News reports said agreement was signed between the local government and Sateri - an affiliate of Asia Symbol – on August 29th on the construction of a high-end coated SBS board and a tissue paper projects, which would "inject new and powerful impetus into the strengthening of new industries in Lianxi District", according to the Jiujiang Municipal Government in Central South China's Jiangxi Province.
As disclosed, Sateri plans to invest RMB5.08 billion to build the 1.2 million/mtpy coated SBS board project, which will generate RMB5 billion in annual sales with RMB200 million in tax revenue and create more than 2,000 new jobs after commercial runs. It will provide board for conversion into disposable cups, cigarette, food and liquid packaging. For the 300,000/mtpy tissue paper project, Sateri will spend RMB2.5 billion. Upon completion and in commercial production, it is projected to generate RMB2 billion in annual sales with RMB54 million in tax revenue and employ 1,500 people. However, the company targets in Phase I of annual production of 100,000/tons with annual sales revenue of RMB700 million from capital investment of RMB650 million.
Earlier, Sateri announced to construct a 2 million/mtpy coated SBS board production complex in Rugao, Eastern China's Jiangsu Province. As planned, a coated SBS board PM at the designed capacity of 1 million/mtpy will be built by Voith and begin running in mid-2023. With two SBS board machines at the combined capacity of 600,000/mtpy already running in Rizhao, upper Eastern China, the new facility in Rugao, Jiangsu and Jiujiang, Jiangxi, when completed as planned, will expand Asia Symbol's coated SBS board capacity to 3.8 million/mtpy and join APP*, Chenming Paper, Sun Paper and Nine Dragons to form the top-5 coated SBS board producer group in China.
The ban on plastic packaging by the authorities and the gradual elimination of low-end duplex board has spurred demand for high-end coated carton in the China market. Such an obvious "blow-out" effect encounters insufficient production capacity. Although the market is highly consolidated as the 21 existing SBS producers representing 13 million/mtpy industry capacity or the announced 7 million/mtpy new capacity expansion before end-2023 in China, APP*, Chenming Paper and Sun Paper are well ahead of others with combined capacity over 3/4 of the industry total. Now that Asia Symbol and Nine Dragons are aggressively investing and joining the top producer group, their market share will be further expanded. Even so, market analysts believe there is still room for mid-to-small players in regional field against the dominant position uphold by large producers in the national and global arena as the market's future will go with growing domestic and foreign demand for industrial packaging board from online and offline business and the stimulant impact from the ban for plastic packaging by the Chinese government.
*Including Bohui Paper
