STRONG Kraft paper demand, helped by a switch from plastic carrier bags, augurs well for Mondi. Antoine de Ras / African News Agency (ANA)

JOHANNESBURG - South African packaging and paper group Mondi Limited said on Monday that it was proceeding with its investment in new 300,000 tonne kraft top white machine at Ruzomberok in Slovakia after having recently obtained the necessary permitting, with start-up expected towards the end of 2020.

Mondi said the total project cost had been revised to €340 million, up from €310 million, as a result of refinements to the machine’s technical concept and higher construction costs since the project was initially scoped. 

Peter Oswald, Mondi Group chief executive said: "This investment provides an exciting opportunity for Mondi to leverage our cost advantaged mill in Slovakia to complement our portfolio and serve a growing market with innovative and sustainable containerboard solutions."

The machine will produce a new and unique environmentally sound containerboard grade, kraft top white, which combines the strength, printability and appearance benefits of a white virgin fibre top layer with the economic advantages of a recycled fibre bottom layer.

Its access to integrated bleached hardwood pulp production, scale and location benefits due to its brownfield nature will provide this machine a cost advantage difficult to replicate. 

Kraft top white will target the growing white top liner markets for applications such as shelf-ready packaging, point of sale displays, customised packaging, e-commerce, consumer durables and other specialised applications.

The related pulp mill upgrade at the same site is progressing according to plan with start-up expected in late 2019. 

Mondi said this upgrade will debottleneck pulp production by 100,000 tonnes per annum, which will be integrated into the containerboard production once the new machine ramps up.

Group capital expenditure continues to be in line with the previous estimate of €700-800 million per annum in 2018 and 2019.

African News Agency (ANA)