SCA signed a joint venture agreement with E.ON today, through which E.ON will develop a number of wind power projects together with SCA.

The joint venture includes the areas operated by SCA Vind up until the licence application: Hästkullen and Björnlandhöjden in Härnösand, and Kramfors and Timrå municipalities. The agreement also covers wind power projects in southern Ånge and in Ljusdal.

“The joint venture includes approximately 270 wind power stations and a total energy production of more than 2 TWh, corresponding to the electricity required for warming 100,000 Swedish households,” says Head of SCA Energy, Åke Westberg.

Future investment decisions can be expected by 2014 or 2015 at the earliest. The project is expected to be in operation by 2016 to 2017 at the earliest.

Weaker pulp markets are forcing pulp manufacturers worldwide to reduce costs, resulting in the lowest softwood wood fiber prices seen since 2010, reports the Wood Resource Quarterly.

The declining prices for softwood pulp during much of 2012 have forced many pulp mills to try to cut wood fiber costs to remain profitable. As a consequence, the wood fiber price index (SFPI) has continuously declined the past year and, during the 3Q/12 was at its lowest level since 2010, according to the Wood Resource Quarterly.

Prices for softwood market pulp (NBSK) prices have trended downward for more than a year from their record highs of over $1000 per ton in the summer of 2011. In the 3Q/12, prices had fallen to between $750-800/ton in Europe and were about 50 dollars higher in the US. This relatively long-lasting price decline seems to have come to an end this fall, as there are now pulp producers negotiating higher prices again. List prices for December are in the range of $820-870/ton depending on if the deliveries are to Europe or North America.

The lower pulp prices have resulted in downward price pressure on wood fiber prices in many high wood cost regions around the world as pulp companies have seen product prices approach production costs. When profit margins for pulp mills are being squeezed, one of the first step taken to improve profitability is often to try to reduce the wood costs, since those costs typically account for 60-70 percent of the production costs when manufacturing pulp.

Prices for pulplogs and wood chips fell in the local currencies in most of the key regions worldwide in the 3Q/12, according to the Wood Resource Quarterly www.woodprices.com. However, because the US dollar weakened against most currencies, wood prices in US dollar terms did not decline as much in the third quarter.

The Softwood Wood Fiber Price Index (SFPI), which is based on US dollars, was down another 0.5 percent from the 2Q/12 to US$100.05 per oven-dry metric ton (odmt). This was the fifth consecutive quarterly decline, and the index has now fallen 8.7 percent since early 2010. The biggest price declines were seen in the Northwestern US, Germany, Spain and Russia.

Hardwood fiber prices started to increase in some regions around the world in the 3Q/12, which resulted in the first increase of the Hardwood Wood Fiber Price Index (HFPI) in over a year, as reported in the WRQ. The Index increased by $1.56/odmt from the 2Q/12 to $106.44/odmt in the 3Q/12. Hardwood fiber prices increased the most in Russia, Eastern Canada and Brazil.

The price outlook for wood prices in the fourth quarter is mixed, with a stabilizing of prices in most softwood pulp-producing countries but also continued price declines in a few regions.

Sonoco (NYSE: SON) Chairman and Chief Executive Officer Harris E. DeLoach Jr., President, Chief Operating Officer and CEO-elect M. Jack Sanders and Vice President and Chief Financial Officer Barry L. Saunders, has provided the investment community in New York with an update on the Company's 2012 performance and outlined the Company's strategic initiatives and financial outlook.

2012 Base Earnings Guidance Unchanged; 2013 Estimates Established
Sonoco expects fourth quarter and full-year 2012 base earnings to be unchanged from the Company's previously announced guidance of $.52 to $.56 and $2.17 to $2.21 per diluted share, respectively. The Company reported fourth quarter and full-year 2011 base earnings of $.46 and $2.29 per diluted share, respectively. Base earnings and base earnings per diluted share are non-GAAP financial measures adjusted to remove restructuring charges, asset impairment charges, acquisition expenses and other items, if any, the exclusion of which the Company believes improves comparability and analysis of the underlying financial performance of the business.

"At this point in the quarter, we have not seen any significant changes in business conditions that would cause us to revise guidance, but customer order patterns remain somewhat erratic and overall economic activity is uncertain," said Sonoco's CFO Saunders.

"Sonoco expects to recognize about $12 million in additional tax expense in the fourth quarter of 2012 associated with the repatriation of cash held outside the United States. This one-time charge is excluded from the Company's base earnings projections," Saunders said.

Commenting on the Company's 2012 expected results, DeLoach said, "Obviously, our performance in 2012 is not what we expected when we began the year. That said, we have weathered a difficult economic and operating environment and made changes we believe will improve our performance in the future."

Sonoco estimates 2013 base earnings per diluted share to be in the range of $2.24 to $2.32, with a projected midpoint of $2.28per diluted share. Saunders said the Company's midpoint guidance assumes a $.20 per share improvement stemming from modest volume growth, productivity improvements and a slightly positive price/cost relationship. Offsetting these improvements is approximately $.11 in negative items, including an estimated $.09 per share impact from higher year-over-year pension expenses.

Free Cash Flow Outlook Provided; Capital Deployment Plans Outlined
DeLoach pointed out that despite lower expected earnings through the first nine months of 2012, cash flow from operations has increased 125 percent year over year to nearly $297 million, due to lower pension and post retirement contributions and beneficial changes in working capital. For 2012, the Company expects to generate free cash flow of approximately $90 million, after paying approximately $120 million in dividends to shareholders.

Looking forward, Sonoco is projecting that annual cash flow from operations could average approximately $460 million over the next several years. For 2013, free cash flow, after dividends, is estimated to increase to approximately $130 million, due primarily to anticipated lower pension contributions, CFO Saunders said.

President, COO and CEO-elect Sanders outlined Sonoco's anticipated capital deployment plans saying, "Our first priority will be to maintain our strong investment grade credit rating. With the repatriation of cash and the use of free cash flow, we expect to make significant debt-reduction payments in 2013.

"In addition, we plan to continue investing in our targeted growth businesses while optimizing operations in our more mature businesses. Our dividend policy is unchanged and we expect to continue rewarding our shareholders with cash dividends as we have for 350 consecutive quarters, going back to 1925. For 2013 through 2015, our remaining available cash is expected to total approximately $260 million and be available for targeted acquisitions and/or share repurchases."

Strategy Focusing Resources to Targeted Growth Businesses  
Sanders said that Sonoco will be focusing resources and investment in businesses which serve faster growing markets, including the Company's Consumer Packaging and Protective Solutions businesses and selected emerging market development opportunities for composite cans and tubes and cores.

"We are targeting to grow our top-line sales to between $5.5 and $6.0 billion by the end of 2015," said Sanders. "We must drive organic growth in our faster growing businesses and optimize operations in our more mature businesses by focusing on market share management and cost optimization."

Sanders cited the following 2012 and 2013 growth projects, by business segment, as examples of the Company's growth strategy.

• Rigid Paper and Closures
  • Sonoco is establishing a new composite can production facility in Johor Bahru, Malaysia, to meet the growing appetite for premium stacked chips throughout Asia.
  • Stacked chip capacity is likely to be added in 2013 in Brazil and a review of growth opportunities in Eastern Europe is underway.
• Rigid Plastics
  • Sonoco started up in the third quarter of 2012 a new multilayer, trim-in-place thermoforming line at its Waynesville, N.C., facility to produce of a variety of containers for chilled and thermally processed shelf stable foods.
  • The Company plans to invest $7 million in 2013 to add a third multilayer, barrier bottle production line for nutraceutical beverages at its Columbus, Ohio, production facility.
  • In the third quarter of 2012, the Company commenced commercial operation of a new $15 million 142,000-square-foot plant in New Albany, Ohio, to produce PET personal care bottles.
• Flexible Packaging
  • Investment is being made to add a new rotogravure press to the Company's Morristown, Tenn., facility in 2013.
• Display and Packaging
  • Expanded packaging fulfillment capacity in Brazil and a new in-DC (distribution center) facility in the U.S. were put in operation in 2012.
• Protective Solutions
  • An investment of $15 million is planned in 2013 to build two new custom-molded foam fabricating facilities in the United States and Mexico to serve the growing automotive component market.

Key Takeaways
Sanders concluded the Company's review by saying, "2013 is projected to be a better year, but again we don't expect any real help from the global economy. In addition, we expect to face pension headwinds. However, free cash flow, after dividends, is expected to increase by up to 40 percent next year to $130 million."

"Our extended outlook through 2015 could see our top line reach $5.5 billion and earnings growing at compound rate of about 8 percent. To fully meet our financial targets we may need to make some minor course corrections along the way, including considering how we are organized so we can better satisfy the customer."  

The Development Authority of Bryan County, in partnership with TerraPointe, the real estate subsidiary of Rayonier, held a groundbreaking ceremony for the Belfast Commerce Centre. Lieutenant Governor Casey Cagle and other state and local dignitaries were present to commemorate the event.

The 1,100-acre industrial park, the largest rail-served site in the Savannah market, is approved for 10.5 million square feet of industrial, manufacturing, warehousing, distribution, office and commercial property.

“With the potential to create more than 7,500 new jobs, Belfast Commerce Centre is an exciting economic development opportunity for the State of Georgia,” said Lieutenant Governor Cagle, “We must continue to work together to encourage business growth, attract capital investment, and create high-wage jobs for Georgians.”

Belfast Commerce Centre has two miles of I-95 frontage, 1.5 miles of frontage on theRiceboro/Southern Railroad Line, and direct access – 16 miles – to the Port of Savannah. It is an attractive location for major manufacturers and other companies that can benefit from the site’s location and transportation advantages. Further strengthening the site’s marketability, theFederal Highway Administration recently approved a proposed interchange at Belfast Keller Road that would provide direct access to I-95.

“Today, Belfast Commerce Centre, Bryan County’s first rail-served industrial park, is open for business and is ripe for significant industrial growth,” stated F.J. “Josh” Fenn, executive director of the Development Authority of Bryan County. “This will be an outstanding compliment to our successful Interstate Centre. Bryan County can now offer industrial sites on both I-16 and I-95, one of very few counties in the country that can offer industrial parks on two different interstates.”

As Georgia’s first recipient of a CSX Select Site designation, Belfast Commerce Centre has been certified as development-ready. This designation ensures the site has met a set of rigorous criteria and is ready for rapid development, reducing risk for companies seeking to expand or locate their operations there.

“Future industrial and commercial development in Bryan County will broaden and diversify our tax base, reducing our reliance on residential ad valorem taxes to fund local government services,” said Harold Fowler, Mayor of the City of Richmond Hill.

“We are grateful for the strong support from federal, state and local partners who have helped us reach this milestone on this important economic development project,” said Paul Boynton, chairman, president, and CEO of Rayonier, “I would like to especially thank our local partners in Bryan County and the City of Richmond Hill for their unyielding commitment to leverage the unique assets here at Belfast Commerce Centre.”

Source: Rayonier

The Competition Directorate-General of the EU Commission has completed the first phase of its investigation under the EU Merger Regulation into the transaction between Ahlstrom's Label and Processing business and Munksjö AB and opened an in-depth (second phase) investigation into the proposed combination with respect to abrasive backings and pre-impregnated decor paper. The Commission now has 90 working days, until April 29, 2013, to take a final decision on whether the combination would significantly impede effective competition in the European Economic Area (EEA) or any substantial part of it.

Ahlstrom and Munksjö AB continue to work closely with the Commission in order to allow the Commission to complete its review as quickly as possible, aiming at a completion of the demerger of Ahlstrom's Label and Processing business in Europe and other related measures forming the first phase of the planned transaction during the first quarter of 2013. It is, however, possible that the completion of the first phase of the planned transaction will not take place until the second quarter of 2013.

On November 27, 2012, Ahlstrom's Extraordinary General Meeting approved the demerger concerning Ahlstrom's Label and Processing business in Europe and the demerger concerning Ahlstrom's Label and Processing business in Brazil in accordance with the demerger plans.

Caroline Hyll presented her licentiate thesis “Infrared emittance of paper – method development, measurements and application” at Innventia. This work will enhance the use of thermography in the pulp and paper industry.

Thermography is a non-destructive technique which uses the emitted infrared radiation to determine the surface temperature distribution of an object. The technique is increasingly used in the pulp and paper industry. To convert the detected infrared radiation to temperature, the emittance of the material must be known. The emittance is a radiative material property which may vary with wavelength, temperature, observation angle, moisture content, material composition, material structure, and surface roughness. An as exact as possible emittance value for a given measurement situation is therefore crucial for the accuracy of thermographic measurements.

The emittance of paper has not been studied for many of the conditions that are encountered in a paper mill. This general lack of information may partly be explained by limitations of existing emittance measurement methods. No emittance measurement method that allows for variation of temperature, observation angle and moisture ratio exist. Additionally, the emittance of paper may not be predicted by current analytical models. The limitations of existing models stress the importance of measuring the emittance.

The aim of this thesis is to improve the accuracy of thermographic measurements in the pulp and paper industry by providing emittance values for different materials under different process conditions. These values can also be used in future modelling of infrared emission from paper at different stages in the papermaking process.

Based on a thorough literature study providing state of the art knowledge, a new angle-resolved goniometric emittance measurement method suitable for paper samples exposed to different temperatures and moisture ratios was developed. Followed by verification testing and error analysis of the system, a large number of angle-resolved emittance measurements were made on paper and board in conditions similar to those at different stages in the papermaking process. The method was applied, and the applicability of measured emittance values to quantitative thermographic measurements was demonstrated.

“I hope that my work will be of use in the pulp and paper industry. Companies that want to use this technique should be able to find values and references applicable to their processes in the thesis,” says Caroline Hyll.

“Caroline’s thorough experimental studies and method development help us a lot when we perform thermographic measurements both in the laboratory and in paper mills,” says Hannes Vomhoff who has been Caroline’s supervisor at Innventia.

UPM has donated more than 1,500 copies of a special edition of Donald Duck comic magazine titled ‘Design!’. The magazines were distributed to 8th grade school children from the neighbourhoods of UPM’s paper mills in Rauma, Kouvola, Valkeakoski, Jämsä, and Lappeenranta.

The purpose of this donation is to encourage school children to read printed magazines, to think about design as part of our everyday life, and to learn new languages in an easy way. “We are starting to learn more about the benefits of paper for concentration and learning. We want students to enjoy good and relaxing reading moments with Donald Duck ‘Design!’ magazine,” commented Ulla-Riitta Unkuri, Communications Director, UPM Paper Business Group.

The magazine was produced in cooperation with Sanoma Magazines as part of the ‘World’s Design Capital - Helsinki 2012’ initiative.

Well-known Finnish designers such as Alvar Aalto, Vuokko Nurmesniemi, Stefan Lindfors and Paola Suhonen are featured in the Donald Duck Design! edition. The designers explore, along with the famous characters from Donald Duck’s cartoons, the possibilities that unfold when a creative mind focuses on design and innovation, and how these can impact society.

The comic magazine of the temperamental, but well-intentioned Donald Duck is intended for readers of all ages and encourages them to consider the essence of design. The magazine was edited in four languages: Finnish, Swedish, English and German.

To honour the festivity of the World Design Capital event, the high quality UPM Finesse was selected for the cover paper. The inside pages are printed on UPM Star matt, which brings out the comic magazine’s bright colours and graphic details. The end result is a magazine that creates a relaxing experience that inspires and facilitates learning new languages.

Barry-Wehmiller International Resources BWIR), a global provider of business and engineering technology solutions to the discrete manufacturing industry, has announced plans to participate in Automate 2013.

This show is North America’s broadest automation event, to be held January 21-24 at McCormick Place in Chicago, Illinois. Senior BWIR professionals and technology specialists will be available throughout the show to discuss how various machine and equipment builders and discrete and process manufacturers can increase their production efficiency by enabling intelligence through controls and industrial automation techniques. BWIR will also exhibit custom intelligent embedded solutions and mechanical design solutions to these segments through proven ideas and systems.

BWIR has over a decade of experience designing custom-built automation solutions, and using controls automation, embedded technology and industrial automation techniques to improve customers’ equipment and increase plant efficiency.

To see a demonstration of these successes or to discuss specific challenges, visit Booth #126.