More Layoffs at Lenzing (2014)

The Lenzing Group is resolutely and systematically counteracting the ongoing difficult market conditions in the global fiber industry on the basis of its cost optimization program as it reported on the occasion of publishing its business results for the first three quarters of 2014. The organizational optimization measures launched one year ago at all sites and in all business areas are having a positive impact. The results achieved up until now are encouraging but by far insufficient to offset the decline in viscose fiber selling prices on the international marketplace.

Lenzing continues to anticipate good volume demand for all man-made cellulose fibers. However, fiber selling prices on the global market are not expected to recover in upcoming quarters. This development is also attributable to the substantial decline in polyester fiber prices as a result of the massive oil price decrease, and the expected longer-lasting period of low or at least volatile cotton prices as a consequence of the surplus supply of Chinese cotton.

For these reasons, the Lenzing Group will not implement any major new projects at the Lenzing site or abroad in the foreseeable future which are designed to expand its viscose fiber production capacities. The investment volume of the company will be adjusted to reflect the current market situation and will be significantly reduced in the subsequent years. This should contribute to improving the supply situation on the international viscose fiber market, which the company would like to sustainably profit from in its role as one of the world’s largest producers.

Due to the successful completion of the new TENCEL® investment volume, technical planning and production capacities cannot be maintained at current levels, especially at the Lenzing site. This necessitates a reorganization of Lenzing’s internal engineering and maintenance business areas and its subsidiary Lenzing Technik GmbH. Organizational structures in these areas have to be adjusted to future requirements. All in all, the restructuring measures will impact up to 250 jobs (including one-third temporary staff), mainly at the Lenzing site. The distribution of the job cuts among the various sites will be determined fiber plant in Lenzing and the reduced by the beginning of 2015 within the context of a project which is already under way. In this connection, Lenzing will try to avoid layoffs and strive to reach a mutually acceptable solution with the affected employees as it succeeded in doing within the context of the first cost optimization program.

During initial talks on this issue held with the Lenzing Works Council, Lenzing agreed to extend the current redundancy program (social plan) and to offer the possibility for employees newly affected by the downsizing to transfer to the Lenzing Labor Foundation.

At the same time, Lenzing is working on a strategic reorientation of its subsidiary Lenzing Technik GmbH to enable it to focus more strongly on the external market in the future.

For more information please contact:
Angelika Guldt Stephanie Kniep
Head of Corporate Communications Head of Investor Relations
Phone: +43 (0) 7672 701-2713 Phone: +43 (0) 7672 701-4032
E-mail: a.guldt@lenzing.com E-mail: s.kniep@lenzing.com

The Cuprammonium route re-evaluated (1980)

The April 1980 report on the possible adoption of the cuprammonium hydroxide solvent route to cellulosic fibres considered it's pros and cons c.f. viscose at that time.  Reconsideration of this old route was based on new patents, optimistic assessments by Russian workers and the view, expressed by Dr Hergert of ITT Rayonier during a visit to DF&VL, that it merited reinvestigation.

The disadvantages of the cupro route were mainly the result of tricky dope-making requiring a high quality pulp or cotton linters which had to be further purified by treatment with caustic soda.  Cost of the cellulose for viscose was put at £1.69/kg compared and compared with £2.75/kg for cupro and this dominated the economic comparison.  Both dopes contained 9-10% cellulose.  Cupro caustic costs were double those of viscose, but copper and ammonium costs were insignificant in the cupro total. 

Spinning into fine continuous filament yarns involved tube-spinning using a sulphuric acid spinbath. This and the need to recover copper as the sulphate produced sodium sulphate as a by-product just like viscose.  The fact that cupro had never really been produced as staple fibre was a serious disadvantage, but the vertically-downwards tube-spinning system and conveyor washing used to make filament yarns did lend itself to spunlaid nonwoven production.

Despite the patented advances in copper recovery and spinning speeds (much faster than ever achieved with viscose), the process was judged to be only suitable for speciality yarns and nonwovens and not a contender for viscose replacement.  The fact that the process, still known as Bemberg rayon after the German company that commercialised it in 1897, has remained a small-volume speciality yarn and nonwoven process (while the market demanded massive viscose and NMMO process expansion) would appear to confirm this judgement.

Jim Rowan recalls making PEEK tubes for Mobile (1993)

I was employed by Courtaulds Research in the Composites Research group and we worked in labs in 72 Lockhurst Lane.  Our manager was Charles Holleyman.  Our work was directly in support of Courtaulds Structural Composites, and was funded by Courtaulds Advanced Materials, so I reported to Charles and to Ed Trewin in CSC.  My role was in filament winding R&D, to develop materials and processes and make prototypes and one-off components.  

I helped manufacture, in Coventry, by filament winding, a tube of PEEK and glass fibre that was needed for the Alabama factory to make Tencel. We were told that the plant could not start up without this tube. I think it was to go in the flow line prior to the spinnerette and was part of a metal detector system. It had to be non-metallic yet very chemically resistant and strong. No other material could fulfil the requirements at the time, and almost nobody world-wide had the technology to make this unique structure. 

The job was something of an experiment as we had only done a limited amount of development to establish a process and some materials data because of the urgency to produce the tube.  All our previous years of R&D had been on carbon/PEEK, which processes differently from glass/PEEK, and we had never made anything remotely this big.  So it was a rather stressful 42 hour marathon requiring non-stop attention.  For example, we were winding a single 6 mm x 0.125 mm tape of glass/PEEK onto an irradiated rotating mandrel at about 300 degrees C and could not stop the process without overheating the product; the tape came on spools of limited length, so every few hours we had to weld the end of one tape onto the start of the next tape (using a soldering iron and paper clips) aided by a mechanism that accumulated enough tape to allow us just enough time to stop the spool while the winding continued. 

I have located the attached document which is a very brief summary, probably for someone like Jim Ratcliffe (who went on to greater things...)

Research Authorised and Development begins (1979)

On 4/10/79 a meeting took place in DF&VL "to decide whether to recommend that R&D work on alternative solvents for cellulose should be started".  Mike Welch (Head of DF&VL), Roger Lund (Deputy Head), Bill Brook (Head of Patent Dept), Jeff Branston, Fred Weymouth, Andy Hopkins, Dennis Woodward and Pat White were present.  If the answer was yes, then this group would decide the aims of the work and identify key areas to start.

At this meeting, the vulnerabilities of the viscose process versus a successful non-polluting solvent spinning development were listed as:

• Pollution and hazards.  Tightening environmental legislation would, if changes were made to comply, increase the costs of viscose by around 10p/kg in the USA, rather less in Europe.
• High spinning chemicals and recovery costs.
• High capital costs.  The US costs for an automated viscose plant using the latest technology would be 40% higher than a new polyester staple plant.

The combined chemical consumption, services and pollution control costs for any future viscose plant would be about 3x those of Courtaulds solvent spinning processes making acrylic and cellulose acetate fibres.

The wording of the conclusion was revealing: "if a recoverable solvent system could be found for cellulose it would be a serious threat" [to Courtaulds' viscose business]

Three potentially viable competitors for viscose were listed:

• The cuprammonium cellulose process where recent advances in ion-exchange solvent recovery had reduced energy costs and improved the viability of the technology.
• The ITT Rayonier DMF/N2O4 was too expensive by the published route due to solvent recovery difficulties.  However if Dupont's process for making anisotropic solutions with 30% cellulose content could be applied instead of ITT's 8% cellulose route, substantial reduction in costs would result.
• The AKZO amine-oxide process could be viable if a solvent recovery system could be developed, but it's costs were impossible to determine in the absence of any practical experience.  (Samples of amine-oxides had been made in the lab. and proved to be solvents for cellulose.)

The meeting agreed to undertake work on each of these systems to provide better information to decide future action:

• A range of amine-oxides would be made and screened and the most promising investigated in depth for solvent stability, potential hazards, recovery possibilities, spinning speeds, fibre properties, process costs, and capital costs.
• The solvating power of a range of known solvents would be investigated with the aim of finding anisotropic systems capable of yielding dopes with very high concentrations of cellulose.
• Because the cuprammonium system was showing no potential for growth, practical work would be avoided but contacts with the producers would be made to ascertain current pros and cons.

This work would be carried out by 2 graduates and would be reviewed after 6 months.

Lenzing report record sales now the new Tencel plant is on line (2014)

Lenzing reported very high production volumes in the first three quarters of 2014, operating all its fiber production facilities at full capacity. A new record sales volume of 706,900 tons was achieved (Q1-3 2013: approx. 660,000 tons). This is all the more remarkable given the fact that all industrial plants in the greater Nanjing area of China, including Lenzing, were forced to reduce production due to the Nanjing 2014 Youth Olympic Games.

The new sales record is mainly attributable to the successful ramp-up of the new TENCEL® fiber production facility at the Lenzing site in Upper Austria towards the middle of 2014. Sales of the Segment Fibers in the first three quarters of 2014 totaled EUR 1,285.4 mn, comprising a drop of 3.1% from EUR 1,326.5 mn generated in the first three quarters of 2013. Segment EBITDA in the first nine months of 2014 amounted to EUR 155.1 mn, 15.8% lower than EUR 184.1 mn in the previous year, whereas segment EBIT of EUR 64.6 mn comprised a 35.5% decline from the prior-year figure of EUR 100.1 mn. 

Specialty fibers accounted for about 39% of total sales revenue in the Segment Fibers.  Lenzing continued to generate very attractive price premiums for the specialty fiber Lenzing Modal® in contrast to viscose fibers, against the backdrop of ongoing high demand. The price premiums achieved for TENCEL® fibers remain at a very attractive level, although prices for new samples and market development projects declined somewhat in individual cases. 

The focus of Lenzing’s marketing activities in the third quarter was on further developing the market for TENCEL® fibers. The market penetration efforts to promote the use of Lenzing fibers in denim have met with success, as demonstrated by the fact that the most prominent jeans manufacturers are integrating TENCEL® fibers in their fashion collections. Demand for TENCEL® bed linen remained strong, especially on overseas markets. In the home textiles segment, Lenzing promoted the use of TENCEL® fibers in towels, opening up new application possibilities with large American retail chain stores. 

A new study in the nonwovens segment confirms that TENCEL® BIOSOFT fibers

significantly enhance wearing comfort when used as a top sheet for incontinence pads.

This extract from the Lenzing quarterly report confirms the successful start of the 67,000 tonne/year Tencel plant in Austria. (A producer-blend of Tencel and cotton is apparently taking the bulk of the new Tencel production and allowing cheaper cottons to be upgraded.  Such a blend was part of the strategy for moving the sudden surplus of Tencel when the Courtaulds Mobile plant started in 1992.  It's also nice to hear the fashion for Tencel in denim - the original launch market - is returning.)

Source: Lenzing Interim Report - 01/09/2014

First reports on solvent spinning (1976-77)

In the mid-seventies the rising influence of the US anti-pollution lobby motivated several US cellulose research groups to renew efforts to find alternatives to the xanthate dissolution route.  Chief among these was ITT Rayonier and it was their publications which stimulated a review of the new possibilities.  This was done in Courtaulds Development Fibres and Viscose Laboratory (DFVL) - the new name for what had been the Viscose Research Laboratory (VRL) in Coventry.

Brian Gardner's August 1976 File Note entitled "Solvents for Cellulose and their Application to Film and Fibre Production - A Literature and Patent Survey." reviewed the available routes but made no attempt to evaluate their suitability as a commercial alternative to xanthation.

Mike Summers-Smith extended Brian's survey in early 1977 and added conclusions on how useful these processes might be.  He listed the disadvantages of the viscose route as identified by ITT Rayonier as:

• High levels of air and water pollution.  Viscose uses strong acids, alkalis, CS2 and its regeneration liberates H2S.  (Mike noted that none of these pollutants need be emitted from the plant and all chemicals could be efficiently recycled given a high enough capital expenditure and energy outlay.  However this would render the fibres uneconomic compared with cotton and the new synthetics.)
• High capital costs.  The lengthy process with critical ageing times for alk-cell and viscose, coupled with dilute polymer solutions and slow wet-spinning processes made viscose plants fundamentally expensive.
• High energy consumption.  Major advances in energy conservation were unlikely.
• High labour costs.  (However the new automated viscose plants with slurry steeping, belt mercerising, wet-xanthation, backwash filters and continuous deaeration were bringing this under control).
• Increasing raw material costs, but these could be limited by increased recovery.

The new processes were divided into 4 classes according to the chemistry involved i.e. cellulose behaving as a complex or as a derivative, as a base, or as an acid.