SCA Transforest, New ways 2/2011

8/6/2019 SCA Transforest, New ways 2/2011

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scatransforest.com

SCA Transforest and Samskip extend cooperation | 4

Swedens Infrastructure Minister believes in shipping | 6

New system transport between Sweden and North America | 12

HEADLINES

EDIT ION TWO 2011


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Pblisher: Nils-Johan Haraldsson +46 60 19 35 30 Editorial sta: Mikael Hgstrm +46 60 19 35 55, Henrik Flldin+46 60 19 36 20, Bjrn Lyngfelt +46 60 19 34 98 Lena Zettervall 060-19 35 27 Editor: Carl Johard +46 70 883 88 10.Frontpage photo: Henrik Flldin. Translation: LanguageWire. Prodction: Frosting Kommunikationsbyr.Printing: Prinfo Accidenstryckeriet. Inla: SCA GraphoCote 90 gram. Coer: Cocoon gloss 200 gram.

Please submit any comments about New Ways to: SCA Transforest AB, Box 805,SE-851 23 Sundsvall, Sweden. Tel. +46 60 19 35 00 [email protected]

Since it started business in 1966, SCA Transorest hassuccessully developed new concepts or handling industrialgoods, particularly orest industry products. In the 1960s,new ports and terminals were built in orward-thinking andstrategic locations in Sweden and Europe, and they are stillproving extremely useul to us today. A new type o ship wasalso developed, in the orm o the Munksund, Holmsund andTunadal, with the largest cargo capacity on the market andgantry cranes or rapid loading and unloading to ensure the best

cost-eciency.

The next advance came in 1996, when SCA built three newO-type Roll-On Roll-O ships based entirely on cassettes asload carriers. This was unique or the time, but an eectivesolution or SCA Transorest and our customers. Punctuality,quality and cost eciency are perhaps what most people todayassociate with the service rom Northern Sweden to London andRotterdam.

The act that SCA Transorest has a long and successul historyo innovation and development is no reason or us to slowthe pace. On the contrary, in order to oer our customers acompetitive product with the right service, quality and price,we need to up the pace o development in every area: at theterminals, on the transport ront and in IT.

SCA Transorest saw a cautious start to 2011, but in recentmonths has shown strong growth, with our container service

seeing growth o almost 50 percent since the beginning o theyear. This container growth is driven by globalisation andthere is every indication that it will continue. As a logistics andtransport partner, we need to ensure that industry in our parto the world has the best conditions to compete in a globalmarket. To this end, one o SCA Transorests priority areas odevelopment will be handling and transporting containers tomeet rising demand regarding capacity, price and quality. Thetrend started on a smaller scale in the mid-1990s, but is set toaccelerate. Developments will be made both on the marine sidewith the right type o vessels and the right service, but also at

all our terminals. To support these developments, we have alsodecided to invest in and implement a new container handling

system or all the terminals within SCA Transorest during 2011.

Although SCA Transorest has taken huge leaps orward atcertain times with new ships or terminals, it is important topersist in exploiting the potential in the smaller details andcontinuously work with innovation and development ineach process, so that we can continue to oer our customerscost-ecient and reliable logistics.

Wishing you a happy and sunny summer!

Continuous Development

anD innovation

NILS-JOHAN HARALDSSON,Vice President Marketing and Business deVeloPMent


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Bore Sea and her sister ship Bore Songare the ultimate RoRo vessels, custom-made or fexible cargo solutions, readyto meet uture environmental criteriaand cost-eective with their low uel

consumption, says Lars Nolander, Heado SCA Transorest Shipping.

With SCA Transorests systemvessel MV Obbola booked in or herplanned shipyard visit in early May, theopportunity arose to charter the brandnew Bore Sea as a replacement or thisshort time, to carry out a round-trip onthe Ume-Husum-Sundsvall-Rotterdam-Tilbury route. SCA Transorest alreadyworks closely with Bore, or example on

shipping to and rom France.

Interesting combination

Sta rom SCA Transorest attended thechristening o Bore Sea and Bore Song onFriday 6 May in the north-German city oFlensburg on the border with Denmark.

Straight ater the naming ceremony, BoreSea started her voyage up to Ume readyor loading on Monday 9 May.

On that Monday in Ume and thenTuesday in Sundsvall, Bore Sea started anormal round-trip voyage as our systemvessel. The dierence was that BoreSea had capacity or a combination oboth cassettes and containers. We dontnormally take loaded containers on oursystem vessels, so this was something o

a departure rom previous procedures,explains Lars Nolander.

The loading operation and shipmentwent well and gave a taste or more.

Our container volumes areincreasing all the time and our growingneed or container transport also brings

a need or an ecient transport solutionrom Northern Sweden down to theContinent. This has proven to be a goodcombination, says Lars Nolander.

Sister ship Bore Song will also putto sea in July 2011. Both ships are 195metres long and have a deadweight o13,625 tonnes.

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NEW WAYS 4

Over the past ew years, Samskip andSCA Transorest have worked increasingly

closely.Samskip transports recovered fbres

every week rom Rotterdam to LillaEdet in Sweden on trailers booked byInterorest Terminal Rotterdam. Forsome time, Samskip has also been usingSCA Transorests vessel system betweenRotterdam and Helsingborg beoreonward transport.

We also carry cargo with rail androad transport rom Rotterdam to Poland

and Central Europe. Each year wetransport around 50-60,000 tonnes orSCA Transorest, says Richard Bealesand continues:

Were now ocusing on developingour presence in Eastern Europe anarea with great potential. Specifcally weare looking at tailor-made intermodaltransport solutions to and rom the CzechRepublic and Poland.

New round-trip supply chain

Since 1 February, SCA Transorest andSamskip have been expanding their initialcollaboration.

We both beneft rom ourcollaboration. For example, Samskipuses SCA Transorests container eederrom Rotterdam to Stockholm, andSCA utilises Samskips vessel network tovarious European destinations.

Since the start o the year, wevebeen working on linking up our business

activities, and oering our respective

customers a round-trip supply chain usinga combination o our own European

vessel network and the Container Express SCA Transorests transport servicebetween Rotterdam, Stockholm andnorthern Sweden. So ar the cooperationhas been very successul.

Weve attained our initial targetsater fve months. The next challengewill be to develop the transport servicesurther by both companies increasingtheir volumes and by increasing thenumber and requency o departures

rom Rotterdam to Stockholm, saysRichard Beales.

High hopes or Stockholm

Richard Beales has high hopes or thedevelopment o Stockholm with the newplanned container harbour in Norvik.

Short-sea container trafc to androm Stockholm has good potentialand is an exciting development area.Its an interesting project that werenow developing together with SCA

Transorest. We hope that our north-bound transport services and containervolumes to Sweden will increase over thecoming years, says Richard Beales.

We hope to develop all our productsto and rom Sweden, and the cooperationwith SCA Transorest has been open,smooth and ocused. We have bothattained all our targets to date, which isvery positive, says Richard Beales.

Intermodal solutions

According to Richard Beales, with

growing environmental awareness, truckssupply issues and cost pressure, Samskiphave increasingly seen their customersinterested in developing tailor-madeintermodal solutions by rail, barge andsea, to either replace or work alongsidetheir current supply chain solutions,

We thereore eel in the uturethere will be ongoing demand to orintermodal development, and we are in agood position to oer our customers cost

competitive, environmentally-riendlysolutions says Richard Beales, beoreconcluding:

Our challenge is to make theseproducts competitive in terms o cost, andat the same time deliver the service levelsour customers demand with the addedbeneft o an environmentally-riendlynetwork. We eel that one o the keysuccess actors or these developments inthe longer term is joint planning betweencustomer and supplier. Investments are

important too, along with collaborationand the open dialogue we enjoy withSCA Transorest, which shares our viewo the uture. This shows that mutuallybenefcial solutions can be ound, saysRichard Beales.

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5 NEW WAYS

samskip one o europesleaDing Companies or

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Since its oundation in 1990, thecompany has grown strongly. In 2005

Samskip acquired the Dutch multimodaltransport company Geest North Sea Line,the British short-sea operator Seawheeland reeer centres rom the Dutchcompany Kloosterboer. Earlier Samskiphad also acquired Van Dieren Maritimeas well as 50 percent o the shippingcompany, Silver Sea.

In September 2006 all Samskipsoperations were merged into a singleorganisation and a single trademark

Samskip.

Presence throghot Erope

Samskip is divided into three majordivisions. One handles trac to androm Iceland and the Faroe Islands,a second division handles as the

international transport o rozen goods.The third division is Samskip Multimodal

Container Logistics with its head oce inRotterdam, which handles all Samskipscontainer transport services to and romEurope.

The container feet comprises 25ships, o which Samskip owns our,and these, together with rail, transport800,000 TEU annually.

Through optimal combinations otransport by short-sea, road, rail and

barges, we can oer reliable, sustainable,and cost-eective transport solutionsthroughout Europe, including theBaltic states, Russia and central Asia,says Richard Beales, o SamskipsMultimodal Container Logistics.


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NEW WAYS 6

How important are the railways as

a transport option for the future?

Inrastructure is the lieblood thatsupports peoples everyday lives andallows business and industry to operateand grow. All the types o trac have towork well, and preerably work togetheror an optimum journey or shipment. Itsparticularly important in countries likeSweden with long distances. The railways

were hugely important when theywere built, and they remain extremelyimportant or us today. More and morepeople are choosing to travel by train,

while increasing amounts o goods arealso being transported via our railways.A core ocus o the current SwedishGovernments policy on inrastructureis to develop and improve rail trac sothat even more people choose to take thetrain. Getting more people and goodsonto trains is a undamentally positivemove, not least or environmentalreasons.

In recent times, the Swedish rail

network has received harsh criticism for

sometimes operating poorly during the

winter. What is being done to ensure

that the Swedish rail network can

compete as a transport option when it

comes to just-in-time deliveries?

Its understandable that people getirritated when they have problems goingabout their everyday lives. More andmore companies need to distribute theirstock, and they oten have commercialagreements based on trust. The Swedish

railway system is vulnerable right nowand we have major problems.

Unortunately, maintenance hasbeen put o or many years and we have

We have to Develop

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7 NEW WAYS

clear weaknesses in the power lines andsignalling systems. Our own analysesalso show signicant bottlenecks andcapacity problems. Weve now started totackle this with a considerable increasein unding. In the budget this spring,the Swedish Transport Administrationhas been allocated a urther SEK 800million. There are now several keyprojects underway to expand capacitythrough double track and passing stationsto allow trains to get to their destinationmore smoothly.

We have to ensure that our railwaysare robust and reliable. It is in avulnerable state at the moment, so thatthe smallest little problem can aect thewhole system.

How quickly will we see these changes

put into practice?

The great challenge is that it takes timeto lay new track. We need to increasethe pace o our maintenance andimprovement work. We have to assess theremaining lietime o current materials,so that we take action in good time andnot in panic at the last minute.

For the immediate uture, the

Government has tasked the SwedishTransport Administration with reportingin October on how rail capacity can beincreased over the next ew years. Wherewill there still be bottlenecks and howlong will it take to remove them? Howcan improvements be implemented?Should we look at dierentiating trackcharges or more optimum traccontrol?

It is also important to review howthe work is organised and how dierent

players cooperate with each other.When one agency is responsible or thetrack, another company or the trainsand another or the stations, successulcollaboration is crucial or the smoothrunning o the railways.

We will then use this review as abasis or our uture budget work.

The signalling system on the new

Bothnia Line has also performed badly,

hasnt it?Yes, there have been problems. But wehave to try out new signalling systemswhen we build new railways. There is an

explicit desire within the EU to prioritiselong transport corridors, making it aseasy as possible to carry goods andpeople across borders. In the long term,there is a push to harmonise the newEU-adapted signalling system and maketransboundary transport easier. Weretalking here about a trans-Europeannetwork rom Norrbotten down throughSweden and out into Europe, as well asthe west-east links rom Norway viaSweden to Finland.

Will we see increased competition on the

Swedish rail network?

Within the ramework o EU regulationsthere is a move to see Member Statesnational rail systems opened up to more

competition. Within a couple o years,were likely to see more oreign trainoperators operating routes in Sweden. Itsimportant that Swedens SJ gets involvedand adapts its business to the competitionit will ace.

For example, preparations are beingmade or dierentiated and increasedcharges or using the national railnetwork, with revenue reinvested intrack. Coupled with this, a system will be

launched in 2012 to reduce disruptions torail trac, based on the body responsibleor the trac disruptions having to paysome kind o ne.

How important is shipping as a

transport option for the future?

Shipping is also extremely important not least because o Swedensgeographical location and its incrediblylong coastline. I we are to reducepressure on our roads, shipping and rail

are necessary transport alternatives.There is a crucial interplay betweendierent modes o transport, and wecannot do without any o them.

The IMOs decision to reduce the limit

for sulphur in bunker oil for shipping

from 1.5 percent to 1 percent this year

and then down to 0.1 percent from 2015

in the SECA area has been strongly

criticised by Swedish industry. What

is your view on the matter and what isbeing done to quell this anxiety?

My basic stance is this: I we are tooperate an internal market subject to

global rules, these have to be harmonised.Otherwise we will see unhealthycompetition between countries,geographical areas and methods otransport. However we must, o course,take account o the environment and actresponsibly in the shipping industry, andin this area we have a particular problemwith the Baltic Sea being so sensitive.We just mustnt take things too ar. Wewill do our best to get this decision bythe IMO changed, but it wont be easyconsidering the attitude that this body istaking. To have any infuence and makechanges within the IMO, you have tohave the majority o the EUs MemberStates onside.

As I understand it, you are pushingto raise the limit from 0.1 to 0.5, or to

postpone implementation of the decision

from 2015 to 2020. How realistic are

these options?

Were looking at various options andassessing which are most viable and mostlikely to succeed. Well be attendingthe next meeting o the EuropeanCommission on 1 June.

Theres also a timetable or any

changes and revisions to the EUs SulphurDirective. I dont want to comment anymore on that at this moment.

Is transport a priority area for the

Swedish Government?

Yes. A more ecient transportsystem is essential or Swedensprosperity. The Swedish Governmentwishes to ocus on strengtheningSwedens international competitivenessand at the same time acilitating

sustainable regional expansion.Travel and transport are necessary

or society to unction. The overridingaim o our transport policy is to secureeconomically eective and sustainabletransport provision or people andcompanies across the country.

The transport system must bedeveloped in a manner that guaranteeseveryone good accessibility and highquality. At the same time, the system

needs to drive orward developmentthroughout the nation.


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NEW WAYS 8

Weve signed an agreement withTransatlantic where they will continueto manage and operate the ships or thenext six months, taking us to 1 Decemberthis year. Were working on the plan thatwill take us beyond that point, with the

crews being oered the option o stayingon under a new employer, says MagnusSvensson, President o SCA Transorest.

There are numerous benets to takingon the three system vessels.

We used to have an operationalagreement where Transatlantic, whichowned the ships, enjoyed all theincentives. Now SCA Transorest willbe able to draw nancial benet rommore ecient and rational operation,

which means that we will be more deeplyinvolved in operational and maintenanceissues.

Control oer costs

Another major benet is that SCATransorest will be able to control itscosts over the long term.

Our inrastructure, in the ormo terminals and IT systems, is largelybuilt around cassette technology. It hasthereore been important or us to secure

control over the cost o our shipmentsor a long time to come, says MagnusSvensson, who continues:

We had the three ships built in 1996and since then theyve operated exactly aswe wanted them to, so were very happywith them. It was cheaper to build ships15 years ago, which is why they remaincompetitive in terms o costs. Theyre

still in good condition and over the yearsa great deal o money has been investedin environmental adaptations andextensions.

Such unique and specially constructedships, customised to handle cassettes orrapid loading and unloading, oer thebest and most eective transport solutionover the next 10 years.

By buying the ships outright, wesecure access to the system and establish

a controlled level o costs, at least overthe next 10 years. This is o considerableimportance to our industiral customers,who carry out large, long-terminvestments and thereore seek stablecosts and conditions, states MagnusSvensson.

Low damage leels

However, the system vessels also beat thecompetition in areas other than costs andthe environment.

This transport system, whichincludes the three system vessels andthe terminals in Ume, Sundsvall,

Helsingborg, Rotterdam and London,has proven to incur very low instanceso damage. The act that we always usecassettes reduces the amount o handling,which has a positive impact on qualityand costs. The cassette technology also

makes it possible to load in many ports,only staying briefy in each port. Thisallows us to combine large ships witha regular requency o service, saysMagnus Svensson.

Longer agreements possible

Owning the ships also increasesfexibility.

Were no longer bound by timecharter agreements over set periods. Our

previous time charter agreements onlystretched over ve years. Now we haveull fexibility to plan or a longer periodo up to at least 10 years, enabling usto saeguard and stabilise our cost leveland service or a long time to come.That makes us more fexible i, at anytime in the uture, we want to make anychanges, concludes Magnus Svensson.

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9 NEW WAYS

In May, an opportunity opened up or SCA Transorest to carryout a trial run to St Petersburg with the Container Expressservice which usually serves Stockholm, Sundsvall, Ume andRotterdam.

This time the route between Stockholm and Ume was

extended with a stop in St. Petersburg.We had a ull boat, with a cargo o more than 640 teus,

twenty oot equivalent units, bound or St Petersburg, and

we were also able to explore the possibility o calling at StPetersburg in the uture.It went exceedingly well. We made the call ater the icerestrictions eased up and the shipment went very smoothly.It has been a positive experience so ar. Now well have

to give the matter more detailed consideration, saysNils-Johan Haraldsson, Vice President Marketing andBusiness Development at SCA Transorest.

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NEW WAYS 10

The bridge will be 2,109 metres longincluding the approaches, 33 metres highand 21.5-30 metres wide. A convertedGerman car erry is now in place in thebay, as a platorm or supplementary testdrilling. The work will run day and night.

The bridge is part o the E4 motorwayproject Sundsvall Bypass, whose aim isto improve access, road saety and the

environment along a 20-kilometre stretcho motorway.

Along this stretch o road, the E4project covers ve junctions and 33bridges. The largest o these bridges isDubbelkrum, which will reach just over1,400 metres across the Bay o Sundsvalland is set to divert over 10,000 vehicles aday rom the centre o Sundsvall.

When the new E4 and the bridgeconstruction work are completed in late

2014, SCA Transorests terminal atTunadal and Port o Sundsvall will gain

increased accessibility and improvedinrastructure.

We already have considerableexperience o shipping large cargos upto Northern Sweden. Naturally, werewilling and able to oer marine transportsolutions or any materials or the bridgeproject, says Lars Nolander, Head oSCA Transorest Shipping.

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NEW WAYS 12

The collaboration is closely linked to SCATransorests system trac rom Ume,Sundsvall and Helsingborg to Rotterdam.At the Interorest Terminal in Rotterdam,cargo is then transshipped onto GriegStar Shipping vessels. The North AtlanticService runs every two weeks to the portso Altamira in Mexico, Houston in Texas,Mobile in Alabama and Wilmington, NCon the east coast o the USA.

The only alternative service rom

Sweden to the USA and vice versa isvia Gothenburg. I you have project /out-o-gauge cargoes rom/to NorthernSweden, thats a long way, says Gerrit

Hartmann, Commercial Managerat Grieg Star Shippings oce inGothenburg, which is the companysEuropean Regional oce or projectcargo. He continues:

The our vessels we use in our NorthAtlantic Service Star Florida, StarFrazer, Star Fuji and Star Evviva arehomogeneous, i.e. similar in terms ocapacity and equipment.

Non-containerised cargoEven i Grieg Star Shippings vesselscan accommodate containers, thecompanys main transport ocus is

on non-containerised cargo, i.e. rawmaterials and equipment that cannot beloaded into containers or are too big orthem. Examples are mining, constructionand agricultural machinery, boats,yachts, power generators, turbines orvehicles with extra containers containingaccessories.

Cargo with unusual dimensions requiresspecial handling, special equipment

and special expertise, and there are ewalternatives or this type o cargo, saysGerrit Hartmann.

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13 NEW WAYS

Initially, transport o pulp and paperaccounted or 90 percent o the business.Today, these raw materials still compriseover hal the volume, while transporto project cargo, as well as metals,newsprint, containers and bulk cargoes

make up the rest.

The Grieg Star eet

Grieg Star Shipping now has a feetcomprising around 30 open-hatch vesselso 25,000-60,000 tonnes with removabletween decks, gantry cranes up to 70 MT,rain protection over unobstructed holds,and cell guides allowing or ast and saehandling o project cargoes.

Furthermore the Grieg group has

just taken delivery o our new state-o-the-art open-hatch vessels, and the

next programme comprises ten 50,000dwt open-hatch ships with a new cranedesign with up to 150 mt li ting capacity.Delivery rom Hyundai Mipo will startrom early 2012 and will be completed in

2014.

Other routes

In addition to the North Atlantic Service(see adjoining article), which runs everytwo weeks rom the European ports oRotterdam, Antwerp and Bremen tothe North American ports o Altamira,Houston, Mobile and Wilmington,Grieg Star Shipping also operates a routerom Brake in Germany and Flushing(Vlissingen) in Belgium to the west coast o

the USA and British Columbia in Canada.Ater the summer, well also be

launching two new regular services, onerom the Mediterranean area to Brazil,and the other rom the Mediterraneanto the Gul o Mexico, says GerritHartmann.

In 2010, Grieg Star Shipping also setup a joint venture company together withNortrans Shipping Pte Ltd o Singapore.The new company, Grieg Star NortransPte Ltd, with head oce in Singapore,operates breakbulk semi-liner routesbetween the Far East, South East Asiaand India.The company will initially beoperating chartered vessels in the 10-20,000 dwt class, with tween decks andsuitable gear, carrying orest products,

break bulk and project cargoes.

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NEW WAYS 14

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SCA Recycling, a subsidiary o SCAPackaging, employs 500 people in ninedierent European countries. Its main

task is to provide SCAs paper mills inTissue, Graphic and Containerboard withrecovered bre.

We sell more recovered bre thanour own mills use. To outperorm themarket long term, it is crucial or SCAto control its main raw material owood bres throughout the supply chainregardless o whether they come romnatural orest or urban orest. The annualrecovered bre consumption o SCA

is about 3.5 million tonnes in Europe,and within SCA Recycling we handleapproximately ve million tonnes yearly,

says Hans Wortman, Managing Directorat SCA Recycling.

The remaining 1.5 million tonnes

o recovered bre are sold to externalcustomers both within Europe as well asin the global market, primarily the FarEast.

The act that we have what we needand then sell our surplus makes us aunique paper company in Europe. Thisdoes require SCA Recycling to developprotable third-party sales and play aneven more important role in the Far Eastexport market, says Hans Wortman.

Global commodity

Recovered bre has become a global

commodity o which more than 200million tonnes was traded in 2009, whichis approximately 55 percent o the global

paper industrys raw material usage (therest being 41 percent pulp and 4 percentother materials).

This also refects the Europeanmarket, which consumes almost 49million tonnes in total.

Europe and the US collect morerecovered bre than they consume,the balance being exported mainlyto China, explains Hans Wortman.However the big question is whether

Europe and the US can continue to satisythe ast growing needs rom countrieslike China and India.


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15 NEW WAYS

In Sweden, SCA shares ownership oIL Recycling with Stora Enso, SmurtKappa and Fiskeby. In Italy, the companyis a 50 percent stakeholder and inAustria, France, Benelux, Germany andthe UK it is a 100 percent shareholder inequivalent businesses.

High collection levels

The Western European market isconsidered highly mature when it comesto collection o recovered bre andconsumption. Collection levels are asmuch as 70 percent.

According to McKinsey, the highestlevels we can hope to achieve are 75-80percent. There is still certain growthpotential in the EUs new Member States,but that will not be enough, says Hans

Wortman.In China too collection levels are

relatively high.They produce 100 million tonnes o

paper per year. A lot o that is exportedand collection levels or what remains areover 60 percent, adds Hans Wortman.

Falling market in the West

The trend in Western Europe andthe USA with regard to availability

o recovered bre is, however, on thedecline. Their population is stagnantor even alling and paper and boardconsumption per capita is decreasingquite strongly. Packaging is becominglighter and more ecient, and at thesame time demand or newsprint hasbeen alling in Europe since 2006 and theUSA since 2000, says Hans Wortman

Strong growth in China and India

Demand is, however, strong in China and

India.China is now the largest bre

consumer and the largest user orecovered bre.

There is more paper production inChina today than in North America andEurope. Consumption is also higher.China uses more than 100 milliontonnes o paper a year, compared with81 million tonnes in Europe and 82million in the USA.

In India the picture is dierent.Although Indias GDP is rising by vepercent a year this growth is largely

coming rom internal consumptionand less rom increased export-basedmanuacturing like China.

Much o its paper productionis thereore used to meet domesticdemand. With a growing middle class,consumption is rising year-on-year inIndia, which nds itsel at the same stageo development in orest industry termsas China was about 10 years ago, saysHans Wortman.

Shortage o recovered fbre

With the saturated supply o recoveredbre in the West and growingconsumption in China and India, theindustry is concerned that there will soonbe a shortage o recovered bre.

At the current time, we have a

surplus in Europe. But in the next veyears, we will need a urther 10-15million tonnes o recovered bre to meetthe increased growth in China. Addedto that is the growing demand in Indiaover the slightly longer term. The priceo recovered bre could double in utureyears and still be more attractive thanpulp produced rom virgin bre. Thiswill pose a tremendous challenge or theindustry, says Hans Wortman.

Competition rom energy sector

Another threat to the supply o recoveredbre is competition rom power stations.The EU has ormulated ambitious targetsor the year 2020 including the usageo 20 percent renewable energy, in partrom woodchips and recovered bre. Toachieve this target, or example Austria

subsidises pellets or energy use, whichnaturally aects prices or wood bres.

From an environmental perspective,it is thereore better to rst use the breor paper production purposes and thenater 4-5 cycles o production, when it isno longer strong enough, it can be usedor energy recovery. It is better to use it4-5 times in production rst. We need toconvince Europe that there is greatervalue in using the bre in productionrather than incinerating it. From atechnical point o view, recovered breis among the most challenging uelscompared to other renewables and ossiluels, says Hans Wortman.

Eective partnership

with SCA Transorest

SCA Recycling has a long-standingpartnership with SCA Transorest whenit comes to transporting and distributingrecovered bre within Europe.

The Nordic markets are netimporters o recovered bre. We shiprom the Interorest terminals inLondon, Lbeck and Rotterdam on SCATransorests system vessels to Obbolaand Munksund (Packaging) and to LillaEdet (Tissue). Using the SCA terminals

and vessels has proven to be highlycost-eective. Our partnership with SCATransorest is important to us, concludesHans Wortman.


16/24

NEW WAYS 16

sCa energy BuilDs more WinDturBines in Central sWeDen

SCA has large areas o land thatare ideally suited to wind powerproduction. This project sees SCA urtherstrengthening its position in wind power,

as part o the Groups strategic movetowards increased production and use orenewable energy, says ke Westberg,Manager o SCA Energy.

The planned wind arm is situatedin an elevated position east o Nsker inthe municipality o Sollete. This is anexcellent location to site wind turbines,both or its wind conditions and the actthat there are ew other interests in thearea, except reindeer husbandry, which

uses parts o the area or winter grazing.The site has the potential or 300wind turbines, generating 2 TWh. Couplethis with the Statkrat collaborationand SCA will be a major player in windpower, with an estimated annual supplyo 4.4 TWh in total.

New joint company

SCA and Fred.Olsen Renewables areorming the company FORSCA AB, owhich SCA will own 40 percent and Fred.

Olsen Renewables 60 percent. SCA willprovide the land resources, while Fred.Olsen Renewables will organise undingo the joint venture.

This is our most important initiativein Sweden so ar and we are pleased tobe working with SCA, which has longindustrial experience in the region.We see our collaboration as a valuableopportunity to deliver renewable energyto Nordic customers, says Torger Lien,

CEO o Fred.Olsen Renewables.

Completion b 2015

In summer 2011, the joint companywill start taking wind measurementsin the area, as it starts compiling

data to support the wind arms caseat the Environmental Court. Themeasurements and surveys o windconditions conducted over the next yearwill determine the extent to which thepotential will be realised.

The project has now started andone o the rst acts is to commencewind measurements and carry outenvironmental surveys. Well submit ourapplication in March 2012, and then it

takes about a year to move through theEnvironmental Court. We hope to beable to start construction work in 2013or 2014 and the aim is to have our rstturbine up and running by 2015, sayske Westberg.

His hope is that this time therewill be a aster and smootherpartnership with reindeer herders,compared with the process or SCAand Statkrats joint wind arms.

The appeals that have been

lodged and the judgements madeby the Environmental Court willinorm and guide us and thereindeer herders when it comesto what considerations need tobe taken into account, sayske Westberg.

More measurements

In addition, SCA andStatkrat is already taking

measurements in theStorhgen area, north ostersund.

Were awaiting the measurement resultsand i they are satisactory, we couldinstall another 40 or so turbines here,

adds ke Westberg.

Fred Olsen Renewables

Fred.Olsen Renewables is a whollyowned subsidiary o the listed companiesBonheur ASA and Ganger Rol ASA.Fred.Olsen Renewables has beendeveloping and operating wind armssince the mid-1990s and currently hasour projects totalling 317 MW o land-based wind power in the UK. Apart

rom two small turbines in Sweden, itsentire production is located in the UK.However, the company has permitsto build more wind power acilities inNorway, the UK and Sweden.

The Swedish oce o Fred.OlsenRenewables is located in Ume.

sCa d d.o rwb wd w swd.w w nw s, sCa e d jc w nw b, d.o rwb, bd wd sCad vd. t d 2 tW cc .

tx: c Jh. Ph: sca.


17/24

17 NEW WAYS

swdih for indury pnd sek 25 billion a yar on ranpor rvic. thi man ha h va majoriyof for indury compani hir ranpor upplir rahr han uing hir own vhicl. th for indury ha

agrd o bring miion of foil carbon dioxid from ranporaion down 20 prcn by 2020. to hi nd, i

hrfor ma opimum u of hip a wll a rain and lorri.

DID YOU KNOW...

Nynshamn Municipality has ought longand hard or the port, which will supportcontainer, lorry and rail transport to androm the Stockholm and Mlardalenregion. The port will have access both byroad and rail.

The Governments decision is

incredibly important. Now we just needthe decision rom the Supreme Courtbeore we can start digging and nallygive the Stockholm region a large portthat will promote increased growth anda better environment, explains AnnaLjungdell, Mayor o Nynshamn.

Two legal cases

For a long time now, there have been twoparallel legal cases underway on the issueo whether Ports o Stockholm may bepermitted to build the port in Norvik.The Governments decision means thatthe issue o the detailed development plan

has been determined at the highest level.Now all that remains is the questiono whether it is appropriate rom anenvironmental point o view to let Portso Stockholm build a port in the area.

This matter has been considered inboth the Environmental Court and the

Environmental Court o Appeal.In December, the Environmental AppealChamber o the Svea Court o Appealapproved the port project, but an appealagainst the judgment was lodged withthe Supreme Court. It remains unclearwhether the Supreme Court will hear the

appeal. In principle, this court only hearsissues o precedent.

Ports o Stockholm aims to startbuilding the port in 2012.

sWeDish governmentapproves port o norvika d , e C a d bd d w swd g -d w p

n n. t dd d p n df d w dc s C b cc wc b. tx: c Jh. Ph: shm Hm


18/24

NEW WAYS 18

2011 will see work begin on buildingaccess roads, laying power cables andcasting oundations. Were then expectingthe frst 30 wind turbines to be assembled

and brought online during the latter part

o 2012. Our plan ater that is to start the

production o 100-150 new turbines per year

over the ollowing three years, explains

ke Westberg, Manager o SCA Energy.

The investment may also have positive

consequences or SCA Transorest,

which already has major experienceo transporting large project cargoesor various wind arms in NorthernSweden.

I hope that SCA Transorest willget to transport the wind turbine sections,whoever we decide to buy the turbines rom.

All the suppliers currently under discussion

are amiliar with SCA Transorest, says

ke Westberg, who is also hopeul about

the other planned wind arms.

Our joint venture is currently beingconsidered by the Environmental Court,which has now set a date o 4-5 Octoberor deliberations regarding the remainingarms. We are likely to see a ruling by theend o October, and we hope to be able totake the investment decision or these assoon as June next year.

As Europes largest private orestowner, SCA also leases some o its land

to external players in the wind power

sCas investment

Creates opportunitiesor sCa transorestsCa d s c j sek 16 b c 500 wdb c swd w c . s wd d cd swd e C. tx: c Jh. Ph: Hm F.


19/24

19 NEW WAYS

There are already 75 similar wind turbines operating on SCAs

forest land, but we have leased land for 1,000 turbines,

market, alongside its own wind powerundertakings.

There are already 75 similar windturbines operating on SCAs orestland, but we have leased land or 1,000turbines, says ke Westberg.

SCA Energy continues to expand

Since the start o the year, these windpower investments have been managedby the business unit SCA Energy, which

is part o the business group SCA ForestProducts. SCA Energys task is to developSCAs production o renewable energy. Aswell as wind power, SCA Energys areaso ocus include orest uels, uel pelletsand the development o new businessopportunities in the eld o energy.

We already sell renewable energyworth around SEK 800 million a year, ata time when energy issues are becomingincreasingly important. Were seeing a

growing interest in renewable energyproduction and the appearance o newplayers and business opportunities inSweden and abroad. SCA has hugeunexploited resources in terms o bothbiouels and wind power. We thereorewant to gather up our resources in this

area to make us an attractive partner orlarger customers and energy producers,concludes ke Westberg.

Under the agreement, stman Transportwill take responsibility or transportingthe entire annual volumes o pulp romstrand (580,000 tonnes) and newsprintand coated paper products rom Ortviken(900,000 tonnes) to Interorest Terminal

Sundsvall. A major investment projectis currently underway at Ortviken,involving installation o an automatedsorting system and our loading ramps.This will allow vehicles to back up toone o the loading ramps, where the

whole cargo will be transerred onto thelorry. The system is expected to comeon stream in April next year, and willrequire the current trailers either to beconverted or replaced.

stman takes overinternal reight in sunDsvallsCa t d f- w h t aB d bw d p m/o p m d i t sd.t c c J . tx: c Jh.


20/24

NEW WAYS 20

The sawmill in Tunadal has beenimproved with new green sorting, newdryers, a new timber-sorting section andnew log-sorting acilities. At the sametime, there have been major investmentsin the new paint shop in Stugun and innew log-sorting and protective treatmentacilities in Bollsta.

In April, the Board o SCA also

approved investments in a new biouelboiler, increased drying capacity andan upgrade o the saw line at Bollstasawmill.

These investments will increaseproduction at Bollsta rom 450,000 cubicmetres to 525,000 cubic metres o pinesolid-wood products per year, says JonasMrtensson, President o SCA Timber.

With two new biouel boilers,which will be uelled by bark and other

waste products rom the sawmill, oilconsumption at Bollsta sawmill will becut by 3,400 cubic metres per year. Thesawmills emissions o carbon dioxide

rom ossil uels will be almost entirelyeliminated.

Desering inestments

Over a number o years now, weve beenable to make signicant investments inour sawmills.

Were reaping the benets o ourgood perormance. There is great internal

competition within SCA or investmentunding and you have to earn the right toreceive new investment. Over the past 5-6years, weve seen an excellent return onthe capital that our owners have investedin the timber business, says JonasMrtensson.

We make money, were moreprotable than our competitors andweve done an excellent job o managingthe investment money weve received

and o living up to peoples demandsand expectations regarding the variousinvestment projects.

Were very pleased with the

investment in Bollsta and Tunadaland hope that this will also lead to anincreased need or transport on oursystem vessels to Rotterdam, or shipmenton to the UK, North Arica and Japan,comments Nils-Johan Haraldsson,Vice President Marketing and BusinessDevelopment at SCA Transorest.

The most modern

plants in Scandinaia

SCA Timber now has eight sawmills,timber-nishing units, distributionoperations and wholesalers with a totalproduction capacity o 2.2 million cubicmetres o solid-wood products.

This makes us the second largestproducer in Europe ater Stora Enso,whose capacity is almost 5 million cubicmetres o sawn timber. We are by ar the

biggest in Scandinavia and the biggest inSweden, says Jonas Mrtensson.

The sawmills are strategically locatedright next to SCAs orest holdings,

sCa timBer Continues

to invest Duringhigh proitaBility

o , sCa tb d b swd w. mc, a dc w sek 290 w B. td sCatb cd b dc e s e. tx: c Jh. Ph: P-a sjq.


21/24

21 NEW WAYS

Ater a long period o steady growth, themarket or sawn timber so ar this yearhas suered instability and a high degreeo uncertainty. This wobble in demandand sales is naturally down to current

political and geophysical circumstances.The North Arican market, which isimportant to the Swedish and Finnishsawmill industries, has not reallymanaged to rebalance ollowing theunrest that started in Tunisia early in theyear and then spread rom country tocountry. The political turbulence is nowcontinuing in countries such as Libya,Syria and the Arab states around thePersian Gul.

The market remains aected by

this and we have not yet seen a ullrecovery in demand rom North Arica.This market is important to Swedishand Finnish sawmills, particularly whenit comes to pine solid-wood products,

explains Jonas Mrtensson, President oSCA Timber.

Temporar downtrn in Japan

Then came the earthquake and nuclear

crisis in Japan, another important marketor European sawmills, which primarilysupply construction timber or glulamrames and beams in the constructionindustry.

While the political unrest inNorth Arica mainly aected demandduring the rst quarter, the disasters in

Japan will impact on deliveries in thesecond quarter o the year, says JonasMrtensson.

There is still considerable uncertainty

and nobody really knows how marketdevelopments will unold in theimmediate uture.

Well have a temporary downturn,but in the longer term were expecting an

upturn due to a build-up in demand orthe construction o new housing in partso Japan other than the Fukushima area.Initially it will be a case o temporaryhousing made rom timber and then there

will be more demand or permanenthousing to be built. However, we will nodoubt see long lead times, because rstthere are problems o inrastructure andland issues to be resolved.

Even so, Jonas Mrtensson iscondent that Japan will quickly recover.

Japanese demand or sawn timberhas been good or many years nowand we believe it will continue to be astrong market. The graph might showa bit o a dip, but Japanese demand will

then recover. We expect an increasedconsumption o 3-5% as a result o theaccident, he says.

Japan Will soon reCover

a w w b , d 2011, b b c b d c n ac d d J.hw, sCa tb pd J m, cfd b . t w b d, b J dd w c, . tx: c Jh. Ph: isph

and many o them are among the mostmodern plants in Scandinavia withcapacity or large volumes.

Following the acquisition o DC inStoke in 2003 and the Seven Timberplaning mill in 2007, SCA Timber hasalso developed a strong delivery platormin the UK.

Focsing on increased fnishing

SCA Timber currently has two pillarsto its business Industrial Solutions and

Distribution Solutions. Within IndustrialSolutions, the ocus is on integratedcomponent manuacture or the timberindustry, which primarily suppliesnished products such as windows,doors and urniture. In this area, IKEAhas become an increasingly importantpartner.

Weve developed an excitingcollaboration with IKEA, and havelearned a great deal so ar. In the uture,the sawmill in Bollsta will be making a

million Gorm shells per year or IKEA.The shells are delivered practicallyeverywhere in Europe. We manuactureand supply nished fatpack urniturewith instructions, screws and ttings,says Jonas Mrtensson.

The second pillar is DistributionSolutions, where SCA Timbers sawmillsplane and produce products that are thensold on by builders merchants in Sweden,Norway and the UK.


22/24

NEW WAYS 22

The load line comprises a circle o about30 cm crossed through with a horizontalline that is painted on the sides o theship and marks how deep the vessel ispermitted to sink (with its maximumload). On the Great Lakes separating theUSA and Canada, the circle is replaced bya diamond.

The ofcial name is the International

Load Line.

Samuel Plimsoll behind the mark

The mark is named ater Britishparliamentarian Samuel Plimsoll(18251898), who tirelessly campaignedor better saety or British sailors. Hispersistence paid o when Parliamentbrought in The Merchant Shipping Actin 1875. The act orced load lines onall merchant ships. The purpose was to

prevent the sailing o cofn ships shipsso overloaded that the owners expectedthem to be wrecked so they could pocketthe insurance. Samuel Plimsoll proposedthe mark to make it easier to check thatthe load on a ship did not exceed themaximum permitted weight. The markwas frst introduced in 1875 in the UK.Similar load lines were then graduallyintroduced in most other countries, and1930 saw the frst International Load LineConvention agreed between 54 nations.

What it looks like

The Plimsoll line also carries lettersstating which certifcation organisationmeasured the ship and whichClassifcation Society it is covered by. DN

stands or Det Norske Veritas (Nor), SFor Statens Fartygsinspektion (Swe), SVor Sjartsverket (Swe), LR or LloydsRegister (UK) and GL or GermanischerLloyd (Ger). A horizontal line above themark shows the deck line.

A scale (oten on the right) marksdierent levels under dierent conditions,linked to the waters salinity and

temperature (as these aect the density othe water). Sometimes the mark also hasanother scale (oten to the let) showingthe values that apply when the ship isloaded with timber.

There is oten also a draught markpainted nearby to show the vessels currentdraught and the ships hull usually changescolour close to the Plimsoll line, althoughnot necessarily exactly in line with themark.

Fresh Water Allowance

In seawater, a ship may be loaded untilits waterline is level with the line throughthe Plimsoll line, or the line marked S. Inreshwater, the ship may be loaded to thetop o line F. The distance between these iscalled the Fresh Water Allowance (FWA).The gap is the dierence in draught thatoccurs due to the dierence in densitybetween reshwater and seawater.

The dierence in density between

warm and cold seawater is ar too smallto have any signifcant impact on a shipsload capacity. The our load marks TF, T,W and WNA relate simply to increasedrequirements or a ships reeboard withregard to prevailing weather in the various

areas.The mark WNA is only used on ships

with a maximum length o less than100 metres.

hoW muCh Do you knoWaBout the plimsoll line?t p d d cc, d

d, c w bd w d d d . tx: c Jh.

Scale for cargoeS

other than timber:

F = Fh: mxmm h w fhw.T = tp: mxmm h w

p w.S = smm: mxmm h w

mm mp w(wm w).

W = W: mxmm h w w mp w ( w).

WNA = W, nh a: mxmm h w nh a w( w).

Scale for cargoeS of timber:

LT= lmb, tp: mxmm h w p wh h hp mb.

LF = lmb, Fh: mxmm h w fhw wh h hp mb.

LTF = lmb, tp Fh: mxmm h w p (wm)w wh h hp mb.

LS = lmb, smm: mxmm h w w wh h hp mb h mm (wmw).

LW = lmb, W: mxmm h w w wh h hp

mb h w ( w).LWNA = lmb, W, nh a: mxmmh w nh awh h hp mb hw ( w).

TF = tp, Fh: mxmm h w p w.

Scale for draught:

th Pm mp b m h h f h hp. s f mhv b .

curiouS factS:

i hmm, h b m h z p h , f p b h g . o h, h pm h wh pp m, hp h f hp

DECK LINE

LTF

LF

LT

LS

LW

LWNA

TF

L R

F

T

S

W

WNA


23/24

October 1114, 2011

Amsterdam, The Netherlands

www.transportsymposium.com

Growth & Sustainability

Meeting the Challenges in Forest Products Logistics

Join us in Amsterdam for the must-attend event for everyone involved in the

transport, handling, and distribution of forest products.

Registration pricing announced!

Visit the event website for program updates, exhibit andsponsorship details, and registration information.

www.transportsymposium.com [email protected]

Organized by In association with

IFPTAmemberssave30%onregistrationfees


24/24

S U N D S V A L L

L B E C K

R O T T E R D A M

L O N D O N

H U L LU M E

We feel that what we are doing is just a drop in the ocean, but the ocean would be less without that drop. Each parcel we

can get off the road and onto the sea makes the environment a little bit happier. Each year we shift thousands of truckloads

from road to sea one parcel at a time. And with the support and trust of our customers, the number of drops continues to

rise each year.

WE SHARPEN yOuR COMPETITIvE EDGE

northBounD rush

SCA Transforest, New ways 2/2011

Documents

Transcript of SCA Transforest, New ways 2/2011