Forest industry reaching out to textile industry

Fastmarkets RISI European Conference13.3.2019

Jukka Kantola

Agenda today

• Textile fiber markets• Textile fiber value chains • Dissolving pulp markets• Man-made cellulosic fibers• Arbron will reshape cellulosic textile fiber

value chain• What about environment

Textile fiber markets

• Total annual consumption today 100 Mt , but already 2025 140 Mt - over 40% increase!• Most import textile fibers

Synthetic fibers ≈70 Mt (non-renewable, oil-based) Cotton ≈22 Mt (non-ecological, faces several problems) Cellulosic fibers ≈6 Mt (viscose most important, but CS2 problem) Others ≈1-2 Mt (e.g. silk, wool)

Man-made cellulosic textile fibersare still based on viscose process

• Viscose remains the dominant market leader

• Lyocell is already in commercial use – but struggles with high production costs

• China is by far the largest viscose producer – and a million tons of new capacity coming

Textile fiber value chains

Cellulosic fibers

WoodCarbon

disulphideCS2

SpinningDissolving pulp Textile Industrys

Synthetic fibers

Textile industrySpinningMeltingCracking + PolymerizationOil Drilling

Textile industrySpinningCardingGinningHarvesting

Cotton

Dissolving pulpRapid growth since 2008

• Dissolving pulp refers to the pulp with cellulose content above 90 % (alpha-cellulose content)

• Mainly wood based– although also bamboo is used in Asia• ¾ of the dissolving pulp is used for viscose production. Other applications like

cellophane, wiping, wound dressing, etc • Total market 8 million tons a year – mainly in China, North America, South

Africa, Western Europe and Brazil. Market growth 6-8% each year!

• Major dissolving pulp producers accounts for 60 % of the total

RISI

+6-8%

Man-made cellulosic fibersTurn around took place 2000

• Viscose is a fiber of regenerated cellulose – over 100 years old technology, but still compelling

• Biggest hurdle is CS2 – production moved to developing countries– China alone almost 70% of the output (!), followed by Indonesia

and India. (Europe 9%)• Total capacity 6 million tons a year - doubled since 2000

• Three big ones

• Several Chinese…

Man-made cellulosic fibersIn production

Production chemistry

Main properties Usage Environment,general notes

Viscose CS2, NaOH, H2S, ZnS, Na2SO4

~cotton, silk-look, absorptive, 100y experience

Textiles, wipings, wound dressing, etc

Toxic emissions, bad occupational health.Reference for others

Viscose-Modal Like viscose + special additives

Enchanced viscose Textiles for hard use and regular washing

Worse than viscose

Lyocell NMMO solvent, high pressure process

High strength Similar to viscose modal

99,5% of chemicals recycle, Alpha 99%

Cuprammoniumrayon

[Cu(NH3)4(H2O)2]2+NaOH

Very silk like niche Toxic, no emission

Cellulose acetate CH3COOH, C3H6O Silk like (tobacco) filters Acetic acid unpleasant

Man-made cellulosic fibersUnder development

Production chemistry

Main properties Usage Environment&notes

CCA (also CC), carbamate cellulose

UreaNaOH, H2SO4

Similar to viscose Same as viscose + great potential

Clean tech,many developers: Fraunhofer, VTT, Wuhan univ&other Chinese, etc

Ionic liquid(e.g. IonCell by Aalto Univ)

1,5-diazabicyclo[4.3.0]non-5-enium acetate

~Lyocell strength,High pressure tech

textile Non-toxic chemicals (not commercial), Aalto univ, many others

Entzymatic dissolution

Various entzymes, NaOH, ZnO, H2SO4

Target: viscose Same as viscose Clean tech,VTT

Direct dissolution without derivation or special solvents

Steam explosion, freezing, ultra pure cellulose, MCC, NaOH, H2SO4

Target: viscose ~viscose et al Many R&D groups, no success

Liquid crystal state (anisotropic)

Phosphoric acid Target Ultra high strength

~viscose et al Toxic, difficult process, lab only

Arbron reshapes the value chain of cellulosic fibres

Arbron™ material is more expensive than dissolving pulp, BUT Arbron based textile fibre is competitive against conventional viscose!

CURRENT VALUE CHAIN

Wood Carbondisulphide

CS2

Spinning Textile production

ARBRON™ BASED VALUE CHAIN

Wood SpinningArbron™ textile fiber

Textile productionSoftwood pulp Arbron™material

Dissolving pulp

What is

• Arbron™ is a material used as feedstock for cellulosic textile fiberproduction ADD ON process for a pulp mill

• Arbron™ based textile fiber production can be used in modified viscose plants DROP IN solution for the viscose plants. In a simplified process, which still use existing equipment

• Arbron™ eliminates the need for using the health risk chemical CS2(carton disulfide)

• The Arbron™ method takes advantage of the softwood pulp making process by benefitting energy surplus and wet pulp

• Development program under way

Why ?• The development program takes the entire value chain into consideration

– from standing tree to textile industry Accelerates the required R&D process

• Eliminates the need for carbon disulphide (CS2) at viscose plants Environmentally friendly production process

• Introduction initially in China – later other areas (including EU) Enormous market potential

• Technically efficient production concept Competitive product

What about environment?

Synthetic fibers are based on non-renewable resources• Not sustainable solution• Non-biodegradable • One of the major source for microparticle plastic problem

Need for ecological alternatives is obvious

Cotton is very demanding plant• High water demand (Aral-lake case). Cotton consumes at

least 5 times more water than viscose• One of the biggest pesticide consumer

Viscose currently requires use of highly toxic carbon disulphide. • Still dominating process• Mainly produced in China

To conclude

• Demand for the textile fibers is rapidly growing

• Challenges ahead with synthetic fibers, cotton and current cellulosic fibers

• Man made cellulosic textile fibers are still by large based on 100 years old viscose technology

• Several alternatives for viscose fibers under development

• Arbron™ will be an environmental friendly and safe alternative to produce cellulosic fibers for textiles

Thank you for your interest!

Jukka KantolaCEO – KaiCell Fibers Ltd

+358 40 552 8880jukka.kantola@kaicell.fibers.com

Thank you for your interest!

Jukka KantolaCEO – KaiCell Fibers Ltd

+358 40 552 8880jukka.kantola@kaicell.fibers.com