Future Guaranteed wood supply essential for restructuring Maritime, Maine operations

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Reid Southwick
Telegraph-Journal

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SAINT JOHN - AV Group is considering future production of biodegradable plastics from wood fibres as it looks to restructure its Nackawic operation in the face of declines in commodity markets, the company said Tuesday.

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There is a real opportunity for pulp operations to shelter themselves from downturns in commodity markets by looking to artificial sweeteners, specialty chemicals and so-called bioplastics, says AV Group president Peter Vinall.

This potential new market is one of several the company, owned by the Aditya Birla Group and Tembec, is considering as it prepares to become more competitive on a global scale.

A major hurdle in this move to develop more value-added products is gaining sufficient access to New Brunswick's Crown wood.

But AV Group president Peter Vinall said Tuesday a new study, headed by a coalition of researchers, governments and forestry firms from the region on both sides of the border, is expected to buoy these efforts.

"There is a whole world of opportunity developing around bioproducts and we have the potential in our own group to expand," said Vinall. "But we have to make sure wood is allocated in a way that supports the best and highest uses."

The new study, involving New Brunswick, Nova Scotia, Maine, their top research universities and about a dozen firms, is looking at global technologies in the bioenergy, biochemical and biofuel sectors, and how they may be adopted in the region.

Lead by analysts with PriceWaterhouseCoopers, the study is designed to clear a new path for the forestry sector, which has been set on a downward spiral in recent years.

Vinall said there is an opportunity for pulp operations to shelter themselves from downturns in commodity markets by looking to artificial sweeteners, specialty chemicals and so-called bioplastics.

The Dow Chemical Company (NYSE:DOW) and other manufacturers from across the globe are considering the potential of replacing petroleum-based plastics with new products made from trees.

But Vinall said the industry cannot move forward without first identifying how the various species and qualities of wood should be divided between these specialized uses and the more traditional commodity products.

He said this work is complex and requires the expertise of not just one government, company or university.

"We need to be very careful that, where there are companies like ours that can expand into value-added products, we are given reasonable access to the resources to do that," he said.

Gleaning the most valuable products from wood is also a major priority for manufacturers south of the border, said Rosaire Pelletier, senior forest products advisor to the Governor of Maine.

"We first want to get an inventory of our forests in the state and then find the best uses for that inventory," said Pelletier.

"Where there is a major demand for biomass, and other uses for the forest, we want to make sure these products bring more economic development and benefits to the citizens of Maine."