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Performance Materials Business

Performance Materials Business

Performance Materials Department

Looking back on 2020 and future outlook

The Performance Materials Department divides its priority fields into four categories and boldly takes on the challenge of creating new value in paper making, centered on industrial paper made for IoT and 5G.

Priority area Paper product
Advanced information technology-related (IOT/5G-related) Smartphones, automobiles, industrial equipment, etc. Chip carrier tape base paper (HOCTO), abrasive-coated base paper, metal interleaving paper, electromagnetic noise suppression sheets
Environment and hygiene-related Water, air, medical, etc. Reverse osmosis membrane (RO membrane) backings, filter media, battery separators, dry non-woven fabrics, medical-related
Plastic alternatives and food-related Specialty fiber board (PASCO), oil resistant paper, oxygen absorber-related, packaging-related
Other functional paper (communication paper-related, etc.) Crimping paper, foam paper, OCR paper, various processed base paper

Advanced information technology-related (IOT/5G-related)

The Performance Materials Department divides its priority fields into four categories and boldly takes on the challenge of creating new value in paper making, centered on industrial paper made for IoT and 5G.

Plastic alternatives and food-related

The SDGs have drawn attention to the issue of plastic waste worldwide, and we are strengthening our sales activities with the keyword of plastic reduction. The number of customers that have made decisions to adopt our products, such as oil-resistant paper trays for major convenience stores, has been steadily increasing and we will continue to expand the range of customers moving forward.

Environment and hygiene-related

Our mainstay reverse osmosis membrane (RO membrane) backings, which are a necessity for water treatment applications, are performing well both in Japan and overseas and have avoided being affected by the COVID-19 pandemic. Due to heightened attention to hygiene, our filter media for air filters has also performed well.

Other functional paper (communication paper-related, etc.)

Processed base paper applications remained firm despite the COVID-19 pandemic affecting communication paper in general, including our mainstay crimped paper. We will work to grow sales of new products such as IJ Form, and actively roll out sales activities.

Containerboard Department

No. 6 paper machine at the Niigata Mill

Niigata Mill No. 6 paper machine specifications

Start of production April 2020
Type On-top multi-cylinder fourdrinier
Wire width 5,800 mm
Finishing width 5,150 mm
Products Containerboard base paper (corrugated mediums, reinforced corrugated mediums, etc.)
Production capacity 130,000 t/year
Daily production 400 t/day

* Containerboard base paper at the Niigata Mill is forest management certified.

Looking back on 2020

From April 2020, we upgraded the No. 6 paper making machine at the Niigata Mill that stopped its operation in 2019 and started production and sales of containerboard base paper under the slogan of “local production for local consumption” to make the best use of used containerboard base paper generated in Niigata prefecture. Until now, there was no mill in Niigata prefecture that produced containerboard base paper, and all recycled paper generated in the prefecture was transported outside its borders. As such, the Group’s production of containerboard at the Niigata Mill will reduce the environmental load associated with the transportation of recycled paper, and will also enable containerboard manufacturers, who are customers, to use base paper with a lower environmental load. Although we just entered this market in fiscal 2020, we were able to receive many orders because of the confidence in the production management system and quality that we have cultivated over the years at the Niigata Mill, and the affinity for the idea of “local production for local consumption.”

Prospects for the future

We will strengthen sales both domestically and for export and maximize production efficiency to improve profitability. At the same time, along with the current corrugated medium base paper, we will actively advance the development of a newly-proposed base paper that can maintain the same performance (strength) as before with less raw material (thin). In its development, we will use the features of the paper machine and the paper making technology developed from our conventional printing paper production. From production to sales, we will continue to make effective use of locally-produced containerboard for highly efficient production and realize scheduled delivery to customers. By doing so, we will reduce our environmental load in the transportation of products thoroughly upstream and downstream. In terms of exports, we will make effective use of the local port of Niigata and aim for flexible sales depending on the destination, whether China, South Korea, or ASEAN countries.

Containerboard production cycle

Key efforts related to priority measures

Performance Materials Department

Business strategy Status of efforts
Efforts related to measures to build a system to produce and sell growth products from a global perspective Bernard Dumas, a French Group company, boasts the top share of battery separators. We will continue to expand our sales channels to the US market through our American sales company, HC USA.
Capture demand for plastic alternatives We are expanding sales of PASCO hard fiber board for hooks and hangers for major apparel companies. Oil-resistant paper plays an active role in fried food trays at convenience stores and is being developed as a product to meet the stay-at-home demand and the trend of reducing the use of plastic.
Develop businesses that leverage the strength of the Group’s integrated production from base paper to processed products HOCTO chip carrier tape base paper uses raw materials pulped at the Niigata Mill and produced at the Nagaoka and Kanto Katsuta mills. Some products are processed by Toh Tech (subsidiary in China) and sold to local customers.
Restructure our business portfolio and study new fields and new businesses In the paper processing field, we will move forward with concentrating on our core competencies and focus on the packaging field.
Strengthen business by deepening cooperation among Group companies We will collaborate with six companies consisting of five affiliated companies under our control (Hokuetsu Toyo Fibre, Nikkan, Shanghai Toh Tech, HC USA, Bernard Dumas) and Hokuetsu Package, to build a business structure that can create more Group synergies.

Containerboard Department

Business strategy Status of efforts
Deepen relationships with customers and expand the basics of production and sales in the containerboard base paper business We listen directly to the comments of many customers and quickly reflect their needs in production and sales.
Promote the improvement of production efficiency and improve profitability at an early stage We are working to improve production efficiency by boosting efficiency in each department. We will effectively remove foreign materials in recycled paper and contribute to improving overall efficiency.
Capture customer needs and link them to the future growth of the containerboard business We will develop thinner and thicker papers and develop the market with the aim of expanding their introduction in e-commerce and mail ordering, which are expected to grow.

Performance Materials Division:
  Production volume (t)Production ratio by product type and mill
  (2020)

Performance Materials Division:
  Production volume (t) and Production ratio by product type and mill
  (2020)

FOCUS:Building a new organization to pursue Group synergy

Cooperation with Group companies

Cooperation with
  Group companies

Background

Due to the organizational structuring dated April 1, Hokuetsu Package, whose strength is in the growing packaging business, became a member of the Performance Materials Department, in addition to our five existing Group companies. This has further strengthened the organization, which covers everything from upstream base paper manufacturing to downstream processing segments. We will deepen cooperation with Group companies and provide products that satisfy our customers.

Development organization

In the Performance Materials Department, we will aim for sustainable growth by enhancing market competitiveness in the priority fields we have set. To expand our new business domain, we have built an organization that allows us to work closely with the Performance Materials Development Office, which is located within the Performance Materials Division, so we can quickly respond to customer needs. In addition, we have Group companies that have processing segments covering each category, so we have an organization in place that is capable of proposing ideas in a concrete form.

Priority area Advanced information technology-related (IOT/5G-related) Smartphones, automobiles, industrial equipment, etc.
Group Company Shanghai Toh Tech Co., Ltd.
Business Processing and sales of chip carrier tape
Shanghai Toh Tech Co., Ltd.
Priority area Environment and hygiene-related Water, air, medical, etc.
Group Company Bernard Dumas S.A.S.
Business Manufacture and sale of glass fiber sheets
Bernard Dumas S.A.S.
Priority area Environment and hygiene-related Water, air, medical, etc.
Group Company HOKUETSU CORPORATION USA
Business Sale of various paper products to the US market
HOKUETSU CORPORATION USA
Priority area Plastic alternatives and food-related
Group Company Hokuetsu Package Co., Ltd.
Business Manufacture and sale of paper containers and processed paper products
Hokuetsu Package Co., Ltd.
Priority area Plastic alternatives and food-related
Group Company Hokuetsu Toyo Fibre Co., Ltd.
Business Manufacture and sale of vulcanized fiber products
Hokuetsu Toyo Fibre Co., Ltd.
Priority area Other functional paper (communication paper-related, etc.)
Group Company Nikkan Co., Ltd.
Business Processing and sales of various paper products
Nikkan Co., Ltd.
Priority area Group Company Business
Environment and hygiene-related Water, air, medical, etc. Shanghai Toh Tech Co., Ltd. Processing and sales of chip carrier tape Shanghai Toh Tech Co., Ltd.
Environment and hygiene-related Water, air, medical, etc. Bernard Dumas S.A.S. Manufacture and sale of glass fiber sheets Shanghai Toh Tech Co., Ltd.
HOKUETSU CORPORATION USA Sale of various paper products to the US market HOKUETSU CORPORATION USA
Plastic alternatives and food-related Hokuetsu Package Co., Ltd. Manufacture and sale of paper containers and processed paper products Hokuetsu Package Co., Ltd.
Hokuetsu Toyo Fibre Co., Ltd. Manufacture and sale of vulcanized fiber products Hokuetsu Toyo Fibre Co., Ltd.
Other functional paper (communication paper-related, etc.) Nikkan Co., Ltd. Processing and sales of various paper products Nikkan Co., Ltd.

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