
Norw ay
USA
O the r pa pe r product im ports - Ire la nd
1999-2003
6000
Imports < 6000 tonnes
5000 1999
2000
4000
to n n e s
2001
3000
2002
2000 2003
1000
0
Franc e
Canada
Finland
Spain
Sw eden
Italy
Netherlands
Germany
Norw ay
USA
2003
2002
2001
2000
1999
NL GB ES IN CN ID HK TW US JP Rest
2003
2002
2001
2000
1999
NL GB ES IN CN ID HK TW US JP Rest
2003
2002
2001
2000
1999
NL GB ES IN CN ID HK TW US JP Rest
2003
2002
2001
2000
1999
NL GB ES IN CN ID HK TW US JP Rest
2003
2002
2001
2000
1999
NL GB ES IN CN ID HK TW US JP Rest
2003
2002
2001
2000
1999
NL GB ES IN CN ID HK TW US JP Rest
The other grades have not been considered – their volumes are insignificant in terms of the overall
total and there is no real evidence that these other grades are being separated out.
The starting point for these projections is the data supplied by EPA for Ireland and that supplied
by the DoE in Belfast for Northern Ireland. The assumptions used for the projections of each
grade are based on information received through the interviews, Pira’s own research and other
data.
Data supplied from the above sources does not neatly fit the grade definitions we are seeking to
project. The data also relates to 2003. Assumptions have therefore been made for each and then
the data sources combined to give a projected 2005 starting point.
Assumption 2: 39,557 tonnes of this is news and magazines (based on Eurostat export
figures) the rest is mixed.
NI – data 2003/2
Paper and cardboard packaging from C&I sources 38,200 tonnes and card (not mixed)
from municipal waste 3,304 tonnes = 41,504 tonnes
All the rest i.e. the mixed paper and card at 8,731 tonnes from municipal waste and the
separately collected paper and card from C&I sources at 57,200 tonnes = 65,931 tonnes
Assumption 5: this is mixed grade (this is a big assumption but we have no evidence of
how this could breakdown further at this time. However the consequences of this
assumption being wrong will not effect the overall availability of the other grades, in fact it
may enhance their quantity – but would diminish the quantity of mixed grade)
Assumption 7: news and magazines assumes 1% growth on ROI figures and the initial
influence of arc21, SWaMP etc. on NI figures. Thus Ireland part grows from 39,557 to
40,352 tonnes and the NI part from 11,560 to 19,400 tonnes. (based on arc 21
estimations that they are taking in 20,000 tonnes of dry recyclable now, of which 70% is
paper and 75% of this is news and mags i.e. 10,500 tonnes. arc 21 constitutes 54% of the
641,000 NI households – extrapolating to all of NI = 19,400 tonnes)
Assumption 8: mixed grows at 2% plus the influence of arc21 and SWaMP etc. which is
increasing the amount collected – card is constituting 25% of paper collected – using
above extrapolation means 6,466 tonnes extra collected
The appendix includes the analysis of the mill options: Each mill option is reviewed in terms of:
Terminology
The report has applied less technical terms to the mill product options. Different audiences will be
reviewing this report, and the following listing is presented to assist in product interpretation
depending on the reader.
Packaging Containers. Also termed unbleached testliner. Can be white surfaced (termed white top
testliner, WT testliner). Fluting can also be produced at the facility.
Tissue
The following are base data which refer to the mill options – the mill specifications and cost base
applied in the analysis.
MANUFACTURING & FINANCIALS
Paper capacity, t/a Investment, MEUR Power consumption, MWe Sales (trend), MEUR/a
Unbleached Testliner 400,000 340 23 138
WT Testliner 200,000 220 14 99
WLC 250,000 420 21 168
RCF Fine Paper 120,000 230 11 92
Tissue 50,000 140 6 60
POWER PLANT – Describes the bioenergy potential, has not been applied in cost comparison
BP Power plant, MWe Heat, MWth Investment, MEUR % of green energy potential
Unbleached Testliner 17 102 38 24%
WT Testliner 8 50 25 50%
WLC 9 58 27 43%
RCF Fine Paper 5 34 20 74%
Tissue 2.5 17 14 100%
PEOPLE
# of personnel Value of jobs, EUR/a
Unbleached Testliner 190 5,750,000
WT Testliner 165 4,990,000
WLC 370 11,190,000
RCF Fine Paper 285 8,620,000
Tissue 75 2,270,000
3rd quarter 2004 average unit prices for the Republic of Ireland
ENERGY
Power
- Purchased MWh 84
Purchased Fuel
- Natural gas GJ 5.0
- Biomass GJ 2.8
Option Description
Product Specification: Unbleached Testliner, 80-150 g/m2. Various
packaging end-uses including:
Consumer goods
Industrial/heavy-duty packaging
Food packaging
Non-food packaging
Beverages
- EUR/t - Fuel
300 Available Recovered (Bio-, NG...)
Cost level 2004/III, Exchange rates September 2004 averages Chemicals
Delivered to London
Paper
Fresh water
250
100
water, emissions,
solid waste
Corrugated
50
converters
0 National Grid
OCC/Post consumer
t/a
t/a
t/a
0
00
00
0
0
40
30
20
1800
net imports
1600 20000
net exports
1400
1200 15000
1000
800 10000
600
400 5000
200
0 0
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Capacity, fluting Capacity, ubl testliner Capacity, white testliner Capacity, fluting Capacity, ubl testliner Capacity, white testliner
Apparent consumption Production Apparent consumption Production
Jefferson Smurfit
SCA
Kappa Packaging
SAICA
Mondi
Papierfabrik Adolf Jass
Prinzhorn Group
Palm Group
Otor
DS Smith
Varel
Emin Leydier
La Veggia Testliner
VPK Packaging RCF Fluting
Pro-Gest
375 Testliner
Delivered
350
costs Testliner Fluting
325
Manufacturing - ROCE according to the market- - ROCE according to the market-
300 12% 12%
costs
275 Cost level 2004/III Cost level 2004/III
3 Dublin Dublin
2
250 London London
1
225 10% 10%
Frankfurt Frankfurt
200 Average Average
175
1) 400 000 t/a
2) 300 000 t/a 8% 8%
150
Cost level 2004/III, Exchange rates September 2004 averages 3) 200 000 t/a
125
Delivered to London
100 6%
0 1 ,0 0 0 2 ,0 0 0 3 ,0 0 0 4 ,0 0 0 5 ,0 0 0 6 ,0 0 0 7 ,0 0 0 8 ,0 0 0 9 ,0 0 0 1 0 ,0 0 0 6%
- Allocated capacity to the market, 1000 t/a -
- EUR/t - 4%
400
4%
375
Fluting
350
Delivered
costs 2%
325 2%
300 Manufacturing
costs
275 0%
2 3
250 0% 400 000 300 000 200 000
1
225 400 000 300 000 200 000 t/a t/a t/a
200 t/a t/a t/s -2%
175
1) 400 000 t/a - PM Scale - - PM Scale -
2) 300 000 t/a
150
Cost level 2004/III, Exchange rates September 2004 averages 3) 200 000 t/a
125
Delivered to London
100
0 1 ,0 0 0 2 ,0 0 0 3 ,0 0 0 4 ,0 0 0 5 ,0 0 0 6 ,0 0 0 7 ,0 0 0 8 ,0 0 0 9 ,0 0 0 1 0 ,0 0 0
400 Fibre
Trend price 2008 Chemicals
Energy
300
Personnel
Recycled Fluting
Other manuf. costs
200 Transport
Capital charges
100
Option Description
Product Specification: White Top Testliner, 90-170 g/m2. Various packaging end-uses
including:
Consumer Electronics packaging
Food packaging
Non-food packaging
Furnish (example): Top layer DIP + Office/high quality white waste paper (+ BHKP)
Base layer OCC
Total recovered paper consumption ca. 220 000 t/a
World Scale: Capacity 200 000 t/a.
Deinking plant on-site. Ca. 60-100% power generation on-site.
Subsequent value-added steps of corrugating, sheeting and
barrier coating
Investment: ca. EUR 250 million
Potential for a new mill:
+ imports substitution in the IOI market
+ large direct/indirect economical impact
+ existing market and converting in the IOI
+ good relative competitiveness
+ better growth in white surface grades
- availability of high quality white recovered paper
- overcapacity in the European market
- EUR/t - Fuel
400 Available Recovered (Bio-, NG...)
Cost level 2004/III, Exchange rates September 2004 averages
Chemicals
Delivered to London
Paper
350 Fresh water
300
Steam & Electricity
RCP/De-inking Testliner
250 plant machine Power plant/CHP
De-inking sludge
200
150
water, emissions,
100 solid waste
Corrugated
50 converters
0 National Grid
OCC/Post consumer
t/a
t/a
t/a
0
00
00
0
0
20
16
12
1800
net imports
1600 20000
net exports
1400
1200 15000
1000
800 10000
600
400 5000
200
0 0
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Capacity, fluting Capacity, ubl testliner Capacity, white testliner Capacity, fluting Capacity, ubl testliner Capacity, white testliner
Apparent consumption Production Apparent consumption Production
M-real
Kappa Packaging
Jefferson Smurfit
SCA
Billerud
Prinzhorn
SAICA
Korsnäs
Palm
Papierfabrik Niederauer Mühle
Europac
Papeteries de Veuze
LEIPA Kraftliner
Otor Testliner
DS Smith
Manufacturing
400 5%
costs
3 4%
350
1 2
3%
300
2%
1) 200 000 t/a
250
2) 160 000 t/a 1%
3) 120 000 t/a
200 0%
0 200 400 600 800 1,000 1,200 1,400 200 000 t/a 160 000 t/a 120 000 t/s
- Allocated capacity to the market, 1000 t/a - - PM Scale -
100
Delivered costs to the UK Market (London), Cost level 2004/III
Capital charges contain of depreciation and 10% ROCE
0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Option Description
Product Specification: Multilayer Bleached Folding Cartons based on recovered fibre,
150-300 g/m2. Various end-uses including:
Food packaging
Cigarette packaging
Non-food packaging
Barrier/PE –coated boards
Furnish (example): Top layer White high quality recovered paper + BHKP
2nd layer 100% DIP
Base layer 50% OCC + 50% Mixed waste
Back layer 25% DIP + 75% Mixed waste
Coating 5-20 g/m2/side
World Scale: Capacity 250 000 t/a. Among the largest WLC PMs in Europe
Deinking plant on-site. 40+% power co-generation on-site.
Subsequent value-added steps of corrugating, sheeting and
barrier coating
Investment: ca. EUR 450 million
Potential for a new mill:
+ imports substitution in the IOI market
+ large direct/indirect economical impact
+ existing market and converting in the IOI
+ good relative competitiveness
+ flexible in terms of raw material mix
- availability of white high quality recovered paper
- would be a huge capacity increase in the market place
t/ a
t/a
Packaging/Post consumer
0
0
0
00
00
00
0
12
25
18
Consumptions - WLC
Purchased Fibre
Chemicals Capacity t/a 120,000 180,000 250,000
Energy Market BHKP t/a 10,000 15,000 25,000
Personnel White office waste t/a 11,000 16,000 18,000
Other manufacturing costs
Delivery to London ONP/OMG for DIP t/a 33,000 50,000 70,000
OCC t/a 29,000 43,000 59,000
Mixed waste t/a 47,000 71,000 98,000
Kaolin/CaCO3 t/a 14,000 20,000 28,000
Power MWh/a 95,000 143,000 199,000
Power, nominal MW 12 18 25
Personnel person 260 310 370
Investment MEUR 360 390 450
Mayr-Melnhof
Reno De Medici
Cascades
Moritz J. Weig
Stora Enso
Buchmann
Kappa Packaging
Ilim Pulp
Cartiera Pirinoli
1200 12000
net exports
1000 10000
net imports
800 8000
600 6000
400 4000
200 2000
0 0
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
400 4%
350
1) 250 000 t/a 2%
300 2) 180 000 t/a
Cost level 2004/III, Exchange rates September 2004 averages 3) 120 000 t/a
250
Delivered to London
0%
200 250 000 180 000 120 000
0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 t/a t/a t/s
- Allocated capacity to the market, 1000 t/a - - PM Scale -
WLC - Feasibility
The opportunity is built around production of Recovered Fibre based Bleached Duplex
Board, WLC. A new machine wouldn’t quite achieve 10% ROCE with current price levels
even though the price level for packaging - cartons has remained generally quite positive for
last couple of years. There is also a variety of end-uses available, which would link through
local IOI converting. A potential option for IOI if costs can be optimised and local converters
gain from domestic producer
900
250 220 180 120
kt/a kt/a kt/a kt/a
800
200
100
Delivered costs to the UK Market (London), Cost level 2004/III
Capital charges contain of depreciation and 10% ROCE
0
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Option Description
Product Specification: Uncoated office/printing and writing papers . End-uses include:
Copy paper
Continuous stationery
Envelopes
Notepads/Drawing pads
Investment Model
BHKP
- EUR/t -
700 Fuel
Cost level 2004/III, Exchange rates September 2004 averages Available Recovered (Bio-, NG...)
Delivered to London Chemicals
Paper
600
Fresh water
500
Steam & Electricity
400 Uncoated WF
De-inking plant Power plant/CHP
Paper machine
300 De-inking sludge
200
water, emissions,
100 solid waste
Printing plants/
0 Publishers
p
p
ul
ul
ul
National Grid
tp
tp
tp
ke
ke
ke
OMG/Office/Post
ar
ar
ar
m
m
5%
45
,1
,2
,
/a
/a
/a
kt
kt
0
0
0
10
12
16
2500 25000
net imports
2000 20000 net exports
1500 15000
1000 10000
500 5000
0 0
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Capacity Apparent consumption Production Capacity Apparent consumption Production
M-real
Dalum
Steinbeis Temming
Golzem
Cartiere Cariolaro
Paperalia
Lenzing
Hermes
Cartiera Romanello
Competitiveness
Competitiveness of a new recovered paper based fine paper machine would be close to the
industry average in the UK market when compared to all fine paper producers. The recycled
based producers tend to be smaller and typically position to the 3rd and 4th quartile. Recycled
grades can enjoy slight price premium in the UK market
The availability of white good quality recovered paper is the limiting factor and the use of
market pulp has a direct negative cost impact
- EUR/t - - ROCE according to the market-
1,200 7%
Cost level 2004/III, Exchange rates September 2004 averages Cost level 2004/III Dublin
Delivered to London
1,100 6% London
Delivered Frankfurt
1,000 costs Average
5%
Manufacturing
900
costs
4%
800
3%
700
2 3
1
600 2%
Feasibility
A recovered paper based uncoated fine paper machine could achieve 10% ROCE with
current price level. Prices for recycled grades are not very different from virgin fibre based
prices – in some countries there is a small (5-15%) discount whereas in the UK recycled
grades enjoy a price premium and there would be demand for larger volumes. However, the
raw material quality is crucial for end product quality and pricing – the availability of white
high quality recovered paper doesn’t enable production of premium qualities in IOI
200
Investment Model
- EUR/t - Fuel
Available Recovered (Bio-, NG...)
600 Chemicals
Cost level 2004/III, Exchange rates September 2004 averages Paper
Delivered to Dublin
Fresh water
500
Steam & Electricity
400
De-inking plant Tissue machine Power plant/CHP
De-inking sludge
300
200
water, emissions,
solid waste
100 Tissue paper
converter
0
National Grid
t /a
t /a
t/a
0
0
00
00
00
District heating
50
30
15
SCA
Kimberly-Clark
Georgia-Pacific
Metsä Tissue
Sofidel
Kartogroup
Tronchetti
Wepa
Cartiera Lucchese
Tissue. Markets
Consumption of tissue paper in Europe is ca. 6.3 million tons. Growth of consumption has
been some 3.8% p.a. within the last 10 years in all of Europe. A demand growth of 3.2% p.a.
is expected up to 2010 in Western Europe.
In the UK and Ireland consumption is ca. 0.9 million tonnes/a, of which almost 90% is
produced in the United Kingdom. Irish consumption of tissue products is ca. 60 000 t/a.
8000
1000
7000 net exports
net imports
800 6000
5000
600
4000
400 3000
2000
200
1000
0 0
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Capacity Apparent consumption Production Capacity Apparent consumption Production
Feasibility
The real prices for tissue jumbo reels have been quite stable. A new paper machine can be
competitive in the local market enjoying a clear transport cost advantage. With more than 30
000 t/a capacity 10% ROCE would be achievable.
It must be noted that the actual market prices vary according to grade quality. The ultimate
competitiveness is largely defined by converting operations.
50 30 15
1400 kt/a kt/a kt/a
200
Delivered costs to the Irish Market, Cost level 2004/III
Capital charges contain of depreciation and 10% ROCE
0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
The viability of a paper mill is not simply confined to the availability (in terms of quality,
cost and proximity) of raw materials, energy source, transport and labour but extends to
include a necessity for suitable geographical locations where the residual emissions can be
adequately assimilated by the environment.
The relevant Directives and environmental objectives include the EIA Directive,
the IPPC Directive and the BREF Documents for this industry sector. Each is further
elaborated below.
EIA Directive
Council Directive 85/337/EEC on the assessment of the effects of certain public and
private projects on the environment. This Directive and its amendments (commonly
known as the EIA Directive) give effect to the requirement for an Environmental
Impact Assessment (EIA) to be conducted prior to specified projects proceeding to
the development stage. In the context of paper production the Directive requires
EIA of industrial plant for:
(b) Production of paper and board with a production capacity exceeding 200
tonnes per day1
Note:
1
Where a development is considered “likely to have significant environmental effects”
plants at or below this threshold are also subject to EIA. It has been the usual practice for
the term “likely significant effects” to be interpreted in the context of the precautionary
principal, i.e. such projects will normally be deemed to require EIA.
(b) paper and board with a production capacity exceeding 20 tonnes per day
The IPPC permits must be based on the concept of Best Available Techniques
(BAT). BAT is represented by a combination of optimisation of production/process
efficiency and controls, wastewater treatment and formal environmental
management techniques. The EU is in the process of defining BAT for each
specified activity and this work is co-ordinated by the European IPPC Bureau to
produce what are termed BAT Reference (BREF) documents. The relevant BREF
document in this instance is the “ Integrated Pollution Prevention and Control
(IPPC), Reference Document on Best Available Techniques in the Pulp and Paper
Industry, December 2001”. This document sets out a comprehensive list of the best
techniques for limiting the environmental emissions for pulp and paper production
and establishes emission values for a range of environmental parameters that are
considered to be appropriate for the sector. In determining the conditions to be
contained in the IPPC licence the regulatory authority is required to take full
account of this BREF document.
It is concluded therefore that any proposed mill, irrespective of location within the IOI, will
firstly require development consent in accordance with established EIA procedures.
Secondly the emissions from that facility will require comprehensive emission controls and
limits as represented by BAT and are to be regulated in accordance with IPPC licence
procedures.
Recovered fibre has become an important source of raw material for the paper
manufacturing industry. This is not only for reasons of price but also because of the
increasing environmental constraints imposed on the paper and packaging industry. These
constraints include a requirement for producers to maximize the “recycled” content of their
product and there are also obligations placed on the user for their ultimate disposal in an
environmentally efficient and acceptable manner (primarily through segregation and return
to paper/board producers and, to a lesser extent, as a fuel).
Recycled fibre (RCF) processes can generally be divided in two main categories, namely:
processes with mechanical and chemical unit processes i.e. with de-inking.
They comprise products like newsprint, tissue, printing and copy paper, magazine
papers (SC/LWC), some grades of cartonboard or market DIP.
The environmental profile of paper mills varies with the type of product and the scale of
production. An overview of the nature and scale of the profile presented by an integrated
RCP based paper mill (including possible bleaching, sizing, coating) can best be considered
in terms of inputs and outputs as presented below. (Source: BREF –Pulp and Paper
Industry 2001)
Inputs
Energy
Electricity from public grid, fossil fuels and/or biofuels for steam and electricity
generation
Water
Additives
Products.
Solid waste
Sludge from raw water treatment, primary sludge (fibres, fillers, coating pigments),
bio-treatment plant sludge, sludge from chemical wastewater treatment, rejects,
de-inking sludge, ashes from steam/power generation, small amounts of other
types of waste
From energy generation: SO2, NOx, CO2, CO, HCl, dust (emission depend
on type of energy supply and type of fuels used)
From the process: small amounts of volatile organic compounds-VOCs
(some paper grades only), visible plume, odour (mostly avoidable)
Energy
Noise
Mechanical plant, cooling fans, compressors, traffic etc.
Wastewater
Based on these average values the likely wastewater arising for each plant capacity
considered can be derived (See Table 2 below). For purposes of comparative scale it is
usual to express the BOD load (i.e. the primary descriptor for biodegradable organic
wastewaters) in terms of Population Equivalent (PE.). PE is the untreated domestic sewage
load that would be generated by an equivalent population. (1 PE = 0.065kg BOD/day).
Paper
productio Without de-inking With de-inking
n
capacity
t/a
Wastewa BOD Populatio Wastewa BOD Populatio
ter kg/day n ter kg/day n
m3/day Equivalen m3/day Equivalen
t t
400,000 6,424 13,862 213,263 12,397 9,354 143,909
250,000 4,0123 8,659 133,218 7,744 5,843 89,895
While wastewaters from paper mills are capable of being treated to a high standard
(possibly as good as 10mg/l BOD) it is apparent from the Population Equivalent values (up
to 213,263 PE) that the quantities arising for treatment can be very substantial. Following
extensive treatment access to a major sewer or surface water (large river, estuary, coastal
waters) will be required. In the case of discharge to sewers secondary treatment may be
provided through co-treatment with domestic sewage in the municipal treatment plant
rather than at the mill. In order to ensure that the paper mill input remains the smaller
fraction of the received wastewater loads and does not overwhelm the municipal plant this
option will be confined to those sewerage systems serving larger towns and cities.
Process Water
Process water (i.e. excludes cooling water) demand can be regarded as essentially
equivalent to wastewater volumes and for the purposes of this exercise evaporative and
other process water losses can be ignored. On this basis water requirements can be
expected to range between some 1,000m3/day and 7,000m3/day.
Air emissions in RCP based paper mills are mainly related to plants installed for the
production of heat and in some cases for co-generation of electricity. Saving of energy
corresponds therefore with reduction of air emissions. The power plants are usually
standard boilers and can be treated like any other power plants. Various options for
incineration of rejects and sludge arising on site may be available however their
applicability is limited by the size of the mill and to a certain extent by the fuel used for
generation of steam and power respectively.
Energy efficient recovered paper mills consume process heat and power as follows:
Integrated newsprint or printing and writing paper mills with DIP plant:
4 - 6.5 GJ/t process heat and 1 - 1.5 MWh/t of power.
It was determined in the course of this study that some 100,000t/a of biomass (wood fuel
– bark, chips, offcuts, forest residues) could potentially be available as a source of “green
energy” to supplement fossil fuels (natural gas, oil) requirements. The viability of such an
Traffic
Inward and outward traffic will be generated for which good road communications will be a
necessary site consideration.
From an environmental and road infrastructure perspective the primary traffic elements to
be considered are those associated with movement of the recovered paper and product
(and biofuels-if used). It is assumed that most bulk materials will be handled by heavy
goods vehicles (HGVs).
Wastewater
Of the various environmental outputs it is the wastewater that is considered to be the most
significant site constraint factor and the most geographically dependant. That is because
the wastewater emission levels (following the application of BAT) will be such that the
receiving waters must have sufficient “Assimilative Capacity” to ensure that mandatory
receiving water quality standards are not exceeded. The availability of such receiving
waters is highly dependent on fixed (geographical) factors namely: proximity to river or
estuary of suitable size and characteristics, coastal waters, or sewers associated with major
urban centres. The study suggests that organic wastewater loads up to a population
equivalent of some 213, 000 people can arise.
Process Water
While the upper value for process water requirement is high (7,000m3/day or 1.5mgd) such
quantities of water are available at a large number of locations in IOI. Where not in close
proximity to a major urban centre with a piped water supply groundwater sources are
widely available as an alternative source. In the ROI major water users in more rural areas
such as large food/dairy industry complexes have utilised significant quantities of
groundwater reliably and effectively for many years.
Raw Materials
Proximity to suitable quality and quantity of recovered paper for delivery by an adequate
roads network. (Proximity to market is considered as less important given the higher value
of product versus raw material)
Energy
Energy requirements are represented by both electricity and fuel. While there is a
comprehensive electricity supply network throughout IOI availability of an appropriate
supply will be, to at least some degree, geographically dependent. In the case of fuel it is
likely that only in the case of a proposal to utilise either natural gas or biofuel will
geographical factors have a role in site selection.
Atmospheric Emissions
Solid wastes and sludges can be generally accommodated by offsite disposal irrespective of
location. The disposal of wastes in regulated throughout IOI by a comprehensive range of
permits and waste tracking procedures derived from various EU Directives. Under these
regulations an adequate number of specialist, licensed, waste disposal contractors are
readily available.
Traffic/Roads
Good road access for up 55 HGV movements per day will be required.
Local authorities both north and south apply charges on industry for water supply and
wastewater treatment. Currently however there is no uniform basis for these charges and
consequently these vary widely throughout the IOI.
The most recent data collected by the DOEHLG (up to 2003) from the various local
authorities throughout the ROI supports this view. The collected data shows combined
water/wastewater charges to vary between as little as €0.71 per m3 (Wicklow) to a high of
€26 per m3 (Cork) with a mean value of €3.78 per m3. This wide variation is in part due to
discrepancies in how individual local authorities calculated the reported charges. Also in
counties such as Cork (the highest reported charge) which have major industrial
enterprises these charges have been negotiated on a case by case basis with a view to full
cost recovery.
The alternative to these charges is for the enterprise to provide its own water from
groundwater sources and to provide full wastewater treatment on site. Many major
industries choose to adopt this approach as, depending on location, it can potentially
provide significant cost savings.
Development Levies
Northern Ireland
Northern Ireland comprises six counties: Armagh, Antrim, Derry, Down, Fermanagh and Tyrone.
In compliance with EU rules, the border counties in the North of Ireland are deemed to be:
Armagh, Derry, Down, Fermanagh and Tyrone.
Introduction
This document sets out the potential funding streams available in Northern Ireland for a project
such as the proposed Paper mill. As such, potential funding sources are outlined under the
following headings:
• European Funding
• Agency Funding and Supports
European Funding
Under the 1994-99 round of Structural Funds support, Northern Ireland had been accorded the
status of an Objective 1 Region (to 2006), that is a region whose development was lagging behind
others in the European Community and warranted support from all 4 Structural Funds, those
being:-
For the current round of funding (2000-2006) Northern Ireland exceeded the qualifying criterion
having a per capita GDP greater than 75% of the community average. However Northern Ireland
was able to avail of newly introduced transitional arrangements that provided former Objective 1
regions access to the 4 Structural Funds but on a declining basis so that by the end of the funding
period, the Region would have adjusted to the lower and more limited financial support likely to be
made available to an Objective 2 Region. Northern Ireland therefore secured funding for a
Transitional Objective 1 programme “Building Sustainable Prosperity” which was complemented by
a continuation of the PEACE programme.
It is therefore expected that additional European funds will become available post 2006 (when the
current support tranche expires) however this will be limited and competition will be very strong.
It is also a reasonable expectation that many of the streams of support currently available under
PEACE II funding, will also be supported in the new PEACE III era of European funding.
Therefore, although the greatest majority of EU funding has already been allocated and calls have
closed, examination of PEACE II funding priorities and measures should highlight the potential
support available to a project such as the Paper Mill post 2006.
The PEACE II programme had the following priorities:
• Economic Renewal
INTERREG IIIA offers various avenues of potential assistance for consideration if re-opened or
repeated post 2006, those being:
Barry Gardiner MP is the Northern Ireland minister responsible for the Northern Ireland Dept. for
Enterprise Trade and Industry, Dept for Employment and Learning (which controls Enterprise
Ulster and Ulster Supported Employment Ltd) and the Dept for Education - an indication perhaps
of the close-knit and often overlapping responsibilities of these different government departments
and their agencies.
The primary agency of interest to this project falls under the remit of the Dept for Enterprise Trade
and Industry, that being, Invest Northern Ireland (Invest NI).
Invest NI
Through its overseas and local office networks, Invest NI ensures that companies locating in
Northern Ireland have access to a range of practical and financial support to help them get started
quickly and successfully develop their businesses.
• Information provision - Key commercial information can be tailored to the needs of the
individual company and introductions provided to industry leaders, universities, centres of
excellence, business professionals and other potential business partners.
• Inward visits/site visits - Visit programmes are set up specific to the client needs.
• Grant and incentives - Invest NI offer a range of business solutions that include flexible
and competitive financial incentives:
• Technologies – the incentive package is geared towards projects that involve innovation,
advanced technologies and enhanced design capability and university or research linkages.
R&D grants of up to 50% are available.
• Venture Capital – The NITECH Fund has been established as a venture capital fund to
finance the commercialisation of technology within new-start or existing businesses. This
enables SMES and researchers to take an R&D project to proof of concept and
commercialisation stages. Staged investments range between £20,000 and £200,000 with
a maximum total investment of £250,000 being provided to any one company. The fund is
available to Northern Ireland based start-ups.
• Green Technology Initiative - Invest NI provide interest free loans towards the cost of
capital equipment, as well as providing an information service in relation to environmental
legislation, and providing a quarterly bulletin distributed to Industrial and Manufacturing
Engineers and other environmental related sectors and companies – potentially a good
method of inviting tenders for construction and generally publicising the paper mill to
enhance uptake of its services. Upper limit is £50000.
The amount of Invest NI funding available is to a large degree dependent upon the financial
requirement of the company, anticipated employment creation, export potential and location. The
funding is accessible via a client executive supported by specialist advisers. Corporate funding is
available to those enterprises that satisfy the eligibility criteria and are considered viable.
In addition to grant funding, Invest NI can offer debt facilities and equity (ordinary shares) capital
to assist business towards faster growth. Invest NI will explore in conjunction with the client
company’s management team, the most efficient capital structure based on cash flow patterns,
expenditure needs over time and refinancing ability. Invest NI will consider funding proposals to
the extent that it has been demonstrated that funding is not available from private sector sources
or where the private sector is not willing to do so on acceptable terms to projects viewed as viable
by Invest NI.
Given that the roles and supports available through the International Fund for Ireland and
InterTradeIreland have already been covered in the Republic of Ireland document, this brings to a
close potential supports in Northern Ireland and the border county region.
Support levels
For the purpose of deciding maximum funding rates (in compliance with EU rules) for industrial
development, the RoI is divided into three regions:
South East/South West/ Mid West: Wexford, Waterford, Kilkenny, Carlow, Kerry, Clare, Cork,
Tipperary and Limerick.
For the purposes of cross-border collaboration projects, such as those funded inter alia by the
International Fund for Ireland, the border counties in the RoI are Louth, Cavan, Monaghan,
Donegal and Leitrim.
Agencies
The Department of Enterprise, Trade and Employment (DETE) controls two principal agencies
responsible for implementing policy with regard to industrial development:
Enterprise Ireland (EI), which is responsible for the development of indigenous industry
Industrial Development Agency Ireland (IDA Ireland), which is responsible for foreign direct
investment (FDI) i.e. foreign-owned companies in Ireland.
Both agencies have offices throughout Ireland, often in the same building, and collaborate closely.
This is an organisation established by the British and Irish governments in 1986 to promote
economic and social advance and to encourage contact, dialogue and reconciliation between
nationalists and unionists throughout Ireland. The fund gives priority to projects located in the
most disadvantaged areas in Northern Ireland and the five Southern border counties. In the period
up to September 2004 the IFI had approved projects to the value of almost Euro 419M.
• Tourism Programme
• Flagship projects
• Two investment companies, which provide venture capital on normal commercial terms
The Business Enterprise and Technology Programme is most relevant to this project. However,
funding provided to existing projects has been in tens and hundreds of thousands at most.
InterTradeIreland:
This is the cross-border trade and business development body, established under the international
agreement between the governments of Ireland and the United Kingdom signed on Good Friday
1998 and commonly known as “The Belfast Agreement”. InterTradeIreland has a strategic vision
“To lead the development of the island economy through distinctive knowledge-based
interventions which will produce significant returns in the areas of cross-order trade and business
development.”
• Establishing a channel for and an information source on North-South trade and business
development
• Creating the climate whereby significant changes in the nature and level of trade and co-
operation between the two economies can be generated
• Enhancing competitiveness by encouraging information sharing, joint marketing initiatives,
joint research and development and other ventures.
• Encouraging the flow and exchange of venture capital within the two economies and between
firms and third level institutions.
Supports
Both EI and IDA Ireland provide extensive supports to their client companies. These include
marketing, personnel development, business planning, technology acquisition and financial
supports for feasibility studies, R&D, training and capital acquisition. Normally, these supports are
negotiated by the company’s Development Advisor at a local level on a case by case basis, within
guidelines.
The amount of EI funding will be determined by the need for financial support for the project, the
anticipated export growth, the potential employment and the regional location. Funding is usually
in the form of redeemable preference shares rather than a grant. EI generally seeks redemption
on the fifth anniversary of investment. In the case of R&D and training supports some or all of the
preference shares can be re-designated as a non-repayable grant. Repayability is highest in the
Dublin/Mid East region and lowest in the Border, Midland and Western region. Funding may be
invested up front, depending on the company need and timing of the project expenditure or it may
be in the form of tranched installments to match expenditure.
Investment and job creation funding will always be re-payable, as there will be no longer capital or
employment grants.
In the case of a major investment, such as is contemplated in this feasibility study, requests for
assistance would be considered by the Boards of EI and IDA Ireland and, given the size and
political thrust of the project, almost certainly at Cabinet as well. It will not be a simple case of
filling in a standard application form.
Whether a request for financial support for this project would be addressed to EI or IDA Ireland
would depend on the amount of FDI involved.
Venture Capital can of course be raised in the normal commercial way. EI does not act as a broker
but can assist companies with contact details in specific areas of interest for the major Irish
venture capital companies. Details are also available from the Irish Venture Capital Association,
whose members professionally manage over 95% of the Euro 1.25 Billion managed by venture
capital funds on the island, InterTradeIreland and others.
EI partners with venture capital funds to provide finance. Under the National Development Plan
(NDP) 2001-2006, the Government has committed Euro 95M through EI to partner with the private
sector to continue the development of the venture capital market for SMEs. EI has committed to
15 funds aimed at SMEs at start up, smaller investment amounts (<500k first round), a greater
regional perspective and sectors that have been difficult to finance, e.g. Biotechnology.
Interreg III:
Support from Interreg III will be focused on four areas, including promoting the environment and
good management of cultural heritage and of natural resources. The allocation to the NWE
programme is Euro 109M. There are five priority areas, the most important here being:
Priority 4: Develop a stronger ecological infrastructure and a reduced ecological footprint. The
NWE ecological footprint, i.e. its negative global environmental impact must be reduced. This
entails tackling a wide variety of issues such as managing waste disposal, developing renewable
energies and promoting sustainable use.
The North South Ministerial Council (NSMC) agreed in 1999 a range of areas for co-operation,
including the environment. A working group of the NSMC has issued joint communiqués on water
quality, the environmental impact of agricultural activities and waste management. On the last
topic, a steering group of officials has been established to develop a structured approach to a joint
programme for the development of markets for recyclable materials e.g. materials that are
collected in bring banks, segregated household waste collections, recycling centres, etc.
Birkner 2004 Directory of the Paper industry Published by Birkner & Co, 2003
CEPI European Pulp and Paper Industry Annual Stastics 2003 Published by the
Confederation of European Paper Industries, June 2004
EPA 2005.. Meeting with Brain Meaney, EPA, Wexford. 6th January 2005.
Industrial and commercial waste production in Northern Ireland 2002: A final report
to the Environment and Heritage Service
Packaging in 21st Century, A Strategic Futures Report, Pira International, June 2001
Paper and board – European list of standard grades of recovered paper and board,
European Standard EN643, December 2001
Social Research Institute, ESRI, Medium Term Review 2003-2010, July 2003
Press Release, ‘Roche expresses regret at Smurfit closure’ Press Office, Dept. of the
Environment, Heritage and Local Government, Ireland, January 2005
Statistics on the trading of goods – user guide, 2004 edition, published by Office for
Official Publications of European Communities
The Recovered Paper Market Capital Markets Day, Liger P, StoraEnso, 2003
We are changing the way we deal with waste are you? Published by Waste
Management Services, Dublin City Council, 2004
Will recovered paper prices remain stable throughout 2005? Marley, ME, Paper
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