Cellulose Fibres from Organic Waste - Nanollose (ASX: NC6)

Cellulose Fibres from Organic Waste - Nanollose (ASX:  NC6)

Nanollose (ASX:  NC6) is an ASX listed company that is trying to make Cellulose fibres from organic waste.  Like me, you ask, what is cellulose fibres?  In a simple chinaman explanation, cellulose fibres are fibres made of esters of cellulose which can be obtained from the bark, wood or leaves of plants, or plant-based material.  These fibres are compound of hemicellulose and lignin, and different percentages of these components are responsible for different mechanical properties observed (source:  Wikipedia).

The main applications of cellulose fibres are in the textile industry, a chemical filter, and fibre-reinforcement composite, due to their similar properties to engineered fibres, being another option for biocomposites and polymer composites (source:  Wikipedia).

Manufactured cellulose fibres come from plants that are processed into a pulp and then extruded in the same ways that synthetic fibres like polyester or nylon are made. Rayon or viscose is one of the most common “manufactured” cellulose fibres, and it can be made from wood pulp (source:  Wikipedia).

Figure 1:  The current process of creating Rayon. (source: Nanollose Presentation January 2019 )

A couple of weeks ago, I heard about Nanollose from a passing conversation.  It intrigued me for a few days as this is something very different from my comfort zone so I started to look into the company. I have had a lot of interest in Hemp in the past and have done a couple of Insights on that topic so as I researched, the similarities started to appear.

Hemp – A very Green Construction Product.
Cannabinoids: Now I know what the fuss is all about……

The creation of natural fibre from the use of organic waste will fit into one of the “clean products” that the world is seeking.  It is probably got a few hurdles to get over before full commercialisation, but it will be a good conversation with management for those people that are keen to find out more.  I am sure you will be able to get all the contact details from www.nanollose.com.

I spoke to Alfie Germano, the managing director, and he gave me a quick introduction to the industry.  For me, it is a unique concept and one that I think could prove to be very lucrative.

In December 2018, the company announced that they had created their first garment from their Rayon.  The first garment was created from the conversion of organic waste.  You can see the process in Figure 2. Simple in nature, but I am sure that is not entirely the case. However, this process would help with the environment.  I know how bad the cotton industry is for the environment, so I welcome anything that can reduce that industry.  I am already all for Hemp as an alternative to cotton.

 

Figure 2:  The Nanollose process of creating Rayon. (source: Nanollose Presentation January 2019 )

 

While researching this company, I also learnt about Rayon and the market.  It is something that I would not have thought about even though I am wearing clothing all day.

According to Wikipedia, Rayon is a manufactured fibre made from regenerated cellulose fibre. The many types and grades of rayon can imitate the feel and texture of natural fibres such as silkwoolcotton, and linen. The types that resemble silk are often called artificial silk.

Since rayon is manufactured from naturally occurring polymers, it is not considered to be synthetic[1]. Technically, the term synthetic fibre is reserved for fully synthetic fibres. In manufacturing terms, rayon is classified as “a fibre formed by regenerating natural materials into a usable form”. [2] Specific types of rayon include viscosemodal and lyocell, each of which differs in the manufacturing process and properties of the finished product.

Rayon is made from purified cellulose, harvested primarily from wood pulp, which is chemically converted into a soluble compound. It is then dissolved and forced through a spinneret to produce filaments which are chemically solidified, resulting in fibres of nearly pure cellulose. Unless the chemicals are handled carefully, workers can be seriously harmed by the carbon disulfide used to manufacture most rayon.

 

I find this topic very fascinating, and I guess Nanollose allows me to get involved in what is considered clean for our environment and has a large market.  Rayon is a high growth market valued at US$16.3B in 2019 and growing at over 10%, according to Nanollose.

Figure 3 below gives a summary of the composition fo the market.  Nanollose has a facility in Indonesia where they are looking to source the waste of a coconut food product manufacturer.  So systems are in place to move their plans forward in 2019.  Corporately the share price for Nanollose has not been performing well but I think there is room for improvement.  The investing market is always looking for something different I think with time and the right marketing, this could be a worthy product.

 

Figure 3:  The cellulose fibre market. (source: Nanollose Presentation January 2019)

 

I could go on for a while on this, but I think it is best to have a look for yourself and check it out. I can see several barriers for the company to reach its target.  Acceptance, by the market, the endurance of the fibres for the garment industry, proving that the material has no adverse health considerations and the ability to sustain the competitive barrage from traditional fibres.

All these thoughts may be overcome with time and endurance to stay in the game. I am thrilled to have found this topic, and it is worthwhile to do more research.

 

www.samso.com.au

If you find this article informative and useful, please help me share the information.  I try and write about topics that are interesting and have the potential to be of investment value.  It is not easy to find stories that fit those parameters.

If you or your organisation see the benefit of what Samso is trying to achieve and have a need to share your journey, please contact me on noel.ong@samso.com.au.

 


Samso is primarily a consulting company that delivers digital information to the market in terms of creating organic content.

Samso provides bespoke research and presentation for clients to engage their customers or investors. Bespoke research is useful for clients who require a two-way flow of communication with their customer/investor base by utilising a social media strategy.

Organic content allows audiences to feel a real sense of sincerity when you share your business strategy, allowing your business to stand out among the sea of social media traffic.

Samso has nearly 30 years of experience in developing business ideas and concepts in the Australasian region. Samso has worked primarily in the mineral resources industry, capital markets and corporate finance. Noel Ong is the founder of SAMSO.

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