If demand for pulp had wavered in the United States, it was building in China. Nine Dragons is Asia’s largest producer of containerboard, which is used to make cardboard boxes and packing material. Its founder, Ms. Zhang, amassed her vast fortune by exporting recycling scrap from the United States, and then breaking it down to pulp that could be made into boxes.
That business model was shaken in 2018 when the Chinese government sharply limited the import of American recycling scrap, in a policy known as the “National Sword.” Paper manufacturers began searching for new sources of virgin pulp, which can be exported under lower tariffs and mixed with lower-grade fibers from Chinese scrap to strengthen cardboard.
And that decision had sent ripples all the way to Old Town, where Nine Dragons announced an initial investment of $45 million. Mr. Mahan watched as the mill became a hive of activity. Four hundred and fifty contractors began showing up daily at the mill, and a pizza shop opened on Main Street. When the company began interviewing candidates for 130 jobs, 1,200 people applied.
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At 2 p.m. on a sunny afternoon in August, Ms. Zhang — known reverently within the company as “Chairlady” — walked into the Old Town mill for its grand opening. She was small and twinkly, wearing a knitted Chanel-style suit woven with gold thread and patent-leather shoes with gold details; inside her collar was tucked a strand of marble-size gemstones.
She was followed by a retinue of family members, many of whom work for her. Ms. Zhang’s father, a military officer, was branded a “counterrevolutionary” and imprisoned during the Cultural Revolution. They were poor, and she had to go to work at a young age, to support her seven younger siblings.
In 2006, the year Nine Dragons went public, she was ranked the richest person in China by the Hurun Report.
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The ambitious two-year goal declared at the grand opening — to convert the mill from hardwood to softwood, and then scale up pulp production from the mill’s former yield of 150,000 tons a year to 270,000 — is still far off.
The mill is still ramping up, producing about 200 tons a day, Mr. Kerschner said. He said he hoped to bring production up to the pre-shutdown level early this year.
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