Cascades’ recycled linerboard production facility is being developed in the existing Bear Island paper mill in Hanover County, Virginia, US, and was originally announced in July 2018.
The Bear Island paper manufacturing facility was acquired by Cascades from paper production company White Birch Paper for $34.2m in July 2018.
The plant will be temporarily operated by White Birch Paper as a newsprint mill under a 27-month lease period.
It will then be converted into a linerboard plant via the integration of new equipment at an estimated cost of $275m-$300m.
The facility’s newsprint paper machine will be reconfigured to produce lightweight recycled and medium linerboard for the North American market.
The project forms part of the company’s strategy to invest in innovative packaging solutions and expand its geographical footprint across the US market.
Location details of Cascades’ recycled linerboard production facility
The Bear Island paper plant is located on a 1,620-acre site at 10026 Old Ridge Road in Hanover County, Virginia.
The Bear Island site was selected as an ideal location for Cascades’ recycled linerboard production facility due to the availability of raw materials and logistics within the region.
In addition, the plant’s existing newsprint paper machine, which is being well adapted for conversion into the containerboard machine under the initiative, was another reason for choosing the site.
Details of Cascades’ recycled linerboard production facility
Cascades aims to finalise the plans for the linerboard production facility in 2019 and commence the production of recycled linerboard in 2021.
The 601,000ft² facility will feature a new containerboard machine, which is expected to produce more than 400,000t of corrugated paper a year.
The converted facility will produce two varieties of linerboard, namely kraft linerboard and natural brown or recycled white linerboard.
Kraft linerboard products are composed of virgin fibre, while the natural brown linerboard products are made from recycled fibre materials.
The linerboards will be available in various thicknesses by basis weights in accordance with the customers’ required surface smoothness and degree of rigidity.
The production costs of the corrugated paper manufactured at the converted facility are expected to be calculated on a per-tonne basis.
Financing for Cascades’ recycled linerboard production facility
The Government of Virginia has agreed to provide a $1.95m grant for Cascades’ recycled linerboard production facility via the Commonwealth’s Opportunity Fund.
The Virginia Jobs Investment Program (VJIP) will also provide services and funding to support job creation and employee training activities at the site.
Cascades is also set to receive Sales and Use tax exemptions for its manufacturing equipment.
Benefits of the linerboard production facility in Bear Island
The Bear Island linerboard production plant will contribute to Cascades’ future development by offering downstream converting capacity and strengthening the company’s containerboard operations.
The project is expected to create up to 140 direct and indirect jobs for locals in Hanover County and the Commonwealth of Virginia, while providing significant tax revenues to Hanover County.
Marketing commentary on Cascades
Cascades was originally founded in 1964 and is focused on the recovery, manufacture, conversion and marketing of corrugated packaging products, tissue products and other speciality items, which are primarily made from recycled fibres.
The company is one of the biggest collectors of recyclable materials in Canada and also offers several varieties of food packaging products and material handling products.
Based in Quebec, Canada, Cascades employs more than 11,000 people and operates approximately 90 production units across North America and Europe.
Cascades recorded revenues of $4.3bn in 2017 and net profit of $175m, which was driven mainly by its containerboard division and the company’s European subsidiary Reno de Medici.