UPM invests in next generation biochemicals to drive a switch from fossil raw materials to sustainable solutions - Seite 2

Attractive growth markets

Application areas for bio-monoethylene glycol include textiles, PET bottles, packaging, and deicing fluids. Bio-monopropylene glycol is used for example in composites, pharma, cosmetics, and detergents. The global glycols market represents more than 30 million tonnes in size and is expected to grow annually approximately by 4%. Currently the market supply is practically all based on fossil raw materials: oil, natural gas and coal.

Lignin-based renewable functional fillers are used in different rubber applications as a sustainable alternative to carbon black and silica. The global market for carbon black and silica combined is more than 15 million tonnes with an expected annual growth of approximately 3%. Besides climate benefits UPM’s new renewable functional fillers will provide additional benefits such as lighter weight and high purity.

“We are truly excited to provide the customers world-class sustainable solutions. Renewable raw material and new technologies enable significant improvement in carbon footprint compared to fossil-based products. We can also take pride in creating an entirely European value chain, thus being a sustainable local producer,” says Juuso Konttinen, Vice President, UPM Biochemicals.

“Furthermore, our products fit directly into our customers’ existing processes and the recycling infrastructure. These aspects are important for brand owners and their businesses and pave the way for holistic circular economy, " says Konttinen.

Ideal location in Chemical Site Leuna close to Halle-Leipzig

Being the European center for chemicals industry excellence and located in the middle of the markets, Germany provides an attractive location for the biorefinery. InfraLeuna GmbH, in the state of Saxony-Anhalt, offers very competitive conditions for constructing a biorefinery with its existing permitting processes, logistics arrangements and infrastructure for various services and utilities. UPM plans to enter service agreements related to wood handling, waste water treatment and other utilities that will be recognised as lease assets and liabilities under IFRS 16 Leases. Depending on the final agreement the total amount of such lease assets and liabilities is estimated to be EUR 40-100 million.