Emerging markets and industry needs for fibre will outweigh traditional
demands for paper
VANCOUVER, May 4 /CNW/ - The demand for some types of paper, like
newsprint and other printing and writing paper will decrease in the
next decade but the many other uses for wood fibre will mean dramatic
increases in global demand overall, according to a new report from PwC.
PwC's Canadian Forest, Paper and Packaging Leader Bruce McIntyre says:
"Companies from a diverse array of industries - energy, utilities,
chemicals and potentially many more as biomaterials evolve - will
compete with FPP companies for control of forests, or at least access
to their fibre, and the best economic use of the resources they
As a result, demand will outpace supply and increasing competition for
fibre will be a key factor of future supply chains.
"The world's forests will make a reduced contribution to meeting our
increasing needs for wood fibre," says McIntyre. "Many of these forests
are economically inaccessible or are sensitive to disturbance. Instead,
these forests are going to be valued for their conservation benefits
and that will result in restrictions on industrial wood output."
Wood fibre needs are increasingly being met from planted forests which
currently cover approximately 272 million hectares or 7% of the world's
total forest area. The World Business Council for Sustainable
Development (WBCSD) estimates that the yield and harvest from planted
forests, will need to increase threefold by 2050, with planted
land-area increasing 60%.
In 2005, there were already nearly 141 million ha of plantation forests
globally, an increase of over 12.8 million ha compared to 2000. Brazil
stands out as the world leader in forest plantation agriculture, with
nearly 6 million ha of plantations producing significant amounts of
fibre for the global market. Brazil's largest trading partner is now
China, and large shipments of pulp are one reason for the increased
The report also finds that in North America and Europe, many of the
existing mills simply won't be needed for newsprint or printing and
writing paper. But increasing populations and wealth will mean more
fibre is needed, regardless of the reduction in traditional paper use.
In the EU for instance, 340-420 million cubic metres of woody biomass
per year is forecast to be needed solely for energy purposes by 2020,
if current government policies continue. That level of demand could
lead to a forest fibre deficit of 200-260 million metres³ by 2020.
Asia's emerging markets are also booming. In China and India, absolute
demand for paper will still go up, although it won't increase as
quickly as overall GDP growth. China in particular has a large fibre
deficit, so pressure to secure access will grow in order to achieve its
2020 goal of 20 million ha for additional woodland planting to fuel
bioenergy projects. In 2009, China imported over 100 million metres³ on
a roundwood equivalent basis - roughly as much as Canada's entire
timber harvest in that year.
Plantations have already faced a lot of criticism, though, for
everything from replacing natural forests with plantations, to
displacement of local peoples, to accusations that they have damaged
local water tables.
"We believe that plantations still represent the single best opportunity
to meet increased demand for forest products without damaging
ecosystems, provided planting is done responsibly and balanced with
appropriate conservation programs," says McIntyre.
New methods of accessing available fibre may emerge in response to the
growing pressures. PwC sees international fibre exchanges and the
emergence of a new biomass aggregation industry as two possibilities,
but there may be others as well.
"The focus will shift from accessing fibre to using fibre more
efficiently. There will be viable alternatives to woody biomass,
although land availability may be a limiting factor," says McIntyre.
"Technologies can help, but those businesses that control, or have
secure access to competitive sources of fibre will be the best
positioned for growth."
These and other issues affecting the global forest products industry
will be discussed at PwC's 24th Annual Global Forest & Paper Industry
Conference, taking place May 11, 2011 at the Westin Bayshore Resort &
Marina in Vancouver, BC. For more information, please visit: www.pwc.com/forestconf11.
For more information, and to read the full report, entitled "Growing the Future", please visit http://www.pwc.com/gx/en/forest-paper-packaging/publications/new-values-directions-technology-fibre-competition.jhtml. The report is also available from the media contacts.
PwC's 24th Annual Global Forest & Paper Industry Conference
Over 400 CEOs, senior executives, customers, suppliers, analysts and
policy makers from the world's forest and paper industry will meet on
May 11, 2011 at PwC's 24th Annual Global Forest & Paper Industry
Conference in Vancouver, BC, Canada. Accredited media are welcome to
attend the full day conference, please pre-register. Contact Jim Nelson
at: email@example.com, or +1 604 806 7047.
Complete PwC conference and speaker details are available at: www.pwc.com/forestconf11.
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For further information:
Jim Nelson, PwC
Tel: 604 806 7047
Kiran Chauhan, PwC
Tel: 416 947 8983