Metsä Group's bioproduct mill -The largest bioeconomy investment in Europe - 2017 Bioeconomy Investment Summit
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Metsä Group’s
bioproduct mill -The
largest bioeconomy
investment in Europe
2017 Bioeconomy
Investment Summit
14.12.2017
Kari Jordan
President and CEO, Metsä Group
METSÄ GROUP | Sales EUR 5 billion | Personnel 9,300
METSÄLIITTO COOPERATIVE | Group’s parent company | Owned by 104,000 Finnish forest owners
METSÄ FOREST METSÄ FIBRE METSÄ WOOD METSÄ BOARD METSÄ TISSUE
Wood supply and Pulp and sawn Tissue and
forest services timber Wood products Paperboard cooking papers
Sales: Sales: Sales: Sales: Sales:
EUR 1.5 billion EUR 1.6 billion EUR 0.5 billion EUR 1.7 billion EUR 1.0 billion
Personnel: Personnel: Personnel: Personnel: Personnel:
850 1,200 1,500 2,500 2,700
2 18/12/2017 Kari Jordan/ Metsä Group
Metsä Group has been successfully
restructured during the past decade
and is now on growth track
• Exit from printing and writing papers
• Closures or divestments of other non-core businesses
• Investments to expand and further develop core businesses
– Benefit from good long term growth prospects
Increase production capacity
Improve efficiency and productivity
Further improve environmental performance
• Main projects:
– Äänekoski bioproduct mill
– Increase of paperboard production at Husum mill in Sweden
– Wood products investment programme
3 18/12/2017 Kari Jordan/ Metsä Group
Metsä Group’s bioproduct mill in Äänekoski
Basic assumptions
• Based on market studies long fibre pulp demand
growth continues steadily, especially in Asia
• We are not expanding the old mill. We are building a
completely new mill in order to achieve a clear
performance improvement incl. energy and
environmental efficiency
• Wood availability in Finland is adequate
5 18/12/2017 Kari Jordan/ Metsä Group
A new high tech unit called the
bioproduct mill
• Not a traditional pulp mill. Share of bioenergy and other
bioproducts clearly larger than before
• Preliminary approval from the Board of Directors and
public announcement in Spring 2014
• Environmental permit process started immediately
• Final approval in April 2015. Immediate start of
construction
6 18/12/2017 Kari Jordan/ Metsä Group
The world’s first
next-generation bioproduct mill
• Annual pulp production 1.3 million tonnes
• Use of wood 6.5 million m³ annually
• The mill will not use fossil fuels
• 150 employees. 2,500 jobs in the whole value chain in
Finland, incl. 1,500 new jobs
• Main markets for pulp: Europe and Asia
– Sales will increase especially in China
• Top-level efficiency and cost competitiveness
Constructed in line with original timetables and budgets
Started up in August 2017. Nominal capacity will be reached
by summer 2018
7 18/12/2017
Demand outlook for forest industry
products is good
• Demand is growing globally
– Population growth
– Increasing living standards
– Sustainability
– Printing paper demand (digitalization!) is declining, but growth
continues in all other main categories
• Further developed current products the mainstream
also in the future
• New products complement the current offering
– Bioenergy and biochemicals
– Wood fibre replacing fossil fuel based materials
8 18/12/2017 Kari Jordan/ Metsä Group
Bioproduct concept: all side streams 100% utilised
* Traditional bioproducts
New biofuels from bark, wood dust
Accomplished * and energy wood
Product gas from bark and sludge
for the mill’s own use
Sulphuric acid from odorous gases
for the mill’s own use
New bioproducts from lignin
Biogas from sludge for traffic fuel
or the mill’s own use
* Fertiliser and earth work material
from dregs and ashes
New textile fibres from pulp
* Biocomposites from pulp
9 18/12/2017 Kari Jordan/ Metsä Group
Bioproduct mill has significant contribution to the
Finnish economy
• Domestic content of the investment over 70 %
• Increases Finnish annual exports by EUR 0.5 billion
• Construction phase (nearly 3 years)*:
– Revenue increase of companies operating in Finland of around EUR 2.4 billion value added
increase of nearly EUR 1 billion
– Annual employment impact 4 000 man-years
• Production phase (30 years)*
– Increases revenue in Finland by over EUR 30 billion and value added by EUR 12 billion
– Employment impact in total over 61 000 man-years
• Diversifies the Finnish forestry sector and broadens the current product portfolio
• Supports Finland in reaching its goal for renewable energy
– The mill increases the share of renewable energy in Finland by approx. 2 percentage points
*Source: ETLA, 5/2016
10 18/12/2017 Kari Jordan/ Metsä GroupBioproduct mill impacts wood supply in the
whole country
2014 2018
• 5.0 million m3 fibre wood Metsä Fibre mills
and wood chips will be
Kemi
transported by trucks from Äänekoski
a radius of 150 kilometers Rauma
Joutseno
• 1.5 million m3 of wood will
come through railways Kemi Kemi
Äänekoski
Äänekoski
Rauma Joutseno Rauma Joutseno
11 18/12/2017 Kari Jordan/ Metsä GroupFinnish forests are managed
sustainably
• Finnish forests are natural commercial forests that do
not compete with agricultural land
– In most parts of the world forest compete with
agricultural land
• Finnish forests are managed sustainably and most of
them are family owned
• Origin of Finnish wood can be traced
– 85% of Finnish forests are certified
– Globally only about 10% of forests are certified
12 18/12/2017 Kari Jordan/ Metsä GroupGood cooperation with key
politicians and civil servants
• First contacts in late 2013
• Target to find new ways to implement a major investment
as fluently as possible
• A pilot initiative (prime minister Jyrki Katainen’s proposal)
was started to show that large projects can be
implemented in Finland rapidly and competitively
– E.g. environmental permit was received in half the usual time
• Processes to be run in parallel, not only sequentially
13 18/12/2017 Kari Jordan/ Metsä GroupMassive logistical operation related
to wood and end products
• Old railways and roads do not enable such a large
investment
• Investment was subject to governmental funding for
public logistics network improvement
• Vuosaari was chosen as the main harbour
14 18/12/2017 Kari Jordan/ Metsä GroupConclusions
• Forest industry has a bright future
– Metsä Group a key player
• We need investments to enhance bioeconomy. Major
investment requires:
– Competitive raw material base
– Customer demand and financial resources
– Good payback time
– Comprehensive planning and stakeholder analysis
– Open dialogue with numerous members of the society
– Determination
15 18/12/2017 Kari Jordan/ Metsä GroupYou can also read
