GF Smith has placed an order for six months' supply of Heaven 42, the leading ultra white coated paper produced by German mill Scheufelen. The paper maker has called in administrators for the second time in the less the three years, but administrators are continuing production in the hope of a going concern sale.
The mill produces Heaven 42, recognised as one of the leading coated fine paper brands globally and sold in the UK through GF Smith. “We have been working with the mill for the last three months when it became clear it was struggling.” says John Haslam, joint management director of GF Smith. “We have built up stocks, asking printers if they are discussing large projects that would need the paper, and have ordered six months' supply.”
The brand is owned by paper merchanting group Igepa, which has been working to find a mill able to make a quality substitute for the paper should the mill be forced to close. This is already being tested on press, says Haslam, so would be ready to switch if necessary.
Scheufelen also makes the Phoenixmotion paper that GF Smith sells and BVS, another coated paper, sold in the UK by Ovendens.
Last year the company introduced a packaging grade produced from grass fibres which have been dried in the sun and which replenish every two months. The paper was well received by environmental groups and was held to be promising by management at the mill, not least because it would free the company from the influence of rising pulp prices.
This has been blamed for the financial problems. “Massive price increases for pulp as well as chemicals in 2017 made it impossible to achieve the turn around.,” says a company statement, explaining that progress at reducing massive losses had been substantial since the acquisition by the Schaeff-led consortium in May 2016.
In 2017 the mill produced 104,000 tonnes, earning €83 million with 340 employees. It has a capacity of 140,000tpa.
It reckoned that high margins possible with Grass Paper and the Phenolux luxury packaging board combined with the market position of Heaven 42 would provide the foundation for it future. The grass derived fibre could be turned into container bird as well as graphic papers and as part of the luxury packaging SBS grade. As well as meeting forthcoming legislation for food contact papers, much less water is needed to produce 1 tonne of pulp.
This may still be the case, but under a changed ownership.
Scheufelen is the second German paper mill to collapse this year following the insolvency of Feldmuehle Uetersen, a producer of packaging papers and boards.
Scheufelen has called in administrators as the mill blames rising prices of chemicals and pulp for financial difficulties. However, the mill remains in production and GF Smith has been swift to protect supplies of the leading Heaven 42 brand.