01.01.02
Location: Memphis, TN
Sales: $225 Million
Description: Key Personnel
Kris Matula, senior vice president, nonwovens; Chip Aiken, senior vice president, manufacturing—nonwovens; Howard Cannon, vice president, nonwovens sales; John Erspamer, vice president, nonwovens product development; Marko Rajamma, vice president, nonwovens sales—Europe and Middle East
Plants
Delta, British Columbia; Cork, Ireland; Steinfurt, Germany; Gaston, NC
Processes
Latex bonded, thermal bonded and multibonded airlaid
Brand Names
Vicell, Vizorb, Unicore, Duocore, Walkisoft, Airspun
Major Markets
Feminine hygiene, baby diapers, adult incontinence products, premoistened wipes, moist tissue, medical, tabletop, wipers, filtration, food packaging, household cleaning products
Last year the big news from airlaid specialist Buckeye Technologies, Memphis, TN, was the completion of a 50,000 ton-per-year airlaid line in Gaston, NC—the largest in the world. This year the question is how to get all of this added capacity onto the market amidst unfavorable conditions caused by such factors as overcapacity and a soft global economy. Still, executives are confident that, in time, the market for airlaid materials will receive a boost from new applications and improved market conditions.
“Current business conditions in airlaid nonwovens are very difficult,” explained Kris Matula, senior vice president, nonwovens. “The rate of new capacity addition has substantially outpaced the growth in demand for airlaid materials, making it extremely challenging to earn an acceptable return. There is hope for a turnaround, but it’s a ways out and will require successful development of new end use applications for airlaid materials.”
During the past three to five years, growth in the airlaid business has been fueled by an increasing use of airlaid materials in feminine hygiene products. As this growth slows, success in new areas, such as disposable household wipes, moist toilet tissue, food pads and baby diapers will be key, according to executives.
“New wipes continue to hit the shelves, and it’s a growing business—it’s not huge, but it’s nice,” explained Howard Cannon, vice president, nonwovens sales. “As for wet toilet paper, the jury is still out on how big it will get or how fast it will grow.”
Food pads is another promising growth area for airlaid, which has been replacing multiply tissues and fluff pulp pads in meat, fish and poultry packaging. Several features of airlaid materials, such as better absorbency, higher integrity and built-in barrier properties, make them preferred for food packaging. Additionally, the ability to engineer multiple functions into a single composite structure can substantially reduce the complexity of finished product converting operations. “Many of our materials are able to do it all—acquire, distribute and store fluids,” said Michael Brown, absorbent products sales. “We add as much functionality to our products as possible to reduce the complexity of customers’ business.”
While Buckeye executives do not expect this market to mirror feminine hygiene in size or scope, it does have the potential to become a meaningful area for airlaid growth. As airlaid tends to be more expensive than traditional food packaging materials, such as tissue, delivering the right balance between performance and cost is a must.
Despite the headway seen in some emerging markets for airlaid, a slower growth environment continues to make this industry challenging for all of its players. In response to this, Buckeye will not bring its aforementioned 50,000 ton-per-year airlaid machine fully onstream during the past 12 months. “Any time you start up a new facility, it’s very expensive,” Mr. Cannon opined. “Due to our current industry conditions, we have chosen to ramp up the machine really slowly.”
This slow start-up so far has meant that Buckeye is moving only one project at a time onto the new line, which is operating five days a week. Still executives remain optimistic about the machine, which features several capabilities not offered by smaller machines. These include the number of heads, embossing options, the amount of powder dosing and how it packs sheets. “We are pleased with the machine and how it is currently operating,” Mr. Matula continued. “Our customers are uniformly pleased with the superior performing, high quality materials they are receiving from the new line.”
The company has also slowed its pace of capital investment. Buckeye’s plan to add a second airlaid line to its Cork, Ireland facility, put on hold in 2001, has not been revisited, and additional expansion plans have not been examined. “Our current focus is on streamlining our operations and reducing costs,” Mr. Cannon remarked. “We invested a lot of capital in the past two years and are now focused on executing our operations with excellence.”
One investment that has paid off for Buckeye is its purchase of Stac-Pac festooning technology, which is now installed on all of its airlaid lines. Buckeye purchased the technology from KT Holdings, Winnipeg, Canada, for a reported $25 million in 2000, and currently about 25% of its roll goods are packaged in bales, using the technology, rather than rolls. The benefits of folding technology include longer run times, reduced shipping costs, less storage space and the ability to deliver extremely narrow width materials. Furthermore, if the diaper industry chose to convert to an airlaid core, this type of technology would be necessary because core material is too thick to be rolled cost effectively.
The technology behind Stac-Pac is so important that Buckeye has been busy defending its patent in both Canada and Germany. In March, the Utility Model Division of the Germany Patent and Trademark Office reaffirmed the patent by rejecting Falkenhagen, Germany-based Concert GmbH’s bid to cancel its validity. The ruling was the latest step in a patent infringement lawsuit filed by Buckeye against Concert Industries, Vancouver, British Columbia, Canada, and its German subsidiary in November 2000. In December, Buckeye announced it had won its infringement lawsuit, prohibiting Concert from producing or selling Stac-Pac-folded bales of material without Buckeye’s permission. While Concert has filed an appeal against this decision, Buckeye has taken the battle a step further by filing a pending Stac-Pac infringement suit against Concert. A ruling on this motion is expected to be handed down in 2003.
“We now have a very strong legal position supporting our folding technology,” Mr. Cannon explained. “Stac-Pac technology gives us one more avenue to further differentiate our products and services from those of other airlaid suppliers.”
As Buckeye waits for airlaid to receive the boost its needs to enter a more promising period of growth, it will focus on streamlining its operations, new product initiatives and technology and development efforts to be poised for success when the time comes.
“Our strategy is to deliver superior performing, differentiated products and services that afford our customers a competitive advantage in the marketplace,” Mr. Matula said. “During the past few years we have made significant investments in technology, our facilities and our people to achieve this objective. We are confident these investments will pay great dividends in the future.”
Sales: $225 Million
Description: Key Personnel
Kris Matula, senior vice president, nonwovens; Chip Aiken, senior vice president, manufacturing—nonwovens; Howard Cannon, vice president, nonwovens sales; John Erspamer, vice president, nonwovens product development; Marko Rajamma, vice president, nonwovens sales—Europe and Middle East
Plants
Delta, British Columbia; Cork, Ireland; Steinfurt, Germany; Gaston, NC
Processes
Latex bonded, thermal bonded and multibonded airlaid
Brand Names
Vicell, Vizorb, Unicore, Duocore, Walkisoft, Airspun
Major Markets
Feminine hygiene, baby diapers, adult incontinence products, premoistened wipes, moist tissue, medical, tabletop, wipers, filtration, food packaging, household cleaning products
Last year the big news from airlaid specialist Buckeye Technologies, Memphis, TN, was the completion of a 50,000 ton-per-year airlaid line in Gaston, NC—the largest in the world. This year the question is how to get all of this added capacity onto the market amidst unfavorable conditions caused by such factors as overcapacity and a soft global economy. Still, executives are confident that, in time, the market for airlaid materials will receive a boost from new applications and improved market conditions.
“Current business conditions in airlaid nonwovens are very difficult,” explained Kris Matula, senior vice president, nonwovens. “The rate of new capacity addition has substantially outpaced the growth in demand for airlaid materials, making it extremely challenging to earn an acceptable return. There is hope for a turnaround, but it’s a ways out and will require successful development of new end use applications for airlaid materials.”
During the past three to five years, growth in the airlaid business has been fueled by an increasing use of airlaid materials in feminine hygiene products. As this growth slows, success in new areas, such as disposable household wipes, moist toilet tissue, food pads and baby diapers will be key, according to executives.
“New wipes continue to hit the shelves, and it’s a growing business—it’s not huge, but it’s nice,” explained Howard Cannon, vice president, nonwovens sales. “As for wet toilet paper, the jury is still out on how big it will get or how fast it will grow.”
Food pads is another promising growth area for airlaid, which has been replacing multiply tissues and fluff pulp pads in meat, fish and poultry packaging. Several features of airlaid materials, such as better absorbency, higher integrity and built-in barrier properties, make them preferred for food packaging. Additionally, the ability to engineer multiple functions into a single composite structure can substantially reduce the complexity of finished product converting operations. “Many of our materials are able to do it all—acquire, distribute and store fluids,” said Michael Brown, absorbent products sales. “We add as much functionality to our products as possible to reduce the complexity of customers’ business.”
While Buckeye executives do not expect this market to mirror feminine hygiene in size or scope, it does have the potential to become a meaningful area for airlaid growth. As airlaid tends to be more expensive than traditional food packaging materials, such as tissue, delivering the right balance between performance and cost is a must.
Despite the headway seen in some emerging markets for airlaid, a slower growth environment continues to make this industry challenging for all of its players. In response to this, Buckeye will not bring its aforementioned 50,000 ton-per-year airlaid machine fully onstream during the past 12 months. “Any time you start up a new facility, it’s very expensive,” Mr. Cannon opined. “Due to our current industry conditions, we have chosen to ramp up the machine really slowly.”
This slow start-up so far has meant that Buckeye is moving only one project at a time onto the new line, which is operating five days a week. Still executives remain optimistic about the machine, which features several capabilities not offered by smaller machines. These include the number of heads, embossing options, the amount of powder dosing and how it packs sheets. “We are pleased with the machine and how it is currently operating,” Mr. Matula continued. “Our customers are uniformly pleased with the superior performing, high quality materials they are receiving from the new line.”
The company has also slowed its pace of capital investment. Buckeye’s plan to add a second airlaid line to its Cork, Ireland facility, put on hold in 2001, has not been revisited, and additional expansion plans have not been examined. “Our current focus is on streamlining our operations and reducing costs,” Mr. Cannon remarked. “We invested a lot of capital in the past two years and are now focused on executing our operations with excellence.”
One investment that has paid off for Buckeye is its purchase of Stac-Pac festooning technology, which is now installed on all of its airlaid lines. Buckeye purchased the technology from KT Holdings, Winnipeg, Canada, for a reported $25 million in 2000, and currently about 25% of its roll goods are packaged in bales, using the technology, rather than rolls. The benefits of folding technology include longer run times, reduced shipping costs, less storage space and the ability to deliver extremely narrow width materials. Furthermore, if the diaper industry chose to convert to an airlaid core, this type of technology would be necessary because core material is too thick to be rolled cost effectively.
The technology behind Stac-Pac is so important that Buckeye has been busy defending its patent in both Canada and Germany. In March, the Utility Model Division of the Germany Patent and Trademark Office reaffirmed the patent by rejecting Falkenhagen, Germany-based Concert GmbH’s bid to cancel its validity. The ruling was the latest step in a patent infringement lawsuit filed by Buckeye against Concert Industries, Vancouver, British Columbia, Canada, and its German subsidiary in November 2000. In December, Buckeye announced it had won its infringement lawsuit, prohibiting Concert from producing or selling Stac-Pac-folded bales of material without Buckeye’s permission. While Concert has filed an appeal against this decision, Buckeye has taken the battle a step further by filing a pending Stac-Pac infringement suit against Concert. A ruling on this motion is expected to be handed down in 2003.
“We now have a very strong legal position supporting our folding technology,” Mr. Cannon explained. “Stac-Pac technology gives us one more avenue to further differentiate our products and services from those of other airlaid suppliers.”
As Buckeye waits for airlaid to receive the boost its needs to enter a more promising period of growth, it will focus on streamlining its operations, new product initiatives and technology and development efforts to be poised for success when the time comes.
“Our strategy is to deliver superior performing, differentiated products and services that afford our customers a competitive advantage in the marketplace,” Mr. Matula said. “During the past few years we have made significant investments in technology, our facilities and our people to achieve this objective. We are confident these investments will pay great dividends in the future.”