AV Group says adding bio-refining capabilities will help diversify its pulp business.

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AV Group is a provider of specialty pulp products for the textile and paper industry, as well as a joint venture between Aditya Birla Group of India and Tembec of Canada. AV Group consists of two pulp mills located in Atholville and Nackawic, both in New Brunswick, Canada.

The company’s dissolving pulp operations use only the wood’s cellulose, which comprises approximately 60 percent of the wood. CEO Peter Vinall says the company saw an opportunity to extract more value from the remaining 40 percent of the wood’s elements through a concept known as bio-refining. “Instead of just taking in wood and making pulp that is valued for its physical properties, we have all this potential to make other chemicals,” Vinall says. “We think about going through this transition from the pulp business to the chemical business, which is a huge leap in terms of physical processes.”

Twenty five percent of the wood’s remaining chemicals are hemi-cellulose, which are essentially a form of sugar, Vinall says. Instead of continuing to incinerate the leftover sugars, there is the possibility of turning them into ethanol. AV Group is currently researching how to implement these processes in its Nackawic location, which could take two to five years, Vinall says.

“We have a very high level of confidence,” Vinall declares. “Our first goal at Nackawic is to complete the work of converting the mill to dissolving pulp, which will make this hemi-cellulose stream available. We have an active project team working on bio-refining. They’re looking at the new pulp mill and analyzing how to best optimize this side stream.”

Vinall says the researchers have established a set of “pathways,” which includes studying advanced enzymes, which can break the sugars down into alcohol.

AV Group ships all of its pulp to Aditya Birla’s headquarters in India, which Vinall says is the largest viscose (sometimes known as rayon) producer in the world. The company occupies 24 percent of the world’s market share for the product, and has an ambitious growth strategy. 

In 2007, Birla began an aggressive, two-year plan to double in size. The company has operations in Thailand, India, Indonesia and China, and has just begun working in Egypt.

Viscose on the Rise
“Viscose is most popular in Europe and Asia,” Vinall says. “Viscose is the most absorbent and best breathing fabric; viscose fiber will take in two times as much moisture as cotton. With global warming, this is a positive development.”

Vinall says for the last few years viscose consumption has started growing strongly, particularly in Europe and Asia, because land to grow cotton is becoming scarcer.

“In the U.S., there is a thriving cotton industry,” Vinall says. “Though they have different and generally complementary physical properties, there is strong competition between viscose, cotton and polyester.

"Birla has been growing by building low-cost plants. The past 15 to 20 years, viscose demand has been relatively flat. However, in the last two to three years, viscose demand experienced around a 5 percent annual growth in Asia. Our competition, cotton, is being challenged because it is an environmentally difficult crop. It takes a lot of fertilizer and is being challenged by corn, because the same land is used for cotton and corn.”

Aditya Birla
The Aditya Birla Group is a $24 billion corporation, with 100,000 employees. The company’s operations cover 20 countries and six continents. The company is headquartered in Mumbai, India. It was named “The Best Employer in India and among the top 20 in Asia” by the 2007 Hewitt, Economic Times and Wall Street Journal study.