By Christine Graf
Finch Paper LLC in Glens Falls is considering a $5 million expansion of its wood yard. The upgrade would allow Finch, one of the largest privately owned pulp and paper companies in the United States, to process 16-foot logs.
It would position the company to purchase more pulpwood from area loggers.
Company Chief Financial Officer Alexander Rotolo said the capital project is in the planning stages.
“Hundreds of companies rely on Finch and make decisions based on Finch,” he said. “If they think we are going to 16-foot wood in the next six months, they may make decisions to do things like change equipment.”
The wood yard upgrades will not be possible without the $1 million Finch is seeking from Empire State Development. The state agency provides funding for economic development initiatives and projects that help retain jobs and generate increased economic activity for businesses operating in New York.
“The 20 percent capital cost assistance is going to be key to any pathway to getting to the ROI that’s tenable for our investment,” said Rotolo. “Without that 20 percent, I can tell you that this is not a feasible ROI for Finch Paper. It’s a great project for the entire forest economy and for the area. But a lot of those benefits may not have to do with Finch. It’s not necessary for us to do. We are very competitive at 8-foot wood. This would be going above and beyond.”
The proposed wood yard upgrade would include the purchase of a new chipper.
“It’s our chipper that is the bottleneck,” said Rotolo. “The de-barker we put in for 8-foot wood is actually designed for longer wood and is more efficient and can have higher production if we move to 16 foot.”
It was December 2015 when Finch Paper completed a $10 million capital project that upgraded their wood yard and allowed them to process 8-foot logs.
Being able to process 16-foot wood would lead to efficiency gains and higher yields. Finch would be able to produce more of its own pulp, he said.
“We are 80 percent integrated, meaning that 80 percent of our pulp needs we make with local wood,” said Rotolo. “Twenty percent we buy off the market regionally in the U.S. and Canada.”
In addition to producing higher yields for Finch, the proposed project would have other far-reaching benefits.
“Any time that we reinvest, that gives confidence to our suppliers and opportunities for our suppliers to invest in new equipment,” said Rotolo. “Any time an upgrade is done, there is usually a pretty good environmental impact in terms of fuel usage and obviously efficiency impact for our loggers and supplier base in terms of their cost structure to log.”
Rotolo and his team remain optimistic that the project will come to fruition.
“We will eventually do this,” he said. “I can’t give a timeline. I was hoping to get started on construction next year, but it could be 18 months or two years before we break ground. It’s not going to be a 30-year project, but these things take time.”
Finch has been operating in Glens Falls for some 150 years.