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KwaZulu-Natal Business 2019-20 edition

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A unique business and investment guide to KwaZulu-Natal Province in South Africa. The 2019/20 edition of KwaZulu-Natal Business is the 11th issue of this highly successful publication that, since its launch in 2008, has established itself as the premier business and investment guide for the KwaZulu-Natal Province. In addition to the regular articles providing insight into each of the key economic sectors of the province, there is a special feature on the surge in investment in new tourism projects, from casino expansions to the building of a dedicated cruise-liner terminal. Another special feature surveys other large investments in a wide variety of sectors, showing the diversity and strength of the provincial economy. For monthly updates about the region, subscribe at or visit our portal at


OVERVIEW in 2017 for the third year in a row. Forestry SA reports that tonnage sales were nearly 2% down on the previous year, at 15-million tons. Wattle showed the largest decrease while pulpwood was the only category to increase, but by less than 2%. The National Department of Agriculture, Forestry and Fisheries reports that South Africa has a shortage of sawn timber and anticipates further shortages in the future. Despite this overall trend in the national forestry picture, TWK has announced that it wants to buy 11 000 hectares of forest land to support its wood chip sales (especially to China and Japan) and timber exports. TWK is an agricultural company that grew out of the Transvaal Wattlegrowers Cooperative and which became the latest such company to be listed when it joined the ZAR X in 2017. The KwaZulu-Natal provincial government's strategy of creating Industrial Economic Hubs (IEHs) includes the development and expansion of wood processing in the Harry Gwala District Municipality. This is in the wooded south-western part of the province and includes the towns of Kokstad, Harding, Ixopo and Underberg. Nampak produces crêpe paper at Verulam and Rafalo produces tissue paper. SA Paper Mills is another paper producer. Mpact's upgrade of its Felixton mill has increased capacity and improved efficiency. The project cost R765-million and takes overall production up to 215 000 tons and a lightweight containerboard option has been included in the product lines. This is in response to market demand for lighter packaging. Mpact has plastics and paper operations, with the paper section divided into three divisions: paper manufacturing, corrugated and converted paper products and recycling. The Merensky Group operates one softwood sawmill and a panel-processing plant in Kokstad that is geared to manufacture according to customers’ needs in any sector. Export is done through the Port of Durban. NCT Forestry Co-op Limited is a key timber-marketing entity with more than 2 000 members and three wood-chipping mills. ONLINE RESOURCES Forestry South Africa: KwaZulu-Natal Department of Agriculture and Rural Development: South African Institute of Forestry: Technical Association of the Pulp and Paper Industry of South Africa: R&B Timber Group has three pole treatment plants and is headquartered in Harding. Flaxton Timbers operates out of Ixopo and Natal Forest Products is in Richmond. Timber Timber plantations are found in five parts of the province: northern KwaZulu- Natal, Midlands, southern KwaZulu-Natal, Zululand and Maputaland. Close to half-amillion hectares – 38.5% of the land in South Africa devoted to forestry – is allocated to timber plantations. Of this area, 70% is devoted to hardwoods and the balance to pine, the only softwood grown in large quantities in South Africa. The percentage of privately owned forest land is 93.4%. Merensky has plantations in the Dargle forest while Sappi and Mondi have holdings across the province, and in other parts of South Africa. Management of the 251 000 hectares of the plantation forest that Mondi has under management is done in line with sustainable forest management principles and the company is engaged in a partnership with the WWF to get different types of water users to work together in improving how water is used. Mondi has reduced its own consumption of fresh water by 12% in comparison to its use in 2015. KWAZULU-NATAL BUSINESS 2019/20 36

PROFILE Sustainable growth Mondi is a global leader with a culture that delivers sustainable growth. Mondi is a global leader in packaging and paper, delighting its customers and consumers with innovative and sustainable packaging and paper solutions. Mondi is fully integrated across the packaging and paper value chain – from managing forests and producing pulp, paper and plastic films, to developing and manufacturing effective industrial and consumer packaging solutions. Sustainability is embedded in everything Mondi does. In 2018, Mondi had revenues of €7.48-billion and underlying EBITDA of €1.76-billion. Mondi globally is leading the response of the packaging and paper industry in developing sustainable solutions to address key environmental and social challenges. The group is taking a sciencebased approach and working with partners across the value chain to develop innovative sustainable solutions that are fit for a circular economy. By taking a holistic view, Mondi believes it can meet the needs of each customer, their products and the planet to contribute to a better world. Peter Oswald, Mondi Group CEO, commented: “As a global packaging and paper group, it is essential for our business, as well as the planet, to drive innovation and change throughout the value chain. We don’t see sustainability as a trend, it’s a requirement. Mondi’s unique offering of highperformance paper, plastic and hybrid solutions means that we can find the most sustainable fit for each application.” Mondi South Africa Our South African business sustainably manages some 250 000 hectares of plantation forests and manufactures and sells pulp, virgin containerboard and uncoated fine paper products. We have around 1 500 employees working in our forestry operations and two mills located in Richards Bay and Merebank, Durban. Strategic advantages Our focus is on leveraging our strong domestic market position and the global competitiveness of our Richards Bay mill. With a history spanning more than 50 years, we understand the value of being efficient, cost-competitive and customer-focused. Our passion for performance will always be central to the way we run our business and is demonstrated through a continuous focus on quality, productivity and efficiency. The fundamental principle behind operational excellence at Mondi is the desire to do more with less. We invest in and manage our business to ensure that our manufacturing operations maintain their cost advantage, that our forestry operations are managed sustainably for a secure timber supply, that we support our customers' success and invest in the development of our people and communities. 37 KWAZULU-NATAL BUSINESS 2019/20

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