Pulp prices have seen their share of spikes over the years. 2011 brought with it the industry’s highest price point in 30 years, only to be usurped in 2015. Currently, the price of wood pulp is forecasted to rise at an estimated annualized rate of 5.1% leading up to and through 2019.
The reasons driving the demand for pulp-based products vary and are tied to different geopolitical, economic and production/transportation factors. Regardless of the impetus, soaring pulp prices are causing tissue manufacturers to re-strategize products and tissue converters to adjust to the industry’s unique needs.
How Tissue Manufacturers Are Controlling Costs
Fiber is the largest input cost for tissue manufacturers (35-40% of cost of sales), therefore reducing the fiber cost per roll is a top priority for manufacturers faced with steep pulp prices. In North America, the consistent price gap between the more expensive long fiber (NBSK, principally from Canada) and short fiber (BHK, principally Eucalyptus from Brazil) seems a good place to start — eliminate the long fiber and drive down costs. As an example, in a line with annualized production of 70,000 tons/year, the replacement of 12% of long fiber (NBSK) with short fiber (Eucalyptus) could generate approximately $1.0 MM/year in savings (using forecasted 2019 pulp prices).
However, the fix isn’t quite that simple. Removing the long fiber compromises tissue strength and quality, both of which are key competitive advantages and sales differentiators, especially for premium product lines.
To control costs and maintain profitability, North American manufacturers commonly employ two methods:
- De-sheeting to reduce the number of sheets of toilet paper or tissues in each package while holding the bulk (volume) of the product and retail prices consistent
- Reformulating fiber mixes to better leverage less expensive pulp
Tissue Converters Need To Keep Pace
While these may be viable solutions for manufacturers, they can pose challenges to tissue converters.
Desheeting requires that tissue converters change specs and fine-tune equipment to run new specs every other year if not more often. This translates to a significant investment of labor, money and engineering resources on the part of the tissue converter — any or all of which may not be fully recouped.
Fiber mix changes involving the reduction of long fibers present serious compromises to converting, bulk properties and product strength. These factors not only impact product quality but also converting and packaging methodologies. Using chemicals, refining or other techniques to compensate for strength lost in fiber mix reformulation is an option to counter the disadvantages, but expensive. Tissue converters may be better off to invest in advanced converting technologies that can provide efficiencies that specifically address the consequences of fiber mix modification as well as those encountered with desheeting.
The Solution: Constellation S8 and S6
Constellation, with its innovative 4-roll rewinding technology, is the latest solution from Fabio Perini that helps tissue converters adjust to the changes brought about by escalating pulp prices and manufacturers’ reactions to them in terms of changing products and production.
For desheeting, Constellation offers the widest operating window and bulk development capabilities in the industry. That means the technology can sustain several desheet cycles and support long-term product development and quality efforts with minimal changes and maximum productivity. Tissue producers can make the same diameter roll with less paper (pulp), or maintain the same amount of paper per roll, and deliver a significantly larger diameter roll.
Likewise, Constellation is the ideal solution for fiber mix and basesheet changes due to its superior winding profile and ability to retain strength and develop bulk at high speed. Plus, the technology has a proven track record in running challenging fiber mixes such as 100% Eucalyptus without slowing productivity, reducing quality or skewing costs.
Pulp prices will continue to dictate how manufacturers approach their products and the market. Tissue converters must be prepared to service customers at the highest level and to their best advantage — now and in the future. For more details on the Constellation S8 including current availability and quoting, visit our Equipment Showcase.