Nine Dragons breathes life into China

by Robert Ryan

Dongguan Nine Dragons is no stranger to capacity expansion plans. With its latest machine order, the company is on track to become a million tonne/yr producer

Dongguan Nine Dragons is a fast mover, even by Asian papermaking standards. Not content with starting up two large machines since 1998, the producer recently placed an order for yet another new PM for its mill in Guangdong province, southern China. The investment further strengthens the company's role as a major containerboard player serving the packaging needs of China's rapidly expanding manufacturing base.

The modern containerboard producer ordered its third PM from Metso in May this year. The order will include a containerboard machine with a three-ply fourdrinier forming section featuring hydraulic headboxes. Metso will supply the press section with two shoe presses, dryer section, calender and reel. The vendor's scope of supply will also include mechanical drives and systems for steam, condensate and air handling, shower waters, lubrication and machine automation.

PM 3, which will have a wire width of 5.95 m and drive speed of 1,150 m/min, will boost Dongguan Nine Dragons' capacity by 1,100 tonnes/day, making it a one million tonne/yr producer of containerboard. The PM is set to start up in the second half of next year, according to Metso. It replaces a shelved 150,000 tonne/yr corrugating medium PM project which was put on hold in 1999.

The fiber source for the new PM will be mainly AOCC (American old corrugated containers). Dongguan Nine Dragons has also ordered a stock preparation system for the new line. Thermo Black Clawson will deliver the 1,200 tonne/day stock preparation system in October this year, and it will come on stream in January next year. The approach system for the new PM will be supplied by Andritz-Ahlstrom.

The mill has grown at a remarkably rapid pace since its owner America Chung Nam first began planning a greenfield investment in containerboard production just a few years ago. Within a short period, an area formerly occupied by banana plantations has been transformed into one of the largest and most modern mills in China. Dongguan Nine Dragons looks set to continue growing as well, with further capacity expansions at the mill and a new site in Shanghai, as well as downstream box plant investments.

Dongguan Nine Dragons is fully owned by the US-based America Chung Nam, a privately-owned recovered paper collection and trading company based in California, US. The company collects around two million tonnes/yr of recovered paper and is the largest exporter of recovered paper in the US.

PM 2, which has a speed of 1,000 m/min and wire width of 5.95 m, came on stream less than a year after it was ordered from Metso Paper

The investment in containerboard production was a natural strategic fit for the company, given that it supplies most of China's AOCC imports and this grade is the main fiber source for the mill.

America Chung Nam first began planning the investment in containerboard production in 1996, says Dongguan Nine Dragons' deputy chairman and general manager, Ming Chung Liu. It chose a site in Dongguan, near Guangzhou, the capital of the southern province of Guangdong as the location for the mill. This strategic location is well-placed to serve the strong demand for quality packaging materials driven by southern China's high growth manufacturing sector. The mill is located in the Xin Sha Port Industry Zone of Dongguan, which is a part of the large Huangpu port.

The mill was on the fast track to development from the very beginning. By March 1998, or just 13 months after signing the contract with the supplier, the company started up its first paper machine. By 2000 it had started up a second PM, while it ordered its third machine this year.

Turning raw materials into paper

AOCC and European old corrugated containers (OCC) make up 70% of the furnish used by the mill. The mill usually keeps 30-60 days supply of OCC on-site, says Liu. This large inventory is a useful buffer against any delays in the transportation of recovered paper to the mill.

Imported virgin fiber - unbleached kraft pulp (UKP) - makes up the balance of the fiber. The high standard of furnish used means that the quality of the mill's liner is equal to that produced in the best mills in the US and Europe, according to Liu. He also believes that the mill's output and operations are much cleaner than most US and European mills as Dongguan Nine Dragons is a new mill.

The company started up its first paper machine in March 1998. PM 1 has a wire width of 5.9 m and trim width of 5.49 m. The PM's design speed is 550 m/min, while operating speed currently reaches 360 m/min. At the time of its startup, the paper machine had a capacity of 200,000 tonnes/yr of containerboard. This was increased to 250,000 tonnes/yr following a rebuild in 1999.

PM 1 has three hydraulic headboxes followed by a fourdrinier former. The press section of the PM features two HL presses and a hot press. This is followed by the dryer section, with 64 cylinders configured in six groups. The dryer is followed by a hard calender from Voith Paper.

Most of the PM was new equipment supplied by Over Meccanica. The vendor supplied the wet end for the PM, including the three headboxes and the forming section. The Italian company also supplied the pope reel and a rewinder. Over Meccanica's scope of supply was complemented by the used dryer section and three locally supplied fourdriniers. The supplier was also responsible for layout and design of the entire line and the guarantee.

Fast track expansion

Dongguan Nine Dragons expanded soon after its first machine came on stream, with the startup of its second large, modern PM in June last year. PM 2 came on stream just 11 months and ten days after it was ordered from the supplier, Finland's Metso Paper. This installation period included two months spent on soil preparation work at the site. Metso's scope of supply for PM 2 included the system for steam, condensate and air handling. ABB supplied process automation for the PM.

The PM has a capacity of 400,000 tonnes/yr and wire width of 5.95 m. It has a design speed of 1,000 m/min but actually operates at 1,032 m/min. This makes it the fastest corrugating materials machine in China.

PM 2 features three hydraulic headboxes, including one with dilution control. The headbox units feed the stock onto a three ply fourdrinier forming section. The PM is the fastest multifourdrinier machine in the world, according to the supplier.

The web proceeds from the forming section to the two nip press section, which includes a long nip press and a Symbelt shoe press which deliver a high level of dryness.

The web then proceeds to the dryer section, which is followed by an Optisoft soft calender. A ValReel winder completes the line.

The PM produces jumbo rolls with a diameter of up to 2.5 m. These are then converted to smaller rolls on a Jagenberg slitter winder and transported to the warehouse on an automated conveyor.

A ValReel winder completes the line on PM 2, a modern containerboard machine which came on stream in June 2000

The stock preparation system for PM 2, which was also provided by Metso, features two lines. One is a 400 tonne/day unbleached kraft pulp line, while the other is a 1,100 tonne/day OCC line. The company experienced some operational problems in the stock preparation area on PM 2 after startup says Liu. Metso sent a team of experts to the mill in February 2001 to resolve the problems.

Vital supplies

The Dongguan Nine Dragons mills draws its water supply from the nearby Pearl river. It uses 10 tonnes of water for every tonne of paper produced.

All of the mill's electricity is generated on-site. The power plant has a capacity of 87 MW of electricity. The coal-fired boiler was supplied by a local vendor and uses coal sourced domestically within China and transported to the mill by barge on the Pearl river. The boiler also produces steam for use in the paper machine dryers. The power plant was expanded prior to the installation of the second PM.

Wastewater from the mill is treated in a two-stage effluent treatment plant before being discharged to the river. The plant features biological treatment in the second stage. Discharged effluent meets the required environmental standards.

The Dongguan Nine Dragons mill has 1,000 employees. Of these, 70% have university or technical college education. The employees come from all over China, and live in company-provided housing. The operators work in three shifts of eight hours. The company operates a 24 hr central kitchen service for employees.

The company's rapid expansion has left it facing the usual skills shortage problem faced by large, new mills in China. The main problem is that it is difficult to find staff with the skills and experience required to operate modern machines. Most of Dongguan Nine Dragons' operators have been trained on the job, while some have received supplier training. Several operators have been trained in containerboard mills in other countries as well.

Marketing channels

The mill produces liner and corrugating medium with grammages ranging from 126-300 g/m2. PM 1 produces containerboard in the higher grammage range (175 g/m2 and above), while PM 2 makes mostly 126 g/m2 liner.

Finished liner and corrugating medium is stored on-site in the mill's warehouse before it is shipped to customers. The company is planning to build a new warehouse in the near future, on a vacant site located across the road from the mill. It will be able to store up to a week's output. The company has its own fleet of 70 trucks for transporting containerboard.

Dongguan Nine Dragons' output is sold mainly on the domestic market in China. Demand for containerboard grades is presently strong in China. According to RISI, the country will see a two million tonne total increase in containerboard demand between 2000-2003, with the upward trend driven by steady growth in the manufacturing sector in China. The company is also planning to export some of its output to the US and other countries.

The end-users for Dongguan Nine Dragons' output include manufacturers from a range of industries including electronics and food/beverages. These end-users serve both the domestic and export markets.

The company is already planning to install a fourth containerboard machine, PM 4. "We will start up the new PM 4 project as soon as time is available," says a spokesman for the company.

The new PM will be built at a greenfield site in the Shanghai area, China's largest city and an important and growing containerboard market. The company has already bought a 220 ha site for the new mill. Startup is scheduled for 2003-2004.

PM 4 will have a capacity of 400,000 - 600,000 tonnes/yr, says Liu, thereby boosting Nine Dragons' total containerboard capacity to around 1.5 million tonnes/yr. Meanwhile, the company is also planning downstream investments, with plans to build 10 box plants in China.

Nine Dragons now faces a bright future of expansion and diversification. The PM 4 investment will give the company both added capacity and a presence in Shanghai, where a steadily expanding manufacturing base is driving strong packaging demand. Meanwhile, the downstream investments will boost the company's value-adding potential, and create a fully integrated player with business interests extending from upstream recovered paper collection to box making.