Wednesday, May 22, 2013
WATERVILLE -- An area entrepreneur has reached an agreement with a partner company in France that opens the European market to his invention, a starch-based filler that can reduce the cost of making paper products.
If Tony Jabar, 56, owner of Waterville-based Cerealus, is right about the value of his product, it could change the paper-making world and bring hundreds of millions of dollars from Europe into Maine.
Jabar's invention is Cerecarb, made from the same starches found in corn or potatoes.
"It produces high levels of strength," Jabar said. "That strength in the paper can then be traded off for a variety of things."
Because it is cheap and strong, paper can be produced from less wood, making it a valuable commodity for mills seeking to improve their product.
The digital age has set a course toward a paperless society but Jabar said that the transition will be long and slow. In the meantime, paper remains a large market with high stakes for those who successfully introduce a better way of producing it.
"The publishing business has been declining for years, but it's still huge," he said. "There are 300 million tons of paper and paperboard made per year worldwide."
That vast amount of paper, which goes into magazines, newspapers, envelopes, cardboard boxes and cereal boxes, among other products, is made by about 500 paper mills worldwide. Jabar said about 80 percent of them are owned by just 10 or 15 corporations.
If one of those companies recognizes the value, Jabar said his product is likely to be adopted universally, because no mill can afford to ignore the competitive advantage his product confers.
John Williams, president of the Maine Pulp and Paper Association, said Jabar's invention demonstrates a principle that is rarely thought about by those who use paper products.
"There's a lot of science and art in making a good, quality sheet of paper," he said.
Williams said innovation is what's needed to keep the highly competitive paper industry moving forward.
"The mills are always looking for ways to make paper of higher quality or at a lower cost," he said.
Williams said some mills, like Sappi in Skowhegan, have their own research centers developing ways to improve the paper-making process.
"There have been a lot of advancements, some in the quality of the pulp, some in the types of additives," he said. "Our mills in Maine have done a lot of innovations over the years."
Other innovations come from entrepreneurs, like Jabar.
A chemistry major in college, Jabar has worked for chemical companies, a starch company and for Monsanto, the Missouri-based agricultural biotechnology company before founding Cerealus in 2004.
Jabar said he has been helped by resources in the state, including the university development center, the Maine Technology Institute, and the Maine Seed Capital Tax Credit Program, which gives a tax credit to early stage investors. For Cerecarb and other products in development, the technology institute alone has given Jabar's company more than $350,000 over the past eight years.
Much of the development has happened at the development center, which is in Orono, and at a lab and small warehousing facility Jabar runs in Jay.
Jabar's company, Cerealus, filed a patent application in November 2011.
Since then, he has been working with a handful of paper mills that are testing the material and trying to verify whether it will add the value to their product that Jabar says it will.
"We're at various stages of evaluation in six to eight paper mills throughout the country, including in Maine," Jabar said.
Jabar expressed confidence about the outcome of the evaluations.
"We're moving very fast," he said. "We have had this tested independently. The feedback we get is, nothing comes close."
Some of the companies that expressed an interest are located in Europe, so Jabar decided that he needed to identify a European partner.
Two weeks ago, he forged an agreement with Seppic, a Paris-based subsidiary of Air Liquide, distributor and manufacturer to Europe's pulp and paper industry.
"That was a big deal for us," Jabar said. "It basically doubles the available market size for us in a short period of time. That market is just as big in Europe as it is in the US. They have a short fiber supply and anything they can do to reduce the use of fiber, they're all over."
If the product takes off, Jabar said his company will grow, helping to boost the local economy.
"At the university and at our lab down in Jay, we would hire everything from administration people to tech people to service people to lab people, all that kind of stuff," he said.
Matt Hongoltz-Hetling -- 861-9287