Tariff fears stall Lenzing’s US expansion plan

Cellulosic fiber producer Lenzing has announced it will “temporarily mothball” the lyocell expansion project it had planned to implement in Mobile, Ala. “The rising likelihood of increasing trade tariffs, paired with the potential surge in construction costs due to the buoyant U.S. labor market, have increased the risk profile of this project,” the company press release says.

Lenzing will instead focus on readjusting its future plans for growth in order to meet demand for its lyocell fibers. This includes more focus on its planned expansion project in Prachinburi, Thailand. “Lenzing will reassess this decision on a regular basis but no substantial additional lyocell volumes, over and above the successful 25,000 tons expansion in Heiligenkreuz (Austria), will be added to the market in 2019 and 2020 by Lenzing,” the company says.