UPMPulp

What’s the outlook for pulp in 2021?

We asked some of UPM Pulp’s business leaders about the challenges they faced in 2020 and how the past year shaped their outlook for 2021.

 

Anssi Käki, Vice President, Pulp Supply Chain, UPM Biorefining

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In 2021, I’m looking for at least some economic recovery, and the pulp market seems to be giving some early signals for that. Pulp goes to a number of different end uses, and the one that is showing growth at the moment is tissue paper. Tissue paper consumption has been very good throughout the pandemic. We’ve all heard the funny stories about toilet paper, but there has also been a big demand for tissue-based products from the healthcare sector. On the graphic paper side, we have been seeing a loss of volume, but this is something we expected to see, and this was just accelerated last year.

Given my background in data and mathematical modelling, I’ve been happy to see how the pandemic has encouraged the discussion of these tools and highlighting the importance of using data to solve problems. At UPM, we have already been using data and modelling, and we are getting better all the time. I think in the future we will increase our use of data-driven scenarios to manage economic uncertainty and better face our challenges. We have a number of people on our management team who are very analytically minded and would like to take that approach further.

 

Saara Tahvanainen, Vice President, Stakeholder Relations, UPM Biorefining

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In 2021, there are two things on top of my mind. The first is to continue on the path of delivering on our commitments and realize our growth plan in Pulp. The other is our work on sustainable forestry, particularly as it pertains to climate change and biodiversity. Climate change and the loss of biodiversity may not have been in the headlines as much as Covid-19 last year, but they haven't disappeared. Neither has our commitment to climate change mitigation and our commitment to improving biodiversity. This year we will continue this work with a renewed vigour.

This year, we continue the development projects in sustainable forestry, such as the commitment to double the quantity of broadleaf trees in our forests. We’re also seizing opportunities to engage with the younger generations. They are rightly concerned for the future of our planet, and we look forward to having a dialogue on working towards a more sustainable future.

In terms of industry trends, I see a trend towards increased regulation to promote sustainability in terms of what kinds of products and materials we use. But we also need to do a better job raising awareness of the role wood-based products play in everyday life. We did a survey recently in Finland on people's views about forests and whether they use wood-based products themselves. Given the drive for sustainability in packaging, the amount of e-commerce and hygiene products we all use, it was quite surprising to see that people don't recognize that they use wood-based products daily. It’s an interesting challenge for us to bridge that gap and increase that understanding.

 

Juha Kääriäinen, Vice President, Finland Pulp Operations, UPM Pulp

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In terms of goals for this year, safety always comes first, and here we want to improve our performance. Last year, we still had too many accidents, so there we have some targets for improvement. We have been working in the mills to make sure people stay healthy, and so far, no problems. We always want to improve our production and productivity but overall, the focus is on people. We try our best to keep the production as high as possible and squeeze the costs down. That’s our main task after the safety and environmental targets and keeping our quality constant and stable for our customers. We don’t only sell pulp to our customers – we also sell trust.

 

Marcos Battegazzore, Vice President, Uruguay Pulp Operations, UPM Pulp

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Actually 2020 was a record year for our operations in terms of productivity and performance. For 2021, our focus is to consolidate the productivity gains that we earned in 2020 and look to benefit from the positive developments in the pulp market.

Then, at the same time, we have to continue working on the implementation of the plans we have to secure wood supply and resources for our future Paso de los Toros mill operation. Next year we will have the start-up of the operations there, so this year we have a lot of work to do to prepare the organisation and resources for it. From the operations side, we are ramping up all the operations related to wood supply to the new mill, contracting required services at forestry and mill operations, and recruiting and training new people to resource our teams.

The pulp and forestry sector in Uruguay has been growing steadily for the last 30 years and the new UPM mill will give an additional boost to the forestry sector. When it starts operations, pulp will become the number one export of Uruguay, so the importance of the pulp industry in the country is significant. It has truly transformed the economy of the country.

 

Tomas Wiklund, Senior Vice President, Sales, UPM Pulp

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Going forward, I think we will see remote work continuing because we have discovered that it can be efficient, and we will have a combination of working in this remote environment with customers and colleagues. We will probably choose to meet on fewer occasions than previously, but we will make sure these opportunities will be more valuable.

Sales is a field that really depends on relationships and knowing your clients and your customers. We have been fortunate in that many of our salespeople have been regularly working from home, and since most of our team members are seasoned veterans who have good standing relationships with their customers, they have been able to manage their relationships online very well.

By now, everyone has gotten used to the uncertainty, and we are managing the situation better than we did in the early phases of the pandemic outbreak. We are on our toes in a different way now, so there should be less stress and concern in the business community.

Our focus this year is strongly on preparing the ground for Paso de los Toros: How do we develop our organisation to serve current and future markets?

 

Text: Lara McCoy