FOREST INDUSTRY, FORESTRY AND BIOENERGY IN FINLAND Canadian - PowerPoint PPT Presentation

FOREST INDUSTRY, FORESTRY AND BIOENERGY IN FINLAND Canadian bioenergy mission to Finland Ahti Fagerblom, Manager, Energy and Climate Policy 2 - 0

FOREST 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 – Industrial core for business services (maintenance etc.) • The forest industry directly and indirectly employs approximately 160,000 Finns 2

FINLAND'S TOP EXPORT PRODUCTS Softwood sawnwood Paper and paperboard Wood pulp 1. 4. 6. 1,6 bill. EUR 7,0 bill. EUR 1,8 bill. EUR Photo Valmet Automotive Photo ABB 2. Diesel fuel 3. Stainless steel 5. Motor vehicles for 7. Electric generators 3,4 bill. EUR 2,5 bill. EUR personal transport and motors 1,7 bill. EUR 1,3 bill. EUR Photo Planmeca 8. Special machinery 9. Earth movers and 10. Electricity transformers and 1,0 bill. EUR excavators and other frequency changers similar machinery 1,0 bill. EUR 1,0 bill. EUR 3

VALUE OF FOREST INDUSTRY EXPORT AND SHARE OF TOTAL FINNISH EXPORTS share of exports Million euros 15,000 30% Pulp & Paper Industry Wood Products Furniture industry share of total exports 2015 Value of exports, billion EUR 12,500 25% Pulp, paper, board and converted products 9 100 Wood products 2 400 Furniture industry 150 10,000 20% Forest industry total 11 650 Share of total Finnish exports 21,6 % 7,500 15% 5,000 10% 2,500 5% 0 0% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 4

FOREST INDUSTRY IS IMPORTANT IN THE REGIONS Share of Gross Value of Top 5 regions Manufacturing , 2014 South Karelia 70 % Kymenlaakso 51 % Central Finland 38 % North Karelia 33 % South Savo 31 % Average for the whole country 19 % 5

FORESTS COVER 60% OF THE TOTAL AREA IN FINLAND Transport Build-up areas Agricultural routes 3% land 2% 8% Scrub land 7% Low-productive Forest land forests 60% 10% Inland watercources 10% SOURCE: Luke 6

MAINTENANCE OF FOREST RESOURCES IN A LONG TERM IS ESSENTIAL TO DEVELOPMENT OF WOOD-BASED BIO-ECONOMY Milj. m 3 2,500 Birch 2,000 Spruce 1,500 1,000 Pine 500 0 1921-24 36-38 1944 51-53 60-63 64-70 71-76 77-84 86-94 96-2003 2009-15 We use only domestic tree species in regeneration SOURCE: Luke 7

PRIVATE FOREST OWNERS OWN 65 % OF FOREST LAND Others 5% State 26% Non-industrial private 60% Companies 9% SOURCE: Luke 8

THE GROWTH OF FINNISH FORESTS FOREST BALANCE IN FINLAND 1960-2014 Mill. m 3 120 Annual increment Total drain Industrial roundwood 100 80 60 40 20 0 1960 62 64 66 68 1970 72 74 76 78 1980 82 84 86 88 1990 92 94 96 98 2000 2002 2004 2006 2008 2010 2012 2014 SOURCE: Luke 9

10 FOREST MANAGEMENT AND CHAIN OF CUSTODY CERTIFICATION • PEFC and FSC certification (FM and CoC) schemes essential to our sustainable business – Forest industry participates actively in different global and national process under both certification schemes • PEFC certification – More than 85 % of commercial forests (almost 18 M ha) – Forest ownership structure in Finland has been a driving force in certification under PEFC • FSC certification – About 7 % of commercial forests (1.5 M ha): Tornator’s, UPM’s, Metsä Group’s own forests – Group certifications owned by the forest companies attract private forest owners

INVESTMENT PROJECTS UPM, Lappeenranta UPM, Kaukas Investment proposals: • Biorefinery (biodiesel) • Pulp mill improvements Finnpulp Oy, Kuopio • 175 million EUR • 50 Million EUR • Announced Feb 2015; new company • Ready 2015 January • Ready end 2016 • 1,4 Billion EUR, softwood kraft pulp Stora Enso, Varkaus Metsä Group, Äänekoski: Kemijärvi Biorefinery • Change from woodfree paper to • Biorefinery / Softwood kraft pulp • Announced Feb 2015, new company packaging material and changes at the • 1,2 Billion EUR • 700–800 Million EUR, softwood kraft pulp mill • Ready by 2017 Q3 pulp • 110 Million EUR • Additional investment: sulphuric acid Kainuu biorefinery • Ready 2015 plant, 20 mill. euros Announced Dec 2015 • UPM, Kymi Kotkamills, Kotka Pulp mill project, several location • • Pulp mill capacity increase • Change of production line PM2 from considered • 160 Million EUR magazine paper to paperboard Kaidi biorefinery • Ready 2015 • 100 Million EUR • Announced Feb 2016 • Start-up 2016 July Sappi, Kirkniemi • Biodiesel project in Kemi, Chinese Stora Enso, Imatra New powerplant • investor • new polyethylene extrusion coating 60 Million EUR • • 1 billion euros, start-up end of 2019 plant and an automated roll warehouse • Ready 2015 • 70 mill. euros Haapajärvi biorefinery Stora Enso, Sunila • Ready by end 2017 • Announced in April 2016 • Biorefinery, lignin separation • Biorefinery, softwood kraft pulp, • 32 Million EUR 400 000 tonnes • Ready 2015 • 500 million euro investment Stora Enso, Varkaus • Wooden building elements, LVL • 48 Million EUR • Ready 2016 SOURCE: Company announcements & press releases

ENERGY CONSUMPTION IN FINLAND, 2015 Hydro and wind Peat power 4% 5% Wood fuels 26% Net imports of 2015* TWh Change%* Total energy electricity consumption 361 -3,3 % 4% Wood fuels 93 -1,8 % %change from previous year * preliminary figures Nuclear energy Other 19% 4% Natural gas 6% Oil 24% Coal 8%

RENEWABLE ENERGY SOURCES IN ENERGY CONSUMPTION IN FINLAND Hydro and wind power TWh TWh 120 Small-scale combustion of wood Other forest industry by-products and waste products Black liquor and other concentrated liquors 2015* TWh Change% 100 Black liquor and other concentrated liquors 39 -0,4 % 80 Other forest industry by- products and waste products 37 -2,0 % 60 Small-scale combustion of wood 16 -4,8 % Hydro and wind 40 power 19 31,9 % %change from previous year * preliminary figures 20 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015*

WOOD PROCESSING – A CORNER STONE FOR NATIONAL ECONOMY AND CLIMATE SOLUTIONS The variety of climate friendly export products Packaging 2/3 Wood and other Medicine and Buildings and materials wellness interior design together The share of renewable energy produced by Energy and Biopolymers and forest-based industry 14 Pulp and paper bio plastics biofuels

15 THE BIO-ECONOMY WHEEL OF FORTUNE Take responsibility Less CO 2 Base for bio- economy Export Growing Natural Substitute Buildings, Efficient Invest in More renewable Growing Replace non- products in our CO 2 cycle Growing bioenergy medicine, metals, energy forestry renewables forest backyard packaging, naturally concrete, from Proper Wood resources Innovate fossils chemicals leftovers accounting revenues Heritage Variety of Organic products Economy New opportunities ¥€$