There s more to Metsä than meets the eye Metsä Group general presentation

Transcription

1 There s more to Metsä than meets the eye Metsä Group general presentation

2 Metsä Group

3 Metsä Group The world needs Metsä Our products come from the forest We are Metsä Group. We use northern wood to create the business of the future. We provide our customers and consumers with premium recyclable products and services. Our business is based on renewable wood raw material which is grown, procured and processed responsibly Juha Mäntylä

4 Key figures 2016 METSÄ GROUP Sales EUR4.7 billion Personnel 9,300 METSÄLIITTO COOPERATIVE Group s parent company Owned by 104,000 Finnish forest owners METSÄ FOREST METSÄ FIBRE METSÄ WOOD METSÄ BOARD METSÄ TISSUE Wood supply and forest services Pulp and Sawn Timber Wood products Paperboard Tissue and cooking papers Sales: EUR 1.5 billion Sales: EUR 1.6 billion Sales: EUR 0.5 billion Sales: EUR 1.7 billion Sales: EUR 1.0 billion Personnel: 900 Personnel: 1,250 Personnel: 1,500 Personnel: 2,500 Personnel: 2,750 Renewable energy 22.3 TWh Juha Mäntylä

5 Metsäliitto Cooperative, Metsä Group s parent company The Cooperative has around 104,000 Finnish forest owners as its members. The members own nearly half of Finland's private forests. Any private person or community owning at least 3 hectares of forest in Finland can join the Cooperative. Owner-members participate in the Cooperative's decision-making. Representative Council (60), Supervisory Board (34), Board of Directors (8), District Committees Elections every four years Juha Mäntylä

6 Metsä Group s bioproduct mill Forest industry s biggest investment in Finland EUR 1.2 billion investment Annual pulp production 1.3 million tonnes (currently 0.5) In addition integrated production of new bioproducts Use of wood 6.5 million m³ annually (currently 2.4) 2,500 jobs in the whole value chain in Finland (currently 1,000) Main markets for pulp: Europe and Asia Sales will increase especially in China A unique ecosystem for bioeconomy will be developed in the Äänekoski industry site The mill will be ramped up during the third quarter of Juha Mäntylä

7 Wood supply and Forest services

8 High-quality wood from sustainably managed forests Metsä Forest Finland s market leader in wood trade and forest energy We serve forest owners and reliably deliver wood to the Group's business areas We annually procure around 30 million m³ of wood Mainly from Finland, primarily from Metsäliitto Cooperative's owner-members Wood supply also in Russia, the Baltic countries and Sweden We offer forest owners the best way to sustainably accumulate wealth from the forest they own Especially for the 104,000 forest owner-members of Metsäliitto Cooperative All of our wood originates in sustainably managed forests Olli Leino

9 Metsä Forest - Services to industry and forest owners We serve Finnish forest owners In addition to wood trade, we offer services related to forest ownership, forest asset management, forest income investment and intergenerational transfer of forest assets. A variety of turnkey services for owner-members Our services can be adapted to forest owners' needs. We are forerunner I developing in e-services for forest owners 14 wood supply districts and over 300 contact persons handle wood supply and forest services in Finland. Overall we employ 600 people in Finland. We use contract entrepreneurs for wood harvesting and transports. We employ entrepreneurs and their drivers. We also require our partners to show responsible operations and good harvesting results Olli Leino

10 Metsä Forest - Services to industry and forest owners >20% of roundwood sales electronically Owner-members of Metsäliitto Cooperative can sell timber or buy forest services electronically. Forest owners chooses the most convenient way. All ready >20% of roundwood sales to us were made via internet. The share has been even higher for forest services bought, ~30 percent. Owner-members have access to Metsäverkko- internet service. They can manage all issues related to their forest property. Metsäverkko s mobile application works also offline. With it forest owner can navigate oneself to a forest compartment, plan forest work, prepare timber sale or forest service purchase, update forest data and work suggestions, add notes and photos on plans and acknowledge work as done Olli Leino

11 Procurement and wood supply from forest to mills We buy most of our wood from private forest owners (90%), mainly from our co-operative members The average forest owners estate in south is around hectares The average trade of wood is about 600 m3 in stumpage sale and in delivery sale 200 m3 Our market share is one third of all the market wood Procurement is divided as follows: Stumpage sales 85 % of all trades (Metsä Group has the right to harvest) Delivery sales 15 % (Forest owner delivers the wood to the roadside) Wood is delivered to over 100 mills in Finland Olli Leino

12 Measurement characteristisc

13 Characteristics of Finnish wood measuring Timber volume is determined as real solid volume over bark Relatively small average size of timber storages The wood measuring method can be chosen freely by the seller and buyer from officially accepted wood measuring methods No systematic errors are accepted in any officially accepted method. The required accuracy is defined by measuring method and lot size Timber logistics flow is very rapid from the forest to the mill due to the mechanization level (98%) in standing sales Well-managed data/information is essential Olli Leino

14 Role of measurement Measurement is part of wood procurement process Measurement serves needs of all stakeholders From forest to mill Information to operations and processes Harvester measurement is done nearly 90% Base of bucking, payments to seller and contractor, logistic reasons Mill measurement is done on most transported wood Base of payments to seller and contractor, material flow, storages and control Measurment data is used to balance costs and business process Costs and needs are considered in entire supply and logistic chain Olli Leino

15 Measuring methods in wood sales The measuring method is agreed in advance Method Place Measurer By the harvester Forest Harvester driver Pile scaling Storage Buyer s foremen Weight scale Storage Truck driver At the mill Mill/terminal Buyer s organisation Measurement costs are paid by the byer No common timber quality and dimension measurement requirements In standing sales buyer is responsible that harvested timber is according to quality and measurement requirements In delivery sales seller is responsible that timber is according to quality and measurement requirements Olli Leino

16 Scaling methods for forest owners 2014 (round wood, privately owned forests) 100 % 90 % 80 % 70 % 60 % 50 % 40 % 30 % 20 % 10 % 0 % Standing sales Delivery sales Average Harvester At mill Weight scale At roadside Olli Leino

17 Scaling methods at mills 2014 (round wood) Log scaling methods Pulpwood scaling methods Stacked measure ment 3 % Weight sampling 39 % Stacked measure ment 12 % Image scanning 10 % 3D log scanning 58 % Bundle sampling 24 % Weight sampling 54 % Olli Leino

18 Wood supply - Processes and solutions

19 Wood supply process - relation to ICT-solutions Utilization of ICT-solutions in finnish wood supply process has been high for decades Metsä Forest took GIS and GPS into use in late 90 s Solutions are developed to support the business processes however, it would be really difficult to run the process without ICT-solutions Forest Purchase Harvesting Transportation Mill Olli Leino

20 Simplified Wood Supply Process - IT Systems Metsäverkko member portal MF Kotka UI Wood purchase and forest services MF Karhu UI Production Entr. WoodForce Bioenergy MF Otso UI Logistics Entr. LogForce Mill Mill scale (MWh) MF Kuva Seller Purchase m3 estimate Harvesting (round wood) Harvester (m 3 ) Transportation Advance wood payment Wood payment location and m 3 estimate Delivery sales m 3 estimate m 3 / storage point Vendor invoicing m 3 / storage point / contract Vendor invoicing Weight scale (m 3 ) Mill Mill scale (m 3 ) External supplier Wood payment m 3 / contract Invoicing SAP ERP - Purchase contract number GIS Database spatial data Olli Leino

21 Dataflow from forest to mill Purchase: Contract Id estimate on the m 3 All geometry data; storage points, parcel borders and markers, retention tress, logistic, safety, environmetal information, warnings etc Harvesting Work orders contain all the map data Use of GPS, accurate volume and assortment data on storage-points, operative markers added if needed Transportation Work orders contain storage-points and volumers, all map data related to the contract Olli Leino

22 Wood supply planning process Annual Wood supply planning Monthly Procurement planning (purchase and harvesting) Transportation planning Operative Harvesting planning Transportation steering MEASURING INFORMATION Operations Material flow Purchase Harvesting Transportation Forest Reserves Storages Customer Olli Leino

23 Delivery planning process / logistics Delivery volumes are planned based on customer wood orders, Mill inventory, external deliveries and imported wood Monthly estimate on own wood procurement need covering all assortments Monthly estimate is further divived into daily level Based on mill reception calender, logistics conditions and capacity, inventory and harvesting plan Operational 3 week transportation plan plan on day-level is calculated every week Accurate logistic plan for the next week Adjusts the monthly levels based on harvesting realizations, inventory and other conditions. Work orders are generated based on the logistic plan and further send to the LogForce / transport entrepreneurs Olli Leino

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