M.A.H.Y. Khoory invests AED 1 billion in new PM4 for premium containerboard in Abu Dhabi

The Middle Eastern packaging sector is witnessing a significant capital injection as M.A.H.Y. Khoory Group commits over AED 1 billion to develop a new paper machine, PM4, at the Union Paper Mills facility in Al Dhafra, Abu Dhabi. Announced yesterday, the project represents a calculated shift from standard volume production to higher-margin technical grades.

Instead of merely adding tonnage to a standard recycled liner market, PM4 is engineered to produce premium containerboard grades and specialized paper for gypsum plasterboard applications. This diversification strategy addresses the growing regional demand for high-performance packaging and construction materials, reducing reliance on imports for these specific technical grades.

Union Paper Mills, established in 1987 as the UAE’s first recycled paper mill, currently processes recovered paper into approximately 1,000 tonnes of containerboard daily. The addition of PM4 at the Al Dhafra site will substantially increase this footprint while integrating advanced manufacturing technologies to optimize resource efficiency and circular economy principles.

The AED 1 billion investment also aligns with the broader vertical integration strategy of the M.A.H.Y. Khoory Group. The company is simultaneously expanding its converting capabilities, with Union Corrugated Packaging Industries scheduled to open a new 4,500-tonne-per-month corrugated plant in Abu Dhabi's KEZAD industrial zone in January 2027. By securing the upstream supply of premium containerboard through PM4, the group ensures a closed-loop material flow for its downstream converting operations.

Furthermore, the project fits squarely within the UAE's Operation 300bn industrial strategy and the Make it in the Emirates initiative, which aim to boost the industrial sector's contribution to the national economy. For the global paper machinery and containerboard markets, this move signals the Middle East's accelerating transition from a net importer of premium paper grades to a self-sufficient, integrated manufacturing hub.