Lenzing Group, a global market leader in specialty cellulosic fibres, and Duratex, the biggest producer of industrialised wood panels in the Southern Hemisphere, will be forming a joint venture to build the largest single line dissolving wood pulp (DWP) plant in the state of Minas Gerais, near Sao Paulo, Brazil.
The joint venture will investigate the construction of a 450,000 t DWP plant, which is expected to become the largest and most competitive single line DWP plant in the world. Dissolving wood pulp is the key raw material for the production of Lenzing’s bio-based fibres.
For the future operation, the two companies have secured a plantation of 43,000 hectares that will provide the FSC® certified biomass. The plantation is fully in line with Lenzing’s wood and pulp sourcing policy. The basic engineering and the application for required permits and merger clearances will now be started.
Lenzing will hold 51% of the joint venture which will operate the mill, while Duratex’s share will be 49%. The estimated cash investment by the joint venture for the construction of the DWP mill is expected to be somewhat above USD 1 bn. The joint venture will supply the entire volume of dissolving wood pulp to the Lenzing Group. This step is an essential milestone in the group’s ambition to grow its specialty fibres business.