Biorefining an Option for Forestry Industry?

Government and industry experts have proposed that companies in the forestry products sector transfer production from low-value goods to downstream value-added products. One option which fits this profile would be biorefineries. The proposals come from ongoing efforts to salvage Finland's forestry industry, which is facing large-scale cutbacks in production and jobs as companies attempt to streamline their operations to enhance the bottom line. YLE has ascertained that a high level working group, led by former Prime Minister Esko Aho, is considering a proposal to encourage biorefining by providing investment subsidies. This could result in a drop of investment funds for traditional forestry operations by as much as 50 percent. The Aho working group will publicise its long-term strategy for the sector by the end of September. The basic principle would be to transfer production in the sector from cheaper paper goods to high-priced output such as identification paper and intelligent packaging. The report also sets out ideas for new biorefineries. Changes in Ownership Structure of Forestry Products Sector

Lauri Hetemäki of the Finnish Forest Research Institute said that biorefining offers the industry many production possibilities.

He pointed out that in the United States, financial support for such refineries runs into billions of dollars. He said backing experimental plants could yield benefits for the forestry sector. He referred to the current upheavals in the sector as the most extreme since the end of the 18th century, when pulp replaced rag paper as raw material in the paper industry.

Hetemäki said he sees diversification coming in the wood processing industry on both the operations and production fronts. He added that the current ownership structure in the forestry products industry is in a transition phase, portending an end to the time of the "big three" - Stora Enso, UPM and Metsä-Botnia.