SCA Skog SCA Skog in brief Manages 2.6 million hectares forest land, of which 2 million is used for timber production. Supplies SCAs Swedish industries with wood raw materials. Comprises five forest districts, one unit for wood procurement, two seedling nurseries and one unit for aggregate products. Fulfills the critera for responsible forest management according to FSC® and PEFC™. Key figures Employees Harvest, million cu.m. Harvest of purchased timber, million cu.m. 2012 2011 460 4.0 470 4.4 2.7 2.6 SCA Skog / September 2013 2 SCA Skog - Employees 460 employees - 350 men and 110 women. We are located at more than 40 places, from Sundsvall in the south to Kiruna in the north. At SCA Skog works for example: Wood purchasers, production leaders, forest ecologists, economists, economy assistents, IT project leaders, nature conservation specialists, transport leaders, map technicians,marketing managers, development managers, production managers, land surveyors, map engineers and forest machine drivers. SCA Skog / September 2013 3 Forestry data 2012 SCA’s own forests Annual harvest, million cu.m. Annual harvest area, hectares, Thinning, incl. alternative forestry methods, hectares, Share of thinning (volume), % Silviculture acreage 4.0 17,000 15,000* 16 73,139 (precommercial thinning, soil preparation, planting), hectares. *Thinning is hard to estimate due to the storm Dagmar. SCA Skog / September 2013 4 The overall objectives Photo: Anna Gullers to supply SCAs Swedish industries long term with wood raw materials to manage and develop the SCA forest holdings over the long term to operate at a satisfactory profit level SCA Skog / September 2013 5 Vision SCA Skog aims to be the leader in sustainable and profitable forestry, and therefore the preferred choice of forest owners. SCA Skog / September 2013 6 SCA’s forest holdings and industries in northern Sweden 2.6 million hectares of forest land, of which 2 million is used for timber production. Kraftliner mill Paper mill Pellet mill Pulp mill Sawmill Sawmill, partly-owned Further processing and distribution Munksund Obbola Rundvik Stugun Gällö SCA Skog / September 2013 Bollstabruk Härnösand Östrand Tunadal Ortviken 7 Organisation SCA SKOG Mats Sandgren Staff units shared with the Business group Business Development and Market Analysis Tommy Sundin Legal Affairs Jan Svedjebrant Business Intelligence and Market Analysis Kristian Areskog Staff units Communications Finance Human Resources IT Real Estate Silviculture Technical Development and TQM Rolf Edström Hillevi Mörtberg Lena Westman Göran Wikström Anders Sjögren Pelle Gemmel Magnus Bergman Profit Centers Forest Districts Wood Procurement Forest Seedlings Aggregates Norrbotten Ångermanland Morgen Yngvesson Björn Larsson Västerbotten Birgitta Boström Wood Raw Material Jörgen Bendz NorrPlant Jörgen Andersson Aggregate products Walter Jonsson Medelpad Göran Tjernberg Jämtland Sven Lindroth SCA Skog / September 2013 8 Organisation – Forest districts District Forest Officer Development Manager Finance/Adm Production Manager Forestry Manager Marketing Manager Production Supervisor District Supervisors Timber Purchasers Timber Specialist Prod. supervisor Forest roads SCA Skog / September 2013 9 Forest districts Norrbotten, Piteå Västerbotten, Umeå Ångermanland, Bollstabruk Jämtland, Östersund Medelpad, Sundsvall SCA Skog / September 2013 10 A wood purchasing company To satisfy the increasing needs of wood for the industry, SCA Skog has gradually built up an organisation for the purpose of procuring raw materials from private forest owners in Northern Sweden. Today, the Group has some 60 wood purchasers and marketing managers from Sundsvall and further north. SCA aims to be the best partner for a longterm business relationship. Our quality-assured work methods place forest owners and their needs in focus. All of the knowledge and experience that SCA has gained in its own forests is now being offered to other forest owners, and we place the same high standards and do the same meticulous work in private forests as we do in our own forests. SCA Skog / September 2013 11 Standing timber volume 300 million cu.m. Forecast Nature consideration 250 Today 200 Pinus contorta Decidous trees Measured Spruce 150 Pine 100 50 0 1947 1953 1968 1976 1984 1996 2006 2016 2026 2036 2046 2056 Historic data is recalculated and based on area of forest land year 2006. SCA Skog / September 2013 12 Timber felling from own forests 1950-2011 5 million cu.m. Cutting plan Timber harvest 4 3 2 1 0 50 55 60 65 70 75 80 85 90 95 00 05 10 Historic data is recalculated and based on area of forest land year 2006. SCA Skog / September 2013 13 Potential harvest 6 million cu.m./an 5 Pinus contorta 4 3 Final felling 2 1 Thinning 0 2006 2016 2026 2036 2046 2056 2066 2076 2086 2096 Gallring SCA Skog / September 2013 14 Age class distribution 18 16 14 12 10 8 6 4 2 0 Area % 0 10 20 30 40 50 60 70 80 90 100 110 120 130 140 Age of forest, years SCA Skog / September 2013 15 Area of final felling, reforestation and precommercial thinning 1950-2012 40 1,000 hectares 35 Precommercial thinning 30 25 Final felling 20 15 10 Reforestation (planting) 5 0 50 54 58 62 66 70 74 78 82 86 90 94 98 02 06 10 Incl. Scaninge Timber from 2002 SCA Skog / September 2013 16 Silviculture acreage excl fertilization 1980-2012 1,000 hectares 100 80 Precommercial thinning -"- deciduous trees 60 Beeting Planting, manual 40 Planting, mechanical Sowing 20 Soil preparation Cleaning 0 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 Incl. Scaninge Timber from 2002 SCA Skog / September 2013 17 Seedling consumption 1974-2012 60 million seedlings 50 40 Larch 30 Pinus contorta Spruce 20 10 0 74 77 80 83 86 89 92 95 98 01 04 07 10 Incl. Scaninge Timber from 2002 SCA Skog / September 2013 18 Total area Pinus contorta 1973-2011 300 250 1.000 hectares Planted each year 200 150 100 50 0 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 Inkl. Scaninge Timber fr o m 2002 SCA Skog / September 2013 19 Mechanical methods used for soil preparation 1967-2011 30 1,000 hectares 25 Excavator 20 Bräcke Planter 15 Mounder Silva Nova 10 Disc trencher Plough 5 Patch removing 0 67 71 75 79 83 87 91 95 99 03 07 11 Incl. Scaninge Timber from 2002 SCA Skog / September 2013 20 Cost development Silviculture 1985-2012 220 Index 200 Consumer price index 180 160 140 120 Silviculture 100 80 60 85 88 91 94 97 00 03 06 09 12 SCA Skog / September 2013 21 What do we get from one tree? PULP WOOD is refined to example publication papers, tissue, containerboard 1 hectare GROT (branches and tree tops) will heat 3 houses/year SAWLOGS becomes planks and boards, and most of it will be refined to high quality solid-wood products 1 hectare STUMPS will heat 7 houses/year SCA Skog / September 2013 22 Main objectives nature consideration Our nature conservation program has three main objectives: to sustain essential ecological processes and life-support systems such as the circulation of fresh water and the preservation of soil fertility to preserve genetic diversity Photo: Lars Häggmark to ensure a sustainable, long-term utilization of species and ecosystems SCA Skog / September 2013 23 Certified forestry operations SCA’s forestry operations are certified in accordance with the standards of FSC®, the Forest Stewardship Council® and in accordance with PEFC™, Programme for the Endorsement of Forest Certification. SCA Skog / September 2013 24 Strategy for nature conservation Nature consideration in all types of forestry operations Environmentally compatible management methods which, in many respects, resemble natural disturbance factors, such as fires Detailed knowledge of the production conditions and conservation aspects of SCA’s forests Ecological landscape planning Photo: Lars Häggmark High level of competence among all employees and continued development of the knowledge base and methods Cooperation with public authorities with regard to special protection under the Nature Conservation Act SCA Skog / September 2013 25 Nature considerations in final fellings Distribution of preserved volume by type of nature consideration Younger forest 1 % Cultural heritage remnants 1 % Other 4 % Tree groups 5 % Edge zones lakes 4 % Rock cliffs 3% Rich in broad-leaves 2 % Edge zones streams 11 % Rocky grounds 7 % Edge zonees wetlands 26 % Waterlogged woodlands 21 % Marshy areas 15 % Approx. 5 % of the timber volume is left for nature considerations within harvested areas. Blue colour shows consideration connected to water and moist areas. SCA Skog / September 2013 26 SCA’s nature values Very high nature value Nature reserves 1-3% (1% sold to the Swedish government) Conservation areas: - set aside, postponed, approx. 5% - alternative forestry methods approx. 3% Non-productive lands with trees: Approx. 10-15% of total area - wetland, bedrock areas Ordinary forest land: Approx. 5% of productive forest area are set aside. Low nature value Non-productive lands without trees: Approx. 10-15% of total area - alpine, wetland areas Productive forest land Non-productive lands Total area 2.6 million hectares, of which 2 million productive forest land SCA Skog / September 2013 27 The forest cycle Soil preparation Planting, natural regeneration, sowing 2-3 Regeneration inspection 5 Harvesting Road construction 80-120 Forest inventory 10 Survey by helicopter 10-20 Precommercial Fertilizing thinning Fertilizing Thinning Fertilizing 20-30 60 Survey young forests Thinning SCA Skog / September 2013 28 SCA logging methods 1955-2012 % Grapple processor 80 60 Tree-parts method Whole-stem method 100 Two-grip harvester Manual cut-to-length method Horse Mechanized cut-to-length method Tractor 40 Feller-buncher processor Single-grip processor 20 Combined logging Whole-tree method 0 55 60 65 70 75 80 85 90 SCA Skog / September 2013 95 00 05 10 29 Employed woodmen 1976-2012 Annual employees estimated as an average during 12 months of a year 2500 2000 All Employees 1500 Temporary employees Machine drivers 1000 Cutting/Felling 500 0 75 78 81 84 87 90 93 96 99 02 05 08 11 Including Scaninge Timber from 2002 SCA Skog / September 2013 30 Productivity development 1955-2011 Logging 60 cu.m. per man-day 50 40 30 20 10 0 55 65 75 85 95 05 SCA Skog / September 2013 31 Cost development 1985-2011 Logging 200 Index Consumer price index 180 160 140 120 Logging 100 80 60 85 90 95 00 05 10 SCA Skog / September 2013 32 Forest machine ownership system and SCA certification development 1970-2012 100% Volume 90% 80% Contractors One machine owners 70% Contractors Machine group owners 60% 50% 40% 30% 20% 10% SCA certified SCA 0% 70 72 74 76 78 80 82 84 86 90 93 95 97 99 01 03 05 07 9 11 SCA Skog / September 2013 33 Forest machines - ownership 2012 SCA Contractors 9.6 % temporary 3% Contractors long-term 87,4% SCA Skog / September 2013 34 Wood consumption at SCA’s Swedish industries Removals from own forests 1971-2012 9 million cu.m under bark excl. chips from own sawmills 8 7 6 Wood consumption 5 4 3 2 Removals from own forests 1 0 71 Scaninge 74 77 Timber 80 83from862002 89 Incl. 92 95 98 SCA Skog / September 2013 01 04 07 10 35 Wood consumption SCA’s industries 1985-2011 1,000 cu.m. 12000 10000 Pulpwood, hardwood Pulpwood, spruce/LWC 8000 Pulpwood, spruce 6000 Pulpwood, softwood incl chips 4000 Sawlogs, spruce Sawlogs, pine 2000 0 85 87 89 91 93 95 97 99 01 03 05 07 09 11 Incl. Scaninge Timber from 2002 SCA Skog / September 2013 36 Wood procurement 2012 million cu.m. 6.8 5.0 from forest districts from wood procurement units 3.8 Locally purchased 3.0 3.4 Chips from own sawmills 1.2 Import 0.4 5.6 SCA’s pulp and paper industries 4.4 SCA’s sawmills 1.8 External industries Photo: Michael Engman SCA forests External suppliers/ Timber exchanges SCA Skog / September 2013 37 Timber transports 2012 Share of volume Share of transport work Truck Truck Rail Rail Average transport distance, km Truck - industry 120 Truck - terminal 64 Rail 236 SCA Skog / September 2013 38 Timber Transportation System Kiruna Murjek Luleå Storuman Piteå Lycksele Hoting Umeå Rundvik Krokom Östersund Bollsta Bensjö Östavall Härnösand Töva Sundsvall SCA Skog / September 2013 39 NorrPlant 2012 120 million seedlings Total 102.5 Pinus contorta 13.8 External 58.6 Pine 41.5 SCA 43.9 Spruce 47.2 Deliveries Share of tree species 100 80 60 40 20 0 SCA Skog / September 2013 40 NorrPlant 2012 Bogrundet plant nursery Production 90 million plants/year 14 heated greenhouses measuring 100x25 m each 110 outdoor areas comprising 15 hectares Laboratory, seed hall, refrigerated storage Wifstamon plant nursery Production 17 million plants/year 2 heated greenhouses measuring 100x25 m and 2 measuring 100 x 12 m 25 outdoor areas comprising 4 hectares Seed hall, refrigerated storage Personnel: 50 including 32 seasonal employees Seed plantations Own: 5 Pine - 40 hectares 7 Pinus contorta - 40 hectares Partly owned: Pine, Spruce - 50 hectares SCA Skog / September 2013 41 SCA Krossprodukter A rock-solid alternative Sells rock and aggregate from SCA’s own quarries to external customers and SCA companies. Undertakes construction projects for customers, such as completing roads for wind farms. Manages the operation and maintenance of existing quarries and investigates potential quarries Works strategically to develop SCA’s quarries. A key component is to maintain and improve the environmental and quality aspects of quarry operations. SCA Skog / September 2013 42 Biofuel deliveries development 1989-2012 3500 GWh Refined fuel 3000 2500 Unrefined fuel 2000 1500 1000 500 0 89 91 93 95 97 99 01 03 05 07 09 SCA Skog / September 2013 11 43 Distribution of delivered biofuel 2012: 3,1 TWh 0,9 1,4 Biofuel from industrial Biofuels from forest Peat Pellets 0,1 0,7 SCA Skog / September 2013 44 For additional information please visit www.scaskog.com