By Annie Zhu, Associate Editor, Pulp & Paper International magazine
SHANGHAI,
May 11, 2009
(RISI) -
I have just attended the Metso "Executive Roundtable Meeting" held in Xi'an, capital city of Shanxi province, China, and of course home to the world famous Terracotta Army.
Around thirty high profile professionals from the Chinese pulp and paper industry attended the seminar and it is clear to see that the producers are more cautious in expanding amid the worldwide economic downturn. Instead the focus appears to be on high efficiency, easy and low cost operation maintenance, and on environmentally friendly machines to meet tightened environmental regulations.
"Currently China's paper industry is just stepping on to the stage of adjustment and further development. Chinese paper producers must make effective plans and rational investments," says Li Hong Xin, president and general manager of Sun Paper at the event.
How are suppliers responding to the changes? Metso took the opportunity at the gathering to release its "Right Sized Investment with the Standard Metso Concept".
"The standard Metso concept is designed for cost efficiency, environmentally efficient solutions, comprehensive knowhow and proven technology, as well as fast and reliable delivery. It is a completely new concept specially developed for the paper industry in China and other growing markets." says Zhou Zhou, sales manger, Metso's Paper Business Line.
Although the standard Metso concept models are still under design and not introduced formally yet, solutions that are based on the standard the concept's philosophy have been utilized in parts of ongoing paper machine projects in China, according to the supplier. For example: Yinhe PM 1, Nanping PM 6 and Shandong Sun Paper PM 23.
"The new standard model has a streamlined design and can benefit from less hall space, lower building costs and faster project time. The details of the new standard model will be released at this year's China Paper conference in Beijing," says Zhou.
Latest new technology that Metso has introduced in China include ValZone Calender (Hongta PM2, Bohui PM7, IP Sun Paper 22 & 23), ValFormer (ND PM21, Sun Paper PM22& 23, Sun Shine PM1, Bohui PM7, Nanping PM6 & MCC Yinhe PM1) and Tissue technology (DCT tissue machine, ViscoNip, and NTT tissue technology).
Ari Harmaala, Metso's president, Asia Pacfic Area, Paper and Fiber Technology comments that: "We pretty much focus on the customers and look at what they want and need during this difficult time. Overall, the service business is pretty stable, the capital business is always a competitive one, but we don't see any remarkable changes in China."
Metso in Xi'an
We also paid a visit to Metso's Xi'an manufacturing base, about 10 km from the city center.
The company has Valmet Xi'an Machinery (XIA) and Metso Paper (China), Xi'an Branch (MPC) at the 12.9 ha plant. XIA is taking care of product technology, engineering and manufacturing, while MPC is responsible for sales and project management as well as services.
Last year, Metso concluded an agreement to increase its ownership in the Chinese joint venture company Valmet-Xi'an Paper Machinery from 48.3% to 75% by acquiring all the shares owned by Finnfund, and part of the shares owned by the other joint venture partner, China National Building Material Company Group.
When asked about Metso strategy in China, Bertel Langenskiold, president of Metso Paper says, "We now have a substantial operation in China with 2000 people and the main thing is to make it as productive as possible. We are focusing very much on internal efficiencies, to make sure that Metso quality in China is just like anywhere else. We are progressing pretty well in this. We have plants in Shanghai and now in Xi'an. That's the main thing - to invest here in order to produce world class equipment."
Harmaala adds that "The biggest service we have now is the Zibo service center. We are finalizing our base at this moment. I believe our focus in the future is not to expand to more places just yet. We are focusing on the current facilities, to improve quality and also try to match the customer needs. We try to provide the best scope and services locally in China."
The XIA is divided into workshops (19,200 m²), preassembly (2,800 m²), foundry (5,300 m²), main office (4,500 m²), other offices (3,000 m²) and storage areas (15,300 m²). Here it can produce all sorts of vital products, including headboxes, forming, press sections, dryer sections, SizePress, automation, closed hoods and air systems, as well as winders, lubrication and mechanical drives, and coating sections.
Main activities in 2009 include technology transfer (winders, tissue machines DCT 40, air systems, and components); welding and plate work specialist and quality system efficiency development.
"New investments are going to be implemented in the plant in the next few years, including new lathes installation, new office buildings, air systems workshop enlargement, and Safop lathe for tube rolls manufacturing," says Mikael Suominen, president of Paper Business Line, Metso Xi'an .
Currently, Bohui's newly ordered 1,400 tonne/day cartonboard machine's press section is under preassembling at the plant. Startup was scheduled for the second half of 2009, however, it will be postponed to March 2010 under the current market situation, says the company at the event.
Metso will deliver a complete coated board line with related air systems and two winders, as well as an extensive automation package.
Metso China has two production plants in Shanghai on top of the Xi'an plant. In addition, the supplier has three service centers in Zibo, Wuxi and Guangzhou. It also has a sales office in Beijing and a logistics center in Shanghai Wai Gao Qiao. The locations are designed to be close to their customers.
Promising future?
Discussions at the event revealed that there are quite a few projects under bidding or resuming negotiation currently, including those that were postponed, following the supplier's last major order -- Sun Paper's PM 23. The picture should be more clear in a few months time.
According to the paper/board producers at the spot, projects that are under negotiation among different suppliers include Shandong Chenming's 450,000 tonne/yr fine paper machine and 1 million tonne/yr bleached hardwood kraft (BHK) pulp line at a Greenfield mill in Zhanjiang city, Huatai's second hand machine revamp at its Anqing mill, Henan Xinxiang Xinya's 300,000 tonne/yr LWC paper line, Ningxia Metallurgical Meili Paper's 250,000 LWC paper line, Bauhinia Group's 90,000 tonne/yr tissue line, and Shandong Zhengda's 90,000 tonne/yr semichemical pulp line.
For the future pulp and paper market in China, Metso is optimistic as always.
"China's pulp and paper consumption stays at 55 kg/capita, and we have no doubt that the figure will double in the coming twenty years and reach Malaysia's at 106.9 kg/capita. So the future is very bright, " says Fan Ze, general manager, Metso Paper (China).
