GLOBAL TRENDS OF FILLER AND COATING PIGMENTS IN PAPER

Transcription

1 GLOBAL TRENDS OF FILLER AND COATING PIGMENTS IN PAPER IAN WILSON, UK LARRY LAI, PRESIDENT, YIE-LIE ENTERPRISE, SHANGHAI, CHINA VANCOUVER, CANADA APRIL 1 st 2014

2 ACKNOWLEDGEMENTS VICTORIA COOPER-SMITH AND COLLEAGUES FOR ORGANIZATION PROFESSOR WEN LU, CHENGDU UNIVERSITY, CHINA DAVE LEAITY, IMERYS GLOBAL KAOLIN PRODUCT MANAGEMENT DIRECTOR CHRIS NUTBEAM, GLOBAL KAOLIN APPLICATION MANAGER RISI AND CHINA PULP & PAPER INDUSTRY REPORTS VARIOUS ORGANISATIONS AND COMPANIES PAUL WOODWARD, CEO, ASCOM CALCIUM CARBONATE, EGYPT TODD HARRIS DOUG CARTER, DIRECTOR

3 AGENDA Current global paper production by region and countries GCC, PCC and Kaolin usage in paper and regional trends Development of China as No 1 paper producer and the future New projects for production of minerals for paper

4 JOUKO KARVINEN, CEO, STORA ENSO WHERE IN THE WORLD IS STORA ENSO S FUTURE STORA ENSO IS ON A JOURNEY TRANSFORMING ITSELF FROM A EUROPEAN PULP AND PAPER COMPANY INTO A VALUE CREATING RENEWABLE COMPANY FOCUSSING ON GROWTH MARKETS. THE DIGITAL REVOLUTION AND ITS IMPACT ON PAPER CONSUMPTION IS A SIGNIFICANT DRIVER IN THE CHANGE. (SOURCE: RETHINK 2013, STORA ENSO) STORA ENSO EMPLOYS 28,000 PEOPLE WORLDWIDE WITH SALES IN 2013 OF EUR 10.5 BILLION. ANNUAL CAPACITY IF 5.4 MT OF CHEMICAL PULP, 11.7 MT OF PAPER AND BOARD,AND 1.3 BILLION SQUARE METRES OF CORRUGATED PACKAGING

5 QUICK LOOK AT CRYSTAL SHAPE OF SOME MINERALS USED IN PAPER AND BOARD

6 SHAPES OF KAOLINITE - BLOCKY, PLATY AND TUBULAR FOR HALLOYSITE KAOLINITE PLATES - 2 MICRONS KAOLINITE STACK - 10 MICRONS HALLOYSITE TUBES NM

7 NATURAL EXAMPLES OF CALCIUM CARBONATE RHOMBOHEDRAL CALCITE SCALENOHEDRAL CALCITE ARAGONITE NEEDLES FORAMINIFERA Nummulitesginzehensis, Limestone, Egypt Cocolith, Chalk, UK

8 SPECIALITY MINERALS MANUFACTURES DIFFERENT PCC MORPHOLOGIES WHICH ARE RHOMBOHEDRAL, SCALENOHEDRAL AND ACICULAR ARAGONITE SCALENOHEDRAL CALCITE RHOMBHEDRAL CALCITE ARAGONITE NEEDLES PRISMATIC CALCITE SPHERICAL CALCITE CLULTER ACICULAR ARAGONITE Source:

9 DELAMINATION OF STACKS OF KAOLIN - UK 10 mic 1 mic DELAMINATION STACK PLATES >10 Micron stacks in overflow second stage of classification PLATES, FROM DELAMINATION OF STACKS HIGH ASPECT RATIO/ SHAPE FACTOR MEDIA GRINDING -USED TO USE ROUNDED SAND FROM OTTAWA/UK - NOW SUITABLE FOR FRACCING

10 MEASUREMENT OF SHAPE FACTOR AND ASPECT RATIO ECC (NOW IMERYS) DEVELOPED A STOP-FLOW CONDUCTIVITY MEASUREMENT INSTRUMENT WHICH GIVES A SHAPE FACTOR. THE METHOD IS KNOWN AS PANACEA: PARTICLE ASSESSMENT (by) NATURAL ALIGNMENT (and) CONDUCTIVITY EFFECT ANALYSIS ASPECT RATIO CAN BE MEASURED BY THE TEM SHADOWING TECHNIQUE For a given shadow angle, particle thickness is proportional to shadow length

11 PAPER INDUSTRY GLOBAL ASIA CHINA

12 REGIONAL SPLIT OF P&B PRODUCTION IN 2011 (%) REGION 2011 (1,000 tonnes) % ASIA 171, EUROPE 108, NORTH AMERICA 87, LATIN AMERICA 20,807 5 MIDDLE EAST 3,021 1 AFRICA 4,124 1 OCEANIA 4,102 1 TOTAL 398, SOURCE: RISI GLOBAL REPORT 2012

13 ASIA LEADER WITH 43% OF PRODUCTION AND SHOWN HERE WITH CHINA (25%) REST OF ASIA i18%) FOR 2011 REGION 2011 (1,000 tonnes) % EUROPE 108, LATIN AMERICA 20,807 5 OTHERS 11,246 3 NORTH AMERICA 87, CHINA 99, REST OF ASIA 72, TOTAL 398, SOURCE: RISI GLOBAL REPORT 2012

14 P&B GLOBAL OUTPUT OF 399 MT IN 2011 LATIN AMERICA 5% OTHERS 3% N. AMERICA 22% OTHERS 3% AFRICA 1% OCEANIA 1% MIDDLE EAST 1% ASIA 43% W.EUROPE 22% E.EUROPE 5% SOURCE: RISI GLOBAL REPORT 2012

15 P&B GLOBAL OUTPUT OF 399 MT IN 2011 (%) REST OF ASIA 18% EUROPE 27% CHINA 25% NORTH AMERICA 22% LATIN AMERICA 5% OTHERS 3% SOURCE: RISI GLOBAL REPORT 2012

16 TOP 5 COUNTRIES ACCOUNT FOR 60% OF GLOBAL P&B OUTPUT OF 399 MT IN 2011 (%) (CHINA 26% SHARE IN 2012) REST OF WORLD 25% CHINA 25% INDIA 2% INDONESIA 2% BRAZIL 2% SWEDEN 3% FINLAND 3% SOUTH KOREA 3% CANADA 3% GERMANY 6% JAPAN 7% USA 19%

17 P&B ASIA PRODUCTION OF MT BY COUNTRY IN 2011 (%) TAIWAN 2% SOUTH KOREA 7% THAILAND 3% OTHERS 3% JAPAN 15% CHINA 58% INDONESIA 6% INDIA 6%

18 % CHANGE FROM 2010 TO 2011 SHOWS INCREASES FOR ASIA AND BRAZIL WITH DECREASES IN JAPAN, NORTH AMERICA AND EUROPE P&B production 2011 % change COUNTRY 1,000 tonnes 2011/10 CHINA 99, USA 75, JAPAN 26, GERMANY 22, CANADA 12, SOUTH KOREA 11, FINLAND 11, SWEDEN 11, BRAZIL 10, INDONESIA 10, INDIA 9, REST OF WORLD 99,089 TOTAL 398,877

19 CHINESE OUPUT AND CONSUMPTION OF P&B FROM (China Pulp & Paper Industry, July 2012 ) YEAR PRODUCTION CONSUMPTION IN 2012 CHINESESE P&B PRODUCTION INCREASED TO MT UP 3.22% FROM 2011 CONSUMPTION IN 2012 INCREASED TO MT UP 3.04% FROM 2011 FROM 2003 TO 2012 P&B PRODUCTION INCREASED BY 10.13% PER YEAR FROM 2003 TO 2012 CONSUMPTION INCREASED BY 8.54% PER YEAR HOWEVER IN 2012 THERE WAS 2.56% DECREASE IN PRODUCTION OF NEWSPRINT AND A SLIGHT DECREASE IN PRINTING AND WRITING PAPERS FROM 2011.

20 P&B PRODUCTION (MILLION TONNES) P&B PRODUCTION AND CONSUMPTION IN CHINA FROM (MT) FROM 2007 PRODUCTION EXCEEDS CONSUMPTION PRODUCTION CONSUMPTION Source: China Pulp & Paper Industry, July 2012

21 P&B GLOBAL PRODUCTION BY TYPE

22 PAPER AND PULP TYPES PAPER TYPES NEWSPRINT MAINLY MECHANICAL PULP OR RECYCLED FIBRE UWF (UNCOATED WOODFREE) PRINTING & WRITING PAPER WOODFREE PAPER - <10% MECHANICAL PULP. WF INCLUDES COATED (CWF)AND UWF. (WF = FINE PAPER, US -FREE SHEET) CWF COATED WOODFREE PINTING AND WRITING PAPER LWC LIGHT WEIGHT COATED. USUALLY MECHANICAL PRINTING PAPER <60gsm USED IN PUBLICATION PAPER PULP TYPES BHKP - BLEACHED HARDWOOD KRAFT PULP BSKP - BLEACHED SOFTWOOD KRAFT PULP BCTMP -BLEACHED CHEMI-THERMOMECHANICAL PULP KRAFT PULP - COOKING TO REMOVE LIGNIN LEAVING FIBRES BLEACHED BEFORE BEING USED IN SOME PAPERMAKING KRAFT PAPER - MADE FROM KRAFT PULP STRONG PAPER USED PRINCIPALLY IN WRAPPING AND PACKAGING

23 P&B PRODUCTION OF 399MT IN 2011 BY TYPE (%) OTHER 4% NEWSPRINT 8% TISSUE 7% PRINTING/WRITIN G 28% PACKAGING PAPER/ BOARD 53%

24 LOOK AT TOP FIVE PRODUCERS CHINA, USA, JAPAN, GERMANY AND CANADA (60% OF 399 MT IN 2011)) OTHERS 40% CHINA 25% USA 19% CANADA 3% GERMANY 6% JAPAN 7%

25 180, , , , ,000 P&B OUTPUT FOR TOP 5 COUNTRIES AND OTHERS ('000 TONNES) CHINA, USA, JAPAN, GERMANY AND CANADA ACCOUNTS FOR 60% OF GLOBAL OUTPUT OF 399 MT 80,000 60,000 40,000 20,000 0 CHINA USA JAPAN GERMANY CANADA OTHERS NEWSPRINT PRINTING/WRITING PACKAGING PAPER/ BOARD TISSUE OTHER

26 P&B OUTPUT FOR 5 COUNTRiESAND OTHERS ('000 TONNES) RISI ON % BASIS OF PRODUCTION 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% CHINA USA JAPAN GERMANY CANADA OTHERS TOTAL NEWSPRINT PRINTING/WRITING PACKAGING PAPER/ BOARD TISSUE OTHER

27 PRINTING & WRITING PAPERS GLOBALLY MILLION TONNES FOR 2011 OTHERS 46% CHINA 23% USA 16% JAPAN 8% GERMANY 7%

28 PRINTING & WRITING UNCOATED WOODFREE MT IN 2011 OTHERS 46% CHINA 29% USA 16% GERMANY 3% JAPAN 6%

29 TOTAL P&W PAPERS MT P&W UNCOATED WOODFREE MT (48.5%) - GRADES FOR WRITING, COPYING, PRINTING OF BOOKS, BROCHURES, MAGAZINES, FORMS. - BASE WEIGHTS FROM gsm(gmssq. metre) - UNCOATED WOODFREE MAINLY FROM CHEMICAL PULP - MINERAL FILLER CONTENT RANGES FROM wt.%. OBJECTIVE IN CHINA TO INCREASE CARBONATE LEVEL TO 40% - LOOK AT MINERALS USED IN UNCOATED WOODFREE

30 UNCOATED WOODFREE PAPER ACCOUNTS FOR 50% OF PRINTING AND WRITING PAPER PRODUCTION GLOBALLY. MAIN FILLER IS CALCIUM CARBONATE -PCC/GCC Newspapers Books Business Magazines Promotional PCC GCC OTHER TALC KAOLIN TECHINAL GUIDE: FILLER FOR UNCOATED WOODFREE PAPERS

31 BLENDING OF PCC AND GCC FILLERS IN UWC PAPERS AT SIMILAR PARTICLE SIZE SCALENOHEDRAL OR ARAGONITIC PCC GIVE HIGHER LIGHT SCATTERING AND BULK COMPARED TO SOLID PARTICLES LIKE GCC OR RH0MBIC PCC HOWEVER THIS IS ACHIEVED BY HIGHER FIBRE DE-BONDING WHICH LEADS TO DECREASED PAPER STRENGTH AND THUS LOWER LOADING LEVELS. SCALENOHEDRAL AND ARAGONITIC PCC PROVIDES GOOD OPTICS, BULK AND SURFACE SMOOTHNESS WHEREAS RHOMBIC PCC OR GCC GIVE BETTER STRENGTH AND DEWATERING TO ACHIEVE REQUIRED BALANCE OF PAPER PROPERTIES BLENDS OF GCC WITH SCALENOHEDRAL OR ARAGONITIC PCC PROVIDE A COMBINATION OF BULK, OPTICS, STIFFNESS AND STRENGTH WITH EFFICIENT DEWATERING.

32 PRINTING & WRITING -COATED WOODFREE MILLION TONNES IN 2011 OTHERS 40% CHINA 25% USA 15% JAPAN 13% GERMANY 7%

33 PAPER COATING One of main roles of a paper coating is to provide optical and physical coverage of the basepaper providing a high quality surface for printing Main difference between kaolin and carbonate in paper coating is particle shape. The platy nature of kaolin gives a smooth surface for printing whilst carbonate is added for brightness(and is generally much cheaper) Generally the higher the aspect ratio of kaolin mixed with calcium carbonate(gcc) will give better printability. IMERYS have developed new coating pigments from mid- Georgia called E-TYPE.

34 IMERYS North American Kaolin Value in Coverage SURFACE GLOSS STIFFNESS PRINT QUALITY SHAPE FACTOR A STOP-FLOW CONDUCTIVITY MEASUREMENT SOURCE: CHRIS NUTBEAM, IMERYS

35 COATING CLAY SHAPE FACTOR AND FINENESS d50

36 PACKAGING & PAPER BOARD MT GLOBALLY IN 2011 OTHERS 41% CHINA 27% USA 21% GERMANY 5% JAPAN 6%

37 PACKAGING & PAPERBOARD 210 MT IN 2011 WRAPPING PAPER 7% CARTONBOARD OTHER PAPERBOARD 25% CONTAINER BOARD 68% FOLDING CARTON PACKAGING GOOD GROWTH

38 PACKAGING & PAPERBOARD MT IN FOUR COUNTRIES (China, USA, Japan and Germany account for 59% of Global Output) 60,000 50,000 40,000 30,000 4,400 13,020 1,521 12,230 20,000 10, ,700 31, ,703 2,767 8,811 7,041 CHINA USA JAPAN GERMANY PACKAGING AND PAPERBOARD CONTAINER BOARD CARTONBOARD +OTHER PAPER BOARD

39 KITCHEN GARDEN BOX 20-EGG TRAY IN CENTRAL RUSSIA SALES INCREASED 40% IN JUST A FEW MONTHS AS CUSTOMERS LIKED THE PACKAGING

40 NEWSPRINT OUTPUT OF 32MT IN 2011 CHINA 12% USA 9% OTHERS 48% JAPAN 10% CANADA 14% GERMANY 7% CANADA 4.4MT PRODUCTION IN 2011 (-7.1% FROM 2010) EXPORTS IN 2011 WERE 3.66 MT, APPARENT CONSUMPTION 0.76 MT (-8.0% FROM 2010)

41 NEWSPRINT MECHANICAL OR RECYCLED FIBRE IS USED AND COST IS INCREASING SAVINGS CAN BE MADE BY REPLACING FIBRES WITH FILLERS FILLERS ARE TWO MAIN TYPES - STANDARD - GCC (MARBLE AND CHALK), KAOLIN - STURCTURED CALCINED CLAY, PCC FILLERS IMPROVE OPTICAL PERFORMANCE, CONTROL FRICTION AND BETTER PRINTABILITY (BY CONTROLLING POROSITY, SMOOTHNESS AND INK PENETRATION REGIONAL CHANGES IN USE OF FILLERS - ASIA - MAINLY CALCINED CLAY, SOME PCC - N. AMERICA - MAINLY PCC, CALCINED CLAY, KAOLIN - EUROPE USE MAINLY CHALK AND MARBLE, KAOLIN, CALCINED CLAY, TALC AND LESS PCC

42 VARIOUS FILLERS USED IN NEWSPRINT - KAOLIN/CHALK/MARBLE % LOADING primarily used in virgin fibre to extend fibre and give similar print characteristic to recycled sheets - PCC % LOADING Used mainly in North West American mills and some in Asia - CALCINED KAOLIN/SYNTHETIC SILICA - 2-8% LOADING - Used to optimiseopacity in low grammagenews and Directory paper - Used to control friction (caused by pitch) - Functional additive to control print through/ strike through as an Ink setting aid

43 FLYO+ NEW PAPER PRODUCTS FOR ADVERTISERS Advertisers are switching from more expensive paper grades to Newsprint without losing quality. It is possible now to print high- quality four-colour images also on newsprint FLYO+ is produced from 100% recycled fibres at Stora Enso s Sachsen Mill in Germany. The paper s extra smooth calendered surface makes it suitable for commercial flyers and other print advertising.

44 1. IMERYS FORMED A NEW BUSINESS DIVISION CALLED PIGMENTS FOR PAPER & PACKAGING REPLACING IMERYS PIGMENTS FOR PAPER 2. IMERYS IS WORLD #2 IN GROUND CALCIUM CARBONATE FOR PAPER 3. IMERYS IS WORLD #1 IN KAOLIN FOR PAPER. 4. SALES IN 2012 FOR THIS DIVISION WERE 859 MILLION EURO WITH 49 INDUSTRIAL SITES IN 19 COUNTRIES WITH 2,465 EMPLOYEES 5. MORE THAN 330 PAPER MILLS ARE SERVED: 43% IN EUROPE, 24% IN NORTH AMERICA AND 33% IN REST OF THE WORLD, MAINLY ASIA-PACIFIC WHICH IS THE MAIN AREA OF GROWH FOR PAPER

45 EGYPT - HIGH QUALITY LIMESTONE BEING DEVELOPED BY ACCM FOR PAPER AND OTHER MARKETS PROGRESS REPORT ON THIS NEWISH GCC PROJECT

46 Nummulites ginzehensis, Limestone, Minya Type of Foraminifera - limestone is high brightness and low abrasion

47 DEVELOPMENT OF ASCOM CARBONATE AND CHEMICAL MANUFACTURING COMPANY IN MINYA, EGYPT BASED ON HIGH BRIGHTNESS AND LOW ABRASION LIMESTONE ASCOM NOW HAS CAPACITY OF 375,000 TPY WITH SALES IN EXCESS OF 300,000 TPY (ANNUALIZED). FINE MILLED CAPACITY NOW 250,000 TPY. DRY GRADES USING HOSOKAWA ALPINE MILLS RANGE FROM 17-70% <2um. A WET PROCESS HAS BEEN INSTALLED TO MILL FROM ASCOM 60 to 95% <2um. ONE PAPER MILL BEING SUPPLIED WITH SLURRY AND ANOTHER IN APRIL 2014 (FIRST COMPANY IN REGION TO HAVE WET GRINDING CAPABILITY). INCREASED CAPACITY FOR COARSE GRADES FROM CHIPS TO 10-15% <2um FOR THE GLASS, CEMENT, PLASTICS AND PAINT MARKETS. IN SECOND HALF 2014 ADDING 12,000 TYY OF ASCOM 70 (70% <2um) FOR PAINT AND PAPER. ALSO ONE OF COATING LINES WILL BE UPGRADED TO OFFER ALMOST ZERO RESIDUE PRODUCTS FOR PVC AND PP FILM MARKETS

48 FURTHER DEVELOPMENTS PLANNED BY END-2015 AND EXPORTS ASCOM CURRENTLY PLANNING FOR A THIRD EXPANSION BY END-2015: TWO FURTHER DRY MILLING LINES USING LATEST CLASSIFCATION TECHNOLOGY TO OFFER PRODUCTS IN RANGE 30% -70% <2um WITH FURTHER COATED PRODUCT CAPACITY CAPACITY WILL BE 500,000 TPY WITH 370,000 TPY FINE MILLED PRODUCTS CURRENT EXPORTS ASCOM HAVE A COMMERCIAL TEAM AND A SERIES OF AGENTS/ DISTRIBUTORS IN GHANA, NIGERIA, KENYA, TANZANIA, SOUTH AFRICA, MIDDLE EAST, GULF REGION AND INDIA. BOTH LIMESTONE CHIPPINGS COARSE AND FINE POWDERS ARE EXPORTED FOR A RANGE OF MARKETS

49 BRIEF UPDATE ON CHINA

50 MAJOR AREAS FOR PAPERMILLS DEVELOPING AREAS TIANJIN SHANDONG SICHUAN 1 YANGSTE FUJIAN ZHEJIANG GUANGDONG HAINAN

51 MAJOR MARBLE DEPOSITS IN CHINA FOR GCC HEZHOU

52 HEZHOU MARBLE MOUNTAIN RANGE HEZHOU IN GUANGXI PROVINCE NOW AN IMPORTANT SUPPLIER OF MARBLE LUMP FOR GCC PLANTS IN CHINA REN-HE COMPANY (OWNDER MR LUO) CONTROLS DEPOSITS OF HIGH QUALITY MARLE NEAR HEZHOU. THE WHOLE AREA PRODUCES ABOUT 2.5 MILLION TONNES OF MARBLE FOR SHIPMENT TO MAJOR CUSTOMERS IN SHANDONG AND TO APP IN HAINAN ISLAND. REN-HE SUPPLY 800,000 TPY. SOME POWDER GCC COMPANIES AS WELL IN THE AREA.

53 TOP 20 PAPER COMPANIES IN CHINA IN 2012 ACCOUNT FOR 40% OF PRODUCTION AND TOP 5 FOR 23% NO PAPER MILL/PRODUCTION 2011 (1,000 TONNES) 2012 (1,000 TONNES) % CHANGE IN NINE DRAGON 8,350 10, LEE & MAN 3,539 4, CHENMING GROUP 3,482 3, HUATAI 2,547 2, SUN PAPER 2,422 2, GOLD EAST APP 2,201 2, CHINA INVESTMENT 2,100 1, NINGBO CHUNG HUA & NINGBO APP 1,526 1, JIAN PAPER 696 1, LONGCHEN 1,158 1, BAO HUI 1,163 1, CENTRAL SUNSHINE 961 1, HAINAN APP 869 1, SHANG YIN 893 1, JIN XING UPM CHINA LIAN SHANG ZHONG YEI YIN HE YINGE PAPER QUAN LIN GROUP ,932 41,106 APP IS THE SECOND LARGEST PRODUCER WITH 2MT COATED BOARD AND 4.0MT COATED PAPER

54 Nine Dragons Paper (Holdings) Limited is the world's largest recovered paper based paper manufacturing Company. Production capacity of the Company is now 12.0 million tonnes per year. The Group has 33 packaging paperboard and printing & writing paper machines operating at its four major production bases in China Dongguan, Guangdong Province, Taicang, Jiangsu Province, Chongqing, regional hub for the Central-Western provinces, and in Tianjin, in the centre of the BohaiBay Economic Rim.

55 DONGGUAN BASE GUANGDONG PROVINCE Products include linerboard, high performance corrugating medium, and coated duplex board and printing and writing paper The world's most concentrated paper and board production facilities on one site 15 PMs of total annual capacity of 5.25 million tonnes in operation

56 SO NINE DRAGONS WOULD BE IN TOP 10 LEADING COUNTRIES AND APPROXIMATELY 2.5% OF GLOBAL OUTPUT NO COUNTRY 2011 (1,000t tonnes) 1 CHINA 99,300 2 USA 75,083 3 JAPAN 26,627 4 GERMANY 22,698 5 CANADA 12,112 6 SOUTH KOREA 11,492 7 FINLAND 11,329 8 SWEDEN 11,298 NINE DRAGONS (2012) 10,450 9 BRAZIL 10, INDONESIA 10, INDIA 9, UNITED KINGDOM 4, TAIWAN 4,026 RISI AND CHINA PAPER INDUSTRY DATA

57 SOME PAPER COATING AND FILLER PIGMENTS UTILISED IN CHINA IN 2013

58 GCC CAPACITY OF SOME MAJOR PAPER COMPANIES AND COMPANIES (2012/2013) COMPANY PLANT TONNAGE TOTAL DAGANG GOLD EAST 600,000 SUZHOU 30,000 APP HAINAN 800,000 QINGZHOU 300,000 1,810,000 NINGBO (1) 30,000 NINGBO (2) 50,000 CHENMING SHANDONG 800, ,000 SUN PAPER PURCHASE 200,000 PLANT AT MILL 400, ,000 CENTRAL SUNSHINE SHANDONG 400, ,000 BOHUI PAPER SHANDONG/JIANGXU 700, ,000 IMERYS - 2 PLANTS NANLING, CHANGSHU 550, ,000 CHANGSHU 300,000 OMYA - 3 PLANTS HONGMEI, GUANGDONG 50, ,000 JIANMENG, GUANGDONG 100,000

59 ESTIMATED PRODUCTION OF 11.2 MT OF GCC FOR PAPER FOR CHINA 2012 (%) OTHERS 31% APP 11% CHENMING 7% BOHUI 6% SUN PAPER 5% FUYANG AREA 5% 8 PAPER MILLS (300,000 EACH) 22% IMERYS 5% OMYA 4% CENTRAL SUNSHINE 4%

60 PCC SATELLITE PLANTS WITH NEW CAPACITY TO COME ON STREAM IN 2014 WHICH INCLUDES COATING PCC COMPANY LOCATION FILLER PCC COATING TOTAL Comments APP GOLD EAST DAGANG (1) 100,000 GOLD EAST DAGANG (2) 50, ,000 APP SUZHOU, GOLD HUA SHEN 50,000 SMI NANNING JINDAXING PAPER 45,000 Operational 4th Quarter 2014 (NEW HENAN JIANGHE PAPER 22, ,000 Operational 4th Quarter 2014 PROJECTS) SHANDONG SUN PAPER 100,000 Op 1st Q 2014, OPACARB A40 IMERYS TIGER GROUP, YUE YANG, HUNAN 50,000 50,000 Filler TOTAL 317, , ,000

61 GCC, PCC AND KAOLIN USED IN PAPER COATING AND FILLER IN CHINA (2013) PCC 4% KAOLIN 5% PCC 1% KAOLIN 9% PCC 6% GCC 91% GCC 90% GCC 94%

62 CHINA: P&B MARKET SHARE BY FOREIGN INVESTMENTS IN 2012 (%) SECTOR % FOREIGN SHARE - CWF (COATED WOODFREE) 40% - CORRUGATING PACKAGING 65% - TISSUE GRADES 38% - UNCOATED WOODFREE (UWF) 15% - NEWSPRINT 3% - OVERALL SHARE OF ALL SECTORS 23.5% Source: Larry Lai Estimate

63 2013 PRICING OF PULP, KAOLIN AND GCC IN CHINA ($/TONNE) IMPORTED PULP (cif) $ IMPORTED KAOLIN (delivered) IMPORTED KAOLIN (cif) MAOMING KAOLIN (delivered) $ $ $ C98 GCC - TOPCOAT C95 GCC - TOPCOAT C65 GCC - PRECOAT C60 GCC - FILLER $ $ $65-85 $

64 FEW NEW PROJECTS FOR COATED PAPER IT IS ANTICIPATED THAT IT WILL TAKE THE NEXT 3 YEARS TO ABSORB CURRENT OVER CAPACITY COATED BOARD/CARTON BOARD WILL CONTINUE TO GROW. ADDITIONAL TISSUE CAPACITY WILL COME ON STREAM EVEN THOUGH ALREADY OVER-CAPACITY. TECHNICAL DEVELOPMENT TO CUT COSTS MORE STARCH WILL BE USED TO REPLACE SB LATEX - OLD POLLUTING MILLS WILL CONTINUE TO BE CLOSED ESPECIALLY IN EASTERN CHINA - LIKELY TO BE PRICE CUTTING WITH LOWER MARGINS - MARGINS AT PRESENT 5-6% (USED TO BE UP TO 10%) - MARGINS FOR NEXT FEW YEARS LIKELY TO BE 4%. - TRENDS IN CHINESE MARKET

65 PIGMENTS FOR PAPER UTILISATION TRENDS FROM 1972 TO 2001

66 USE OF PAPER FILLER PIGMENTS FROM , NORTH AMERICA (%) % KAOLIN GCC PCC TALC

67 USE OF PAPER FILLER PIGMENTS FROM WESTERN EUROPE(%) 100% 90% 80% 70% 60% 50% % 80 30% 20% 10% % KAOLIN GCC PCC TALC

68 CHANGING USE OF PAPER FILLER PIGMENTS FROM 1972 TO 2001 NORTH AMERICA WESTERN EUROPE % 90% 80% 70% 60% % % 40% 30% % 10% % KAOLIN GCC PCC TALC

69 100% 90% 80% USE OF PAPER COATING PIGMENTS FROM NORTH AMERICA (%) % 60% 50% 40% 30% 20% 10% % KAOLIN GCC PCC

70 USE OF PAPER COATING PIGMENTS FROM WESTERN EUROPE (%) 100% 90% % 70% 60% % 40% 94 30% 20% 10% % KAOLIN GCC PCC TALC

71 100% 90% 80% 70% 60% CHANGING USE OF PAPER COATING PIGMENTS FROM (%) NORTH AMERICA WESTERN EUROPE % 90% 80% 70% 60% % 40% 30% 20% 10% % 40% 30% 20% 10% % % KAOLIN GCC PCC TALC

72 EUROPE PAPER PIGMENTS FROM 1991 TO 2012

73 KAOLIN AND CALCIUM CARBBONATE IN PAPER FROM (%)

74 INCREASING MINERAL LOADING LEVELS OF COATED AND UNCOATED WOODFREE (Source: Olivier Hautin, Pigments for Paper & Packaging, Investor Day Jan 12, 2012) CWF UWF

75 CHANGES IN KAOLIN COMPANIES FROM 1980 TO APRIL 1 st 2014

76 ,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 COATING CLAY FROM USA, UK AND BRAZIL FROM 1974 TO 2013 USA UK BRAZIL ('000 T)

77 INFORMATION ON SOME OF THE MAJOR KAOLIN COMPANIES IMERYS PAY VALE $76 M KAMIN PAY $30 M STORA ENSO SELL THEIR 40.24% SHARE OF THIELE KAOLIN CO. TO THIELE KAOLIN COMPANY FOR $76 MILLION IN FEBRUARY 2014 IN UK NOW ONLY TWO PRODUCERS SIBELCO CONTROL RESERVES/ OPERATIONS IN DEVON AND IMERYS CONTROL ALL RESERVES AND OPERATIONS IN CORNWALL FOLLOWING ACQUISITION OF GOONVIAN

78 Glukhovetsky kaolin plant KAOLIN AD, BULGARIA QuarzwerkeGmbH, Germany holds directly 95,33 % of the capital of Kaolin AD.

79 COATING AND FILLER PIGMENTS FOR P&B 48 MILLION TONNES KAOLIN 18% TALC 4% GLOBAL SUMMARY OF GCC, PCC, KAOLIN AND TALC USED IN P&B IN MT TALC 2% PCC 13% GCC 65% KAOLIN 24% KAOLIN 10% TALC 7% PCC 3% GCC 71% PCC 29% GCC 54% COATING MT FILLER 18.5 MT

80 IMPACT ON PAPER IN MATURE MARKETS (WITH INPACT BY e-media DEVICES) FROM 2010 TO 2015 (F) PAPER MATURE COUNTRIES BOARD & PACKAGING COMMENTS EUROPE -0.6% 1.9% BOARD & PACKAGING N. AMERICA -1.7% 2.2% TO GROW WORLDWIDE EMERGING COUNTRIES S. AMERICA 5.3% 4.4% PAPER TO GROW IN EMERGING ASIA 4.2% 7.2% COUNTRIES AND NEGATIVE GROWTH IN EMERGING COUNTRIES

81 THANKS FOR YOUR ATTENTION