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Hope Yet for the Paper Industry

April 23, 2009

Andritz Boardmembers Optimistic about the Future

In an article recently published by Pulp & Paper International Magazine , an interview with Karl Hornhofer and Humbert Köfler, members of the executive board of the Austrian firm Andritz , a prominent supplier to the pulp and paper industry, gives insight into their thoughts about the future.

Today’s world is dominated by bad economic news wherever you look. It is therefore quite refreshing to find a company’s management that is able to see beyond the current turmoil. Hornhofer and Köfler are philosophical, even optimistic, about the industry and its long term future. “Paper has been around for a few thousand years and it’s not about to go away,” said Humbert Köfler.

Köfler is aware of the current recession, but according to him it is nothing new, as the pulp and paper industry has always fluctuated between highs and lows. Karl Hornhofer added that they as a supplier are flexible and have prepared themselves to handle these cycles. Andritz took early steps and preventive measures to cope with these changes and they don’t feel that this is going to be a long-term situation. According to Humbert Köfler, now is the right time to invest in modernization and efficiency and also a very good time for upgrading, as good deals can be struck in a downturn. One possibility along these lines is improving energy efficiency. Karl Hornhofer explained how the pulp and paper industry can save energy and costs by using biomass. The industry is already working there in the forest, so why shouldn’t they go one step further and process the wood waste and forest residues to create energy for sale. In this way mills have the perfect opportunity to become completely independent of outside energy supplies or even sell electricity to the grid and generate additional revenue. Andritz supplies biomass boilers and demand has been growing lately. They also offer gasifiers to produce biofuels from biomass. Another project is to produce second-generation ethanol from cellulose with straw as raw material.

Andritz is also looking into other areas of green energy. Humbert Köfler sees renewable energy having huge growth potential. Over the last decade the company has been growing by 19 % per annum and currently 50 % of their sales comes from projects around renewable energy. Andritz is spending 3 % of their turnover on research and development (R&D). The majority of their spending goes toward finding ways of system cost reduction, energy saving technologies and processes, including service. For example, in mechanical pulping they have reduced energy consumption by 20-30 %, and reductions of 30-40 % can be reached in hardwoods. It follows that savings can be huge, making payback times very short.