26 September 2005

Pulp and Paper: Stora Enso is purchasing land in Brazil and Uruguay

Stora Enso has started to purchase land in the southern part of Brazil (state of Rio Grande do Sul) and in Uruguay with the intention of establishing fast-growing plantations. Stora Enso intends to plant eucalyptus and pine in the areas starting next year. The plantations will serve as a competitive fibre supply for Stora Enso’s future pulp and paper production in these countries.

Stora Enso plans to establish a total base of around 100,000 hectares of plantations in each country. This includes also acquiring already existing plantations, especially in Uruguay. The target for 2005 is to complete the purchase of around 50,000 ha of land in each country. Stora Enso estimates to spend up to USD 100 million during 2005 for acquisition of land and initial investments in nursery and infrastructure. The selected regions offer excellent conditions for plantations and have good infrastructure.

“We are now taking another important step in Latin America. These purchases are in line with our emerging markets strategy. This will be our second-largest investment in South America after the successful completion of Veracel Pulp Mill in the state of Bahia in Brazil, a joint venture with the leading local pulp producer Aracruz Celulose S.A.,” comments Jukka Härmälä, CEO Stora Enso, in press conference at Porto Alegre in the Brazilian state of Rio Grande do Sul.

The land in both Brazil and Uruguay is being purchased from private landowners who have used it mainly for cattle grazing and partly for growing crops. In establishing the plantations, Stora Enso will follow its principles for sustainable plantations by adopting the best environmental and social management practices, and expects a positive economic impact in the region. An important part of these management practices is to engage and have an open dialogue with the local stakeholders in the sustainability work. The intention is to certify the plantations in Brazil with both CERFLOR and FSC forest certifications, and in Uruguay with FSC.

“Stora Enso aims to encourage local landowners to establish their own plantations as an opportunity to have an alternative use of their land. We estimate to have about 20% of our future needs supplied by local landowners,” comments Nils Grafström, President, Stora Enso Latin America.

Source: Holz.net vom 2005-09-26.

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