From the Sector

• Lenzing again recognized for sustainable sourcing, innovation and transparency
• Lenzing achieves the highest category for the third time already

The Lenzing Group achieved first place in the “Hot Button Ranking” of the Canadian non-profit organization Canopy, thus confirming its leading role in the areas of sustainability and responsible wood and pulp sourcing. Lenzing can also once again celebrate a dark green shirt, synonymous with the highest category.

In this ranking, which receives a lot of attention in the textile and apparel industry, Canopy evaluates the world’s 34 largest producers of cellulosic fibers in terms of their sustainable wood and pulp sourcing, their efforts with regard to the use of alternative raw materials and their achievements in the protection of ancient and endangered forests. Resource preservation is a key element of Lenzing’s corporate strategy and at the core of its innovation agenda. The sustainable production of TENCEL™, VEOCEL™ and LENZING™ ECOVERO™branded specialty fibers is based on these principles.

Promoting the circular economy
With its REFIBRA™ and Eco Cycle technologies, Lenzing offers solutions for transforming the textile and nonwovens industries towards a circular economy. In line with its vision for the circular economy, “We give waste a new life. Every day.” Lenzing is driving the industry toward a full circular economy by striving to give waste a new life in all aspects of its core business and developing circular solutions together with potential partners inside and outside the current value chain. A milestone on this path is the cooperation with the Swedish pulp producer Södra. The two global market leaders, who have been proactively promoting the circular economy in the fashion industry for many years, are joining forces to give the topic a further boost and make a decisive contribution to solving the global textile waste problem by making fibers from post-consumer textiles.

Today, Lenzing offers lyocell fibers made from 30 percent recycled cotton waste. The company aims to launch lyocell, modal and viscose staple fibers with up to 50 percent recycled post-consumer content on a commercial scale by 2025 and to develop a new circular business model by closing the loops for post-consumer waste. By 2025, the company plans to enter into further partnerships with 25 key supply chain companies.

• Sales increase of 10.7% to €549.8 million in the first half of 2022
• EBITDApre improves by 22.6%, higher than the increase in sales, to €87.9 million
• Positive business development, price increases and strict cost management led to forecast increase on June 7, 2022

Despite uncertain general conditions in the first six months 2022, SGL Carbon's business model is proving its resilience. After €270.9 million in Q1 2022, SGL Carbon was able to increase sales to €278.9 million in Q2. Accordingly, sales for the first half of 2022 amount to €549.8 million, which corresponds to a sales plus of €53.1 million or 10.7% compared to the same period of the previous year.

The increase in sales was driven in particular by customers in the semiconductor industry and growth in the industrial applications market segment. Demand from the automotive and chemical industries was also encouraging.

EBITDApre, as one of the Group's key performance indicators, improved by €16.2 million (+22.6%) to €87.9 million (H1 2021: €71.7 million). Consequently, the EBITDApre margin increased from 14.4% to 16.0%. In addition to the higher utilization of production capacities due to higher sales, the improvement in earnings was also driven by the largely successful passing-on of higher raw material and energy costs to customers as well as savings from the transformation program.

EBITDApre does not include positive one-off effects and non-recurring items totaling €10.6 million (H1 2021: minus €5.2 million). As a result, EBIT in H1 2022 increased significantly from €38.3 million to €69.6 million. Taking into account the financial result of minus €16.6 million (H1 2021: minus €14.0 million), consolidated net income for the first six months of the current fiscal year amounted to €48.8 million, compared to €17.9 million in the prior-year period.

Business Units
With an increase in sales of €22.2 million (+10.0%) to €243.4 million, the Graphite Solutions (GS) business unit made a major contribution to SGL Carbon’s sales growth. In particular, continued high demand from customers in the semiconductor sector, which represents approximately one third of the segment's sales, led to the positive business development in GS. As a result of the predominantly high-margin business, EBITDApre at GS improved by 22.7% to €54.0 million.

The Process Technology (PT) business unit benefited from the good order situation in the chemical industry in H1 2022 and consequently increased sales to €49.2 million (H1 2021: € 40.8 million). EBITDApre also improved from €0.1 million in the prior year’s first half to €4.1 million in H1 2022.

The Carbon Fibers (CF) business unit benefited in the 1st half 2022 from final deliveries to a major automotive manufacturer whose contract expired as scheduled on June 30, 2022. Segment sales increased by 5.8% year-on-year to €176.0 million. In contrast, EBITDApre at CF decreased by €4.2 million to €28.2 million despite the good order situation and successful price increases. It should be noted that CF was impacted by a special effect from energy derivatives for price hedging in the amount of €9.2 million in the first quarter of 2022.

With an increase in sales of 15.6% to €69.6 million, the Composite Solutions (CS) business unit continued its upward trend. The specialist for customized component solutions for the automotive industry improved its EBITDApre from €5.7 million in the first half of 2021 to the current €9.7 million, based in particular on price and volume effects.

Balance sheet figures
Working capital rose by 11.7% to €381.1 million as of June 30, 2022. This was mainly due to higher inventories (€ +73.9 million) and an offsetting increase in trade payables (€ +29.0 million). A targeted build-up of inventories in critical raw materials due to disruptions in transport routes and the recent Covid lockdown in Shanghai were some of the reasons for the higher inventory levels.

SGL Carbon's net financial debt slightly increased by €6.6 million to €212.9 million as of June 30, 2022 (Dec. 31, 2021: €206.3 million), which was due to a lower free cash flow of €7.5 million for H1 2022 (H1 2021: €56.6 million).

Guidance increase
On June 7, 2022, SGL Carbon raised its sales and earnings guidance for fiscal year 2022. The company now expects sales of €1.1 billion (previously: around €1.0 billion) and EBITDApre of €130 - 150 million (previously: €110 - 130 million). Based on the pleasing business development, realized price increases, a stringent cost management, and taking into account the currently known risks, SGL’s management expects to achieve the earnings forecast for 2022 at the upper end of the stated range.

Natural fibers are among the most important raw materials in the textile and fashion industry worldwide. For centuries, they have fed millions of people through their cultivation or breeding, and it is impossible to imagine daily life without them. Especially at the moment, natural fibers are gaining special importance due to the intense discussions about sustainable living. Even though natural fibers have accompanied mankind for a long time, they are changeable, technical, and adaptable to the challenges of the textile industry.

The Discover Natural Fibres Initiative (DNFI) is celebrating natural fibres in a program to be conducted during Heimtextil in Frankfurt on 23 June. Anyone with an interest in the role of natural fibres in the world economy, economic indicators of textile activity, innovations in natural fibre research, and updates on proposed EU legislation affecting textiles is welcome to attend.

The program will include various presentations by the previous and current award winners, presentations, and discussions:

Overview of world natural fibre production, employment, and value,

• Economic indicators and impacts of coronavirus on textile industries,
• Updates on innovative uses of natural fibres:
• Use of wool in automobile insulation applications for enhanced sustainability,
• Using cellulose from cotton to produce a biodegradable plastic substitute,
• Manufacturing waterproof fabric from a blend of cotton and jute as sustainable
• Substitute for polypropylene tarps
• Proposed EU textile legislation and potential impacts on natural fibres

Zhoukou Xuwang Co., Ltd. has successfully started up two new ANDRITZ neXline spunlace lines at its facilities based in Henan province, China. Combining equipment from the aXcess and eXcelle ranges, both lines are dedicated to the production of spunlace fabrics of 30 to 120 gsm made out of viscose and polyester fibers. The ANDRITZ design will allow Zhoukou Xuwang to serve the premium product market, especially for premium hygiene and technical wipes, in China.

The ANDRITZ scope of supply for the two lines included:

• aXcess opening and blending systems
• high-performance eXcelle card and crosslapper
• robust aXcess CA25 carding machine
• efficient Jetlace Avantage hydroentanglement unit

This configuration will enable Zhoukou Xuwang to manufacture high-quality products while reducing raw materials consumption. These goals are further enabled by the installation of an ANDRITZ Asselin-Thibeau crosslapper PRO35-140, generating a uniform profile over the entire web width.

In spite of the difficult circumstances and supply chain disruptions related to the Covid crisis, both spunlace lines were installed smoothly and on time. They quickly went into commercial production, with a line speed of up to 100 m/min and high-performance MD/CD ratio.

• Carbios has succeeded in producing a 100% enzymatically recycled white PET fiber from colored textile waste
• At the same time, the company has produced the first 100% recycled PET bottles, that have successfully passed the food contact validation tests, from the same textile waste.
• Carbios received €827,200 for the validation of this final technical stage of the project co-funded by ADEME

Carbios announced the validation of the 3^rd and final technical step of the CE-PET research project, co-funded by ADEME3 (France’s Environment and Energy Management Agency), for which Carbios is the lead partner alongside its academic partner TWB. This achievement confirms, once again, the full potential and breadth of Carbios’ enzymatic recycling process, C-ZYME™. This breakthrough innovation makes it possible to produce a wide variety of products of equivalent quality to those of petro-sourced origin from any PET waste, including textiles.
 
The first white PET fiber recycled enzymatically from colored textile waste
Worldwide, around 90 million tons of PET are produced each year, more than 2/3 of which are used to manufacture fibers. However, only 13% of textile waste is currently recycled, mainly for downcycling, i.e. for lower quality applications (such as padding, insulators or rags). By successfully manufacturing at pilot scale a white PET fiber that is 100% enzymatically recycled from colored textile waste, Carbios is paving the way for the circular economy in the textile industry.  C-ZYME™ is now on the doorstep of industrialization and will soon enable the biggest brands to move closer to their sustainability goals.
 
Emmanuel Ladent, Chief Executive Officer of Carbios: « Thanks to our breakthrough process, it will soon be possible to manufacture, on a large scale, t-shirts or bottles using polyester textile waste as raw material. This is a major breakthrough that gives value to waste that currently has little or no value. It is a concrete solution that opens up a global market of 60 million tons per year of potential raw materials and will help to reduce the use of fossil resources. »
 
Separate collection of textile waste soon to be mandatory in Europe
From 1 January 2025 the separate collection of textile waste, which is already in place in some countries, will be mandatory for all EU Member States (European Directive 2018/851 on waste).  Carbios’ process will enable this waste to be sustainably recovered and included in a true circular economy model.
 
These technological validations were carried out as part of the CE-PET research project, co-funded by ADEME3. In particular, the project aimed to develop Carbios’ enzymatic PET recycling process on textile waste. The C-ZYME™ technology is complementary to thermomechanical recycling and will make it possible to process plastic and textile waste deposits that are currently not or poorly recovered. For the validation of this stage of the project, Carbios received €827,200 (€206,800 in grants and €620,400 in repayable advances).

Strict protective measures will make the industry meeting possible at the International Conference on Cellulose Fibres in Cologne on February 2 and 3, 2022. The latest innovations will be shocased: from hygiene and textiles to non-wovens and carbon fibre alternatives to lightweight construction applications. Online participation is also possible.

Cellulose fibres show an increasingly expanding wide range of applications, while at the same time markets are driven by technological developments and political framework conditions, especially bans and restrictions on plastics and increasing sustainability requirements. The conference provides rich information on opportunities for cellulose fibres through policy assessment, a session on sustainability, recycling and alternative feedstocks as well as latest development in pulp, cellulose fibres and yarns. This includes application such as non-wovens, packaging and composites.

Live at the conference, host nova-Institute and sponsor GIG Karasek GmbH will grand the “Cellulose Fibre Innovation of the Year” award to one of six highly interesting products, ranging from cellulose made of orange and wood pulp to a novel technology for cellulose fibre production. The presentations, election of the winner by the conference audience and the award ceremony will take place on the first day of the conference.

The conference sessions reflect the current topics of industry and research. “Strategies and Market Trends” provides an overview of the rapid development of cellulose fibres and their technological progress across the fibre market. An analysis of the key cost components of these fibres to benchmark against current cost levels will highlight future opportunities and challenges for novel textile fibres. The session will conclude with an overview of the industry's recent strategies to defossilize the fibre market.

The session “New Opportunities for Cellulose Fibres in Replacing Plastics”, focusses on questions such as: “What impact does the ban on plastics in single-use products have on the industry?” and “What are the latest regulatory issues and policy opportunities for cellulose fibres?”. This part of the conference presents new opportunities for the replacement of fossil-based insulating materials with cellulose-based technologies suitable for use in a variety of applications, from aerospace to mobility and construction.
Institutefor Ecology and Innovation

“Sustainability and Circular Economy” highlights crucial issues with regard to the overall goal of keeping the environmental impact of cellulose fibres low. A core theme of the session is the responsible use of wood and forests. With this objective, the five speakers discuss the importance of circular concepts for cellulose feedstocks. Exciting insights into the important “Hot Button Report” are offered by Canopy. The “Hot Button” report enables the producers of cellulose fibres to better understand the impact their raw materials have on forests and the climate development worldwide.

The full conference programme is available at www.cellulose-fibres.eu/program.

Over the past 14 days, the wholesale cost of natural gas in Germany has risen by more than 50%. This increase presents an extraordinary challenge for industry, and there is no sign of support or intervention from the Government. Indeed, recent statements are destined to provoke a worsening of the situation.

Kelheim Fibres is entirely dependent on natural gas for the generation of electrical energy and steam and has no viable short-term alternatives. In addition, the raw materials used by the company often consume high levels of energy in their production and are also increasing significantly in cost. These increases in cost jeopardise the future of the business if they cannot be passed on though the supply chain.

Kelheim Fibres is calling on the Government of Germany to take immediate steps to mitigate the impact of the cost increases for natural gas and is committed to work to implement alternative sources of energy in the medium term.

In parallel, the disruption to global logistic networks that has been seen throughout 2021 is now expected to continue throughout 2022. Massive increases in shipping rates – in some cases in excess of 80% – are being imposed without notice and with no opportunity for negotiation. These costs must also be passed on though the supply chain if businesses are to remain viable.

To address these issues, Kelheim Fibres is implementing the following measures with immediate effect:

• The increased cost of energy and freight will be passed on in prices to customers at the soonest opportunity;
• If necessary, changes or adjustments to existing agreements will be negotiated to reflect the increased cost levels;
• If the necessary increase in fibre prices cannot be secured, cuts to production will be implemented with the objective of minimising losses until the cost increases can be mitigated.

As the drivers for the increases in natural gas prices appear to be temporary in nature, we will maintain any price adjustments under review and pass on any relief to customers.

Craig Barker, CEO of Kelheim Fibres, describes the current situation as critical. “The cost increases we are facing are unprecedented and call for swift and decisive action. We are determined to take the necessary steps to preserve the future of our business and provide security of supply for our customers. At the same time, we are relying on the support of our customers to help us conquer the challenges our business is facing.”

In the Canopy’s 2021 Hot Button Ranking, Kelheim Fibres once again occupies a leading position: With a increase of 2.5 points in the evaluation, the Bavarian viscose speciality fibre manufacturer tied for third place out of around 40 viscose fibre manufacturers worldwide and a dark green/green shirt for the second year running. The Hot Button Report not only stands for responsible raw material sourcing - it is an overall sustainability indicator for viscose fibre producers.

Especially in the areas of transparency and procurement, the NGO Canopy, which is committed to the preservation of ancient and endangered forests, awarded Kelheim Fibres top points: Kelheim Fibres is the only EMAS-certified viscose fibre manufacturer worldwide and publishes all environmentally relevant data publicly.

Kelheim Fibres also gained points in the area of "Next Generation Solutions" - the use of alternative raw materials in fibre production. Together with the Swedish textile recycling company Renewcell, the fibre experts are planning to realise the large-scale production of high-quality viscose fibres from up to 10,000 tonnes of the 100% textile recyclate Circulose® per year.

• The success story of cellulose fibres continues - plastic bans drive innovation – 300 participants and 30 exhibitors are expected in-person and online
• 2-3 February, Cologne (Germany), hybrid event

Cellulose fibres are among the winners of the European 'Single-Use Plastics Directive (SUPD)', which has been in effect since July 2021 and entails plastic bans for a variety of single-use products. Cellulose is the main component of plant cell walls and a natural polymer. As a result, disposable products made of cellulose and cellulose fibres are not labelled as plastic and are explicitly excluded from the regulation. The success story of cellulose fibres will thus continue at a rapid pace with new developments and applications. Building on the success of this year's conference with 200 participants, the International Conference on Cellulose Fibres 2022 will again cover the entire value chain, from lignocellulose, chemical pulp, cellulose fibres such as rayon, viscose, modal or lyocell and new developments to a wide range of applications: Textiles of all kinds, nonwovens such as wet wipes and new areas such as composites or nanocellulose in the food industry. All these sectors have gained considerable momentum in recent years.

Cellulose fibres have been a success story within the textile market with a compound annual growth rate (CAGR) between 5 and 10 % over the last ten years and similar growth rates are expected in the coming decade. This makes cellulosic fibres the fastest growing fibre group in the textile industry and also the largest investment sector in the global bioeconomy.  The challenge now is to achieve a balance between the ongoing capacity expansion and the growing demand, to avoid overcapacity while still meeting rising demand from the major brands. These high growth rates are driven by the increased demand for natural fibres (and bottlenecks in cotton production), the microplastic issues, and bans on plastics in disposable applications. All three factors will continue to play an important role in the development of the sector in the future.

Focus of the conference

• Impact of plastic-bans on single-use products
• Transformation from fossil to renewable raw materials
• Challenges in developing new value chains
• Alternative raw materials for cellulose fibres
• Latest technology and market trends
• Market dynamics and stakeholders in the cellulose sector
• New ecosystems and partnerships
• Development of political environment
• Improvement of sustainability in production

Companies are now invited to submit presentations as well as their latest developments for the Innovation Award.

Call for Abstracts and Posters
Abstract submission is open now. Latest products, technologies, developments or market trends are welcome.
Deadline for submission: 15 October 2021

• Circular economy at Kelheim Fibres: Examples of innovation from raw material, product design and all the way to “end of life”

Kelheim Fibres, the world's first viscose fibre manufacturer with an EMAS-certified environmental management system, is continuously working on optimising its special fibres. These can be functionalised as needed - in many cases to save further processing steps (such as dyeing or coating) and thus energy, water and chemicals - and are completely biodegradable at the end of their product life in a short time (according to OECD Test 301 B).

Currently, the specialists in Kelheim are working on the development of alternative raw materials for the production of viscose fibres, such as recycled cellulose as well as other cellulose-containing starting materials. One approach to closing the product cycle in the textile sector is the use of pulp produced from recycled post-consumer waste materials.

In production, Kelheim Fibres focuses on resource conservation by minimising emissions and waste through closed-loop recovery systems, as well as through highly efficient energy generation and the corresponding operation of the plants.

Dr. Roland Scholz, Project Manager Fibre and Application Development at Kelheim Fibres, will present details of this on Wednesday, 15 September, at 5.50 p.m., in Hall B of the 60th Dornbirn GFC WEBINAR WEEK.

Translated with www.DeepL.com/Translator (free version)