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Operation Report: Comceh: technology showcase
The development
of Comceh from a Ceaucescu-era integrated kraft pulp and printing paper mill
to a consumeroriented tissue mill and converting plant is a good example
of what free-market supporters believe should be happening more in Romania.
It represents the transformation of an inefficient industrial plant into
a responsive modern business.
Most important for Romania, it provides local employment in an area that
has suffered badly from the after-effects of the collapse of the old regime.
Not the 722 jobs that were on offer in the early 2000s but 260 jobs supported
by genuine demand for high-grade products able to hold their own against
imports in an open and competitive market.
In addition, the majority of those who left when the offset machine shut
down last year have found new jobs in the new wastepaper sorting plant set
up at the mill site. This is run by an independent company but delivers virtually
all its high-quality wastepaper to Comceh, ensuring a more standard input
to the Kadant Lamort deinking line.
The former national company CCH on whose foundations Comceh has grown was
established in 1962 to make printing and writing papers. It was fully integrated,
with bleached long-fibre kraft pulp, its own power station and three paper
machines making around 60,000 tons/yr of paper for photocopy, books and school
exercise books.
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Clearly, in a world where a modern printing paper machine can make half a
million tons and new pulp mills may be up to 1 million tons, CCH with its low-capacity
old machines was unable to compete on cost or quality. Nonetheless, one of the
printing paper machines continued operating until one year ago, when the mill
finally started to focus all its attention on tissue.
The mill continued to run under local ownership for 10 years after the fall
of the Ceaucescus but was put up for sale in 2000 and finally bought by Mr Fabio
Perini At that time, his interests included not only Futura but also Toscotec
and he set about investing in a new tissue plant to showcase the technology
of both companies.
Three years after the takeover, in the second half of 2003, a new 4.6 m Toscotec
paper machine started up on the site of one of the old printing paper machines.
The Comceh Ahead 1.5M unit is complete with a five-roll cantilevered crescent
former with forming roll of diameter 1540 mm, a single jet headbox (TT Headbox
SL-T), pneumatically-loaded suction press roll TT SPR 1050. It has a steel Yankee
dryer TT SYD 12FT (3660 mm) working at max 10 bar (g), hydraulic Pope reel type
TT REEL-H with max reel diameter up to 2600 mm and Duosystem gas fired hood.
It has a design speed of 1500 m/min and is capable of making up to 110 tons/day
of paper with a basis weight on reel of 15-40 g/m2 and with a crepe of 10-25%.
In addition to the paper machine itself, Toscotec’s scope of supply for Comceh
also comprised a wire washer for the deinking plant and the approach flow system.
The tissue machine was followed with the original full-width rewinder from
Beloit- Fampa and an in-line Futura converting unit, also full width, which
was the second line supplied to the market from the new company. Last year,
a second Futura high speed converting line was added. The 2.8 m line includes
flying splice unwinders, the JOI flexible embosser, a four-colour printer, along
with the Futura cutting system. The line is capable of very fast product configuration
changes, thanks to its global flexibility which drastically reduces the average
downtime required by conventional lines,according to General Manager Carlo Ferrero.
The combination of the large line, which is used for long runs of standard
product, and the 2.8 meter line gives Comceh the ability to meet a wide variety
of demand for its multiple products. Each month, Ferrero said, the new line
goes through 3-5 changes of its JOI embossing rolls, with 1-2 changes per day
of the roll size, sheet count etc. The wider line is currently running three
shifts for five days/week, while the new line is in continuous operation.
Since the start-up of the new unit, the company has increased its output
of finished product to around 17-18,000 tons, roughly equal with jumbo sales.
Finished product sales are still rising and long term will be about 80%
of the total capacity, according to Ferrero. Most of this is destined for
the local market but the mill is only 7 km from the Bulgarian border, half
way between Bucharest and Costance, with a geographical position and industrial
characteristics, ideal to serve Eastern Europe Countries. Exports are easy
in that direction, and tonnage is also shipped further afield to Albania,
Czech Republic, Greece, Hungary and the countries of the former Yugoslavia.
The boost to converted product sales has helped Comceh grow its sales
sharply since last year. From 2007-08 volume was up 60% against a Romanian
market that remained almost flat. This year, Comceh is again outperforming
the market by a large margin, with value sales up 19% in the first half.
For Romania as a whole, the first quarter saw a 4.5% increase yearon- year,
while in the second quarter sales fell about 2% from the first-quarter level.
The success is largely attributable to the popularity of the company’s brands
Volare and Onda, properly supported by a constant product innovation. In
2008, its share of the Romanian market was 6% by volume and 8% by value*.
In the first half of 2009 these figures leaped to 19% by volume and 23%
by value. Volare toilet tissue is a three-ply product made from 100% bleached
kraft pulp and comes in white or pastel shades. Kitchen towel of the same
brand is 2-3 ply and is white decorated with 3-4-colour printing. Napkins
are single ply.
The company’s value range, Onda, is available as two-ply pink toilet tissue,
microembossed and with a mechanical ply bond. It is entirely made from a
mix of recycled fibre and is also available as yellow kitchen towel. It
is mainly sold in pack sizes from 4- 40 rolls, but much of this is still
sold on to the final consumer by hawkers and kiosks as single rolls.
In toilet tissue, Comceh is market leader in Romania, according to the
company. In kitchen towel, Monte Bianco, a major converter which started
a second hand machine this year, is Number 1 with 37% market share against
Comceh’s 22%. The locals producers face strong competition from foreign
majors such as SCA, K-C and others. SCA has always been considered the market
leader in terms of quality but, with its new converting line and product
innovation, Comceh is staking a claim for leadership in the premium end
of the market, according to Ferrero. It differentiates its products through
quality, innovation and service, all at a reasonable price, he told Tissue
World.
For these reasons, Comceh has become the bigger supplier of private label,
that in volume, already represents about 24% of the market and is growing
rapidly as the big supermarkets extend their presence. By 2011, they will
double their market share, Ferrero believes.
Over the past two years, Comceh has invested €11 million: new rewinder,
wastepaper sorting, safety, water treatment. In its plans are further major
investments in the environment, productivity and training, as well as quality
improvements to the paper machine and rewinder.
At the time of Tissue World’s visit to the Comceh mill, a team of North
American paper makers was visiting to see the new converting line in operation.
This ability to showcase Futura‘s latest technology is certainly a bonus
for Fabio Perini, owner of both companies. But Comceh is above all a standalone
business serving the booming Romanian market and other countries in Eastern
Europe with a wide range of popular tissue products.
*Market data source: GFK Consumer Tracking - September 2009
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INCREASING SHARE OF A GROWING MARKET
The Romanian tissue market has grown rapidly in recent years, though per
capita consumption is still low by the standards of most neighbouring countries.
Total demand is put at around 100-120,000 tons, representing an annual per
capita level of 4- 5 kg/capita.
Since Comceh started, though, the picture has changed dramatically. Back
in 2002, all local tissue was low grade toilet paper: wastebased, single-ply,
and pink. Supermarkets were completely absent; tissue was sold in small shops
and kiosks or by wandering traders, frequently as single rolls of toilet
tissue.
Today, a wide range of large supermarket chains have set up in the country,
including such giants as Carrefour, Kaufland, Metro, Mega Image and so on.
They are still concentrated in the big cities, notably Bucharest, where there
are now 30 or more, according to local sources, but they are spreading to
the smaller centres.
And they are selling a range of premium as well as cheaper brands and private
label that could not be found in most outlets in Western Europe. “The quality
gap against France, Germany or Italy is very small,” according to Carlo Ferrero,
general manager of Comceh. “But we have a wider range of top-quality products
here in Romania.”
In their toilet tissue Romanians like colour, patterns, printed surfaces
and perfumes as well as the softness, whiteness and absorbency that one would
expect in a modern product. And plenty of them are prepared to pay for such
luxury. There is still a big class divide, though, between the rich market
of Bucharest, the less prosperous Transylvania, and the still poor north-east
of the country.
The market is still heavily skewed to toilet tissue, which represents more
than 60% of demand. Still, that is a huge change over the past few years.
When Comceh came on the scene, seven years ago, low-grade toilet tissue represented
virtually 100% of the market. Since then, all grades have grown rapidly.
Kitchen towel in particular has boomed, with total volume of around 15-20,000
tons last year, while napkins are also proving increasingly popular (perhaps
8000 tons). Facial tissues and hankies are the main soft spot. Last year,
according to Ferrero, total demand was no more than 2-3000 tons for the whole
country.
Comceh was the first to introduce twoply products and it has been followed
by an ever-widening range of competitors, including the big producers such
as SCA, K-C and GP but also a multitude of others from within Romania but
also from the surrounding region – Bulgaria, Greece, Poland etc.
Today tissue production capacity is as follows (1000 tons):
| Pehart Tec* |
60 |
| Comceh* |
35 |
| Vrancart |
22 |
| Monte Bianco* |
8 |
| Petrocart |
10 |
| *New machine(s) added in the past 10 years. |
In mid-2009, toilet tissue prices per roll range from RON 0.26 for the
cheapest products to RON 1.21 for Zewa, the most expensive of those surveyed,
according to GfK. Most of the 10 brands surveyed were in the range RON 0.30-0.55
At the same time, Volare, Comceh’s premium brand, was selling for RON 0.88
and Onda for RON 0.41.
Comceh does particularly well in the richer parts of the country, above
all Bucharest and the north-west. In Bucharest it had a 28% market share
by volume (29% by value) in the second quarter of 2009, the latest period
for which data are available. In the north-west, its volume share was at
30%, with value up to 38% for the same period.
Over the period first quarter 2008 to second quarter 2009, supermarkets
and hypermarkets increased their share of the toilet paper market marginally,
from 33% to 34%. But in value terms they did much better, raising their share
from 36% to 40%. Cash & carry stores have also done well, raising shares
from 9% to 12% in volume and value. The gains in these retail sectors have
been at the expense of boutiques, general stores and street vendors. They
are trends that suit Comceh well, since it has a high and rising share of
the market in the supermarkets and, above all in the hypermarkets, where
the latest figures give it over 40% by volume and value.
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