your partner in paper 2006 - international color … february 2, 2006 2 contents your partner in...
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February 2, 2006UPM 2
Contents
Your Partner in PaperKey figuresPaper capacitiesPaper marketsPaper gradesPositioning - WorldPositioning – EuropeTrade flowsDemandGeneral informaation
February 2, 2006UPM 4
KEY FIGURESExecutive Team
President & CEO - Jussi Pesonen
Magazine Papers
Newsprint Fine & Speciality Papers
Wood Products
Jyrki SaloEVP and CFO
Riitta SavonlahtiEVP
Human Resources
Pauli HänninenEVP
Business Development
Hans SohlströmEVP
Marketing
Pirkko HarrelaEVP
Communications
Markku Tynkkynen,EVP
Resources
Heikki MalinenEVP
Strat. Development
Converting/Speciality Coatings
Converting/Labelstock
HartmutWursterPresident
JyrkiOvaska
President
MattiLievonenPresident
HaraldFinne
President
Matti JLindahl
President
HeikkiPikkarainen
President
February 2, 2006UPM 5
1,000 tons1,000 m3
1,000 m3
1,000 tons
EUR million
EUR million
31,500
10,2202,150
9701,840
260
9,348
2005
9,7909,820Sales total
10,2302,410
9402,030
10,8902,410
9702,240
Paper productionSawn timberPlywoodChemical pulp
430560Profit before tax
34,500
2003
33,400Personnel at 31.12
2004
KEY FIGURESUPM – Key figures 2005-2002
February 2, 2006UPM 6
Papers 68%
Converting14%
Wood Products13%
Other 5%
Newsprint13%
Magazine papers32%
Fine and Speciality papers23%
KEY FIGURES UPM – Sales by division € 9,350 million in 2005
February 2, 2006UPM 7
Other EU 22%France 7%
Asia 9%
North America 14%
Germany 16%
Finland 10%
UK 13%
KEY FIGURES UPM - Sales by market area 2005
Other Europe 5%
Other 4%
Total sales € 9,350 millionEU 70%, Europe 74%
February 2, 2006UPM 8
Converting11%
Other operations11%
Magazine papers26%
Fine and speciality papers21%
Newsprint11%
KEY FIGURES UPM – Personnel by division 31.12.2005
Wood Products20%
Total personnel 31,500
February 2, 2006UPM 9
Other EU 5%
France 5%
Asia Pacific 5%North America 6%
Germany 14%
Finland 55%
UK 5%
KEY FIGURES UPM – Personnel by area 31.12.2005
Other Europe 5%
Total personnel 31,500
February 2, 2006UPM 11
USA 3%
France 6%
Canada 4%
China 6%
Germany 23%
Finland 48%UK 6%
Paper production capacity 12.6 million tonsEurope 84%
PAPER CAPACITIESUPM - Paper capacity by market 2006
Austria 4%
February 2, 2006UPM 12
PAPER CAPACITIESUPM – paper capacity by market 2006
350
450
490
780
800
800
2930
6020
0 1000 2000 3000 4000 5000 6000 7000
Finland
Germany
China
Great Britain
France
Austria
Canada
USA
'000 tons
Total 12.6 mill. tons of which 52% outside Finland
February 2, 2006UPM 13
PAPER CAPACITIESUPM – Total paper capacity by paper division 2006
0 1000 2000 3000 4000 5000 6000
Magazine Papers
Newsprint
Fine and SpecialityPapers
Total 12.6 mill. tons of which 52% outside Finland
Coated mech. 3,870 SC Magazine1,850
Newsprint 2,810
Coated WF1,680
Uncoated WF1,620
Specs790
'000 tons
February 2, 2006UPM 14
PAPER CAPACITIESUPM – Paper capacities 2006
0 200 400 600 800 1000 1200 1400
NordlandRauma
KymiJämsänkoski
ChangshuSchongau
KaipolaKajaaniKaukasShotton
AugsburgSteyrermühlTervasaariMiramichi
VoikkaaBlandin
ChapelleSchwedt
StracelCaledonianWisapaper
Docelles
LWC
SC
Newsprint
WFC
WFU
Label
Packaging
'000 tons
February 2, 2006UPM 15
3870
1850
2810
1680
1620
790
Coated Mechanical
SC
Newsprint
WF Coated
WF Uncoated
Speciality Papers
PAPER CAPACITIESUPM – Total paper capacity 2006
Total 12.6 mill. tons
’000 tons
February 2, 2006UPM 16
PAPER CAPACITIESUPM Paper DivisionsPaper and pulp capacities 2006
450Miramichi
775190Wisapaper/Wisapulp4,090
460
1,400
950
140150
800
Fine &Specs.
2,295
240
520740
Pulp
Tervasaari
Docelles
300190Steyrermühl
1,260Rauma500230Schongau
500Augsburg
2,8105, 720Total capacity
410Voikkaa
280Stracel
520Shotton300Schwedt
Nordland
Kymi580Kaukas
450160Kajaani390300Kaipola
730Jämsänkoski
350ChapelleChangshu
280Caledonian350Blandin
NewsMag'000 tons
February 2, 2006UPM 18
Changshu
MiramichiBlandin
PAPER MARKETS UPM - Paper and pulp mills in the world
KajaaniVoikkaaKymi(also pulp)Kaukas(also pulp)
Pietarsaari (also pulp)Jämsäkoski
KaipolaTervasaari (also pulp)
Rauma
Augsburg
Caledonian
Shotton
ChapelleDocelles
Stracel Steyremühl
SchwedtNordland
Schongau
February 2, 2006UPM 19
PAPER MARKETS UPM – Paper Mill Heads
Timo SuutarlaMiramichi
Raimo SärkeläVoikkaa
Jari A VainioWisapaper
Eero KuokkanenTervasaari
Philippe GaudronStracel
Walter PillweinSteyrermühl
David InghamShotton
Juha KääriäinenSchwedt
Artur StöcklerSchongau
Pertti AsunmaaRauma
Hannu JokisaloNordland
Harry Sundqvist =>1.3.2006Kaukas
Leo LindroosKaipola
Kari PasanenKajaani
Sebastian LoewenbergAugsburg
Michel ChakaïDocelles
Yngve LindströmKymi
Erkki PuruJämsänkoski
Timo HeinonenChapelle
Hannu JokisaloChangshu
Gordon MitchellCaledonian
Joe MaherBlandin
February 2, 2006UPM 20
Uncoated Woodfree11%
Speciality Papers7%
Coated Papers31%
Newsprint25%
SC Magazine15%
PAPER MARKETS Paper sales by product category 2005
Coated Woodfree11%
Total 10.1 million tons
February 2, 2006UPM 21
USA and Canada13%
Other markets4%
Finland3%
Europe 72%
PAPER MARKETS UPM – Paper sales by market area 2005
Asia12%
Total 10.1 million tons
EU66%Other Europe
5%
February 2, 2006UPM 22
UPM – Top market areas 2005
7988100103115117133
178199205215226
345368395
477738
12281443
19361. Germany2. Great Britain
3. USA4. France
5. Italy6. China7. Spain
8. Finland9. Japan
10. Netherlands11. Austria12. Poland
13. Belgium14. Switzerland
15. Australia16. Russia
17. Denmark18. Turkey
19. India20. Korea
Total paper sales 10.1 million tons
’000 tons
February 2, 2006UPM 23
PAPER MARKETS UPM - Paper mills and sales network
Sales companyAgentLogistics
Paper mills
22 paper millsSales representation in 55 countries
February 2, 2006UPM 24
PAPER MARKETS Paper supply chain from mills to customers
Austria 1Canada 1China 1Finland 9France 3Germany 4Great Britain 2USA 1
Sales representationin 55 countriescustomers in 120 countries
22 paper mills in
12.6 million tons, 51 PMs
February 2, 2006UPM 26
Relative quality
Relative price
KAUKAS, RAUMA
JÄMSÄNKOSKI, STRACEL, VOIKKAA
CHAPELLE, KAIPOLA, KAJAANI, SCHONGAU
CHAPELLE, KAIPOLA, KAJAANI, SCHONGAU, SCHWEDT, SHOTTON, STEYRERMÜHL
CHANGSHU, KYMI, NORDLAND
UPM News
UPM Brite, UPM Opalite,UPM Color
UPM Smart, UPM Cat,UPM Lux, UPM Max, UPM Eco
UPM Satin, UPM Matt
UPM Ultra, UPM Cote
UPM Star
UPM Fine
UPM Finesse
JÄMSÄNKOSKI, KAJAANI, RAUMA, SCHONGAU,STEYRERMÜHL
AUGSBURG, BLANDIN, CALEDONIA, KAIPOLA, KAUKAS,MIRAMICHI, RAUMA, STRACEL, VOIKKAA
CHANGSHU, KYMI, NORDLAND
News
MFS
SC
MFC
LWC
MWC
WFU
WFC
PAPER GRADES Relative quality and price of paper grades
February 2, 2006UPM 27
PAPER GRADES Paper grades by product category
1.680
200
910
570
Capacity'000 tons
UPMFinesse
150Docelles
1.620
600
490
380
Capacity´000 tons
UPMFine
Kymi
Changshu
Total capacity
Nordland Papier
WF
HSWO RG Sheet Fed
February 2, 2006UPM 28
PAPER GRADES Paper grades by product category
350Blandin
UPMSatin
UPMCote
3,870Total capacity410Voikkaa280Stracel720Rauma450Miramichi580Kaukas300Kaipola120Jämsänkoski280Caledonian Paper
380Augsburg
UPMMatt
UPMUltra
UPMStar
Capacity'000 tons
MWC, LWC, MFC
HSWO CSWO RG
February 2, 2006UPM 29
1,850
190
230
540
160
610
120
Capacity'000 tons
UPMSmart
UPMLux
Augsburg
Steyrermühl
Schongau
UPMEco
Total capacity
Rauma
Kajaani
Jämsänkoski
UPMMax
UPMCatSC
PAPER GRADES Paper grades by product category
HSWO CSWO RG
February 2, 2006UPM 30
PAPER GRADES Paper grades by product category
110Chapelle Darblay
X)Schongau
UPMOpalite
UPMBrite
670Total capacity
220Kajaani
340Kaipola
UPMColor
Capacity'000 tonsMFS
x) combined capacity for UPM Brite and UPM News is 500
HSWO CSWO RG
February 2, 2006UPM 31
PAPER GRADES Paper grades by product category
240 Chapelle Darblay
500 x)Schongau
230Kajaani
2.140Total capacity
300Steyrermühl
520Shotton
300Schwedt
50Kaipola
UPMNews
Capacity'000 tonsNews
x) combined capacity for UPM Brite and UPM News is 500
HSWO CSWO RG
February 2, 2006UPM 32
PAPER GRADES Reel papers for various end uses
UPM SmartSCUPM Matt
UPM Lux
UPM NewsNewsUPM ColorUPM OpaliteUPM BriteMFSUPM EcoUPM Max
UPM Cat
UPM SatinUPM CoteUPM UltraUPM StarMWC,
LWC,MFC
UPM FinesseUPM FineFine
Mag
azin
es
Cat
alog
ues
New
s-pa
pers
Spe
cial
N
ewsp
.
Sup
ple-
men
ts
Inse
rts
Dire
ctor
ies
Dire
ct m
ail
Adv
ertis
ing
Mat
eria
ls
Boo
ks
Oth
er
end-
uses
February 2, 2006UPM 33
PAPER GRADES Digital papers
UPM DIGI High DefinitionUPM DIGI Laser
UPMDIGIFine
UPM DIGI Jet
UPM DIGI CoteUPM DIGI Star
UPM DIGI Lux
UPM DIGI NewsUPM DIGI Color salmonUPM DIGI BriteUPM
DIGINews
UPM DIGI Satin
UPM DIGI Laser+UPM DIGI PresentationUPM DIGI Color LaserUPM DIGI Finesse
UPM DIGIMagazine
Mag
azin
es
Mar
ketin
g m
ater
ials
Cat
alog
ues
Boo
ks.
Dire
ct m
ail
Bro
chur
es
Adv
ertis
ing
mat
eria
ls
Tran
sact
iona
ldo
cum
ents
Inse
rts a
nd
new
spap
er s
uppl
.O
ther
en
d-us
es
New
spap
ers
February 2, 2006UPM 34
PAPER GRADES Office papers
UPM LetterUPM PosteUPM PrestigeUPM PrintUPM FormulaUPM Natura
UPM PrelaserUPM PrePersonalUPM PrePersonal+UPM PrePremiumUPM PreInsertUPM FormUPM Finesse Matt
Yes Professional Photo paperYes Photo paper
Yes Professional Business cardYes Premium Business card
Yes ColorinkjetYes ColorcopyYes HeavyweightYes Gold presentationYes silver multifuctionYes Bronze copy/print
Future colorinktechFuture imagetechFuture smoothtechFuture inktechFuture multitechFuture lasertech
UPM Officecolor inkjetUPM Office color laserUPM Office presentation plusUPM Office presentationUPM Office multifunctionUPM Office copy/print
UPM MailPrePrintPapers
Photo-realistic printing
SpecialendusesYesFutureUPM Office
Papers for copying and printing (A4, A3)
February 2, 2006UPM 35
PAPER GRADES Speciality papers – Label papers
WF coatedWF uncoatedC1S
UPM Finesse Gloss
UPM FineUPM JetlabelUPM Fine SCUPM Vellum
UPM LabelcoatUPM UniqueUPM Unique Lux
UPM CCK OfficeUPM CCKUPM CCK Pro
UPM SCKUPM HoneyUPM GoldenUPM BlueUPM PacificUPM BrilliantUPM Brilliant Pro
Face PapersCCKSCKGlassine
Base Papers
February 2, 2006UPM 36
PAPER GRADES Speciality papers – Packaging papers
UPM Flex papers
UPM JamsacoatUPM UniqueUPM Unique Lux
UPM ForteUPM KraftUPM Kraft steelUPM PrimeUPM Prime wrapUPM Prime whiteUPM Prime PS whiteUPM SwanBaseUPM SwanBase innoUPM SwanFineUPM SwanFine glossUPM SwanLineUPM SwanWhiteUPM SwanWhite abraUPM SwanWhite cupUPM SwanWhite GUPM Sean White glossUPM SwanWhite innoUPM SwanWhite XUPM WEX whiteUPM SwanXtremeUPM White flexUPM X White lineUPM White plus
UPM WEX LDUPM WEX LDFUPM WEX SPUPM WEXUPM WEX whiteUPM WEX WS whiteUPM WEX DIS whiteUPM WEX LD whiteUPM WEX LD DIS whiteUPM WEX SP whiteUPM Prime whiteUPM Prime WS whiteUPM SwanXtreme
UPM KraftUPM Kraft ribbedUPM Kraff sapporoUPM Prime bioUPM SwanFineUPM SeanFine glossUPM SwanWhiteUPM SwanWhite glossUPM SwanWhitegloss WSUPM SwanWhite ribbedUPM SwanWhite XUPM White flexUPM White flex ribbedUPM White plusUPM White extra strong
UPM Tech PapersUPM Sack PapersUPM Bag papers
February 2, 2006UPM 37
PAPER GRADES Examples of end uses
Mechanicalpulp and/ordeinked pulp
magazines, brochures, direct mail, annual reports,books, advertising materialWoodfree coated papers
sacks, bags, wrapping and packaging, envelopesKraft papers
office papers, writing papers and envelopes, direct mail, magazines, books, advertising materialWoodfree uncoated papers
label paper, label release papers, food wrapping,household and sanitary papers, baking paper,packaging material
Speciality papers
Chemical pulp
magazines, catalogues, newspaper supplements,advertising material, books, direct mailCoated mechanical papers
magazines, catalogues, newspaper supplements,inserts, advertising materialSC papersChemical
and mechanicalpulp
newspaper supplements, newspapers, directories,magazines, books, catalogues, advertising materialmechanical speciality paper
newspapers, inserts, flyersnewsprint
End use examplesPaper gradeRaw material
February 2, 2006UPM 39
PAPER GRADES Fine papers
high-brightness, double coated woodfree paper (WFC)
matt or calendered,uncoated woodfree paper (WFU)
February 2, 2006UPM 40
PAPER GRADES MWC, LWC, MFC
high-brightness, double coated mechanical paper (MWC)
high-brightness,coated mechanical paper (LWC)
coated mechanical paper (LWC)
matt finished, coated mechanical paper (MFC)
mechanical speciality paper (MFC) for CSWO
February 2, 2006UPM 41
PAPER GRADES SC papers
high-brightness, supercalenderedmechanical paper (SCA+)
high-brightness, silk finished, supercalendered mechanical paper (SCA+)supercalenderedmechanical paper (SC-A)
on-line calenderedmechanical paper (SC-B)
high-brightness, uncoated groundwood paper
February 2, 2006UPM 42
PAPER GRADES MFS papers
uncoated mechanical speciality paper
mechanical directory paper
coloured mechanical speciality paper
February 2, 2006UPM 44
PAPER GRADES Digi range
Woodfree Fine Papers
Mechanical Newsprint Papers
Mechanical Magazine Papers
UPM DIGI Fine
UPM DIGI Magazine
UPM DIGI News
February 6, 2006UPM 46
0
10
20
30
40
50
60
Newsprint Coated mech. SC WF coated WF uncoated
Rest of the world
Other Europe
UPM
POSITIONING – WORLDUPM’s share in graphic papers capacity 2006
Source: Jaakko Pöyry, UPM
49
mill. tons
2.8UPM 3.9 1.9 1.7 1.6
20
8
28
46
February 2, 2006UPM 47
UPM's market positionBusinesses
3Sawn goods
1PlywoodWood products
1Industrial wrappings
22Self-adhesive labelstockConverted products
3Packaging papers
11Label papers
53Fine papers
52Newsprint
11Magazine papersPaper
GlobalEurope
POSITIONING – WORLDUPM's market positions 2006
February 2, 2006UPM 48
***1Envelope papers
45Woodfree coated papers
11Coated mechanical
***1-3**Packaging papers
11Label papers
86Woodfree uncoated papers
52Newsprint
21SC magazine papers
in the Worldin Europe
POSITIONING – WORLDUPM's paper market positions in 2006*
*) based on capacities **) depending on the product ***) no ranking available
February 6, 2006UPM 49
POSITIONING – WORLDWorld’s biggestgraphic papers producers 2006
0 2000 4000 6000 8000 10000 12000
Stora Enso
UPM
International Paper
Norske Skog
Nippon Paper Group
Abitibi-Consolidated
Asia Pulp & Paper
M-real
Oji
Bowater
’000 tons
Source: JP, UPM
February 6, 2006UPM 50
POSITIONING – WORLDWorld’s biggestgraphic papers producers 2006
0 2000 4000 6000 8000 10000 12000
Stora Enso
UPM
International Paper
Norske Skog
Nippon Paper Group
Abitibi-Consolidated
Asia Pulp & Paper
M-real
Oji
Bowater
News
SC Paper
Coated mech.
WFC
WFU
’000 tons
Source: JP, UPM
February 6, 2006UPM 51
POSITIONING – WORLDWorld’s biggest paper and paperboard producers 2006
0 2 4 6 8 10 12 14 16 18
Stora Enso
International Paper
UPM
Georgia-Pacific
Oji
Weyerhaeuser
Nippon Paper Group
Smurfit Kappa Group
Smurfit-Stone
Asia Pulp & Paper
GraphicPapers
Other paperand board
mill. tons
Source: JP, UPM
February 2, 2006UPM 52
POSITIONING – WORLDCoated mechanicalLargest producers in the world 2006
0 1000 2000 3000 4000
UPM
Stora Enso
M-real
International Paper
Burgo Corporation
Myllykoski
Norske Skog
NewPage Corp.
Bowater
Oji
Capacity ’000 tons
Consolidation
Other 47%
Top 553%
Source: JP, UPM
February 2, 2006UPM 53
POSITIONING – WORLDSC magazineLargest producers in the world 2006
0 500 1000 1500 2000 2500
Stora Enso
UPM
Myllykoski Corporation
Norske Skog
SCA
Irving Pulp & Paper Ltd.
Abitibi-Consolidated
Belgravia Investments Ltd.
Katahdin Paper Co. L.L.C.
Bowater
Capacity ’000 tons
Consolidation
Other 23%
Top 577%
Source: JP, UPM
February 2, 2006UPM 54
POSITIONING – WORLDNewsprint*)
Largest producers in the world 2006
0 1000 2000 3000 4000 5000 6000
Norske Skog
Abitibi-Consolidated
Stora Enso
Bowater
UPM
Nippon Paper Group
Holmen
Catalyst Paper Corp.
Oji
Kruger
Capacity ’000 tons
Consolidation
Other 60%
Top 540%
Sour
ce: J
P, U
PM
*) including TD, improved newsprint, superimproved newsprint and book papers
February 6, 2006UPM 55
POSITIONING – WORLDWoodfree coated paperLargest producers in the world 2006
0 1000 2000 3000
Sappi
Stora Enso
Asia Pulp & Paper
UPM
M-real
Lecta Group
Oji
Burgo Corporation
Nippon Paper Group
NewPage Corp.
Capacity ’000 tons
Consolidation
Other 64%
Top 536%
Source: JP, UPM
February 2, 2006UPM 56
POSITIONING – WORLDWoodfree uncoated paperLargest producers in the world 2006
0 1000 2000 3000 4000 5000 6000
International Paper
Weyerhaeuser
Mondi
Asia Pulp & Paper
Domtar
Stora Enso
Nippon Paper Group
UPM
M-real
Boise Cascade, L.L.C.
Capacity ’000 tons
Consolidation
Other 72%
Top 528%
Source: JP, UPM
August, 2005UPM 57
POSITIONING – WORLDBiggest paper and paperboard producing countries 2004
80,241,7
30,320,119,3
13,111,110,49,99,4
7,97,7
6,36,25,4
59,8
1. USA2. China3. Japan
4. Canada5. Germany
6. Finland7. Sweden
8. Korea,9. France
10. Italy11. Brazil
13. Russia
15. SpainOthers
World production 339 mill. tons change 2004/2003: +2.8%
mill. tons
Source: PPI
12. Indonesia
14. Great Britain
August, 2005UPM 58
POSITIONING – WORLDBiggest paper and paperboard exporting countries 2004
14,911,8
10,79,4
8,65,3
3,932,92,72,62,5
1,91,81,8
19,7
1. Canada2. Finland
3. Germany4. Sweden
5. USA6. France7. Austria
8.9. Italy
10. Korea,11. Indonesia
12. Russia13. Norway
14. Spain15. Brazil
Others
World export103 mill. tonschange 2004/2003: +3.7%
mill. tons
Source: PPI
August, 2005UPM 59
POSITIONING – WORLDMain paper and board importing countries 2004
16,69,9
7,66,26
4,63,6
3,12,9
2,52,1
1,81,8
1,51,5
1. USA2. Germany
3. Great Britain4. France
5. China6. Italy
7. Spain8. Netherlands
9. Belgium10. Hong
11. Canada12. Mexico13. Japan 14. Poland15. Taiwan
mill. tons
Source: PPI
August, 2005UPM 60
World consumption kg/capita 56 kg
World population million inhabitants6 430
N. AmericaW. Europe
L. America
Oth. Europe
Africa
Oth. Asia
China Japan
OceaniaSource: PPI
POSITIONING – WORLDPaper and paperboardconsumption per capita 2004
31
187267
329
455
33552
6
882
39 280
27
1388
1306
42
247
127
203
August, 2005UPM 61
0
50
100
150
200
250
300
Finland Sweden Canada USA Germany France GreatBritain
Japan
19602003no. of mills2003
46
'000 tons
96
18881126
Source: PPI
451
435
POSITIONING – WORLDPaper and paperboard production per mill 1960 and 2004
46
March 23, 2006UPM 62
POSITIONING – WORLDAverage capacity of printing paper machines
0 50 100 150 200 250 300
UPM
Nordic countries
Other Western Europe
Canada
USA
Japan
Asia-Pacific region
Average
'000 t/a
Source. Jaakko Pöyry
February 2, 2006UPM 63
POSITIONING – WORLDWorld demand trends of graphic papers 1983-2007
0
10 000
20 000
30 000
40 000
50 000
60 000
'83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07
WF unctd+1,8 % p.a.
Newsprint+1.0 % p.a.
WF ctd +3,7 % p.a.
Ctd mech.+1.4 % p.a.
Unctd mech.+1.5 % p.a.
Growth rate2004-07
Source:Cepiprint, PPPC, EMGE, JP
'000 tons
February 2, 2006UPM 64
POSITIONING – WORLDWorld capacity trends of graphic papers 1990-2007
0
10 000
20 000
30 000
40 000
50 000
60 000
'90 '92 '94 '96 '98 '00 '02 '04 '06
WF uncoated2,2 % p.a.
Newsprint 1.1 % p.a.
WF coated2.3 % p.a.
Ctd mech. 2.0 % p.a.
Unctd mech.1.6 % p.a.
Growth rate2003-07
Source:Cepiprint, PPPC, EMGE, JP
'000 tons
February 2, 2006UPM 66
POSITIONING – EUROPEBiggest graphic papers producers in Europe 2006
UPM
Stora Enso
M-real
Norske Skog
Burgo
Sappi
Myllykoski
Holmen
Mondi
Lecta Group
Coated mechSCNewsprintWF coatedWF uncoated
mill.tons
4.5
3.5
3.0
2.5
2.5
2.2
1.6
10,4
10.2
1.6
Source: JP, UPM
February 2, 2006UPM 67
POSITIONING – EUROPEEuropean Coated mechanical players(´000 tons)
Rauma (FIN)Kauksas (FIN)Voikkaa (FIN)Augsburg (D)Kaipola (FIN)Stracel (F)Caledonian (UK)Jämsänkoski (FIN)
UPM (3.070)Kirkniemi (FIN)Jyväskylä (FINHusum (S)
M-real (1.280)
Verezuolo (I)Duino (I)Villorba (I)Marzabotto (I)Avezzano (I)Toscolano (I)
Burgo (1.250)
Plattling (D)Albbruck (D)Dachau (D)Myllykoski (FIN)
Myllykoski (1.115)Other (780)
Perlen (CH)Holmen (S)Matussiere & Forest (F)Steinbeis Holding (D)Kübler & Niethammer (D)Paper Mill Gemmrigheim (D)Ahlström/Ascoli (I)
Ortviken (S)SCA (460)
Schwedt (D)
LEIPA-GeorgLeinfelder (460)
Walsum (D)Bruck (A)Follum (NO)
Norske Skog (810)
Lanaken (B)Sappi (450)Kabel (D)
Corbehem (F)Veitsiluoto (FIN)Kotka (FIN)Anjala (FIN)
Stora Enso (1.935)
February 2, 2006UPM 68
POSITIONING – EUROPEEuropean SC-magazine paper players(´000 tons)
Jämsänkoski (FIN)Rauma (FIN)Schongau (D)Steyrermühl (D)Kajaani (FIN)Augsburg (D)
UPM (1.850)
Lang (D)Myllykoski (FIN)
Myllykoski (790)
Halden (NO)Norske Skog (550)
Kvarnsveden (S)Maxau (D)Reisholz (D)Langerbrugge (B)Wolfscheck (D)
Stora Enso (1.525)
Vetrni u CeskehoKrumlova (CZ)
JIP –Papirny Vetrni (40)
Holmen (140)Hallstavik (S)
Laakirchen (A)SCA (500)
February 2, 2006UPM 69
POSITIONING – EUROPEEuropean newsprint players(´000 tons)
Skogn (NO)Golbey (F)Parenco (N)Follum (NO)Bruck (A)Sieti (CZ)
Norske Skog (2.175)
Shotton (UK)Schongau (D)Kajaani (FIN)Kaipola (FIN)Chapelle (F)Steyrermühl (A)Schwedt (D)
UPM (2.810)
Hylte (S)Kvarnsveden (S)Summa (FIN)Langerbrugge (B)Anjala (FIN)Sachsen (D)Varkaus (FIN)Maxau (D)
Stora Enso (3.300)
Eltman (D)Aalen (D)
Palm Group (540)Balakhna (RUS)
JSC InvestmentCompany (540)
Ortviken (S)Aylesford (UK)
SCA (560)
Rhein Papier (D)Utzenstorf (CH)Lang (D)
Myllykoski (580)
Kondopoga (760)Kondopaga (RUS)
Braviken (S)Hallstavik (S)Pap. Peninsular (ES)
Holmen (1.845)
Mantova (I)Toscolano (I)Marzabotto (I)
Burgo (185)
JSC Solikamsk-bumprom (425)
Solikamsk (RUS)
Mondi (390)Aylesford (UK)Syktyvkar (RUS)
Ellesmere (UK)
Abitibi- (230)Consolidated
Renteria (ES)Papresa (370)
Matussiere et Forest (F)Perlen (CH)Kama Pulp & Paper (RUS)IP (P)S.C. Letea S.A: (RO)Arctic Paper (S)Golzern Holding (D)Vipap Videm Krskod.d. (SL)Fabryka Papieru S.A.Fabryka PapieruSzczecin (P)
Others (935)(excl. below 50.000 t)
February 6, 2006UPM 70
* Cap. min. 250.000 t/a
POSITIONING – EUROPEEuropean fine paper players* ('000 tons)
M-real (3.085)Biberist (CH)Stockstadt (D)Husum (S)Hallein (A)Alizay (F)Berg.Gladbach (D)Kemsley (UK)Sittingbourne (UK)Äänekoski (FIN)Wifstavarf (S)Pont St. Max (F)
Oulu (F)Veitsiluoto (F)Nymolla (S)Varkaus (FIN)Grycksbo (S)Wapenweld (NL)Imatra (FIN)Uetersen (D)
StoraEnso (3.300)
Le LardinSaint Lazare (F)Riva del Garda (I)Motril (ES)Zaragoza (ES)St Joan les Fonts (ES)Sarria de Ter (ES)
Lecta (1.530)
Sappi (1.970)Gratkorn (A)Maastricht (NL)Nijmegen (NL)Alfeld (D)Ehingen (D)Blackburn (UK)H.Hempstead (UK)Lanaken (B)
Nordland (D)Kymi (FIN)Docelles (F)
UPM (2.500)
Kwidzyn (POL)Svetogorsk (RUS)Saillat sur Vienne (F)Inverurie (UK)Maresquel (F)
IP Europe (1.170)
Mondi (1.220)Syktyvkar (RUS)Ulmerfeld-H. (A)Ruzomberok (SLO)Szolnok (HUN)Dunaujvaros (HUN)Kematen/Ybbs (A)
Virton (B)Sora (I)Avezzano (I)Chieti (I)Tolmezzo (I)Sarego (I)Toscolano (I)Lugo di Vicenza (I)
Burgo (1.480)
Lenningen (D)
Pap. Scheufelen(290)
Portucel (1.075)Figueira da Foz (P)Setubal (P)
Hernani (I)
Pap. Guipuzcoana(250)
Arjo Wiggins (420)Bessé sur Braye (F)Wizernes (F)Saint-Mars-la-Briére (F)Annat Point (UK)+ 14 mills(cap. below 50.000 t/a)
Kostrzyn (POL)Åsensbruk (S)Munkedal (S)
Arctic Paper (480)
Excl. WF specialities
February 6, 2006UPM 71
POSITIONING – EUROPEEuropean WFC players ('000 tons)
Matussiere & Forest (F)Dalum Papir A/S (DK)Smurfit Kappa Group (UK)Aconda Paper S.A.)
Other (320)(excl. below 50.000 tons)
Åsensbruk (S)Arctic Paper (150)
Scheufelen (270)Lenningen (D)
Bessé sur Braye (F)Wizernes (F)
Arjo Wiggins (375)Le Lardin Saint Lazare (F)Riva del Garda (I)Motril (ES)Zaragoza (ES)St Joan les Fonts (ES)Sarria de Ter (ES)
Lecta (1.510)
Nordland (D)Kymi (FIN)
UPM (1.480)
Virton (B)Sora (I)Avezzano (I)Chieti (I)Sarego (I)Lugo di Vicenza (I)Toscolano (I)
Burgo (1.260)
Gratkorn (A)Maastricht (NL)Nijmegen (NL)Alfeld (D)Ehingen (D)Blackburn (UK)Lanaken (B)
Sappi (1.930)
Biberist (CH)Hallein (A)Bergisch Gladbach (D)Stockstadt (D)Sittingbourne (UK)Äänekoski (FIN)Pont St. Maxence (F)
M-real (1.585)
Oulu (FIN)Grycksbo (S)Uetersen (D)Varkaus (FIN)
Stora Enso (1.550)
Excl. WFC specialities
February 6, 2006UPM 72
UPM (1.410)
POSITIONING – EUROPEEuropean WFU players ('000 tons)
Mondi (1.220)Syktyvkar (RUS)Ulmerfeld-Hausmening (A)Ruzomberok (SLO)Szolnok (HUN)Dunaujvaros (HUN)Kematen an Ybbs (A)
Veitsiluoto (FIN)Nymölla (S)Berghuizer (NL)Varkaus (FIN)Imatra (FIN)
Stora Enso (1.750)
Husum (S)Alizay (F)Kemsley (UK)Stockstadt (D)Wifstavart (S)St. Maxene (F)Biberist (CH)
M-real (1.500)
UPM (1.020)Nordland (D)Kymi (FIN)Docelles (F)
Pap. Guipuzconade Zicuña (250)
Hernani (ES)
Kwidzyn (POL)Svetogorsk (RUS)Saillat (F)Inverurie (UK)Maresquel (F)
IP Europe (1.170)
Figueira da Foz (P)Setubal (P)
Portucel (1.075)
Kostrzyn (POL)Munkedal (S)
Arctic Paper (320)
Tolmezzo (I)Toscolano (I)
Clairefontaine (F)Steinbeis Holding (D)Cart. Fedrigoni (I)Paperalia S.A. (ES)
Other (550)(excl. below 100.000 tons)
Velsen Noord (NL)
Crown Van Gelder N.V. (205)
Burgo (220)Ruzomberok (SL)
Eco-Invest. (250)
Excl. WFU specialities
February 17, 2006UPM 74
Capacity27,2 mill. tons
Demand23,9 mill. tons
N. America W. Europe
L. America
Oth. Europe
Africa
Oth. AsiaJapan
Oceania
1,6
0,3
0,2
Source: Cepiprint, PPPC, EMGE, RISI
TRADE FLOWSMagazine papers Demand and capacity 2006 preliminary
8,0 8,5
0,2 0,6 0,03 0,1
0,07 0,4
16,1
10,7
2,0 1,9
0,04
0,1
0,9 0,20,4
0,4
0,1
0,7 0,8
0,05
0,1 1,0
February 17, 2006UPM 75
Capacity19,5 mill. tons
Demand17,0 mill. tons
N. America W. Europe
L. America
Oth. Europe
Africa
Oth. Asia Japan
Oceania
1,0
0,2
0,02
0,3
Source: Cepiprint, PPPC, JP
TRADE FLOWSCoated mechanical paper Capacity and demand 2006 estimate
5,7 5,9
0,2 0,5- 0,1
0,1 0,3
10,9
7,3
- 0,7
1,9 1,8
0,04
0,1
0,7 0,20,3
0,2
0,1
0,8 0,70,1
February 17, 2006UPM 76
Capacity7,7 mill. tons
Demand6,9 mill. tons
N. America W. Europe
L. America
Oth. Europe
Africa
Oth. Asia Japan
Oceania
0,7
0,05 0,3
Source: Cepiprint, PPPC, JP
TRADE FLOWSSC magazine paperCapacity and demand 2006 estimate
2,32,7
- 0,1 0,06
- 0,1
5,2
3,5
0,1
0,08 0,1
0,03
0,3 0,02
0,1
0,1
0,4
- 0,1
0,06
February 17, 2006UPM 77
Capacity40,2 mill. tons
Demand37,7 mill. tons
N. America W. Europe
L. America
Oth. Europe
Africa
Oth. Asia
Oceania
0,2
0,3
Source: Cepiprint, PPPC, JP
TRADE FLOWSStd newsprint Capacity and demand 2006 estimate
13,2
10,2
1,01,8
0,8 0,9
10,39,2
2,9
3,8 3,90,6
0,8
1,3 6,24,41,3
0,5 0,6
1,8
China
3,3 3,2
1,4
0,9
Japan
0,2
0,1
February 17, 2006UPM 78
Capacity30,5 mill. tons
Demand27,6 mill. tons
N. America W. Europe
L. America
Oth. Europe
Africa
Oth. Asia
Japan
Oceania
Source: Cepiprint, PPPC, JP
TRADE FLOWSWoodfree coated paperCapacity and demand 2006 estimate
5,0 5,6
0,9
0,2
0,1
11,5
8,1
5,24,7
0,1
0,8
0,20,5
0,10,6
0,3
1,0
0,5
0,4
0,1
0,4
0,20,1
0,03
7,86,5
0,2
0,7
0,1
0,1 0,7
0,5
February 17, 2006UPM 79
Capacity57,1 mill. tons
Demand50,5 mill. tons
N. America W. Europe
L. America
Oth. Europe
Oth. Asia
Oceania
Source: Cepiprint, PPPC, JP
TRADE FLOWSWoodfree uncoated paperCapacity and demand 2006 estimate
13,512,6
3,2
1,0
0,4
10,89,6
3,6 3,6
0,2
0,5
3,0
0,2
0,033,3
1,2 China
13,011,21,8 8,9
6,7
0,6
0,1 0,2
0,1
0,8
0,30,2
0,2
0,6
*) 7 500 Cepifine demand (Cepifine bulk grades, i.e. excl. spec. grades) 8 400 (Cepifine capacity)
0,1
0,1
Africa
Japan
February 2, 2006UPM 81
DEMANDWestern EuropeCoated mechanical - Demand forecast
0
2
4
6
8
'98 '99 '00 '01 '02 '03 '04 '05 '06e
mill. tons Demand change from previous year
Demand growth rate 2003-2006: 3%
1% 4%13%
-6% 1%5% -1%4%
4%
Lockout in Finnish mills 2005 Source: Cepiprint, UPM
February 2, 2006UPM 82
DEMANDWestern EuropeSC magazine - Demand forecast
0
1
2
3
4
'98 '99 '00 '01 '02 '03 '04 '05e '06e
5%
9% 6%9% 0% 1% 3% -2%
-1%
mill. tons Demand change from previous year
Demand growth rate 2003-2006: 2%Lockout in Finnish mills 2005 Source: Cepiprint, UPM
February 2, 2006UPM 83
DEMANDWestern EuropeNewsprint - Demand forecast
0
3
6
9
12
'98 '99 '00 '01 '02 '03 '04 '05e '06e
5%3%
-5% 0%1%-3%5% 5% 1%
mill. tons Demand change from previous year
Demand growth rate 2003-2006: 2%Lockout in Finnish mills 2005 Source: Cepiprint, UPM
February 2, 2006UPM 84
DEMANDWestern EuropeWoodfree coated - Demand forecast
0
2
4
6
8
'98 '99 '00 '01 '02 '03 '04e '05e '06e
8%10% 3%
-7% 1% 1% 8% 2% 4%
mill. tons Demand change from previous year
Demand growth rate 2003-2006: 5%Lockout in Finnish mills 2005 Source: Cepiprint, UPM
February 2, 2006UPM 85
DEMANDWestern EuropeWoodfree uncoated - Demand forecast
0
2
4
6
8
'98 '99 '00 '01 '02 '03 '04e '05e '06e
3%3% 5% 2% -4% -1% -1%
6% 1%
mill. tons Demand change from previous year
Demand growth rate 2003-2006: 3%Lockout in Finnish mills 2005 Source: Cepiprint, UPM
February 13, 2006UPM 87
0
10
20
30
40
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000
- Paper consumption, million t/a -
Newsprint
Printing and writing papers
Expansion of Internet/WWW
PCs
RadioCinemaTV
Laser PrintersCD-ROMs
MainframeComputers
ColourTV
Cable TVVCR
Satellite TVMini Computers
Newsprint and printing & writing paper consumption and the Proliferation of Electronic Media in Western Europe
Source: Jaakko Pöyry Consulting
High speed Internet access
February 2, 2006UPM 88
Printing papers' life cycle
Paperproduction
Waste paper/ waste
Productionof recycled
fibres
Fresh fibreproduction
Forest
Biodiversity
Reader
Distribution
Printing
Incineration/landfill
February 2, 2006UPM 89
Structural changes of the forest industry in Finland
EnsoGutzeit
Veitsiluoto
Stora Enso
Varkaus(Ahlström)
Myllykoski
Rauma-Repola1991
Rosenlew1987
Kajaani1989
Kymmene
Kaukas1986
UnitedPaper Mills
1991
UPM-Kymmene1996
Repola
Serlachius
MetsäliitonTeollisuus
Schauman1988
Ahlström ==> Jujo Thermal
Metsäliitto
Metsä-Botnia
Kemi
Joutseno-Pulp
Metsä-Sellu
Finnforest
TampellaForest and
Tambox
Oulu
EnsoStora
Corenso
Sunila
Georgia-Pacific Finland (Nokia),
Stromsdal
Georgia Pacific
M-realMetsä-liitto
Kyro
Metsä-Rauma
February 2, 2006UPM 92
APRIL Changshu mill, 2000
G. Haindl'sche Papierfabriken KgaA, 2001
Repola Oy 1991
Yhtyneet Paperitehtaat OyRauma-Repola Oy
Chapelle Darblay S.A.1990
Lohjan Paperi Oy1982
Osakeyhtiö Mahogany ja Puukeskus Oy 1977
Oy W. Rosenlew AB1987 Stracel S.A.
1988
Shotton PaperCompany Ltd
1985
Raf. Haarla 1976
Repap Enterprises Inc., 2000
Blandin PaperCompany, 1997
UPM-Kymmene1996
Kymmene Oy 1986
Oy Wilh.Schauman Ab
1988Caledonian
Paper plc 1987
Kymi-Strömberg Oy 1983 Papeteries
Boucher S.A.1977
Nordland Papier GmbH1967
Kymi Kymmene Oy1975
Kajaani Oy1989 Oy Kaukas Ab
1986
Kymin Osakeyhtiö
February 2, 2006UPM 93
From forest to office paper –one hour / paper machine
105 m3 95 m3
Birch pulp 24 000 kg Pine pulp 16 000 kg
8,5 m
50 000 per hour 20 000 reams A4
Speed 75 km/h
Fillers 10 000 kg
February 2, 2006UPM 94
From forest to coated paper –one hour / paper machine
65 m3 95 m3
Birch pulp 16 000 kg Pine pulp 16 000 kg
Fillers & coating colours25 000 kg
8.5 m
Speed PM 8: 80 km/h &C3: 110 km/h (record 130 km/h)
60 000 kg per hour
100 reelsin size 90 x 120 cm