Several thousand jobs have been lost in Finnish paper mill towns in recent years due to mill and production line closures imposed by the big forest industry companies, who are seeking to maintain their profitability in the face of rapid changes in global markets for pulp and paper products.
No new paper production lines have been set up in Finland since 1998 and further closures are feared at several mills.
The Nordic forest industry firms are at the same time looking at new business areas where they can utilise wood in new ways in new materials and products. Bioenergy is an obvious option, since these companies already have plenty of experience of producing and using biofuels within their pulp and paper plants. Many paper mills also provide heat derived from bioenergy to local communities through district heating schemes connected to combined heat and power plants located in mill complexes.
In recent years energy obtained directly or indirectly from wood has accounted for around 20 per cent of Finland’s total energy consumption. Most of this energy is used by the forest industry itself, and obtained from residual materials and by-products including bark, sawdust and energy-rich black liquor derived from the pulp-making process. As much as 40 per cent of the wood brought into pulp and paper mills ends up being used to produce energy at some phase of the production process.
Looking to a greener future
“The forest industry will still change a lot over the next decade, with restructuring and consolidations continuing. We envisage that the conventional forest industry sectors will be combined into a new wider ‘bioforest’ industry,” says Hans Sohlström, executive vice president of the Finnish forest industry giant UPM.
UPM has gone so far as to rebrand itself as “The Biofore Company”. Sohlström explains that this new branding reflects the company’s desire to be at the forefront of developments in a new sustainable bioeconomy. “We want to be part of the solution to the problem of global warming. We see the forest industry as providing a good basis for sustainable development, as we use renewable raw materials, our processes recycle a lot of materials and energy, and our products help to combat climate change by acting as carbon sinks,” he says.
The forest industry companies already have the infrastructure and supply chains in place to procure wood from the forests. This makes it easier for them to launch new production processes where the main raw material is wood.
New liquid biofuels for road vehicles
UPM and rival Nordic forest industry giant Stora Enso are both increasingly looking for ways to convert wood into fuels including wood pellets, wood-based heating oils and liquid biofuels that can be used in road vehicles. Stora Enso has been working with Neste Oil at a pilot plant in Varkaus running trials for the production of biodiesel fuel from logging residues, with a view to starting commercial production at Porvoo or Imatra. UPM hopes to launch commercial scale biodiesel production at one of its mills by 2014. The company also aims to produce bioethanol fuels based on wood as a preferable alternative source of biomass to crops that can also be used as food.
In the longer term the Finnish forest industry’s branching out into new areas such as bio-fuel production may help to compensate for declines in the export income and employment generated by paper production. Biofuel sales could soon account for a much higher share of the incomes of companies formerly seen primarily as paper producers.
UPM’s Hans Sohlström is excited about these expansion prospects, but he is convinced that there is also a future for paper-making in Finland. “We see plenty of opportunities for growth in bio-
fuels and other new product areas including biochemicals and new biomaterials such as nanocellulose and biocomposites, but paper production will still represent the biggest part of our operations,” he says. “Even though some of the least cost-competitive mills have been closed down recently, the forest industry still has about 50 active mills in Finland.”
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