The world is transitioning away from the dependence on fossil fuel-based products towards the incorporation of the infinite possibilities offered by bio-based products. This will require the replacement of non-renewable materials such as chemicals, plastics, and fossil fuels. We believe that long-term, sustainable wood resources will have an important role to play in this evolution. Wood extractives are biodegradable, carbon-friendly, and generally not recyclable. Wood contains many of the building block chemicals that are found in fossil fuels. We believe that bioextractives will become an increasingly important alternative to petroleum-based fuels, aromatics, food additives, fragrances, and medicinal applications.
We believe that Mercer is well-positioned to leverage our experience and expertise in our aim for the full utilization of our raw material inputs, and in recent years have been expanding our product mix to include bioextractives and biomaterials. We are engaged in a number of initiatives focused on developing innovative, new products including derivatives from our kraft pulping process, as well as stand-alone extractive facilities.
Along with producing energy from the biomass and chemical recovery process at our pulp mills, we produce an environmentally friendly alternative to some types of petrochemicals: tall oil. The resins contained in coniferous wood store nutrients and act as a source of protection. In our production process, the resin forms soap together with sodium hydroxide, which we separate and then refine to tall oil.
We operate tall oil facilities at our Stendal and Rosenthal mills in Germany and sell to customers who utilize it as an alternative to petroleum-based fuels. Tall oil has a similar structure to crude oil and is a product made from one hundred percent renewable resources. Currently, the European Union is working toward implementing more stringent carbon regulations, making for more favourable markets for the sale of bio-based fuel products like tall oil.
Another sustainable extractive of our kraft mill process is turpentine. Anyone who has smelled turpentine in its industrial form might have been surprised that this substance – despite its intense odour – is indispensable to producers of fragrances that are used to scent products such as perfumes, deodorants, and detergents.
Through our joint-venture company, Performance BioFilaments, we are in the process of developing commercial applications for cellulose filaments. Cellulose filaments can be used in a wide range of applications, including as a reinforcement agent or a rheology modifier. Industries that can benefit from this technology range from manufacturing, construction, and consumer products.
Cellulose filaments can result in lighter-weight materials and more advanced filtration systems. They are differentiated from other cellulose products by their unique aspect ratio and particle size. The material is a ribbon-like form of cellulose that is very long and thin.
With our recent acquisition of the Australia-based Sandalwood producer, Santanol, we have begun producing and supplying ethical, sustainable, and reliable Australian-grown Indian Santalum Album oil and products. Sandalwood oil is a foundational essential oil used in fragrances, aromatherapy, cosmetics, and spiritual events. Recently, this material has become scarce, as illegal harvesting has eliminated many of its natural sources.
Historically, much of the world’s supply of Sandalwood oil has come from unethical, undocumented sources. We are proud to be one of the few large commercial, plantation-based operators offering a future ethical supply of Santalum Album oil. We own and operate 2,500 hectares of sustainable plantations and utilize modern harvesting, processing, oil distillation, and refinery operations in Western Australia.
Our plantations range in age from 1 to 14 years, with 15 years as the optimal harvest age. We have successfully secured Santalum Album and Spicatum Album wood supply from neighbouring plantations allowing us to offer Sandalwood oils to supply global markets.