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Segezha Group to build new papermaking machine to improve sustainability at Sokol Pulp and Paper Mill in Sokol, Russia

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Segezha Group to build new papermaking machine to improve sustainability at Sokol Pulp and Paper Mill in Sokol, Russia

September 01, 2021 - 09:33
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MOSCOW, Sept. 1, 2021 (Press Release) -Segezha Group, a subsidiary of Sistema PJSFC  and the leading Russian vertically integrated timber holding with a full cycle of logging and added-value wood conversion, is implementing a large-scale investment project to build a new paper machine (PM) at Sokol Pulp and Paper Mill (Sokol, Vologda Region).

Total investment is over RUB 11 billion. The productive capacity will quadruple: from 20 to 80 thousand tons per year; over 100 new jobs will be created for Sokol residents. Taxes and other payments will amount to RUB 1.6 billion per year.

The full range of equipment will be designed and supplied by the German company Bellmer. The new machine will be 135 metres long and will be built in a new hall next to the existing production facility. The new PM will be designed to ensure sustainability and a closed-loop production concept. The latest two-level wastewater treatment system will be installed. Commissioning is scheduled for 2023.

The implementation of the project will help significantly increase production efficiency and make full use of pulp cooking facilities. The new PM will quickly switch between greaseproof and sack paper manufacturing. This will allow us to effectively meet consumer requests.

‘The fast food industry, restaurants, coffee houses and bakeries are the main consumers of greaseproof paper. They account for more than 90% of its consumption. At the same time, there is growing concern about the environment. People are trying to protect nature and choose biodegradable, environmentally friendly greaseproof paper and packaging whenever it is possible. These are the products that our holding company produces. Therefore, we believe that capacity expansion is an optimal response to the consumer demands and the market transformation we are observing’, commented Alexander Kharitonov, Vice President for Commerce at Segezha Group.

Sokol Pulp and Paper Mill is the only manufacturer of greaseproof unbleached paper in Russia. It is widely used in the food industry for packaging, baking and roasting.

After modernisation is completed, the Sokol Pulp and Paper Mill will retain first place in Russia and second place in Europe in the unbleached greaseproof paper sector. Moreover, the impregnation of the paper will be fully environmentally friendly. There is rising demand for such products both in Russia and all over the world. This project will allow us to replace import products and supply more to foreign markets of high-margin greaseproof paper.

Segezha Group is one of the largest Russian vertically-integrated timber holdings with a full cycle of logging and added-value wood conversion. The holding includes enterprises in both Russian and European timber, woodworking and pulp and paper industries. The group operates in 11 countries, including Russia. Its products are marketed in over 100 countries. SG plants employ 13 thousand people. Segezha Group is the largest forestry company in European Russia. As of 31 December 2020, the total area of leased forest was 8.1 million hectares of forest plots, 83% (6.72 million hectares) of which had achieved forest management certification from the Forestry Stewardship Council (FSC). In 2020, the holding made RUB 69 billion in revenue, achieving an OIBDA margin of 25%. Total investment over the past seven years is roughly RUB 50 billion. Segezha Group is Russia's largest producer of paper for multilayer sacks, industrial paper sacks and timber; the world's second-largest producer of paper for multilayer sacks and industrial paper sacks; and the world's fifth-largest producer of large-format birch plywood.