Metsä fibre annual review 2011

Transcription

1 Metsä fibre annual review 211

2 Metsä fibre annual review ceo s review 4 strategy 6 Metsä fibre in sustainable and responsible business 12 specific emissions from PulP Mills in the nordic countries 13 Material balance 14 environmental balance environmental impact ManaGeMent

3 Sales 1.3 billion euros Result before tax 258 million euros Employees 9 Production 2.2 million tonnes Metsä Fibre is a world-leading producer of softwood pulp. Our main products sustainably and costefficiently produced softwood and birch pulp are specially developed for the production of high-quality fine papers, magazine and tissue papers, and board. Our main brand is Botnia. With four pulp mills in Finland, we employ a total of about 9 people. Our sales in 211 were approximately EUR 1.3 billion. Metsä Fibre is part of Metsä Group.

4 Metsä fibre 211 KeY figures * 28* 27 SaleS EUr million 1,31 1, ,184 1,371 Operating result excl. non-recurring items EUr million % Of SaleS Operating result EUr million % Of SaleS result before tax EUr million % Of SaleS result for the period EUr million net liabilities / % Of SaleS equity ratio % net gearing % return On capital employed % gross capital expenditure EUr million personnel ,111 1,267 1,263 * continuing operations

5 PulP deliveries: 1, tonnes sales: eur million return on capital employed, excluding non-recurring items: % Softwood pulp hardwood pulp moving 3-year average 3, 1,5 6 2,5 2, 1,5 1, 5 1, * 29* * 29* operating result, excluding non-recurring items: eur million result before tax, excluding non-recurring items: eur million moving 3-year average equity ratio: % * 29* * 29* * 29* net GearinG interest bearing liabilities Shareholders s equity net gearing, % Personnel: at year end sales by MarKet areas: % eur million % 1,8 1,6 1,4 1,2 1, * 29* * 29* ,5 1, finland 58 other eu countries 18 other europe 4 other countries 2 * continuing operations

6 2 CEO'S REVIEW CEO's review

7 CEO's review Metsä Fibre Oy is a world-leading producer of softwood pulp. Our parent group, Metsä Group, has specified pulp business as one of its core businesses. The synergies provided by Metsä Group s business areas strengthen Metsä Fibre s opportunities to work efficiently and responsibly in co-operation with our customers. The change from Oy Metsä-Botnia Ab to Metsä Fibre Oy emphasises the development of recent years that has enhanced our company s efficiency as part of Metsä Group. The use of the Botnia name as our product brand will clarify our product and service offering. Botnia now refers to a concept that combines the highest-quality pulps with services and competence that support our customers' competitiveness. We will continue our determined work to improve our competence and offering so that the Botnia products and services provide our customers with concrete advantages for the development of their product quality and production efficiency. Good results in varying market conditions In 211, Metsä Fibre s operating profit totalled EUR 267 million. Performance in the first half-year was good, due to strong demand and price increases in all the markets. The weakening of the economic outlook had a negative impact on demand, while the utilisation rate of production capacity remained high. The imbalance caused a slight oversupply in the market and led to an increase of global stock levels. As a result, pulp prices fell in the second half of the year. At the end of the year, the development of pulp prices stabilised again and it looked as if they could start rising. In varying market conditions, Metsä Fibre achieved the planned production level and ensured a reasonable financial result. The increased importance of China With regard to total pulp deliveries, the proportion of deliveries to China increased significantly, as the unfavourable financial situation weakened the market particularly in Europe. A record amount of pulp was delivered to the Chinese market in 211, also by Metsä Fibre. However, the company s main market area continues to be Europe, including the Nordic countries. A similar development will continue in 212. Breaking production records Metsä Fibre s four mills together produced a record amount of pulp, totalling more than 2.2 million tonnes. Annual production records were broken at the Joutseno, Rauma and Äänekoski mills. Renewed causticising and The synergies provided by Metsä Group s business areas strengthen Metsä Fibre s opportunities to work efficiently and responsibly. water plants started up in Kemi. Together with lower development investments, they ensure future increase of production efficiency also at the Kemi mill. In recent years, the management model of Metsä Fibre mills has been developed with the focus on occupational safety issues. We have achieved good occupational safety results. In 211, the accident rate per one million working hours was 6.6. This means that we are one of the global leaders in safety in the forest industry, but complete elimination of accidents still requires effort. The work continues. The basis of competitiveness The cornerstones of Metsä Fibre s competitiveness are the customer, competence and cost-efficiency. Our operations are based on challenging goal-setting, systematic development and allocation of the resources of the company s staff and our service providers to selected goals. Thus equipped, I believe that Metsä Fibre can provide its customers with high-quality pulp and competent service in 212 and beyond. Ilkka Hämälä CEO CEO'S REVIEW 3

8 strategy Oy Metsä-Botnia Ab is now Metsä Fibre Oy. The renewal is part of the harmonisation of Metsä Group s corporate identity and reflects the change that has taken place in our company in recent years. As a uniform group we can more efficiently use internal synergies, resources and the best practices, not only in Metsä Fibre but throughout Metsä Group. Furthermore, a strong, uniform identity clarifies the image of our responsible operations. We are part of a Finnish forest industry company which is rooted deep in the responsibly managed northern woods. Metsä Fibre is owned by Metsä Group s parent company Metsäliitto Cooperative, Metsä Board and UPM-Kymmene. The solid Botnia product family The name Botnia will remain in our products and services. The Botnia product family comprises our long-fibre softwood pulp Botnia Nordic Pine, the short-fibre pulp Botnia Nordic Birch and the strong reinforcement pulp Botnia Nordic Strong. The Botnia products are characterised by high, uniform quality, and they are produced in a responsible manner. End products manufactured from these pulps meet the strict Eco label requirements. Botnia means the most suitable fibre for the customer in the right place at the right time. In addition to the products, the Botnia family includes a wide range of technical and logistic services related to the use and development of fibre. The cornerstones of success Our values reliability, renewal and cooperation lay the foundation for our responsible profitability and our customers success. Our We respond to rapid changes in the global pulp market with continuous renewal. common values are shared by all our employees and guide our daily work. Alongside our values, we are also guided by our ambition to constantly develop our operations and skills. Annual planning and measurement of operations constitute the backbone of cost-efficiency. We develop our mills in accordance with life cycle plans. Multi-skilled personnel is a success factor for Metsä Fibre. Our ability to produce first-class fibres that are suitable for the customers is based on our competent staff. Therefore, the skills development and personnel training are in a key position. The operations of Metsä Fibre are based on a finished process model and a simple, transparent structure. We have created our operating model with the needs of our customers in mind. The customers are our partners, and we want to help them to develop their operations and the quality of their products. Metsä Fibre offers its customers a diverse product range and extensive fibre know-how. Continuous renewal Metsä Fibre builds its future as part of strong Metsä Group. Cost-efficient production of northern softwood pulp lays a solid foundation for the future. We listen to our customers and monitor changes in the operating environment. We respond to rapid changes in the global pulp market with continuous renewal. VALUES vision Responsible profitability We bear responsibility for the environment, our partners and each other to ensure successful business operations. Good performance provides the foundation for continuous improvement of operations. Reliability Our success is based on long-term cooperation with our stakeholders. We understand that our customers success depends on reliable availability of high-quality pulp, advanced technical services and reliable support services. Delivery of consistent-quality pulp exactly at the agreed time is a matter of honour for us. Cooperation We improve our operations in cooperation with our customers and distribute knowledge and best practices to each other. We operate as one group, using mutual synergies and relying on joint benefits. Renewal Metsä Fibre is committed to continuous improvement of all its operations. We are aware of environmental challenges and have the courage to question old practices in order to provide our customers with better products and services in support of their particular business operations. To be the preferred supplier for high-quality pulps and services that bring benefit to customers' business. MISSION To be the most competitive and efficient player in the pulp industry. 4 STRATEGY

9 Key events in 211 February Investment in a gasification plant at the Jousteno mill is announced. The plant will improve the efficiency of renewable energy. April Metsä Fibre, Oy Botnia Mill Service Ab and Andritz Oy sign a consortium agreement to integrate the process development and process maintenance at the Joutseno mill into an efficient package. June Metsä Group increases its shareholding in Metsä Fibre by purchasing shares from UPM-Kymmene. After the redemption, Metsäliitto Cooperative owns about 57 per cent of the company, Metsä Board about 32% and UPM-Kymmene about 11%. September Metsä Fibre initiates a preliminary survey with Gasum and Helsingin Energia on the construction of a biogas-generating biorefinery in Joutseno. Metsä Fibre invests in the treatment of mild malodorous gases at the Äänekoski mill. The investment includes increasing the scrubber and collection capacity for the collection of vapours and gases. The new cutting station in the debarking plant at the Äänekoski mill starts up. October The causticising and water plants built at the Kemi mill start up in October 211 (the causticising plant) and February 212 (the water treatment plant). BOARD OF DIRECTORS Kari Jordan Chairman, Metsä Group, President and CEO Hannu Anttila Member, Metsä Group, Executive Vice President, Strategy Martti Asunta Member, Metsäliitto Cooperative, Chairman of the Board Mikko Helander Member, Metsä Board Corporation, CEO Juha Mäntylä Member, Metsä Forest, Executive Vice President Tapio Korpeinen Member, UPM-Kymmene Corporation, Chief Financial Officer Tapani Sointu Deputy Member, UPM-Kymmene Corporation MANAGEMENT GROUP Ilkka Hämälä CEO Ismo Nousiainen Senior Vice President, Production Kaija Pehu-Lehtonen Senior Vice President, Business Development Ari Harmaala Senior Vice President, Sales and Marketing Mikael Westerlund Senior Vice President, Finance KEY EVENTS IN 211 5

10 metsä Fibre in 211 On the whole, the company s profitability remained good, even though demand for pulp and the price level fell towards the end of the year. Mills set production records and investments progressed on schedule. The building of a gasification plant began at the Joutseno mill, and a new causticising plant and water plant were completed at the Kemi mill to improve the reliability of production and environmental performance. Metsä Fibre will continue its work to improve cost-efficiency and plant utilization rate. In addition, the bark gasification plant at the Joutseno mill to be completed in the summer 212, will reduce carbon dioxide emissions and improve environmental efficiency. On the whole, 211 was good for Metsä Fibre, even though the uncertainty of the market caused reductions in demand and prices, which weakened the company s sales and profitability. On the other hand, in the latter half of the year the exchange rate development between the euro and the US dollar was favourable for the company. Metsä Fibre s sales totalled EUR 1,31 million, and the operating result excluding non-recurring items was EUR 267 million, down by about one-third from 21. The technical condition of Metsä Fibre's mills is excellent, as demonstrated by the annual production records set at the Joutseno, Rauma and Äänekoski mills. The total production volume was 2,25,77 tonnes. Fall in pulp price is levelling off The favourable development of pulp prices continued throughout the first half of the year, and the price of softwood pulp peaked at USD 1,2 in the summer. Prices took a downward turn and pulp stocks increased in the third quarter as demand decreased first in Asia and then in Europe, and many pulp, paper and board manufacturers announced production cutbacks. Towards the end of the year, there were signs of a halt in the price decrease. No considerable increase was seen in the market pulp capacity 211. The closing of straw pulp mills and the shift to viscose pulp at some mills slightly decreased the supply of pulp. Investments in improving environmental performance continued The Metsä Fibre mills are continuously improved through good maintenance and maintenance investments. In 211, investments focused on the improvement of energy efficiency and environmental performance. Metsä Fibre s most important investments of the year were the new causticising and water plants at the Kemi mill. They started up in the last quarter of the year. In addition to improving the mill s operating reliability, they decrease interruptions in production and environmental impacts. The company has worked systematically to reduce its energy consumption and to increase its energy production. In February, Metsä Fibre s Board of Directors decided on a major bioenergy investment: a bark gasification plant at the Joutseno mill. When the plant is completed, the mill will be running solely on self-produced biofuel. What makes the plant unique is the overall concept: biogas is produced from bark dried with surplus heat from 6 METSÄ FIBRE IN 211

11 Production Capacity Personnel* PULP MILLS, 1, TONNES Joutseno Kemi Rauma Äänekoski Total 2,25 2,173 1,878 2, Capacity utilisation % Metsä Svir SAWN GOODS 1, m * Personnel at year end An innovative organisation culture the mill to replace the natural gas used in the lime kiln. The building of the gasification plant progressed on schedule, and it is expected to start up in mid-212. In addition to the ongoing gasification plant investment, Metsä Fibre is engaged in a preliminary survey with Gasum and Helsingin Energia on the construction of a biogas-generating biorefinery at the Joutseno mill. The potential refinery would use renewable wood raw material, bark and forest chips to generate environmentally friendly methane which would be distributed via the natural gas network to consumers. The investment decision will be made in 213 at the earliest. The RFID system developed for the automatic tracking of pulp units was implemented at the Rauma and Kemi mills in the second half of the year. The Äänekoski and Joutseno mills and the most important loading and unloading ports will implement the system in the first quarter of 212. The RFID system enhances supply chain management and improves the accuracy of deliveries. Metsä Fibre redeemed its own shares from UPM-Kymmene Corporation on the basis of a shareholder agreement signed in 29. The number of the redeemed shares corresponds to 6.7 per cent of Metsä Fibre's entire stock. Metsäliitto Cooperative owns about 57 per cent of Metsä Fibre, Metsä Board owns 32 per Metsä Fibre continuously improves its operations in order to strengthen its competitiveness. We are actively looking for new solutions to improve our business operations and support our customer-driven approach. In addition, we investigate new business opportunities that support our core business. For example, the RFID system, which is based on remote identification of pulp units, provides new opportunities for the logistics chain and customers in product identification. At Metsä Fibre, innovativeness means how to do more smartly what we are doing now. Multi-skilled personnel makes continuous improvement possible. However, in order to succeed we also need close process cooperation with equipment manufacturers. For example, the Joutseno mill is now engaged in new maintenance process development collaboration, where the equipment manufacturer has a clearly stronger role than before in the process development at the mill. Metsä Fibre is about to launch a systematic innovation programme. All employees in the company can enter their ideas in the joint system, and the best ideas will be further developed together, based on a transparent operating model. The purpose of the new innovation process is to harness all creativity and ideas in the company for the development of new operating methods and products. cent and UPM-Kymmene about 11 per cent. Metsä Group has a two-year call option for the remaining Metsä Fibre shares held by UPM- Kymmene Corporation. WOOD CONSUMPTION REDUCTION WAS ANALYsED In 211, our fibre experts helped customers with a range of issues, such as how best to utilise fibre mixes. Process development focused on improving the cooking process yield in order to decrease the consumption of wood. The research collaboration promotes the goals of our current business and the investigation of new business opportunities. Metsä Fibre is an owner of Forestcluster Ltd and participates in the planning, implementation and funding of its research programmes. Significance of the Asian markets is increasing The uncertainty in the economy makes the near-term outlook challenging. However, the long-term demand outlook, particularly for board, continues to be strong, and the Chinese market is expected to pick up after the first months of 212. The importance of the Asian market for Metsä Fibre will continue to grow. Metsä Fibre focuses on anticipatory work and the development of in-depth special expertise to increase the production levels and improve the plant utilization rate at mills. The company will also reinforce its role as a producer of renewable energy. METSÄ FIBRE IN 211 7

12 responsibly our business is responsible. this means we aim for profitability in a responsible manner, take care of our environment and society and look after the well-being of our staff. investments improve environmental Performance wood-based by-products SuStainably managed raw material 3.5 % 1 % 82 % the new water Plant at the kemi mill improves heat recovery at the mill, reducing annual heat consumption by 3.5 Per cent. the SurPluS electricity and heat as well as bark, tall oil and turpentine, account for ten Per cent of metsä fibre S total SaleS. our main raw material is wood that has been responsibly Sourced and delivered from SuStainably managed forests. of the wood used by metsä fibre, 82 Per cent is certified. 8 RESPONSIBLY

13 The most responsible choise Not a splinter of wood used by Metsä Fibre s pulp mills is wasted; in addition to pulp, wood is converted into various by-products and energy electricity, heat and steam. A pulp mill is a modern biopower plant that generates more energy than it needs. Hard work to reduce effluents The volume of Metsä Fibre s effluents has been reduced by 25% during the past five years. Forerunner in occupational safety In four years, the accident frequency has fallen to one third of the initial level. In 211, the accident frequency was 6.6. Joutseno mill to become a carbon dioxide neutral production plant Metsä Fibre wants to be a forerunner in the use of bioenergy. The company is building a bark gasification plant at the Joutseno mill. It will produce bioenergy that will be used in the lime kiln instead of fossil fuel. The mill will become a completely carbon dioxide neutral unit during normal operation. In the summer 211, Metsä Fibre started building a bark gasification plant at the Joutseno mill. The investment will replace the fossil fuel used in the lime kiln with biofuel produced from tree bark. In addition, surplus heat from the mill will be used for the drying of bark at the gasification plant. The gasification plant complex is new in its kind. What makes it unique is the overall concept: biogas produced from bark dried with surplus heat from the mill replaces the fossil fuel (natural gas) in the lime kiln. The plant investment will improve cost efficiency at the Joutseno mill and reinforce the mill s environmental performance at the same time. The gasification plant will be completed in June 212. Pulp mills are important producers of renewable energy. When chipped wood is cooked in the pulping process, about half of the used wood is dissolved in the pulping liquor. The combustion of the residual pulping liquor, black liquor, generates a large amount of energy to be used by the pulp mill itself and delivered to external customers. One Metsä Fibre pulp mill produces enough eco-electricity to satisfy the energy needs of 3, electrically heated Finnish single-family homes. The gasification plant investment makes Metsä Fibre a pulp industry forerunner in the efficient production and use of bioenergy. RESPONSIBLY 9

14 Sustainable and responsible business Metsä Fibre is committed to sustainable development throughout the supply chain. Metsä Fibre develops its business responsibly in order to continuously improve its services and to ensure successful and sustainable performance also in the future. The development of mills is based on longterm life cycle planning. Metsä Fibre plans its investments, major repairs and development measures for the whole life cycle of the mill as cost-efficiently as possible. Metsä Fibre is committed to sustainable development throughout the supply chain. Moreover, the company requires that its partners are also committed to sustainable and responsible operations. Continuous improvement ensures competitive mills Metsä Fibre s mission as the most cost-efficient pulp supplier requires it to continuously improve the efficiency of its mills. The company ensures the striking force of its plants with investments and by focusing on their usability rate and operating methods. In 211, the investments focused on improving the consistency of pulp quality, costefficiency and the reliability of mill operations. For example, a new cutting station was completed at the Äänekoski mill. It improves the efficiency of the harvesting and transportation chain and decreases wood wastage during debarking. Particular focus was placed on cooperation between Metsä Fibre, its partners and equipment manufacturers. A consortium agreement was signed between Joutseno mill, Botnia Mill Service and Andritz concerning daily maintenance and process development. An even closer cooperation provides a good foundation for continuous improvement of operations at the mills. Leader in occupational safety The company has achieved a top level position in the forest industry for its low accident frequency. In four years, the accident rate has fallen to one third of the initial level. In 211, the accident rate was 6.6. A good level of occupational safety provides an excellent basis for the improvement of overall efficiency. Occupational safety has improved as a result of long-term work. Metsä Fibre has implemented an occupational safety management system based on anticipation. As a result, the personnel is committed to making safety observations, the mills arrange Safety Walks and supervisors organise brief Safety Talks. Each mill has established goals and indicators for anticipatory safety work. Metsä Fibre s successful occupational safety management model will be implemented in the safety culture of the Group's other business areas. Building deeper competence The personnel s competence is an integral part of Metsä Fibre s responsible way of working. The company invests in systematic HR development. The goal of Metsä Fibre s key personnel programme is to ensure top-level key resources and competitiveness in future challenges. The programme has been renewed and it is part of the HR development process. The development of the production personnel s multiple skills model continued, and in 212 it will be fully implemented. HR development continued with the focus on the depth of competence. This ensures the necessary reliability of mill operations and the personnel s ability to successfully manage processes in operation malfunctions. A workplace functionality survey covering the company s entire organisation is carried out each year. Focus on environmental management Metsä Fibre works actively in improvement of environmental performance. The company invests in the continuous improvement of its 1 SUSTAINABLE AND RESPONSIBLE BUSINESS

15 Occupational safety - No. of accidents at work, own personnel: No. / million work hours Proactive safety work safety observations: No , 5, 4, 3, 2, 1, Resident panel monitors odour emissions in Rauma equipment and operating methods and uses all raw materials effectively. Kemi mill's new causticisation and water plants improve the reliability of the mill s operations and reduce the environmental load on both waterways and the air. In Äänekoski, the improved effectiveness of malodorous gas processing has helped reduce emissions in the air. Each Metsä Fibre mill succeeded in reducing their COD emissions compared to the previous year. Internal targets that are stricter than the permit values imposed by the authorities have been set for all environmental indicators. The usage of water has traditionally been high in the pulp industry. To reduce the usage of water, Metsä Fibre is investing in its equipment and the continuous improvement of its operating methods. As a result, the volume of Metsä Fibre s effluents has been reduced by 25 per cent during the past five years. The company is still actively seeking technical solutions to increase the reuse of water in the mills' processes. Metsä Fibre, bioenergy trailblazer Thanks to targeted investments and systematic improvement of energy efficiency, Metsä Fibre is an efficient producer of bioenergy. All our mills produce more energy they use. One-fifth Discomfort: Proportion of residents who experienced the odour disturbing, % In Finland, there is no direct reference value for odours. According to the survey odour may be regarded as discomfort when 25 3 per cent of residents experience the odour disturbing. of the electricity produced with wood-based fuels in Finland is created at Metsä Fibre pulp mills. We sell almost 4 per cent of the energy we produce as carbon dioxide-neutral electricity and heat. The excess electricity and heat, along with the by-products of pulp manufacturing, comprise ten per cent of Metsä Fibre s net sales. Metsä Fibre participates in the Energy Efficiency Agreement of Finnish industries and has undertaken to improve the efficiency of its energy usage together with Metsä Group's other business areas A resident panel survey was carried out in Rauma in 211 for the fifth time to investigate the presence of odour and odour nuisance around Metsä Fibre's Rauma mill and Forchem's production plants. Compared with the results of similar surveys from previous years, the average frequency of odour emissions from the pulp mill has remained nearly the same, one per cent, and the frequency of odour nuisance has decreased from one per cent to less than one per cent. The percentage of residents who found the odour of the pulp mill disturbing rose slightly from eight to thirteen per cent. Sustainably managed raw material The main raw material of Metsä Fibre is wood that has been responsibly sourced and delivered from sustainably managed forests. The origin of wood is always known, and most of the wood used by Metsä Fibre comes from Finnish forests. Of the wood used by Metsä Fibre, 82 per cent is certified. At full capacity, Metsä Fibre's mills use about 12.5 million cubic metres of wood per year. The wood coming to the mills is used in its entirety. About half of the raw material is used for pulp production, while the rest is used for bioenergy, tall oil and turpentine. SUSTAINABLE AND RESPONSIBLE BUSINESS 11

16 Specific emissions from pulp mills in the Nordic countries Specific emissions from Metsä Fibre's, and other Finnish and Swedish mills producing bleached sulphate pulp are compared below. The figures for Finnish mills in 21 come from Finnish Forest Industries Federation and the figures for Swedish mills from Swedish Forest Industries Federation. Chemical oxygen demand: (COD Cr ) kg/adt Metsä Fibre mills 211 Finnish mills 21 Swedish mills Joutseno Äänekoski Rauma Kemi Chlorine and other halogens bound to organic material in effluent: (AOX) kg/adt Metsä Fibre mills 211 Finnish mills 21 Swedish mills 21,25 Äänekoski Kemi Rauma Joutseno,2,15,1,5 Phosphorus: (P) g/tp Metsä Fibre mills 211 Finnish mills 21 Swedish mills Kemi Rauma Joutseno Äänekoski SPECIFIC EMISSIONS FROM PULP MILLS IN THE NORDIC COUNTRIES

17 Material balance Emissions to air - Sulphur t (SO 2 ) Nitrogen oxides t (NO 2 ) 4,7 - Carbon dioxide, fossil (t) 244, - Particles (t) 88 Raw material - Wood (k-m 3 ) 11,84, Fuels - Fossil fuels (GWh) 1,64 Water - Process and cooling water (m 3 ) 168,, Products * - Pulp (t) 2,25,78 - Tall oil (t) 71,699 - Turpentine (t) 2,878 - Sawn goods (m 3 ) 196,121 - Electricity (GWh) 59 - Heat (GWh) Bio fuel (GWh) 1,44 * includes only products sold. Effluents - Chemical oxygen demand COD cr (t) 26,971 - Biological oxygen demand BOD7 (t) Phosphorus (t) 3 - Nitrogen (t) AOX (t) 277 Solid waste - Landfill waste (t) 48,837 - Hazardous waste (t) 157 Certificates METSÄ FIBRE S MILLS IN FINLAND Quality Management System SFS-EN ISO 91 Environmental Management System SFS-EN ISO 141 Occupational Health and Safety Management System OHSAS 181 Food Safety Management System SFS-EN ISO 22 Chain-of-Custody Management System FSC Chain of Custody and Controlled Wood and PEFC Chain of Custody and the use of the PEFC logo Energy efficiency system (EES), EN 161 Kosher certificate, Äänekoski mill METSÄ SVIR Quality Management System ISO 91 Environmental Management System ISO 141 Occupational Health and Safety Management System OHSAS 181 Chain-of-Custody Management System FSC Chain of Custody and Controlled Wood and PEFC Chain of Custody MATERIAL BALANCE 13

18 Environmental balance 211 Annual production Joutseno Kemi Rauma Äänekoski Svir Total 211 Total 21 Pulp t 63,35 531,82 567,1 53,213 2,25,78 2,173,264 Sawn wood m 3 196, ,121 27,724 Wood consumption Total wood consumption 1, m 3 3,269 2,677 3,112 2, ,84 11,741 Certificated wood % Effluents Waste water Process water volume 1, m 3 18,327 18,916 13,95 14, ,17 64,235 Total suspended solids t ,4 1,588 Chemical oxygen demand (COD) t 6,48 7,216 7,615 5, ,971 29,519 Biological oxygen demand (BOD) t Phosphorus (P) t Nitrogen (N) t AOX t Air emissions Sulphur dioxide (as SO 2 ) t TRS (as S) t NO x (as NO 2 ) t 1,67 1,44 1, ,7 3,77 CO 2 from fossil sources 1, t CO 2 from biomass 1, t 1,366 1,28 1, ,647 4,576 Particles t Waste Landfill waste t 13, ,646 15, ,837 98,769 Hazardous waste t Energy Wood based fuel use GWh 3,756 3,322 3,277 2, ,782 12,585 Fossil fuel use GWh ,64 1,74 ELECTRICITY SOLD GWh HEAT SOLD GWh ,17 14 ENVIRONMENTAL BALANCE 211

19 ENVIRONMENTAL IMPACT MANAGEMENT Effluents In 211, production at Metsä Fibre s four pulp mills was at a record level. The effluent load into waterways also remained at a good level. Emissions to water of oxygen-demanding organic material (COD) were reduced at all mills, particularly in Joutseno and Kemi, in the reporting year. Effluent volumes as well as suspended solids and nutrient emissions remained at the previous year s level despite occasional disturbances in the treatment of wastewater. The allowed amount of phosphorus was exceeded in Joutseno and Äänekoski at a monthly level. Reasons for this included momentary disturbances in production which increased the phosphorus content of wastewater flowing to the treatment plant. In Rauma, there was a malfunction at the forest industry s and city of Rauma s joint treatment plant in September, resulting in exceeded permit conditions for phosphorus and nitrogen emissions. Air Malodorous gas emissions remained unchanged compared to the previous year. The efforts to reduce sulphur dioxide emissions at the Kemi mill were successful. In Äänekoski, particulate emissions decreased considerably due to the improved processing of combustion gases. In Kemi, some odour emissions were experienced due to production disturbances. In Rauma, problems in the combustion gas processing equipment resulted in surpassing the monthly permit limits in individual cases. previous year. This was due to the increased use of waste as material for land reclamation. In 211, trial use of process waste as soil enrichment material for agricultural land was launched. Combustible waste and primary and organic sludge were either sold as fuel in addition to bark or burned in the bark-fired or recovery boilers of the mills. Development projects The new duct stripper commissioned at the Joutseno evaporation plant reduced the organic load to the wastewater treatment plant significantly. The process changes implemented made it possible to reduce the usage of water at the mill. At the end of 211, a causticisation investment was commissioned in Kemi, improving the recovery of chemicals and reducing emissions into the air. The oxidised white liquor treatment equipment commissioned in Rauma enables the mill to adjust chemicals more accurately than before. The processing of combustion gases from the lime kiln was improved by renewing the supply line for service chemicals in the scrubber. In the reporting year, a fifth resident panel was organised with the task to monitor odour issues caused by the pulp mill in the residential area in question. The environmental noise pollution report of the mill was updated and sorting of waste was streamlined. In Rauma, the use of secondary condensate as process water was increased, resulting in lower hydraulic and heat load of wastewater flowing to the treatment plant. All secondary condensate generated in the process is utilised. In Äänekoski, the processing capacity for weak malodorous gases was increased and new sites were added for collecting gases. The mill s capacity to treat combustion gases was increased by replacing the separator field of the electrostatic precipitator. In Äänekoski, a development project improving the operations of the wastewater treatment plant was completed, resulting in improved management of nutrient emissions. Environmental investments at Metsä Fibre's Finnish mills : eur million Waste management The volume of waste generated in production decreased during the reporting year. Similarly, the total volume of waste transported to landfills decreased considerably compared to the ENVIRONMENTAL IMPACT MANAGEMENT 15

20 Environmental permits Joutseno Kemi Rauma Äänekoski Effluent Eastern Finland Regional State Administrative , Vaasa Administrative Court and the Supreme Administrative Court Northern Finland Regional State Administrative and Vaasa Administrative Court Western Finland Regional State Administrative , Vaasa Administrative Court and the Supreme Administrative Court Eastern Finland Regional State Administrative and the Supreme Administrative Court Emissions Eastern Finland Regional State Administrative , Vaasa Administrative Court and the Supreme Administrative Court Northern Finland Regional State Administrative and Vaasa Administrative Court Western Finland regional state administrative , the Supreme Administrative Court Vaasa Administrative Court Noise Eastern Finland Regional State Administrative , Vaasa Administrative Court and the Supreme Administrative Court Regional State Administrative Agency of Northern Finland Western Finland Regional State Administrative , the Supreme Administrative Court Vaasa Administrative Court Solid waste Eastern Finland Regional State Administrative , Vaasa Administrative Court and the Supreme Administrative Court A separate landfill permit Northern Finland Regional State Administrative and Vaasa Administrative Court Western Finland Regional State Administrative , the Supreme Administrative Court Central Finland Centre for the Environment Glossary AOX (Adsorbable organic halogens) indicates total concentration of chlorine bound to organic compounds in waste water. BOD 7 (biological oxygen demand) is a measure of the amount of oxygen needed by microorganisms to break down solids and other readily degradable organic matter present in effluent in seven days. Carbon dioxide (CO 2 ) is gas produced in burning. Elevated levels of atmospheric carbon dioxide have been found to accelerate the greenhouse effect. COD Cr (chemical oxygen demand) is the amount of oxygen consumed in complete chemical oxidation of matter present in effluent. It indicates oxygen consumption by slowly degradable organic matter present in effluent. N stands for nitrogen which is the main constituent of air (about 79%). Nitrogen arriving in waters airborne, bound in wood raw material or in chemical compounds causes eutrophication. NO X is collective symbol for nitrogen oxides; produced partly during combustion and partly by reaction between oxygen and nitrogen in the atmosphere. Nitrogen oxides are present in flue gases and vehicle exhaust gases. They form acids and nutrient compounds causing eutrophication. P stands for phosphorus, a nutrient causing eutrophication in receiving waters. In the forest industry phosphorus mainly originates in wood raw material. Sulphur dioxide (SO 2 ) is a gas produced by burning sulphurcontaining fuels and as a by-product in chemical pulping. Reacts with oxygen and water vapour in the air to produce sulphuric and sulphurous acids, which dissolve in rain, causing acidification of soil and water. Suspended matter Wood material present in water as a result of debarking and pulp production as well as impurities solidified during waste water treatment. Can be removed from waste water through sedimentation of filtration. TRS (Total Reduced Sulphur). Refers to compound containing sulphur that escape into the air from sulphate pulp mills and are malodorous even in minute quantities. In modern pulp mills in normal operations they are burned. 16 ENVIRONMENTAL IMPACT MANAGEMENT

21 ContaCt information Metsä Fibre Oy P.O. Box 3 FI-22 Metsä, Finland tel () fax () Mills in Finland Metsä Fibre Oy Joutseno mill FI-5412 Pulp, Finland tel () fax () Metsä Fibre Oy Kemi mill FI-942 Kemi, Finland tel () fax () Metsä Fibre Oy Rauma Mill P.O. Box 165 FI-2611 Rauma, Finland tel () fax () Metsä Fibre Oy Äänekoski mill FI-441 Äänekoski, Finland tel () fax () sales OFFices Metsä Fibre GMbH Burgstrasse 2-4 D Wiesbaden Germany tel fax Metsä Fibre shanghai Representative Office Unit 116, HSBC Building, Shanghai ifc 8 Century Avenue Pudong New Area Shanghai 212 China tel fax Metsä Fibre s.r.l. Corso di Porta Nuova 15/A 2121 Milan, Italy tel fax sawmill in russia Metsä svir , Leningradskaya oblast Podporozhskij raion Poselok gorodskogo tipa Vazhiny ulitsa Karyernaya, No. 48 Russia tel. +7(812) fax +7(812) PublicatiOn information Papers Cover: Carta Integra 19 g/m 2 Annual review: Galerie Art Silk 15 g/m 2 Graphic design and layout: Zeeland Branding Oy Photos: Metsä Fibre image bank, Aleksi Koskinen, Seppo Samuli Printer: Erweko Oy

22 Metsä fibre p.o. box 3 fi-22 metsä tel