Austria’s Lenzing Group said it plans to invest €1billion to increase production of its Tencel brand lyocell fibers to meet the strong demand.

The first expansion phase, construction of a state-of-the art 100,000 t/y plant at Prachinburi, Thailand, at a cost of €400 million, has now been approved. Lenzing said this facility will be the largest of its kind.

Site grading at Thailand’s Industrial Park 304 around 150 kilometers east of Bangkok has been completed, and start-up is scheduled for the end of 2021.

Group CEO Stefan Doboczky said the investment in Thailand represents the next consistent step in the implementation of Lenzing’s sCore TEN strategy and will help to further transform the Austrian producer into a specialty fibers company.

Doboczky added that lyocell products are considered a benchmark in “ecologically responsible” fibers, and the expansion underscores Lenzing’s commitment to improve the ecological footprint of the global textile industry.

 The facility at Prachinburi can draw on a sustainable biogenic energy supply, which leads to low CO2 emissions, the group notes.

Lenzing plans further expansion in future at the Thai site, which it said has space for several more plants. It is already laying the framework for general infrastructure improvements to benefit future capacity upgrades.

The group’s future plans also call for potentially expanding lyocell production in other parts of the world.

For the new facility, the fibers maker said its goal is to implement the project in a strategic partnership with an international engineering contractor that is capable of supporting its further organic growth worldwide.