New chance for pulp maker Fibre Excellence Tarascon

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Fibre Excellence Tarascon switches from bleached to unbleached pulp production

Fibre Excellence Tarascon is trying to find a way to survive.

The company thinks that prospects are looking good now, as conditions on the pulp market are improving and it will get more financial help.

A ray of hope is still left for French pulp producer Fibre Excellence Tarascon which has been in receivership since 8 October 2020 and is facing the threat of liquidation. Responding to a query, the company said that the commercial court of Toulouse had decided in a session of 12 January to postpone any decision about the future of the mill until 26 January. It would then be in a better position to assess if Fibre Excellence must be liquidated or if activities can be continued. The observation runs until 8 April.

A spokeswoman for Fibre Excellence explained that a fresh financing plan had to be drawn up as new factors had emerged that needed to be taken into consideration to make a decision on the future of the mill. Firstly, market conditions had improved because pulp prices were on the rise, she said. Secondly, government help is forthcoming.

€1.6m in state aid

The French government is equally interested to find a solution for the mill and its 280 employees and has announced additional financial assistance, according to a press release from the department of Bouches-du-Rhône. The department has agreed to provide another €1.6m. This will be the second financial contribution from the government, which has already provided a subsidy to the tune of €7m last year. The new funds will be used to keep the mill running during the observation phase and to find solutions to continue the business in a profitable way.

Despite all the efforts, the department of Bouches-du-Rhône does not rule out that the search for a new investor, which has been going on since February 2020, might well turn out to be fruitless and the mill might have to be closed. The press release underscores that there is no takeover offer at the moment and the shareholder – Fibre Excellence – has shown no interest in investing in the site.

Production to be progressively switched to unbleached pulp

However, trade union Filpac CGT has not given up hope and says that the mill is fundamentally viable. The company is equally optimistic. As early as last year, changes to the mill’s portfolio had been made, the spokeswoman noted. The mill now also produces unbleached in addition to bleached softwood pulp. Production costs for the new product were lower and the company had bagged a large order, a trade union spokesman said. Fibre Excellence Tarascon reported that unbleached pulp accounted for 25 per cent of its output in 2020. This year, the company is expecting to raise its share to 50 per cent. The aim is to progressively switch entirely to the unbleached pulp, the company said.

Meanwhile, discussions continue about a project that is also aimed at cutting costs. A new biomass-powered turbine could be installed at Tarascon to supply power to the pulp mill.

According to the company, pulp production at Tarascon has returned to normal after suffering a longer disruption last September due to a strike. The mill can produce 250,000 types of softwood pulp and employs 280 persons. Fibre Excellence, the parent company of Fibre Excellence Tarascon, has a second subsidiary in Saint-Gaudens which is not affected by the restructuring.