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UPM AP CUSTOMER MAGAZINE 2/2012

UPM FLASH

Cooperation in a Green way

The answers you need – right now www.upm.com


EDITORIAL

UPM FLASH

A new Chapter for UPM!

2/2012

UPM Flash is UPM Paper Business Group’s customer magazine in Asia Pacific region.

Since its establishment in later 1990s, UPM was able to progressively increase its footprint in the APAC region, investment in few phases has allowed us to provide an expanded offering to our customers in this dynamic territory. Today we are marking another major milestone in the development of our Changshu operations. The decision to build a new paper machine at Changshu mill in China will further strengthen our presence in the Asian paper market, especially in the value chain of self-adhesive materials. The new machine is designed with a swing capacity catering to the evolving demands: It is capable of producing up to 360,000 tonnes of wood free uncoated grades or 170,000 tonnes of uncoated high quality release base papers. The total investment is 3 billion CNY (390 million EUR) and the machine is expected to be operational by the end of 2014. In addition, we are finalising the construction of a 100,000 tonnes cut-size sheeting line, which will enhance our deliverability and service capability in office paper grades in the region. We realize the promising outlook in both label and woodfree uncoated paper products. In this challenging time of the global economy, it is crucial to place our focus in the high performing market, leveraging our long standing global expertise and advanced solution in the self-adhesive and release liner industry. Those experience will be very valuable for our local customers here in Asia. 

EDITORIAL BOARD: Lenny Zhong, Vivian Wang, Jackie Bao, Mary Ma EXECUTIVE EDITOR: Ada Qin (Chinese Version), MOLI Design (Chinese and English Version) LAYOUT: MOLI Design PAPER: UPM Finesse premium silk 250 g/m2 (cover), UPM Finesse premium silk 130g/m2 (inside) SUBSCRIPTION: fax 86 (21) 5292 8912 or email upm.flash@upm.com Please email your feedback on Flash magazine to: upm.flash@upm.com UPM in-house magazine

UPM China & Asia-Pacific Sales Network Shanghai: 86 21 6288 1919 Korea: 82 2 723 0555

Given our extensive sales and logistic networks today in the region, we are well positioned to support you with excellent service and high quality products. Our recently launched UPM Customer Online tool also provides you the real time visibility of your supply chain information. You are highly encouraged to utilize this web-based platform to track your order status 24/7. As an environmental-friendly company, we take pride in our world leading environmental performance in the paper mills, and our dedication to driving innovation and environmental excellence has always been the foundation of our success. We look forward to building upon our strong relationships in APAC as we enter the new chapter.

Jaakko Nikkila Vice President, Sales Asia Pacific UPM Paper Business Group

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Hong Kong: 852 2527 0177 Singapore: 65 6838 7280 Japan: 81 3 5778 2660 Australia: 61 2 9334 5000 www.upm.com


CONTENTs

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Drupa exhibition proved that print has great potential

EDITORIAL

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News

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FEATURE STORY

18 CORPORATE RESPONSIBILITY Cooperation in a Green way

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The answers you need – right now

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Drupa exhibition proved that print has great potential

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CUSTOMER STORY Printing Pioneer

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A leading variable information specialty paper producer

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TECHNOLOGY FRONTLINE An introduction to dot of printing

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MARKETING INFORMATION Key Points of The 12th Five-Year Plan for 22 China Pulp and Paper Industry PRODUCT & SERVICE

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NEWS

UPM CEO Pesonen states confidence in UPM’s growth businesses underlining importance of solid margins in Europe

Jussi Pesonen, UPM’s President and CEO, stated his confidence in the company’s growth businesses during its Capital Markets Day in London.  He also underlined the importance of improved margins in the mature European businesses to maximize the cash flow of the company. “UPM’s growth businesses sales today exceed EUR 4.0 billion and we have confidence in further growth going forward. More than 50% of our sales will derive from these solid performing growth businesses on latter half of  this decade,” said Pesonen.

Pesonen highlighted that since 2007, UPM’s Energy, Pulp, Label and Asian Paper business have grown by 40 % in the topline. As future sources of top line growth, he identified Paper in China, an expanding Pulp business, continued Label expansion in the emerging markets, biofuels and nuclear power generation - where UPM has a significant holding through the Finnish energy company TVO. “Our first investment in biofuels will add a totally new dimension to the business portfolio and growth outlook,” said Pesonen. “In the longer term, biocomposites, biofibrils and

biochemicals will also complement the business portfolio.” “While other businesses have grown, sales of our mature Paper, Timber and  Plywood  businesses have come down by 10 % since 2007. However, these businesses have a pivotal role in our growth strategy. We are expanding in growth businesses  with the cash flow generated by the mature businesses. Improving margins for strong cash flow and releasing capital from our mature businesses is crucial. To this end, further consolidation in the industry is needed,” said Pesonen.

UPM grows in China and in the fast developing label materials segment UPM takes further steps to reshape its business portfolio and expands in profitable growth businesses in Asia. The company will increase its presence in the attractive Asian paper segments and strengthen its position in the label materials value chain by building a

new woodfree speciality paper machine at its Changshu mill in China. “This move is aligned with our strategic target to have more than 50 % of our sales from well performing growth businesses in the latter part of the decade. It supports our growth in China and provides an excellent platform to strengthen partnerships with self-adhesive labelstock customers and expand into new end uses in Asia. It also supports the good profitability of our growth businesses,” says Jussi Pesonen, UPM’s President and CEO. The new machine is an uncoated woodfree speciality machine capable of producing up to 360,000 tonnes of uncoated woodfree grades and high quality label papers. The machine

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will start up by the end of 2014. The investment will also include future-oriented infrastructure investments in the Changshu site. The total investment cost is CNY 3,000 million (EUR 390 million). In addition, UPM Changshu is finalising a 100,000 tonnes cutsize sheeting line investment which strengthens the Group’s leading position in office paper grades in China. Both label paper and uncoated woodfree papers have a healthy demand outlook in Asia. The annual growth of UPM’s label paper mix is expected to be 8 % in Asia and 4 % globally. In uncoated woodfree grades, UPM focuses on high quality office paper, where the Chinese market is expected to grow by 8 % annually.


UPM named “Most Innovative Company” at 2012 Ethical Corporation Awards UPM has been awarded “Most Innovative Company” at the 2012 Ethical Corporation Awards held in London. UPM was highlighted for its Eco Design approach and overall sustainable thinking.  UPM’s innovative approach has seen new products created such as the world’s first biodiesel manufactured from wood raw material. “Our focus on producing more with less is a clear example of UPM as a forest industry company is now creating tangible results with bio composites, bio fuels and the use of non-fossil fuel energy,” comments Hartmut

Wurster, Executive Vice President Technology and responsible for new businesses and environmental issues.

ed the effort of all entrants to demonstrate genuine innovation in their sustainability approach.”

“The integration of the bio-based and forest industries has created the Biofore vision the foundation of our corporate responsibility.”

UPM has brought to market several innovative products recently including UPM ForMi a composite material made from pulp fibres from sustainably managed forests and clean plastic polymers. It has also launched the fuel of the future, UPM BioVerno, the first wood-based biofuel.  UPM aims to be a major player in the production of advanced transportation biofuels.

A spokesperson for Ethical Corporation commented: “The judges commended UPM for its commitment to creating innovative materials for increased recyclability and robustness.This is traditionally a very challenging category and the judges commend-

UPM plants thousands of trees with school children UPM organises a global Plant a Tree Day each year in spring and especially on May 22nd, the UN International Day for Biodiversity. This year school children and other stakeholders in Finland, the UK, Russia, China, the US and Uruguay participated in Plant a Tree events. In Finland the school children and UPM forest professionals plant trees together in Pyhäjärvi, Nokia and Joroinen. UPM participates also as a partner in the ENO tree planting day in Espoo, one of the global events organized by ENO Environment Online. The seedlings for these events come from UPM’s nursery in Joroinen, which produces high quality seedlings of native origin to be used to regenerate UPM forest service customers’ and UPM company forests.

“A tree seedling and a school child are creators of the future,” says Päivi Salpakivi-Salomaa, Vice President, UPM Environment. “Planting a tree is an investment and good for the climate. A growing tree sequestrates atmospheric carbon throughout its lifetime. The new forest improves the quality of surface and ground water, it creates the preconditions for berry and mushroom production and makes a habitat for hundreds of other species.”  Every year UPM plants more than 50 million tree seedlings. The long time span of sustainable forestry materialises in tree planting. Forest regeneration is a central element of responsible forest management.

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NEWS

“Care for a Green Future” summer camp inspires students UPM’s “Care for a Green Future” summer camp was held on July 18. The event raising awareness of environmental protection brought together 47 teachers and students from four local primary schools. The governors from Changshu Environmental Protection Bureau, Municipal Education Bureau and Law Promotion Division also attended the summer camp. During the summer camp, students visited the Changshu mill and gained insights into paper-making technology. The students also practiced team working skills by making paper-cut art works and putting together a

green fashion show using recycled materials. “The summer camp is an extension of UPM green education and it enables us to experience the meaning of environmental protection first-hand and see environmental protection in action,” says Headmaster Fei of the Lv Di Primary School. “Through the summer camp activities, we hope the students will take home green thinking, and start making small steps toward making a larger environmental difference in their everyday lives,” says Lenny Zhong, Head of UPM Communications, APAC.

UPM Clean Run campaign stresses environmental leadership In 2011, UPM launched the Clean Run campaign aiming to further reduce the environmental impact of UPM operations. The campaign encourages all employees to strive towards a greener UPM through actions in daily work including discussions, performance assessments, and operation audits. One of the major steps of the Clean Run campaign has been the mill operation audit. Päivi Rissanen, Environmental Director from UPM headquarters in Finland, audited the clean operations of Changshu mill during May 22-23, 2012. During the mill operation audit, Rissanen inspected energy and water consumption as well as other emission data at the mill’s power plant, wastewater processing plant, and production workshop. Changshu mill has performed well on the Clean Run campaign. Besides the enhancement of employee environmental training, the mill has made substantial investments in equipment improvement, including a German filtering device to further reduce the suspended solids in wastewater.

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NEWS

UPM Changshu mill upgrades Preprint Papers In September, UPM Changshu mill upgraded its Fine Preprint Papers. The upgraded preprint papers not only provide customers with more options on grammage, but also extend the whiteness to fully meet requirements of different customers. The UPM Preprint Papers includes two types of products: UPM Fine Preprint and UPM Fine Premium Preprint. UPM Fine Preprint line has expanded from the 60, 70 and 80 g/m2 series to 60, 70, 80, 90, 100 and 120 g/m2. UPM Fine Premium Preprint still includes the 70g/m2 and 80g/ m2. The whiteness has been upgraded by three grades, including CIE whiteness 145, 155 and 167. UPM Preprint range covers papers for all main preprint end uses. It’s suitable for documents such as invoices, bank account and insurance statements, advertising leaflets or any kind of direct mail. Both FSC and PEFC certified Preprint papers are available.

Mini-pack of UPM Jetset Presentation launched The mini-pack of UPM Jetset Presentation is now available in the Chinese market. 100 sheets of copy paper in A4 size are packed into a smaller plastic bag with a self-adhesive sealing. The smaller pack provides an easy choice for consumers to carry, use and storage.

UPM sponsors printing skills competition in China This year, UPM sponsored the Third National Occupational Skill Competition for the Printing Industry, following on the success of its sponsorship of the same event in 2010. As the exclusive paper sponsor for the competition, UPM provided competition paper to the final round of the competition. The paper used was the 105g UPM Finesse classic gloss produced by UPM Changshu mill. There were two series in the competition: the six-day student competition was held on May 29 in Shenzhen and drew 119 students from national printing colleges and technology schools. The competition for industry representatives including 150 participants was held in Shenzhen on Aug 13. UPM Finesse classic gloss paper performed as expected, providing superlative paper performance ensuring the fairness of the competition.

UPM wins government bid in China UPM has won the bidding for the 2012 governmental procurement for information products with its UPM Jetset, Copykid, Yes, Future and Office series copy paper. The papers were cited for their high quality, excellent environmental credentials and reliable service.

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featUre stOrY

Text: Ada Qin Photos: UPM

The answers you need – right now The newly upgraded UPM Customer Online tool provides customers the convenience and accessibility to track their order status anywhere at any time, enabling UPM to offer superior services.

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s. Guo Zhijun, General Manager of Shanghai Guantian Paper Co., Ltd. (SGP), is a regular user of the UPM Customer Online service. The service fits her busy schedule as it allows her to track orders quickly and efficiently. “In the past, we had to phone or fax UPM Customer Service Specialist to obtain our order information. Now, it is much more convenient and the information is easy to access,” says Guo Zhijun. SGP is a professional paper distributor that has grown rapidly for 15 years in Shanghai market and is one of UPM’s earliest customers in China. “We’ll most often look into order status when our customers need an urgent delivery. So, ideally we would like to get order information within a few minutes so that we can answer our customers promptly. Through conventional ways such as phone and fax, that just wasn’t possible,” explains Guo Zhijun. SGP and other customers began to use UPM Customer Online about two years ago. In March this year, UPM launched an upgraded version offering better performance and improved user friendly interface. Available all the time

The prime advantage of UPM Customer Online is providing customers with real time online information - 24 hours a day, seven days a week. With a computer or a portable computing device, like IPAD and an Internet connection, customers can log onto the

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featUre stOrY

system anywhere at any time. In the system, the customers have a wealth of information at their fingertips: order status, delivery status, stock information, and invoices. Customized reports can be requested at the click of a mouse and all changes are updated in real-time. “After office hours, if a UPM Customer Service Specialist is not available, we can check our order status, and print copies of the information we need. Knowledge of order status allows our logistics planners to make proper arrangements,” says Ms. Makiko Nakao of Marubeni Corporation. “We anticipate that by the end of this year more and more customers in the Asia-Pacific Region will be using UPM Customer Online to support their business,” says Tim Huang, E-business Manager of UPM Asia-Pacific Region. Efficiency and cost savings

Customers appreciate the efficiency gains provided by the new system. Chengdu Zhenxingheng Trade Co., Ltd. (CZT) is one of the largest copy paper dealers in Southwest China. This March, they began to use UPM

Customer Online Service, and were amazed by the system capability. “The new system allows us to get the most up-to-date information on order quantities, delivery times, invoices and allows us to calculate our rebates. Gathering such information before was time consuming, but now that we’ve tailored the system to our needs, the information can be with us in an instant,” says Ms.Yan, a CZT Accountant. Shu Yuqiong, the CZT account manager, also spoke highly of the cooperation with UPM. “Out of all the paper suppliers we work with, UPM is the only one who can offer an online customer service system,” says Shu. Guo Zhijun, GM of SGP, also underlined the saving advantage of using the customer online service. “In the past, all our reports were printed by fax. The resulting piles of paper were all stored in a warehouse, and because of confidentiality issues, had to be shredded before disposal. It goes without saying, that the system has provided us a lot of efficiency and savings.” says Guo Zhijun.

“I like the new UPM online customer service very much,” praises Kathy Law, a buying clerk from the Samson Group in Hong Kong. “It’s fast, and the dashboard is clean and easy to navigate.” Improved management control and overall business planning

To give the users a better experience, each customer can customize the interfaces to their needs. Customers can also create user-defined printed reports. “Having easy access to the information and reports allows the management to have better control and visibility of their own daily operation and enhance their business planning.” Says York Fang, VP Supply Chain, UPM Asia Pacific. “We have received many positive feedbacks from our customers but we are striving to incorporate more functionality to the system such as placing orders on line, track and trace function and other system updates. Ultimately, the system will be developed to meet the evolving customer needs. It also plays a key role in shaping our high quality customer service!”

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featUre stOrY

Drupa exhibition proved that print has great potential Text: Thomas Ehrnrooth Photos: UPM

At the drupa exhibition in May I realised at the latest, how much the paper and printing industry have changed during the past six years I spent in another business. Technological development, innovations and new features made me impressed.

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featUre stOrY

service for comprehensive workflow, colour and print quality management.Also our environmental team had a strong presence at our stand and our customers and other stakeholders got to know the new UPM Responsibility HUB website as well as our brand new UPM Paper Life video among other interesting topics discussed during the exhibition.

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aving a long history in the paper business I was expecting to meet the good old drupa atmosphere at the biggest expo of the worldwide print and media industry – but my expectations did not realise. There was something new in the air this time. Drupa 2012 - held in Germany, Düsseldorf was clearly showing that despite of the huge challenges the whole industry is facing – print has potential and the sector is renewing and investing heavily in its future. As the world’s leading manufacturer of graphic papers, we wanted to stand out at the fair above all as a frontrunner and a partner that keeps up with the times, who strongly believes in paper and print – today and tomor-

row. That was well recognised and appreciated by our customers too. Our stand supported the chosen theme and we succeeded extremely well in presenting paper as a gateway to new and inspiring experiences by introducing the third dimension of print at our stand. Augmented reality, QR codes and other examples of combining print and digital content were a hot topic at drupa and also an integral part of our appearance there. Our own experts and visionary cooperatives were showcasing exciting examples of combining digital and print – providing inspiration and solutions to all in the media industry. UPM’s services were well present at the stand. As part of our technical service offering we showcased UPM ColorCTRL, a new

An international trade fair, drupa, is the biggest exhibition of the print and media industry. The event is held every four years and it brings together media and printing professionals from all around the world. This year drupa trade fair gathered over 314,000 experts and almost 2,000 exhibitors from more than 130 countries to Düsseldorf, Germany in May. More information can be found at www.drupa.com.

Despite the first impression you might have got as a visitior drupa is not only an exhibition for digital printing. After what I have heard and seen at the exhibition I believe that both digital and analog printing will continue living in a constructive co-existence also in the future. During drupa the Landa Corporation launched a new printing method that is based on the nano- technology aiming to set a new industry standard for mainstream printing. The most unique feature in the presses is probably that they are operated by a touch screen which looks looking like a giant iPad. Due to the high degree of automation a single operator can manage even four presses at a time. It is interesting to see, if Landa will be showing the way also for other companies. The finals of the “SHOTS Heard Around the World” print simulator-based productivity contest culminated during the expo. Over 150 students from Asia, Europe and North America had been remotely competing at their technical schools and the best students met face-to-face at drupa. Simulation-based training is now a worldwide norm in almost every profession. We have been using printing simulators successfully for several years to train customers and our own staff to improve their understanding on the printing processes. Let’s continue to explore the new opportunities paper and print have to offer! UPM FLASH / 2. 2012 /

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customer story

Text: Ada Qin Photos: UPM

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customer story

Printing Pioneer Business for Beijing Shengtong Printing is flourishing in the Chinese high-end printing market. The company is ready to expand its market and go global.

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PM and Shengtong Printing have been cooperating with each other for over a decade. The partnership has been especially fruitful in northern China.

vorable reputation in the overseas markets; such as in Europe. In the brutally competitive printing industry, Shengtong has risen high on the list of China’s top 100 printing enterprises.

“UPM has consistently provided us with high quality paper, and we feel that the product quality is as good as UPM’s world-class reputation,” says Li Yanqiu, Vice-President and one of the founders of Shengtong Printing.“Through the close relationship, we get insights into the changes and future direction of the international paper making and printing industry.”

Li Yanqiu credited three factors that have been key in the success of Shengtong Printing: vision, determination, and focus.

Since Shengtong Printing was listed on the Shenzhen Stock Exchange Small and Medium-sized Enterprise board in July 2011, this private-run printing company has gained interest and standing in the public eye. Shengtong Printing developed rapidly during its first decade, multiplying its sales income tenfold, and gaining a firm foothold in the high-end publication and commercial printing market. Shengtong Printing’s customers include many well-known publishing houses and magazines including the Xinhua News Agency, People’s Education Press, Foreign Language Teaching and Research Press, as well as Outlook, Money Weekly, and Marie Claire. In addition, Shengtong Printing’s hardback book products have earned a fa-

Target high-end market

The Shengtong Printing entrepreneurial and management team have broad experience in the printing industry. During the rapid development of the printing industry at the turn of the century, Shengtong’s entrepreneurial team recognized that the competition in the printing industry was focused on the middle and low-end of the market. “The middle and low-end printing market was still profitable at that time, but the long run prospects were limited and the competition was becoming increasingly fierce,” says Li Yanqiu. At that time in the export printing business in the coastal areas of China, there were also foreign-invested printers. However, the Shengtong team found there was a significant gap in the product quality of world-class printers and theirs. Since its establishment in 2000, Shengtong has aimed their development strat-

Li Yanqiu, Vice-President and one of the founders of Shengtong Printing.

egy at the mid-to-high end printing market. An industry pioneer

To break through the high-end printing market Shengtong Printing went on the path of continuous improvement; especially made a bold move for investment in printing equipment and technology, Shengtong soon have a leading position in the market. In 2002, Shengtong acquired a GOSS M600 printing press for printing high-end periodicals to become the first private-run printer to own such advanced printing equipment in China. The acquisition of cutting edge equipment was the first step. Next Shengtong was chal-

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customer story

Shengtong Printing’s customers include many well-known publishing houses and magazines including the Xinhua News Agency, People’s Education Press, Foreign Language Teaching and Research Press, as well as Outlook, Money Weekly, and Marie Claire.

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lenged to learn how to get the most out of the equipment. Both the founders and the management team of Shengtong Printing waded through the study and training in order to master the technology.This in turn led to the opening of a new market.

planning (ERP) system for their own business management, applying information technology to the production management and has made great strides in improving production and operational efficiency.

Shengtong staked its reputation on staying current with international cutting-edge printing equipment and technology. Over ten years of development, Shengtong has been ranked at the top of printing industry, introducing computer-to-plate (CTP) digital printing technology, the most advanced American and German printing machines and a powerful post-press system. Innovation is always the company’s culture, according to this, Shengtong designed and installed two commercial keel transmission systems and became one of the first printers in China to introduce the keel transmission system into the heatset web offset printing. Shengtong independently developed an enterprise resource

Shengtong is also known in the industry for its commitment to the environment. In 2009, Shengtong was among the first to join the Beijing Green Printing Industry Technology Innovation Association. After joining, Shengtong invested heavily in green printing and environmental protection, and has been awarded the Green Award and green certification by authorities every year. Using environment-friendly ink, paper, and pre-press materials, Shengtong Printing has even infused the idea of energy conservation and low carbon into their plant design and construction as well as equipment model selection. The ECLOCOOL drier used with the GOSS Sunday2000/24p wide high-speed Heatset

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Committed to sustainability think

Web Offset Printing Press adopts secondary combustion technology, and the watercooling device for the Heidelberg Format 70 x100 8-color Sheetfed Offset Printing Press have the latest cleaning and energy saving mechanisms. Shengtong Printing and UPM’s shared commitment to the environment has become a key factor for long-term cooperation and has also won the respect of the high-end market. “Environmental protection reflects the values and attitudes of an enterprise. When Shengtong was established, we set a very definite goal: to make our development sustainable. We later found it consistent with the theme of green printing,” says Li Yanqiu. “Sustainability is at the heart of our strategic development and this allows us to adopt an integrated approach in all aspects of our business including marketing, business management, and investment.”


customer story

Text: Ada Qin Photos: Guangdong Guanhao & UPM

Guangdong Guanhao – a leading variable information specialty paper producer Guangdong Guanhao, the industry leader for Chinese direct thermal paper and carbonless paper, has joined forces with UPM to create new businesses in the label industry.

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uangdong Guanhao’s specialty paper products are widely used across China in many forms: value-added tax invoices, express mail labels, ATM slips, train tickets, and supermarket receipts. “We are the first large scale specialty paper manufacturer in China for direct thermal paper and carbonless paper,” says Li Zhen, the Vice General Manager of Guangdong Guanhao.

Guangdong Guanhao High-Tech Co., Ltd, founded in 1993, is a leading enterprise in the Chinese specialty paper industry with a current annual base paper capacity of 60,000 tons and annual coating capacity of 150,000 tons. Its products are used by tax agencies, post offices, banks, and business services. High-tech Products

Guangdong Guanhao targets medium and high-end markets for both its direct thermal paper and carbonless paper. In 1990s,

Guanhao began to enter the carbonless paper market. The company introduced the most advanced carbonless paper production line from Switzerland and adopted microcapsule technology from Germany, a method crucial to carbonless paper production. It also partnered with leading Chinese researchers in order to develop cutting edge carbonless copy products. In the following years, the carbonless paper market developed rapidly, and Guanhao was UPM FLASH / 2. 2012 /

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customer story

ready to meet the needs of the market. With its technology, equipment and talent people, the company gained a sizable market share. According to Li Zhen, carbonless paper stands out as a successful product case study in the specialty paper industry. “The annual global demand has reached over 3 million tons, benefiting from the requirements of international accounting standards. The annual growth of China’s carbonless paper sales (including export growth) is over 20 percent. Third party statistics show that the carbonless paper capacity of China reached 450,000 tons in 2011.” In terms of total output, Guanhao is not the largest manufacturer in China, but the company targets markets requiring higher product quality and greater added value. “We seldom enter areas like computer form which have relatively low product quality requirements,” says Li Zhen. “Our strength is in providing customized direct thermal paper products which are individually formulated to meet our customers’ requirements exactly.” The most valued characteristic of direct thermal paper is its ability to print variable information rapidly without changing ink cartridges. Direct thermal printing is used extensively to print tickets, logistics labels,

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supermarket cashier receipts and ATM receipts. The print quality of these direct thermal printed documents must be sharp because of their valuable content of information. “Train tickets require heat-resistant direct thermal printing paper that demands a special production process. Some paper may also need to go through a special coating process so that the direct thermal printed information lasts,” explains Li Zhen. Changing Markets

Carbonless paper once enjoyed extraordinary growth in specialty paper sales and its annual sales growth rate in the Chinese market is still relatively high.

In comparison, growth in the direct thermal paper market is showing no signs of slowing down. According to third party data, direct thermal paper displays stable global growth with total output reaching 800,000 tons in 2011. At the same time, direct thermal paper output in China has maintained a double-digit increase with total output reaching 110, 000 tons in 2011. “Although the demand of direct thermal paper for fax machines is decreasing, tickets, invoices for logistics, supermarket labels and cashier receipts, continue to show healthy growth potential. In this respect, we can see that new applications are stimulating demand.”

“However, the multi-ply layers carbonless paper market is declining year by year in the global market, especially in the EuropeanAmerican countries, because of the impact of informatization,” says Li Zhen.

From the point view of Li Zhen, Guanhao’s achievements in the field of variable information specialty paper can be attributed to its long-term development strategy.

Li Zhen also points out two reasons why carbonless paper output in China continues to grow.

Several years ago, Guanhao turned its attention to the label industry. In 2008, Guanhao imported a label production line with the most advanced technology at that time. This formally marked the start of its investment in the adhesive label materials.

“Firstly, Chinese informatization hasn’t reached the levels of the developed countries, and secondly, Chinese firms have considerable export potential. However, we realize that the market will eventually come to a halt.”

Label Cooperation with UPM

“We feel that the demand for label markets is very high. Statistically, the Chinese label


customer story

“Through our partnership we know that UPM’s products and services are fit-for-purpose.”

market’s sales growth is twice that of the GDP and what’s more important is that Chinese label consumption per capita is far lower than that of the developed countries,” says Li Zhen. The variable information label has a huge market, in which Guanhao has natural advantages and solid experience. More than two years ago, UPM started to cooperate with Guanhao as the supplier of the glassine paper for label base paper. “Through our partnership we know that UPM’s products and services are fit-for-purpose. No matter whether it has been in putting together the formula for our label products or providing us advice on our label production line, we’ve been provided with strong technology and service support. Working with UPM has been excellent in every way,” Li Zhen says with certainty. Juhani Ylikoski, Sales Director of UPM Converters Segment in AsiaPacific, said UPM is very optimistic about the growth potential of specialty paper in the Asia-Pacific region and China. “We are currently building a professional technical service team here, hoping to share our many years of accumulated experience in specialty paper with local manufacturers. We’re utilizing our experience, technology, products and strong service orientation to help clients grow rapidly, and to create a win-win situation,” says Juhani. Recently, UPM has announced an investment in a new woodfree uncoated and label paper production line in China, aiming to meet the constantly increasing market demand of high quality label and release liners product in China and the Asia Pacific region. “At present, the Chinese label market is still led by international brands. With cooperation with our international partners, such as UPM, we believe that Guanhao has the capability to reach a leading market position by becoming the key local representative for labels,” Li Zhen affirms. UPM FLASH / 2. 2012 /

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CORPOR ATE RESPONSIBILITY

Text: Mary Ma Photos: UPM

Cooperation in a Green way

— UPM visits WWF and Greenpeace headquarters in China

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n a sunny day in Beijing, UPM Asia Pacific Marketing and Business Development Director Ali Malassu, Global Environmental Director Päivi Rissanen, and Asia Pacific Environmental Marketing Manager Mary Ma sat down for a meeting with representatives of global environmental organizations World Wide Fund for Nature (WWF) and Greenpeace. The aim was to discuss environmental protection issues and explore opportunities for future cooperation. Green partners

UPM has a close partnership with WWF globally. In the International Year of Forests 2011, UPM and WWF worked together to produce their joint symbol for forest protection. The symbol includes the WWF panda logo and the slogan “Working with UPM to Protect Our Forests”. The symbol underlines both organizations’ aim to promote

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sustainable forest management and the use of products from sustainable forests. But the partnership of the two parties does not end there. UPM has also supported WWF’s paper evaluation system “Check Your Paper”, participated in WWF’s annual “Earth Hour”, and cooperated with WWF to promote Next-generation Plantation Project. In 2011, the project team visited Yunnan and Sichuan provinces to improve the economic benefits of planting and harvesting of forests and improve the income of local residents. WWF entered China over 20 years ago, and currently has around 100 employees in China in 10 different offices. WWF works mainly in the Yangzi River Basin, Heilongjiang River Valley, Yellow Sea biological area, Upper Mekong River and Tibet. Major projects include saving the Siberian Tiger, promoting the expansion of nature

reserves, Yangzi River Basin water conservation, the promotion of forest management and FSC forest certification. Recently WWF has focused on the protection of forest and water resources. Zhong Dexin, Cooperation and Development Director for WWF, has praised UPM’s environmental protection efforts and achievements. Regarding sustainable forests and forest products, both parties agreed to carry out deeper and broader cooperation and jointly promote the development of FSC certified paper in the Chinese market. “UPM Changshu mill has been FSC certified since 2006. The long-term publicity and promotion of the FSC concept has achieved remarkable results, with more and more users beginning to pay attention to FSC certified paper,” says Ali Malassu. “We are delighted that FSC-certified UPM Jetset is used at all WWF offices in China.”


CORPOR ATE RESPONSIBILITY

Positive action will bring change

After the visit to WWF, the UPM team traveled to Greenpeace Headquarters in Beijing. There they met with Li Yifang, the Senior Project Director, and Forest Protection Project Manager Liu Bing to discuss the marketing prospects of environmental and sustainable forest products. Greenpeace is another advocate of FSC certification. In early 2009, Greenpeace launched the “Book Lovers for Forests” campaign and engaged in promoting forest friendly book publishing together with publishing houses, paper suppliers, authors and the public. Greenpeace called on well-known authors and publishing houses to use environmentally friendly paper, including recycled paper and FSC-certified paper.

One of the recent Greenpeace projects addressing harmful chemicals and the safety of foods and agricultural products is chemical product management. In line with this, UPM has guaranteed that no harmful chemicals have been added to paper production, so consumers can rest assured when using UPM products.

WWF (World Wide Fund for

“We not only carried out very detailed multi-level discussions, but also considered many projects that have potential for cooperation. We expect to further cooperate with world renowned environmental organizations such as WWF and Greenpeace to protect our environment and improve the public’s environmental awareness,” says Ali Malassu.

WWF has been active in China

Nature) is one of the world’s largest independent organizations dedicated to the conservation of nature. Since the first office was founded in Switzerland in 1961, WWF has grown into a global network active in more than 100 countries.

since 1980, when it was invited by the Chinese government as the first international NGO to work on nature conservation. The Beijing office opened in 1996, and there are now 8 additional field offices spread across China. WWF has more than 120 employees working in China on a broad range of conservation programs including species, freshwater, forest, marine, climate change and energy, the green economy and footprint. Greenpeace is an independent global campaigning organization that acts to change attitudes and behaviour, to protect and conserve the environment and to promote peace. It consists of Greenpeace International (Stichting Greenpeace Council) in Amsterdam, and 28 national and regional offices around the world, providing a presence

From left to right: Jiang Yun, Zhong Dexin, Päivi Rissanen, Jim Gradoville (Chief Executive, WWF), Ali Malassu and Mary Ma.

in over 40 countries.

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TECHNOLOGY FRONTLINE

Text: Xu Yuan Photos: UPM

An introduction to dot of printing

T

he halftone dot has served as the standard in the printing industry since its introduction in the 19th century. Modern printing professionals know that mastering a whole range of halftone dot techniques is important for their industry. To the uninitiated, though, a whole new world can appear to them when they are given the opportunity to observe presswork through a microscope. In this article we review the basics of the halftone dot in order to better understand this small but essential element of the printing world. What’s halftone dot?

The halftone dot is a basic unit of printing

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that when combined with unprinted area creates a continuous tone image. There are two key types of halftone screening technique: one is called Amplitude Modulation - where gradations of image are expressed through the varying size of dots but where the distance between the dots is fixed. The other method of creating screens - Frequency Modulation - where the gradation within the image is expressed through the density of dots and not through their size. The halftone dot is the foundation of printing and reproduction processes, the “DNA” of nearly all printed image. It is the basic unit through which printed materials can embody

different gradations on a page layout and enable a natural division of tone shades. It determines color, gradation and image outlines. Therefore, when making printing plates, only a precisely sized halftone dot can reproduce the original color faithfully and guarantee a favorable output. Size of halftone dot

The shade of a printed page is made possible by varying the sizes of the halftone dot. In China, technicians use character “Cheng” to measure different dot size. This so-called “Cheng” represents the percentage of halftone dots within a given unit area. For example, one cheng is 10%, and two cheng is


TECHNOLOGY FRONTLINE

20%. One hundred percent results in a true solid color. The higher the percentage number, the bigger the dot and more ink coverage. The percentage difference determines the color gradations on the page layout. Usually, the gradations on the image are divided into three areas. Highlight area is created using dot size of 10% to 30%, composing the lighter shades of an image. Midtone area is produced with dot size of 40% to 60%, resulting in the medium shades between bright and dark extremes. Shadow area is composed of 70% to 90% of dots, forming dark shades and shadows. The lightest part on the page with less than 10% dots, but they still contain dots. Only by precisely identifying the percentage of halftone dots, can printers apply the rules of dot change, bring the plates into conformity with an original manuscript, and produce printed products with precise colors and satisfactory quality. These are the goals of quality assurance.

2%

50%

98%

Chart 1

Y90°

K75°

M45°

C15° Chart 2

Halftone dot printing

There are two key halftone dot printing techniques: amplitude modulation and frequency modulation. 1) Amplitude Modulated Halftone Dot Screening grades images by varying the sizes of halftone dots. One of the shortcomings of this technique is that a moiré effect caused by intersecting linear patterns can result. Key to this approach is screen angle, the angle formed by the line between centers of two adjacent dots and datum line. Den-

Only by precisely identifying the percentage of halftone dots, can printers apply the rules of dot change, bring the plates into conformity with an original manuscript, and produce printed products with precise colors and satisfactory quality.

sity and screen angle of screen line need to be controlled, and the angle formed by two color plates must be 30 degrees or above so that “screen collision” producing undesirable patterns can be avoided. Usually, the screen angle of C plate is 15 degrees, M plate 45 degrees, K plate 75 degrees, and the Y plate 90 degrees. Although, the angle formed by the Y plate and other plates will be only 15 degrees, as it is lighter than other three colors, the screen collision will not be apparent. 2) Frequency Modulated Halftone Dot Screening grades images by randomly placing dots, that is varying densities of dots identical in size within a given unit area. Using this approach solves most moiré problems. The diameters of the small dots are between 8-30 microns, and the sizes of the dots are identical. The color shade expression is different from that of Amplitude Modulated Halftone Dot. The shade of image is expressed through density: the higher the density of dots, the darker the color. The disadvantages of this technique include light

position gradation and the flat screen can easily generate coarse particles. The density of middle tone dots is also extremely high, and dot gain is difficult to control. 3) Hybrid Halftone Dot Screening The Hybrid Halftone method combines both Amplitude Modulation and Frequency Modulation. Frequency Modulation is used to create identical small dots expressing gradation through density in the light areas with 1-10 percent dots and dark areas with 90-99 percent dots. In the middle tone area between 10 and 90 percent, Amplitude Modulated Halftone Dot Screening is used altering the sizes of the dots. As the positions of all dots are random, the screen angle need not be considered. Mixed dots carry both the advantages of the Frequency Modulated Halftone Dot and Amplitude Modulated Halftone Dot techniques. Combined with the set-up of a highly calibrated external drum CTP plate setter and fast hardening thermosensitive plates, the Mixed Halftone method can really bring out the best in CTP printing. UPM FLASH / 2. 2012 /

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Marketing Information

Source: The 12th Five-Year Plan for China pulp and paper industry, RISI

Key Points of The 12th Five-Year Plan for China Pulp and Paper Industry China’s 12th Five-Year (2011-2015) Plan for the pulp and paper industry (FYP) was released on December, 30, 2011. The latest FYP directing the pulp and paper industry through 2015 targets balanced growth of total paper and board consumption and production. Put an emphasis on demand and supply rebalancing. FYP requires working on 7 focused areas:

9 policies and support

1. Improve raw material structure. 2. Increase indigenous innovation, improve technological structure. 3. Optimize regional development, allocate resources properly. 4. Conduct clean production, protect environment. 5. Optimize enterprise structure, promote mergers & acquisitions. Efforts to improve industrial consolidation. 6. Improve product structure, improve product quality. Develop new and environment-friendly products, speed up the upgrading of lowend products. 7. Establish saving mechanism, promote appropriate consumption.

1. Strengthen policy support, promote forest-pulp-paper integration. 2. Support independent R&D, develop equipment manufactured in China. 3. Improve incentive policy, promote energy saving and emission reduction. 4. Increase waste paper recycling, promote green consumerism. 5. Improve foreign investment utilization policy, improve foreign investment utilization environment. 6. Increase support, promote overseas investment. 7. Increase investment, expand financing channels. 8. Establish & improve mechanism in response to trade conflict. 9. Increase influence of China Paper Society, improve industry selfdiscipline.

Implement 3 key projects

Project on forest–pulp-paper, clean production and recycling, and product upgrade and equipment independence.

Driven by national policy on eliminating outdated capacity (more than 10 million tons, accounting for 10%-15% of total capacity), the consolidation paper-making industry is expected to speed up and the pollutant emission is also expected to reduce gradually during 2011-2015.

Main chart Chart 1 Main targets of the 12th Five-Year Plan for paper-making industry development Category

Target

2010 年

2015 年 ( 预计 )

CAGR%

P&B capacity (million t/a)

9270

11600

4.6

P&B

Expecte

Fiber

Resource

P&B demand (million t/a)

9173

11470

4.6

1. Pulp (%)

22.0

24.3

/

Domestic (%)

8.4

10.3

/

Imports (%)

13.6

14.0

/

2. RCF (%)

Consumption

Consumption

62.7

64.0

/

Domestic (%)

38.0

41.0

/

Imports (%)

24.7

23.0

/

3. Non-wood pulp (%)

15.3

11.7

/

Coal consumption /ton of P&B -22%

0.68

0.53

-4.9

Coal consumption /ton of pulp -18%

0.45

0.37

-3.8

Water consumption /ton of pulp/P&B -18% Environment Protection Old Capacity

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属性

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85

70

Reduce 10-12% from 2010 to 2015

Ammonia & Nitrogen discharge

Reduce 10% from 2010 to 2015

Capacity closure

Above 10 million tons

North East Foreign fiber resources Fast growing plantation Reed base

North West Not suitable for paper industry

Heilongjiang Jilin Xinjiang Inner Mongolia

Gansu Expecte

Ningxia

Qinghai Tibet

Sichuan

Restricte

Yunnan

Liaoning

Beijing

Yellow river & Huai river

Hebei Tianjin

Shanxi

Shandong

Fujian

Guangxi Guangdong

South China Taiwan

Hong Kong Restricte

Restricte

Develop chemical mechanical pulp Strength market wood pulp and waste paper recycling Adjust the straw pulp structure

Jiangsu Shaanxi Henan Anhui Yangtze river Shanghai Forecast-paper integration Hubei Encourage wood pulp imports Zhejiang Strength waste paper recycling Jiangxi Hunan

Guizhou South West Develop bamboo pulp

-3.8

COD discharge

Chart 2 Regional Development in China

Hainan

Develop plantation Encourage woodchip imports Pearl River Delta: control of development Guangxi: bagasse resources

Correction:In Flash magazine Issue 1/2012, the article of“The future of the Asia Pacific printing market ”, which data sources comes from Pira.


Product & Service

UPM FLASH / 2. 2012 /

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Upm Flash Issue 9