Location: Parana, Brazil
Sales: $220 million
Description: Plant Location
São Jose Pinhais-Paraná, Brazil
Milan Starostik, chairman, Ana Seles, Starostik, commercial director; William Starostik, marketing director, Romeo Bregant, industrial director; Vicente Batista de Lima, financial and administrative director, Cleber dos Santos, export director; Wagner Carvalho, sales manager
Spunbonded, SMS, meltblown, laminated nonwovens
Hospital, agriculture, bedding, towel and coverlet, table mat, hygiene, baby diapers
As it finalizes plans for a ninth production line, Companhia Providencia continues to focus on the hygiene market. With all eight of its existing production lines centered on spunmelt technology, the Parana, Brazil-based company—Brazil’s largest nonwovens producer—continues to add value to its operation through printing and laminating capabilities. “We are not a commodity supplier of nonwovens,” said Cleber dos Santos, export director. “We add a lot of a value to our goods and make specialties for the hygiene market.”
This added value has allowed Providencia to achieve higher returns on its spunmelt nonwovens. In 2005, the company’s sales reached $220 million, up from $200 million the year before. Continuing this momentum could prove difficult, according to Mr. dos Santos, as the hygiene market continues to increase its competitiveness and adds pressure to pricing levels. Between 50-70% of Providencia’s output targets hygiene applications, mainly in the Americas.
“The Latin American hygiene market is still growing,” Mr. dos Santos continued. “We are seeing good initiatives in terms of better products in South America, compared to major markets like the U.S. Companies are converting to cloth-like backsheet and other improvements.”
Additionally, Providencia is responding to demands for more innovative features such as alternative colors and printing applications and better hand, improved softness and elastomeric products. Last year, Providencia upped its printing capabilities with the addition of a new multicolor line giving it the ability to print nonwovens for hygiene products.
Providencia’s ninth line will add 15-20,000 metric tons to its operation, making its total capacity 70,000 tons when it comes onstream during the second quarter of 2007. This line, like its eighth line—which came onstream during the second quarter of 2005—will be based on Reicofil 4 technology. It will add to the company’s hygiene business but also expand its efforts in the medical market, according to Mr. dos Santos.
Beyond hygiene, Providencia targets industrial markets such as agriculture and bedding with output from its older lines, which make heavier weight products. “Compared to hygiene, the growth in these areas is much more conservative. Basically, we have good years and bad years and the situation varies from one year to the next,” Mr. dos Santos said.
Geographically speaking, Providencia’s are more or less split in half between exports and imports but its entire business is served from its one plant in Parana. Diversifying its manufacturing base, however, could be the next step in Providencia’s growth strategy but Mr. dos Santos refused to elaborate on attractive locations for his company’s potential expansion."