DET ANNONSERAS MÅNGA STORA UTBYGGNADER I FINSK SKOGSINDUSTRI VAD HÄNDER? Virkesforum Timo Jaatinen, Director General Finnish Forest

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1 DET ANNONSERAS MÅNGA STORA UTBYGGNADER I FINSK SKOGSINDUSTRI VAD HÄNDER? Virkesforum Timo Jaatinen, Director General Finnish Forest Industries Federation

2 FOREST-BASED INDUSTRY IN FINLAND The sector employs directly 42,000 people in Finland and abroad approx. 50,000 people Significant indirect effects for other sectors Important customer of products and services of other industries and transportation The forest industry directly and indirectly employs approximately 160,000 Finns Substantial indirect effects due to the industry's heavy reliance on domestic production inputs 2

3 FOREST INDUSTRY PRODUCTION FACILITIES SPREAD EVENLY AND THEY CREATE WELFARE IN PROVINCES Forestry and the forest industry is important to over 50 local communities 49 pulp, paper and paperboard mills Over 200 industrial sawmills, panel factories or other wood products companies The industry purchases 60 million m 3 of roundwood in Finland in a normal market situation 90 % of wood-sales revenues go to private individuals SOURCE: Finnish Forest Industries Federation; *FFIF members' sawmills, **Member companies of the Association of Finnish Joinery and Furniture Industries 3

4 FOREST INDUSTRY INVESTMENTS IN FINLAND Million EUR Pulp and paper Wood products Forecast e Year SOURCE: Statistics Finland, forecast Confederation of Finnish Industries, FFIF 4

5 INVESTMENT PROJECTS UPM, Lappeenranta Biorefinery (biodiesel) 175 million EUR Ready 2015 January Stora Enso, Varkaus Change from woodfree paper to packaging material and changes at the pulp mill 110 Million EUR Ready 2015 UPM, Kymi Pulp mill capacity increase 160 Million EUR Ready 2015 Sappi, Kirkniemi New powerplant 60 Million EUR Ready 2015 Stora Enso, Sunila Biorefinery, lignin separation 32 Million EUR Ready 2015 Stora Enso, Varkaus Wooden building elements, LVL 48 Million EUR Ready 2016 SOURCE: Company announcements & press releases UPM, Kaukas Pulp mill improvements 50 Million EUR Ready end 2016 Metsä Group, Äänekoski: Biorefinery / Softwood kraft pulp 1,2 Billion EUR Ready by 2017 Q3 Additional investment: sulphuric acid plant, 20 mill. euros Kotkamills, Kotka Change of production line PM2 from pr&wr paper to paperboard 100 Million EUR Start-up 2016 July Stora Enso, Imatra new PE extrusion coating plant and an automated roll warehouse 70 mill. euros Ready by end 2017 Metsä Group, Finland and Estonia 100 million EUR investment programme for wood products, one half to domestic targets More efficient veneer, plywood and LVL production by UPM, Kymi Pulp mill improvements to wood handling etc to increase capacity 98 million euros Ready 2017 autumn 5 INVESTMENT PROPOSALS Finnpulp Oy, Kuopio Announced Feb 2015; new company 1,4 Billion EUR, softwood kraft pulp Kemijärvi Biorefinery Announced Feb 2015, new company Million EUR, softwood kraft pulp Kainuu biorefinery Announced Dec 2015 Pulp mill project, several location considered Kaidi biorefinery Announced Feb 2016 Biodiesel project in Kemi, Chinese investor 1 billion euros, start-up end of 2019 Haapajärvi biorefinery Announced in April 2016 Biorefinery, softwood kraft pulp, tonnes 500 million euro investment

6 SUSTAINABLE USE OF DOMESTIC WOOD CAN BE INCREASED 21 MILLION M 3 ANNUALLY milj. m 3 Annual growth of forests Sustainable annual harvest* } Growth potential Energy use of roundwood Industrial useof roundwood 0 SOURCE: Natural Resources Institute Finland 6

7 DEMAND FOR ROUNDWOOD INCREASES EMPHASIS ON WOOD PRODUCTION million m Additional demand for roundwood in 2017 (estimate) Additional demand for roundwood in the 2020s (preliminary investment assessments) Imports Industrial use of roundwood *Energy use of roundwood (wood chips and firewood) Sustainable annual harvest (Natural Resources Institute Finland) Metsä Group: 4 Stora Enso: 0,5 UPM: 1,1 Others: 1, Logs (estimate): 2, s *Assuming that roundwood use for energy production stays at 2015 level SOURCE: Natural Resources Institute Finland & companies press releases 7 Finnpulp (Kuopio): 6,7 Logs (estimate): 5,2 Kaidi Finland (Kemi): 2 Haapajärvi: 2 Boreal Bioref (Kemijärvi): 2,3 KaiCell Fibers (Kainuu): 2,

8 STRATEGIC GOVERNMENT PROGRAMME AND KEY PROJECTS The action plan for the implementation of the key projects and reforms defined in the Strategic Government Programme involves a large number of operational changes designed to reform Finnish society and underpin the efforts to create favourable conditions for economic growth. 1. Employment and competitiveness 2. Skills and education 3. Wellbeing and health 4. The bioeconomy and clean solutions Towards carbon-free, clean and renewable energy cost-efficiently Wood on the move and new products from forests Breakthrough of a circular economy, getting waters into good condition Finnish food production will be profitable, trade balance on the rise Nature policy based on trust and fair means 5. Digitalisation, experimentation and deregulation 6. Reforms 8

9 HOW TO ENSURE THE GROWTH OF BIOECONOMY? 1. Forest-related laws must support bioeconomy 2. Putting into action measures to improve supply of wood and forest ownership structures E.g. taxation, active utilization of forest resource data, digital trading platforms for roundwood, jointly owned forests, etc. 3. Endorsing sound and even-handed support policies 4. Sustaining and developing a well-functioning infrastructure 5. Ensuring the availability of skilled labour 6. Paying special attention to ecological sustainability when demand for wood increases Forest certification Nature management of commercial forests Voluntary conservation (METSO programme) Forest Industries Forest Environment Program EU policies must strengthen the bioeconomy otherwise nonrenewable raw materials take over and supress forest-based industries 9

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