Forest Product’s production of paper for packaging and print, pulp and solid-wood products is concentrated to northern Sweden, close to SCA’s forest holdings. SCA’s forest holdings are certified in accordance with the FSC®’s rigorous forest management standard and SCA is one of the world’s largest suppliers of FSC®-certified forest products.
SCA is Europe’s largest private forest owner with a holding of 2.6 million hectares of FSC® and PEFC™-certified forest land, of which 2.0 million is managed for timber production. Over the past 50 years, the standing volume in SCA’s forests has increased by nearly 50%, at the same time as growth, and thus the sustainable harvesting potential, has more than doubled. The forest is a unique resource that offers us access to high-quality forest raw materials, which are then converted into solid-wood products, pulp and paper for packaging and print in our production process. The forest also makes a positive contribution to SCA’s environmental practices, enabling energy production from wind power and biofuels while at the same time storing and binding carbon dioxide. From a community perspective, the forest also contributes biodiversity while also providing a source for nature experiences and recreation. While responsible forest management and the replanting of trees help to combat climate change, a major contribution in the climate work also comes from replacing products with a large carbon footprint – such as concrete, plastic and oil – with products and materials with a smaller carbon footprint – such as wood products, paper and biofuels. SCA’s forests display a net growth rate and the company’s growing forests absorb 2.6 million tons of carbon dioxide each year, which exceeds the emissions from SCA’s use of fossil fuels in production.
In 2015, SCA’s nurseries produced 86 million seedlings, of which 57% was sold externally.
SCA is Europe’s third largest supplier of packaging paper based on fresh wood fiber – kraftliner. SCA’s kraftliner mill in Munksund specializes in white-top kraftliner with good printability, while the kraftliner mill in Obbola specializes in more robust grades and higher wet strength packaging paper. In recent years, SCA has made significant investments in both mills to increase production, improve quality, reduce costs and enhance energy efficiency. In 2015, a new digester was commissioned at the Obbola mill.
SCA’s sales of publication papers mainly take place within the Western European market. The single largest markets are the Nordic region, Germany and the UK. In 2015, SCA decided to close down a newsprint machine, the smallest and oldest of the Ortviken mill’s four machines. Ortviken is now focusing on the development and production of value-added publication paper grades. Even after the closure, the mill remains one of the world’s largest publication paper mills and has the potential to become one of the most competitive.
In the pulp market, SCA has positioned itself in the high-quality segment based on its excellent access to, and expertise in, the Nordic long-fiber forest raw material. Approximately 40% of production at Östrand pulp mill is utilized within SCA for production of tissue and publication papers. To satisfy the long-term growth in demand for pulp, SCA decided in 2015 to invest in increased capacity for pulp production at Östrand pulp mill in Timrå, Sweden. The annual production capacity of bleached kraft pulp will increase from the current level of 430,000 tons to about 900,000 tons. The investment will amount to about SEK 7.8bn over a three-year period. Production is expected to commence in the second quarter of 2018. Over time, the investment in Östrand will increase sales and competitiveness and create a world-class cost position and higher margins. The expanded pulp plant will entail a high level of demand for pulpwood and sawmill chips in northern Sweden for a considerable time to come, with a positive effect on the value of the forest and the sawmill business.
SCA’s sawmill operation is the second largest in Europe. The strategy for solidwood products is to move toward more value-added and customized products in markets and with customers that offer long-term growth. SCA’s own raw materials, production and logistics expertise, combined with close cooperation with customers, generate competitive advantages, which in turn are combined with world-class productivity. SCA’s five mills are among the largest and most competitive sawmills in Europe. SCA is a qualified supplier of purpose-designed wood products to industry for further processing into such items as panels, floors, windows, doors and furniture. Finished-wood components for window manufacturing, for example, represents another high-growth market. Products for the builders merchant sector are delivered planed and pre-packaged. Service and advanced logistics solutions are of key significance for the builders merchant sector. SCA works in close cooperation with its customers in its principal markets in Scandinavia, France and the UK. SCA supplements the economies of scale generated at its sawmills in Sweden with further processing carried out close to the customer in the market.
SCA Energy is continuing the construction of the Björkhöjden wind farm, one of the largest in Sweden. At year-end 2015, 298 turbines were in production on land owned by SCA with total generating capacity of 2.3 TWh per year. SCA is one of Europe’s largest suppliers of forest-based biofuels, such as tree branches, crowns, stumps, bark, sawdust, peat and processed products, which includes pellets and briquettes. In 2015, production of biofuel amounted to 2.7 TWh.
Because transportation accounts for one of the largest cost items for SCA’s forest products, SCA Logistics has been given the strategic task of developing cost-effective logistical solutions. In 2015, SCA launched a new strategy for its three RoRo vessels involving services to terminals in Germany, the UK and the Netherlands. In parallel, SCA will relocate its terminal from Lübeck to Kiel and, in the UK, from Tilbury to Sheerness.