According to various Arkansas business publications, China based Shandong Sun Paper is planning to build a kraft linerboard mill at its site in Clark County, Arkansas, shifting its focus from the original plan to build a bio-products mill. The investment will increase from $1.3 billion to $1.8 billion.
“The announcement of the initial Sun Paper $1.3 billion investment has been one of the largest in our state’s history,” Arkansas Economic Development Executive Director Mike Preston said in a statement. “The new focus will bring an even larger investment and more jobs to the state than anticipated, and we couldn’t be more pleased to see that.”
Mark Wilde of BMO Capital Markets says the decision to build the mill makes sense. “Financing costs remain low and recent US tax law changes provide tax incentives for large capital investments. The state and local government are also providing financial incentives. Moreover, global linerboard markets are tight and the increasing Chinese government restrictions on imported wastepaper have Chinese packaging companies looking beyond locally produced recycled containerboard grades.”
Construction is expected to begin in 2018.