Skip to main content

Pulp Business

Further improving corporate value based on high added value forest management

Business Overview

Canadian subsidiary, Alberta-Pacific Forest Industries Inc. (Al-Pac) is responsible for the upstream sector of the HOKUETSU GROUP, and is the heart of our pulp business. Al-Pac operates the largest pulp mill in North America, boasting an annual output of 560,000 tons of leaf bleached kraft pulp (LBKP) and 100,000 tons of needle bleached kraft pulp (NBKP).
Al-Pac is entrusted with managing 6.4 million hectares of forest land (an area that is larger than Kyushu and Shikoku combined) from the government of Alberta, and uses this resource for raw pulp material.
Al-Pac produces and sells high quality pulp with high purity and a high uniformity of fiber which comes from the forest resources managed by Al-Pac and the production technology of the mill. Thanks to the praise for their high quality, environmental measures, and accurate response to customer needs, we have secured a stable customer base in North America, China, Japan, and South Korea.

Future Issues and Initiatives

In order for Al-Pac to maintain its FSC certification, it must manage its vast forests in a manner that is “Ecologically, Economically, and Socially” suitable for the environment.
In addition, FSC credits have typically been managed separately for hardwoods and softwoods. However, since there is only one forest, a new recognition that the way the forest is managed is shared, and not by tree type, was established, and the logs Al-Pac harvests were uniformly certified. As a result, it became possible to significantly increase the amount of pulp that can be supplied as FSC-certified pulp.
By leveraging the high market valuation of FSC certification, we aim to build and thoroughly develop an ecological value chain from logs to the final product and its users, and deploy this laterally to differentiate the company’s products. We intend to realize sustainable, improved, corporate value by strengthening our sales system so that it is not influenced by market conditions.

Performance Highlights

Change in production Change in production

In 2017, the Pulp Business contributed to the profits of the entire Group, with significant results that exceeded 2016 totals backed by higher sales prices due to the recovery in market conditions, increased sales as a result of higher production, and lower manufacturing indirect costs.
Production-wise, we strive to stabilize and improve our day-to-day output, and are working to maximize production by considering optimization of the periodic maintenance interval.
As demand for printing and writing paper continues to decline, we are aggressively working on technical support for household paper, such as tissue paper, and specialty paper manufacturers to diversify our pulp sales. Furthermore, we will do our utmost to have customers appreciate the quality and value of Al-Pac products by offering FSC® (Forest Stewardship Council) certified products etc. and diversifying our sales customers, leading to growth.

Sales ratio of Al-Pac pulp by usage Sales ratio of Al-Pac pulp by usage

Return to top

Business Topics

Start of operation of chemical and freight car receiving facility

Chemical cars on the side trackChemical cars on the side track

In 2017, the Pulp Business contributed to the profits of the entire Group, with significant results that exceeded 2016 totals backed by higher sales prices due to the recovery in market conditions, increased sales as a result of higher production, and lower manufacturing indirect costs.
Production-wise, we strive to stabilize and improve our day-to-day output, and are working to maximize production by considering optimization of the periodic maintenance interval.
As demand for printing and writing paper continues to decline, we are aggressively working on technical support for household paper, such as tissue paper, and specialty paper manufacturers to diversify our pulp sales. Furthermore, we will do our utmost to have customers appreciate the quality and value of Al-Pac products by offering FSC® (Forest Stewardship Council) certified products etc. and diversifying our sales customers, leading to growth.

Manufacture and sale of biomethanol

Al-Pac has worked with its partners in Canada to put into practical use technology to extract and purify only methanol from gas generated in the pulp manufacturing process.
The technology is innovative and has been subsidized by the Canadian government and the Government of the province of Alberta. Al-Pac built manufacturing facilities that include distillation towers and concentrating towers, and has worked with its partners to put the technology into production and improve quality. There are prospects for its practical application, and sustained continuous operation has become possible. Product quality has also improved, and customers have expressed their approval of plant-derived biomethanol.

FSC® field tour

As one of the pre-tours of the FSC Annual Meeting held in October 2017, Al-Pac hosted a field tour that was attended by members of four countries mainly from FSC Canada and WWF Russia, and introduced examples of forest management in Canada. The tour covered examples of protection of the natural environment through forest management from tree harvesting to product (pulp) production, and the social role of the company.
Participants included those involved in the company’s production and forest management (representatives of indigenous peoples, local employees, forest management researchers, etc.) where they learned about building a balanced and sustainable coexistence with all stakeholders. The tour ended on a high note with participants commenting that it was an operation that set an example for all countries.

FSC<sup>®</sup> field tour

Optimizing periodic maintenance intervals

Since starting operations in 1992, Al-Pac has consistently strived to develop and implement a systematic and appropriate facility maintenance plan. As a result, it has been able to keep its facilities in good shape order 25 years after the start of operations. Up to now, it has been performing long-term periodic maintenance (facility inspection, repairs) about every 12 months, and while everything has been maintained, it has tried to extend this periodic maintenance interval to increase production and lower maintenance costs.
To do this requires that facilities be operated safely and efficiently over a long period. Based on their facilities management and operating results to date, they received approval from the relevant agencies, including the provincial government, and insurance companies, and postponed the scheduled periodic maintenance in 2017, and have been operating continuously for about 19 months. As a result of this effort, they achieved their highest production ever in 2017 when they did not perform long-term maintenance. It contributed to higher sales with a rising market, and significantly contributed to boosting profits. Al-Pac will continue to maintain and manage the facilities appropriately while considering the optimization of the interval for long-term periodic maintenance to ensure continuous operation.

Return to top