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New Container Vessels at Your Service No 3 2020 New container vessels at your service Automation leads to Increased volumes on Volvo and SCA Logistics improved service in Kiel SCA’s RoRo vessels in a strong collaboration The speed of change is faster than ever We are living in a world in flux. New external factors such as But, of course, SCA will do as it always does and move the coronavirus are moving the goalposts for us individually on to a more futureproof and sustainable product. SCA is and for the industry. Digitisation too is having an undoubted therefore investing SEK 1.5 billion in a new chemical thermo- impact on us. As these two factors interact, we are forced mechanical pulp (CTMP) line at Ortviken in Sundsvall, with to change our behaviour at a pace that may well be production scheduled to begin in 2023. For us in Logistics, unprecedented. this naturally presents both challenges and opportunities. As for our customers, who manufacture and deliver The challenges include changeable volumes over the products to a global market, some see new opportunities coming years, as well as a somewhat different although not being created, while others face greater challenges. In the unfamiliar product mix. The opportunities, on the other hand, forest sector, for example, Containerboard can benefit from include the fact that the restructuring of the forest industry increased e-commerce, while Wood Products may benefit offers fresh possibilities for combining with new customers from the COVID-19 era by increasing and goods flows, while at the same time we continue with sales of DIY products. For the already our vital strategy of: shrinking publication paper market, • consolidating freight through Umeå and Sundsvall, where however, the writing is on the wall major infrastructure investments have been made; and as the coronavirus accelerates • continuing to strive for sustainable, large-scale and cost- digitisation and reduces the effective logistics solutions. consumption of printed media. As you can read on page 5, this It has not escaped any of us that the pace of change in our has had consequences for SCA’s business environment has increased with the coronavirus own production of publication and digitisation. We are highly motivated and our goal is to paper, which will now cease take full advantage of the opportunities change offers us, so at latest Q1 2021. that we can continue to add value to the logistics chain and increase the competitiveness of our customers. Nils-Johan Haraldsson Vice President Marketing and Business Development SCA Sourcing & Logistics NEW WAYS No 3 2020 Publisher Editorial staff Cover photo Printing Comments New Ways is printed at an Nils-Johan Haraldsson Anne Lindström Linda Snell Ågrenshuset Produktion, SCA Logistics AB, FSC® certified printworks Dan Persson Bjästa, Sweden Box 805, and on FSC® certified paper. Editors Lena Zetterwall Translation SE-851 23 Sundsvall, Throughout the production Thomas Ekenberg Michaela Edin Dahlgren Semantix Inlay Sweden. process, the environmental Håkan Norberg Mikael Toft SCA GraphoSilk 90 g Tel. +46 60 19 35 00 impact is kept to an absolute Kerstin Olofsson Sandra Larsson Production [email protected] minimum, with a view to Frosting Cover promoting responsible Kommunikationsbyrå Invercote Creato 260 g use of the world’s forests. New Ways protects the privacy of our subscribers. At sca.com you can learn more about how we process your personal data in accordance with applicable data protection legislation. If you want to unsubscribe from New Ways please contact [email protected] and we will immediately discontinue the processing of your personal information associated with this subscription. Maximising opportunities for empty containers On one occasion during the summer, shipping company Ocean Network Express (ONE) and SCA Logistics worked together to address the imbalance in the availability of containers. There are now plans for a long-term solution to this logistical conundrum. Text: Håkan Norberg. Photo: Per-Anders Sjöquist. Sweden is an exporting country, while its metropolitan containers we accumulate due to the extensive imports regions mainly import. This creates an imbalance in the to the Stockholm region,” says Järlestig. logistics flow for many stakeholders. When shipping SCA Logistics constantly evaluates business company ONE found itself with a surplus of containers in opportunities for its northbound route from Rotterdam. Södertälje during the summer, a collaboration with SCA In the past, the company has made scheduled calls to Logistics seemed like the natural solution. St Petersburg among other places. The south and east “We needed to get our containers out of Södertälje; at the coasts of Sweden are now on the agenda. same time, they had collected a large number of containers “We have time in the schedule for northbound call and on the Continent, where we usually drive them to. This was a are looking at other alternatives. It would be a good good opportunity for SCA to pick them up to meet its export complement to our container service,” says Mikael Toft, needs from Sundsvall and Umeå,” explains Mattias Järlestig, Commercial Manager Marine at SCA Logistics. Head of Sales at ONE in Sweden. The challenge is our opportunity Spot calls that may become regular Identifying solutions to such logistical challenges makes this During a spot call at Södertälje in June, 215 empty containers opportunity successful. were loaded in approximately eight hours for transport to “It is not just a matter of arranging transport here or there; northern Sweden. the challenge is in finding someone with use for a container “We would like to see Södertälje added to SCA’s container in the area where it has landed,” Järlestig says. vessel route. We could then regularly get rid of the “There is a great need for Swedish products such as pulp and sawn timber products out there in the world. Our task is to identify smart ways to deliver them,” concludes Järlestig. ONE and SCA Logistics cooperating to maximise utilization of containers. 3 SCA 2025 – Shifting the portfolio to growing product areas SCA is currently planning to move away from the shrinking publication paper market and into chemical thermo-mechanical pulp (CTMP), a product increasingly in demand on the global market. The company’s investment in increasing the production of Kraftliner has already been decided and implemented. Text: SCA. Illustration: SCA. +2-3% -5-10% +2-3% +2-3% Growing Forest asset Wood Publication Paper Pulp Kraftliner Harvesting own forest (k m3) Capacity (m m3) Capacity (kt) Capacity (kt) Capacity (kt) +1,100k m3 +200k m3 -1,810kt +880kt +340kt 1,140 5,400 2,200 2,300 1,810 1,400 2,100 Further 200 potential 4,300 4,300 865 1,000 800 From 11 to 5 775 sawmills 520 1,200 0 2010 2020 2025 2010 2020 2025 2010 2020 2025 2010 2020 2025 2010 2020 2025 +[]% = Annual market growth / decline PRESS RELEASE SCA to acquire 13,000 hectares of forest land in Latvia SCA has signed an agreement to acquire forest land in Latvia. The acquisition comprises an area of 19,150 hectares, of which 13,100 is forest land. The purchase price is EUR 44.5m, approximately SEK 450m. Read more on sca.com Text: SCA. Photo: Adobe Stock. 4 PRESS RELEASE SCA intends to invest in pulp production and initiates consultations to discontinue publication paper SCA intends to invest SEK 1,45bn in the production of chemically pre-treated thermo-mechanical pulp (CTMP) at the Ortviken paper mill in Sundsvall. In parallel, SCA is initiating consultations with trade unions and employee representatives to discontinue the production of publication paper at the mill. Text: SCA. Photo: Bergslagsbild. SCA intends to invest to achieve an annual production paper mill has been adapted to the weak order level. This volume of 300,000 tonnes of CTMP pulp at Ortviken, using low demand, combined with a weak price development, the existing infrastructure. The investment is expected to results in a negative profitability for the operation. give a positive EBITDA-effect of approximately SEK 0.3bn The closure of publication paper manufacturing at Ortviken per annum. Expected start of production in the new mill is paper mill proposed by SCA will affect about 800 employees, the beginning of 2023. SCA today has a production capacity primarily at Ortviken paper mill, but also in other parts of of 100,000 tonnes of CTMP pulp at the Östrand pulp mill. SCA’s operations. The closure would result in non-recurrent This production will be phased out when the new line starts costs with cashflow effects which are estimated not to up, which will allow a future increase in the production of exceed SEK 0.9bn and an impairment of about SEK 1.1bn. kraft pulp at Östrand Pulp mill. “Through today’s proposals, we intend to continue to “Our pulp customers want us to grow with them in develop a strong, sustainable and profitable industry based product segments such as packaging board and hygiene on our renewable forest raw materials”, says Ulf Larsson. products, segments with healthy growth,” says Ulf Larsson, “This will have a significant impact on many people and we SCA’s CEO. “In line with our strategy, we have gradually will in a responsible way seek the best possible solutions for reduced our exposure to publication paper. We now initiate those affected.” negotiations to leave this product segment completely.” Negotiations under the Co-determination at Work Act (MBL) Currently, SCA produces coated and uncoated with trade unions will now begin regarding the plans to publication paper on three paper machines at Ortviken discontinue paper production at Ortviken paper mill, the paper mill with annual sales of approximately SEK 4bn. investment in CTMP production at Ortviken and the impact Demand for publication paper in Western Europe has on other SCA operations.
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