UPM FLASH

UPM AP CUSTOMER MAGAZINE 3/2011

UPM FLASH

From forest to paper, the story of our Water Footprint UPM foothold in Taiwan secured by trust

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EDITORIAL

UPM FLASH

UPM IN JAPAN – ACHIEVING TOGETHER WITH CUSTOMERS

3/2011

UPM Flash is a quarterly magazine for UPM paper customers in the Asia Pacific region.

The “3-11” triple catastrophe combining an incredibly powerful earthquake, a huge tsunami and a crippled nuclear power plant was “the biggest catastrophe to hit Japan since WW2” and the impact it has cast throughout the country, the society and the economy still remains fresh today, even it is already six months away. It will probably carry on for next 10 years.

EDITORIAL BOARD: Vivian Wang, Jackie Bao, Mary Ma, Zheng Guohua, Zhao Ye

Even if the country has tried its best to keep everything under control and people have showed courage, faith in their behavior, Japanese were deeply shocked and tottered inside. To a great extent, Japan will never be the same as it used to be in the perception of the majority – people’s basic thinking has changed in many aspects of life.

EXECUTIVE EDITOR: Ada Qin (Chinese Version), MOLI Design (Chinese and English Version) LAYOUT: MOLI Design PAPER: UPM Finesse premium silk 200 g/m2 (cover), UPM Finesse premium silk 130g/m2 (inside)

Through the human despair and considerable confusion in government follow up, people’s spirits were lifted with uncountable signs of compassion and help from foreign countries - from governments, companies, NGO’s, celebrities and normal citizens all alike. In business, many long term relations were tested in how foreign contacts reacted to the sudden problems their Japanese customers encountered from various catastrophe impacts. Some ran away, some turned their backs, some showed resilience and support – and turned the bad situation into an opportunity to re-strengthen the old ties.

Please email your feedback on Flash magazine to: upm.flash@upm.com UPM in-house magazine

photo: Tony McNicol www.tonymcnicol.com

As UPM local leader, I am proud that we chose the latter approach. Given the first news of fear for lack of supplies from two disrupted paper mills in the north-east coast, UPM responded immediately to customers’ request and was able to deliver paper to meet the demand in short notice. More than just a temporary move, our support helped to again demonstrate our commitment to the customers. A positive response from them has become the new mutual, promising business plans with steady growth together further ahead.

SUBSCRIPTION: fax 86 (21) 5292 8912 or email upm.flash@upm.com

UPM China & Asia-Pacific Sales Network Shanghai: 86 21 6288 1919 Korea: 82 2 723 0555 Hong Kong: 852 2527 0177 Singapore: 65 6838 7280 Japan: 81 3 5778 2660 Australia: 61 2 9334 5000

“Trust and to be trusted. Achieve together. Renew with courage” are the new company values this year. They are well reflected in the way we conduct our business. Facing the difficult situation in Japan, we managed to pull all the values with our customers. We built the bridge of stronger ties in trust, renewed our relationships, and achieved new business together. Now we are reaping the results of our efforts.

Timo Varhama General Manager UPM-Kymmene Japan

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CONTENTs

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From forest to paper, the story of our Water Footprint

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featUre stOrY

UPM supports the New Generation Plantation Project

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UPM points way for the printing paper business

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customer story

Editorial

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News

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The copy paper demand in the information age

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UPM foothold in Taiwan secured by trust

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technology frontline Unraveling the Metamerism Mystery 20

product and service UPM Fine preprint paper

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COrPOrate resPOnsiBiLitY

UPM teaches environmental virtues to summer campers

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From forest to paper, the story of our Water Footprint

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READERSHIP SURVEY UPM Flash Readership Survey

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NEWS

Dear Customer, We are pleased to confirm that UPM has closed the deal of acquiring Myllykoski on August 1st.

Together, UPM and Myllykoski are a good fit. We are confident that our combined expertise in publication papers will be beneficial for your business. Our aim has been and will be to offer our customers world class services and products that are produced in an environmentally sustainable way.With this transaction we are creating a cost-competitive, stable long term partner who has a strong vested interest in paper and print.

Combined, UPM and Myllykoski, will result in improved geographic footprint with several new local mills in Central Europe, especially in Germany, and in North America. This ensures our possibilities to serve and enhance supply security. Our ability to meet our customers’ needs and to operate on a world-wide basis including new growth markets will be better than ever. Our combined product portfolio offers a complete range of alternatives for any kind of printed products.

plans based on an asset review.

In the interim your contacts will keep you informed of new developments as well as continue to take care of your day-to-day business.

We will honour the currently valid sales contracts and commitments made by UPM and Myllykoski sales organisations. We will be very active in our communications towards you in the next few months.

The new product names will be migrated into UPM order processing systems in due course after a short IT transition period. Please visit also our brand new website www.upmpaper.com to learn more about our extensive product range and services.

We all are fully committed to print media and to serve you in the best possible way, furthermost we will continue to improve our mutually beneficially relationship over the coming years.

Yours sincerely,

Now that UPM’s acquisition of Myllykoski has been closed we will swiftly move into a jointly planned integration phase. Our aim is to move speedily in all organisational matters as well in finalising our

UPM and Ricoh partner in green seminar On June 27, the “Environmental Paper and Sustainable Lighting Seminar” sponsored

by Ricoh was held in Hong Kong. Ricoh recruited UPM’s environmental expertise and invited UPM representatives to speak on the developing market for environmental copy paper during a forum.

At the seminar, speeches and discussion topics highlighted environmental paper, environmental certification, how to purchase certified paper, and the function of LED lighting for commercial development. Approximately 40 guests attended the seminar, and most attendants were Ricoh customers. UPM noted that green paper seminars being sponsored by third parties is a sign that environmental friendly paper has become more and more recognized in the market.

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Jyrki Ovaska President, UPM Paper Business Group

Notice of company name change The company name of “UPM-Kymmene (Changshu) Paper Industry Co., Ltd.” formally changed to “UPM (China) Co., Ltd.”.

The previous company name will be officially and completely replaced by the new company name from September 1, 2011.

The company name change will not lead to any other changes in legal entity, investment relationship, contract information and contractual rights and obligations, etc.

NEWS

UPM provides advocacy at the fourth International Sustainable Forests Conference

UPM represented the paper industry in Shanghai on June 22 and 23, introducing forest certification to the Fourth International Conference on Sustainable Forests and Market Development.

The conference, which explored this year the theme “Forests • Markets • Policy • Practice”, is sponsored annually by the Research Center for Economics and Trade in Forest Products of the State Forestry Administration (CINFT, SFA) and The Nature Conservancy

(TNC). The conference discussed public policies and business practices of the legal and certified forest product market, seeking to improve the ability of enterprises to manage challenges and opportunities while balancing environmental policies, public policies, and consumer demands in supporting certified forest products and practices.

During the afternoon session of the opening day, UPM Environment Marketing Manager, Mary Ma, took center stage to present “Paper

Industry and Forest Certification.” Mary detailed the positive achievements and experiences UPM has had in China, and discussed current topics such as how forest certification can help Chinese enterprises to improve their bottom lines.

UPM’s leadership as an advocate of forest certification has made the paper manufacturer the leading biofore company in the world and an industry leader of forest product production and management.

UPM attends prestigious science journal conference

Welcome to visit www.upm.com

As the major paper supplier for domestic magazines and periodicals, UPM was honored with an invitation to attend in Zhengzhou the Fifth Annual Conference on China Science Press Journals.

Wang Yunjiang, the deputy manager of UPM technical sales team, gave a speech at the conferences titled “Development Trends and Technical Requirements of Journal Paper.”

UPM Global website domains will unify under www.upm.com. Links to regional or functional sites can be accessed by selecting from option menus at the homepage.

Wang discussed perspectives on international development trends and a reflection on UPM’s experience. Wang summarized journal paper trends as “low basic weight, high-whiteness and environmental protection.” Also, users are seeking reduced cost, and improved quality. The introduction of environmental-friendly paper has provided customers with the option to select paper certified by sustainable forest management system, to support good environmental practice.

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Printer pays UPM a “Green Visit”

Text / Photos: Cai Wen Yan

Accepting UPM’s invitation, the guests from C&C China group visited UPM Changshu Mill on June 1. The mill’s working environment, advanced equipment and modern management impressed the guests. After the visit, Mr. Cai Wen Yan from C&C Joint Printing wrote an article entitled “Green Visit.” Below is an excerpt of the article: The mill area of Changshu paper mill is located on the north bank of the Yangtze River near the Sutong Bridge. When the bus entered the mill gate, we could see the container yard with neatly stacked containers and contiguous scattered mill buildings in the distance.

The bus led us directly to the living area.

Outside the windows, there was a large green lawn, and basketball courts and tennis courts not far away from us. Some employees were playing there, suggesting that the company values balance between relaxation and work.

On the next morning, the UPM production

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technical department conducted presentations which gave us a much deeper understanding of UPM’s paper production process.

In the afternoon, we rode a bus to visit the mill. Outside the bus, there were large sites to be built, and lush grass grew.

There was a tall chimney beside the wharf connected with a nearby power plant. Such chimneys are rare now. There was a water treatment plant located on the bank of a circular pool, in the process of purifying and recycling the water used in the paper-making process.

Paper machine No.2 we visited produces the printing paper that we often use. complex appearance was impressive. We looked at various precise inspection and testing instruments in the checkout room, saw the circulation from massive rolls of rewound and cut paper, and observed the cutting and packaging processes along the conveyor belt. The whole process of green paper-making was laid out before us in a day and we left with feelings of great admiration for our hosts and their successful operations.

NEWS

UPM wins bid to supply the State Organs Work Committee of the CPC 2011 information project.

The brands included in the winning bid are: UPM Jetset, UPM Classic Jetset, UPM Copykid, UPM Yes, Future

UPM earns China Environmental Labeling Product Certificate The brands that have been recognized: UPM Green Jetset, Office, UPM Yes, UPM Jetset, UPM Copykid, Future

China Environmental Labelling

Changshu Mill unveils new wrapper for graphic paper UPM Changshu Mill launched in September the new packaging for UPM Fine and UPM Finesse classic gloss and matt which will proudly carry “the Biofore company �logo.

Reel paper wrapper

The newly packaged paper products will be phased in over the coming months while the stock for the products carrying the previous design is run down.

Folio sheet paper wrapper

UPM Fine

UPM Finesse classic

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Text: Ada Qin Photos: UPM

UPM supports the New Generation Plantation Project The New Generation Plantation Project (NGPP) is a platform of partners, including the World Wildlife Federation (WWF) and companies and governments from around the world, that have united to examine the social, environmental, economic and cultural role of plantations and to create best practices for their planning and management.

E

nvironmental groups and businesses see planted forests (or plantations) as the future of sustaining a global wood and fibre supply.

biodiversity conservation and human needs.

NGPP aims to improve plantations by sharing information gleaned from case studies and the experiences of participants.

UPM was a founder member with the World Wildlife Federation (WWF) in the New Generation Plantation Project (NGPP) in 2008.

A world leader in conservation, WWF tackles the toughest issues facing our planet today.

Forest products are renewable. When acquired from well-managed forests and plantations, forest products have a lower carbon footprint than alternatives like steel, concrete and plastic derived on fossil resources. WWF believes that NGPP can play a major role in maintaining the planet’s natural capital.

In March, UPM Environmental Manager Andrew Heald came to China as a company representative for a NGPP investigation group.

The purpose of his seven-day trip was to tour Yunnan’s forest plantations.

“What struck me most, was that everywhere we visited there was development and construction (of roads, buildings etc.) that relied heavily on natural resources, particularly timber,” says Andrew.

NGPP, founded in 2008, has responded to the growing need for understanding plantations and their impact on forest landscapes,

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“UPM wants to be the leader in the sustainable management of plantations,” Andrew comments. “We have maintained a close working relationship with WWF for many years. Through NGPP we have been able to share best practices and to learn the best techniques for sustainable management.”

“Forests have been key to our evolution as

societies and individuals,” Andrew adds. “It is vital to address the impact of human activities on forests in a transparent and participatory way. There are two important facts to keep in mind: a) tree plantations provide essential natural resources, and b) original and pristine ecosystems are under increasing pressure every year to keep up with human demand. These two pressures give rise to the question: is it possible to innovate forestry models so that commodities keep flowing, the rights of local communities regarding access and benefit sharing are respected and activities to protect and restore natural forests are sustained?”

During 2011, the International Year of Forests, WWF’s Living Forests Report is examining the drivers of deforestation and opportunities to shift to new models of sustainable forestry, farming and consumption.

The report aims to catalyze debate on the future role and value of forests in a world where humanity lives within the Earth’s ecological

featUre stOrY limits and shares its resources equitably. Zero Net Deforestation and Forest Degradation (ZNDD) by 2020 is a critical milestone moving toward this goal.

Around 2050, the global population is projected to both pass 9 billion and to have a higher average income. Major changes will be needed for the Earth to sustain this many people. These changes include new consumption patterns that meet the needs of the poor while eliminating waste and over-consumption of the affluent.

Achieving and maintaining near-zero forest loss will also require forestry and farming practices that produce more resources with less land, water and pollution. This suggests an increasing reliance on high-yield plantations for timber, fiber, and biomass for energy. The Living Forests Report indicates that plantations will need to be expanded at a rate of four to six million hectares per year between now and 2050.

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management. Manual labour is still heavily used and many plantations are not well mechanized.

“We have long and rich experience with forests and plantation management,” Andrew says. “UPM owns in Uruguay (250,000 hectares) and in the UK (8,000 hectares) of plantations, and a million hectares of forests in Finland, all of which are certified to the two international sustainably schemes, FSC (Forest Stewardship Council) and PEFC (Programme for the Endorsement of Forest Certification Schemes).”

UPM believes that experiences in plantation development in China and other developing countries will be of great help.

“In Brazil, in particular, the technological developments in terms of tree breeding and establishment techniques have increased sustainable productivity considerably. It is essential in a time of increasing resource pressure these techniques are shared,” Andrew 16 17 18 19 20 21 22 23 Glossary Endnotes that Credits China, though, still lags behind in plantation emphasizes.

3.0 The NGP concept

The NGP concept TOOLS

TOOLS

WATER CYCLE

• National and international legislation

• National and international legislation

NUTRIENT CYCLE

LOCAL COMMUNITIES

• Forest management certification

• Forest management certification

• Social impact assessment

• Forest carbon certification

• Best management practices2

• Environmental impact assessment

AT IO N

V

• Forest management certification

BIOLOGICAL CYCLE

T

VA LUE S

ECO

LO PM ENT

IC M NO

ECOSYSTEM SERVICES

ECONOMIC GROWTH

• International labour standards • Labour and trade certification

• HCV Resource Network toolkits

TOOLS

JOB CREATION

D

• Environmental impact assessment • Best management practices3

CARBON CYCLE

EV E

ER NS CO

• National and international legislation

• Best management practices4

OS YS

NEW GENERATION PLANTATIONS

HIGH

BIODIVERSITY

EC

ITY GR TE IN

STAK EH OL

VO IN

EM

DE R

SOCIETAL AGENTS

EN T EM LV

SOCIAL & CULTURAL VALUES

VALUE CREATION

• Economic impact assessment • Forest management certification TOOLS

UPM FLASH / 3. 2011 / 7 | New Generation Plantations Bioenergy and Carbon Report 2011

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featUre stOrY

Text: Tuovi Similä Photos: Viljak, Jari Leino

UPM POINTS WAY FOR THE PRINTING PAPER BUSINESS A follow-up to the restructuring in the forest industry eagerly awaited by the markets was achieved when UPM announced the completion of its acquisition of Myllykoski and Rhein Papierd on On August 1, 2011. “I’m confident that this transaction will send a strong signal that UPM believes in the paper business and that we have a genuine desire to develop paper in an important role in the company,” says Jyrki Ovaska, President of UPM’s Paper Business Group.

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vaska regards Myllykoski as a suitable partner for UPM in every respect. The products are similar but with a slightly different focus, and so they complement UPM’s product palette perfectly. Excellent, too, is the fact that most of the Myllykoski mills are located in Cen-

tral Europe and North America, in the middle of the markets, which strengthens UPM’s customer service and supply security. “One of the trends is growth in the proportion of paper consumption in end-uses where lead times for paper deliveries are short. Now we can more easily participate in this part of the paper business,” he says.

want to be an active player in restructuring this industry and make only those moves that will bring added value to our shareholders.”

He specifies that he means, among other things, a reasonable transaction price, and a synergistic deal which will take the company forward. “There is optimism and expectations are high.”

The most important aspect of the merger in Ovaska’s view, however, is its compatibility with UPM. “For some time already we have said that we

Restructuring and growth in emerging markets part of the future

Combining forces with Myllykoski is a significant and major step in putting the Paper business area’s strategy into practice.

The strategy also includes expansion in the emerging markets, where there is potential for growth in paper products. “Yes, Asia and especially China rank very high in our deliberations, and opportunities for growth there

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featUre stOrY

business this is vital, and it is also UPM’s great strength.

Jyrki Ovaska, President of UPM’s Paper Business Group.

have been explored exhaustively. Likewise, we have scrutinised India and other emerging markets both as potential markets and as manufacturing locations,” Ovaska says.

Led by China, the rate of growth in Asia is a huge 6–8% per year. China provides UPM’s paper business too with an opportunity for organic growth, unlike the mature European and North American paper markets. It is certainly no disadvantage that UPM is already strongly established in China. In Changshu, UPM has a modern fine paper mill, UPM Raflatac’s self-adhesive labelstock factory and an R&D Centre. In Guangzhou, the company also has an RFID tag and inlay manufacturing unit.

“Cost-efficiency entails continuous improvement and streamlining of operations as well as innovativeness in adopting new ways of operating,” Ovaska says. He commends UPM personnel for taking seriously the internal development challenge which cost-efficiency has brought. The organisation is generating new ideas, even radical ones, spontaneously.

“A good aspect of a bad time has been the fact that people have come to understand that things have to be done differently. We have sought and been able to create a flexibility which was previously lacking, and this too is an important part of being a frontrunner.”

We want to be perceived by our customers as their most important and natural partner, with whom it is easy to do business. “It requires, of course, that we have highly competitive products and services. Our strength is that customers get a complete product palette of

graphic papers.”

Ovaska points out that ways of operating must be continuously improved. “This is what our competitors also do. But we must ensure that we are at the forefront all the time.”

Operating in accordance with sustainable development is naturally part of being a frontrunner too. “Sustainability is a constantly rising, global theme. UPM has invested a great deal in carbon-neutral energy production and the use of recycled paper. In my view this constitutes a frontrunner role, not only within the print value chain but also in relation to other industries.”

Ovaska also includes reliability among the elements of being a frontrunner. “It means that UPM is a reliable partner on which customers can build their future. Paper is a core business for UPM, and we aim to be a frontrunner in the paper business in the future too,” Ovaska says.

Madison North America

“The pace of moving forward is determined by two things. We must be sure that market development and our own projects are such that going forward is worth our while. Another determining factor is the company’s resources – the strength of future cash flow and how we prioritise strategic growth projects,” Ovaska says.

Being a frontrunner means constant renewal

Being a frontrunner is the cornerstone of UPM as a whole and also of the Paper business area. In Ovaska’s view cost-efficiency is part of being a frontrunner. For the paper

UPM mills Myllykoski mills

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customer story

The copy paper demand in the information age

Text: Ada Qin Photos: UPM

Despite the growing push to promote the paperless office, demand for copy paper in the Chinese market has grown and not decreased. Office Depot, the multi-national office supply chain and UPM partner, is increasingly optimistic about future paper sales.

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he growing calls for offices to go paperless should be cause for concern with paper manufacturers and office suppliers. Trends, however, have revealed some surprises.

“Contrary to expectations, the growth rate for copy paper demand has been large and increasing in recent years,” says Mr. Derek Hu, Office Depot Global Vice President and China President.

Established in the United States in 1986, Office Depot is one of the biggest supplier of office products and services in the world with global sales revenue reaching USD11.6 billion in 2011. Office Depot entered the Chi-

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nese market in 2006. In contrast to selling through bricks-and-mortar stores as Office Depot most commonly does in North America, Office Depot China has adopted online sales methods (www.officedepot.com) alongside direct sales and direct mailing. After just a few years, Office Depot has become the biggest office and service supplier in the Chinese market and has widened its gap with its competitors.

“For the last few years we’ve maintained double-digit growth in the Chinese market,” notes Derek, “This is mainly because of the strong demand in the Chinese economy. Even so, our company still has much more room for growth.”

Even though the value of the office supply market in China is approaching billions of US dollars, Office Depot, the industry leader, does not have more than 10% market share.

It is evident that the office supply market in China is still highly fragmented and moves towards integration will only intensify in the coming years.

A steady and supportive partner

Office Depot began to work with UPM in 2007. Speaking of the first impression of UPM as a supplier, Derek characterized the paper manufacturer as “consistent” and “reasonable.”

“When it comes to product quality, service,

customer story

Mr. Derek Hu, Office Depot Global Vice President and China President

We don’t think the paperless office will reduce the absolute quantity of paper used, because the paperless office brings with it the technology to easily acquire information; in an era where demand for information is exploding, people’s demand for printed information will also be much stronger.

and price, UPM is very consistent; there are no surprises. Maintaining this level of consistency is not very easy to do. It is also inevitable when two parties cooperate that they will not always see eye-to-eye, but whenever we’ve had to discuss anything with UPM, we’ve always reached a rational solution which is in the best interest of both parties.”

During the 2008 Beijing Olympic Games, Office Depot confronted extraordinary product demands.

“During the Olympics we faced the threat of severe supply shortages in Beijing, and UPM responded by giving us great support, not only ensuring a steady product supply, but also helping us solve logistical and delivery problems. UPM went beyond the call of duty and what really impressed me is that they did it without any quibbling,” says Derek.

Information become the growth booster of copy paper

Although, the ‘paperless office’ has been

popular for over ten years, the demand for paper does not look like abating.

“We don’t think the paperless office will reduce the absolute quantity of paper used, because the paperless office brings with it the technology to easily acquire information; in an era where demand for information is exploding, people’s demand for printed information will also be much stronger,” says Derek.

Another driver of paper demand in our age of digital information is official documentation. For example, in China the paperwork required by the tax authorities, although easily available in electronic version, needs to have the real signature on it, thus necessitating more printing.

Partners in environmental protection

As a member of World Wildlife Fund (WWF), Office Depot is committed to environmental protection. Its environmental protection motto is “Buy Green, Be Green, Sell Green.” It is this policy that requires Office Depot to be

very careful in its choice of suppliers.

“We will not cooperate with suppliers that do not do their utmost to protect the environment,” says Derek.

He revealed that copy paper cooperated by Office Depot and UPM has received FSC environmental protection certification and this is fully recognized by customers.

“We weren’t sure how successful this cooperation was going to be, but in the end the worries were unfounded as customers reacted positively and enthusiastically to the certification,” says Derek, “On the industry side, the electronic and financial industries were particularly enthusiastic about the environmental certified paper. Japanese-funded enterprises were among the foreign invested enterprises that had the highest demand for the paper with environmental certification.

Local Chinese enterprises are still in the early stages of cultivating an acceptance of such certifications.”

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A decade of cooperation between PrintMax Paper Co., Ltd. and UPM has served the UPM brand well in the Taiwanese printing paper market.

During an era of reduced printing paper demands, where are the new paper marketing opportunities to be found?

UPM foothold in Taiwan secured by trust Text: Ada Qin Photos: UPM

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aiwan is a fertile market for UPM as the paper manufacturer is positioned to thrive after already earning the trust of the business community.

“Of the three best-known magazines in Taiwan, two of them will definitely be printed on UPM paper,” says Joseph Wong, General Manager of PrintMax Paper. “In the media and publication field, UPM has become a well-known and respected brand.”

In the magazine paper market, UPM dominates the familiar brands: Business Week, Common Wealth, Global Views, Marie Claire, National Geographic, and many others.

Ten years ago, DaYeh, the paper distribution company established by Joseph’s father in the 1970s, became the largest paper distributor in Taiwan. They mainly sold paper produced locally in Taiwan including printing paper, office paper, and packaging paper.

“At that time, my father predicted that in the future imported paper would occupy an important place in Taiwan, so he planned to expand our imported paper business,” says Joseph.

Joseph had completed his studies in Canada and was working on information technology projects for Canada HSBC Bank when his father called for him to return to Taiwan to open up the import paper business.

Upon his return to Taiwan, UPM was the first imported paper brand he contacted.

“At that time, UPM had not yet entered into the Taiwan market.

They chose us to be their exclusive printing paper distributor in the Taiwan market and I think this was related to the fact that our marketing channels comprehensively covered the Taiwan market,” explains Joseph.

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customer story

Joseph Wong, General Manager of PrintMax Paper

International companies seeking to enter the Taiwan market sign a cooperative agreement with a trader, and the trader leverages its connections with local distributors to jointly develop the market. The cooperative relationship between the trader and distributors is normally weak.

“To earn the trust of local customers buying imported printing paper, geographical and psychological barriers must be overcome – foremost in their minds is whether the goods can be delivered on time, all the time,” says Joseph.

DaYeh had cultivated a strong network in the paper distribution field, and had an established means of distribution. Using this base of operations, Joseph’s family established PrintMax Paper, which took responsibility for marketing and pre-sale and after-sale services for UPM. “This complete supply chain model laid a good foundation for UPM which helped to accelerate their development in the Taiwan market,” Joseph adds.

Partner provides UPM with key for growth

It was not an easy thing to let the publishers and media of Taiwan use UPM paper produced as far away as Europe. After some study, Joseph found a key to open the Taiwanese market.

“In the past, most of Taiwan’s magazines used

paper with a higher gram weight, and even though such paper looked thicker and heavier, the cost was disproportionately higher,” Joseph further reveals. Following the trend set by international magazines, PrintMax Paper recommended UPM product to publishers and media outlets; not only was this paper lighter, but it also maintained a respectable thickness and excellent quality.

regularly provides analysis on the Taiwan paper industry market to UPM.

“UPM pushed paper thickness to a whole new level in the market.” says Joseph.

Joseph said the main cause for the reduction in printing paper is the reduction in Taiwan’s population, less and less people in Taiwan read books. Finally, many Taiwanese industries have moved abroad and this has reduced the amount of product manuals and promotional materials required.

This selling point attracted the attention of the market. Although the unit price of UPM paper was higher, comparing to the same basis weight of the local manufacturers, the price was still lower than the heavier paper the customers used at that time. That’s why the customers were much better off overall.

The other benefit to printing customers in Taiwan was the UPM technical sales team.

“The local paper mills in Taiwan had never heard of technical sales. The UPM team answered many questions about the paper products, and the team members regularly came to the printing house to advise on the best printing methods for UPM paper. This was enthusiastically received in Taiwan’s printing industry. They never thought that the technicians in a paper-making company could have so much professional printing knowledge,” says Joseph.

Impressed by the support received, the publishers and magazines of Taiwan were drawn to the UPM brand. A few years later, UPM had achieved a considerable share of the printing paper market in Taiwan.

Opportunities opening as the market changes

After ten years of working together, Joseph’s company has a very close partnership with UPM. Joseph not only introduces Taiwanese customers to UPM, but his company also

“A clear trend has become apparent in the Taiwan paper market. Sales and consumption of printing paper is on the decline, while the sales and market share of copy paper, packaging paper and cardboard paper is increasing,” Joseph states.

“Copy paper consumption has increased as a result of the information explosion. Equipment manufacturers have increased their output of printing devices, which has also stimulated the rapid growth of the copy paper market. The increase of packaging paper is related with the change of public perception on paper. In the past, the Taiwanese thought that papermaking required tree cutting. Now, they are aware that paper production is a recyclable and sustainable process,” Joseph analyses.

At the same time, a government reduction in the use of plastic products for goods packaging has led to greater use of paper packaging.

In his view, the relationship with UPM goes beyond the products.

“Because we have a very close, mutually beneficial partnership, if there is any particular demand for a UPM product in Taiwan, we know we can provide the marketing power and channels to match.”

DaYeh is currently seeking to be publicly listed. If successful, it will be the first independently-listed paper merchant in Taiwan.

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product and service

UPM Preprint Papers For personalised communications In July UPM Changshu Mill launched new preprint paper products: UPM Fine Preprint and UPM Fine Premium Preprint.

UPM Fine preprint is ideal to print documents like invoices, bank account and insurance statements, or correspondence, advertising leaflets or any kind of direct mail you can be sure that UPM has the right quality paper for you. UPM Preprint range covers papers for all main preprint end uses.

UPM Fine Preprint comes in a wide range of weights: 60g/m2, 70g/m2, 80g/m2.

It provides excellent printing performance and is suitable for most printed text and print demands.

UPM Fine Premium Preprint comes in two grades: classic and high whiteness, and two weights: 70g/m2 and 80g/m2. This product is suited to high speed laser printing jobs, and stands out because of its excellent thickness and stiffness.

Both UPM Fine Preprint and UPM Fine Premium Preprint are available for FSC and PEFC certified products.

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COrPOrate resPOnsiBiLitY

Text / Photos: UPM

UPM teaches environmental virtues to summer campers

T

he UPM Changshu Mill shared the importance of protecting the environment on July 18 with 110 Changshu area elementary school students.

from the Changshu Municipal Environmental Protection Bureau and Education Bureau also attended the opening ceremony and spoke to the students.

UPM co-sponsored “Care for a Green Future Student Environmental Protection Summer Camp” with Changshu Environmental Protection Bureau and Changshu Municipal Education Bureau.

During the ice breaking activity at the beginning of the event, the children brought crafts that they made to exchange with their new friends from other schools. These unique and practical handicrafts were all made from recycled materials.

In the morning, students from eleven Changshu elementary schools arrived at the UPM Changshu Mill activity center. Production Director Xiao Yunfeng of the Changshu Mill gave a welcoming speech at the opening ceremony of the summer camp. Leaders

The campers then participated in an “Environmental Protection Fashion Show.” The children were divided into 10 groups. With a 30 minute time limit, each made two or more outfits using waste newspapers, rags

and plastic bags. The outfits were a hit with the judges who praised them for their ingenuity and innovation.

The whole day was rounded off by a visit to converting house and Jetty with UPM environmental volunteers followed by the “Green Shots” photo competition.

In their groups the children explored the best shooting angle to produce their photographic take on a green life. Some groups struck pose of Thousand-hand Bodhisattva and some groups were running passionately to the camera with smiling faces seeming like flowers in blossom in the sun.

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COrPOrate resPOnsiBiLitY

Text: Ada Qin Photos: UPM

From forest to paper, the story of our Water Footprint While much of the buzz in recent years has been about the “Carbon Footprint”, UPM has looked ahead to what will be an equally important environmental topic in the future: the “Water Footprint.” UPM is one of the first global corporations to calculate the water footprint of paper. The term ‘carbon footprint’ has already found its way into the public consciousness and water footprint may soon follow. The World Business Council for Sustainable Development (WBCSD) believes that in time, governments will require major corporations to calculate the size of their water footprint.

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COrPOrate resPOnsiBiLitY

T

he water footprint concept was in 2002 introduced by Dutch scholar Professor Arjen Y. Hoekstra in 2002, soon after the Water Footprint Network was established (www. waterfootprint.org). The mission of the WFN is to promote the transition towards sustainable, fair and efficient use of fresh water resources worldwide. A water footprint refers to the total amount of fresh water used in the supply chain and direct operations of paper production. In a water footprint research, water is divided into three categories: green, blue and grey water footprint.

For paper making, green water footprint represents the forests natural water cycle, this is in fact the moisture that trees evaporate.

The blue water footprint refers to the water used in the production processes and grey water footprint is the volume of freshwater needed to assimilate effluent in receiving freshwater bodies.

According to the WFN, the water footprint of an apple is around 70 liters, for a kilogram of rice its 500 liters, a kilogram of cotton takes 10,000 liters, while a kilogram of beef comes in at a massive 15,400 liters. The annual water footprint for each Chinese person is 700 cubic meters, while U.S. citizens have the highest individual consumption rate in the world, averaging 2,500 cubic meters.

ing concerns of water scarcity. The Water Footprint Network applauds this effort and congratulates UPM on taking these first steps toward sustainable water use in all of their mill locations, operational management and forestry practices. ” explains Ruth Mathews, Executive Director, from Water Footprint Network.

“According to UPM’s pilot study, 60% of the UPM’s Nordland mill’s water footprint is green water, 1% is blue water and 39% grey water. Around 99% of the water footprint comes from the supply chain and the remaining 1% from the actual paper mill production processes,” explains Sami Lundgren, Director, Environmental Services, UPM. “In other words, if you think about the water needed in producing one sheet of A4, according to the current calculation method most of the water is used in the forest as part of the natural water cycle,” he continues. The current methodology for paper is however not yet at the stage in which the full potential of water footprint is utilized. UPM and the Water Footprint Network will maintain a close cooperation on the research of this subject throughout 2011.

UPM sustainable water use

UPM’s research on the water footprint

Fresh water is the most important resource in the production process of paper. Water also has an important role in UPM’s forest management, power generation and pulp production. UPM mills are therefore located in regions that are water abundant and have a good quantity and quality of freshwater available.

At the world water week in Stockholm (August 2011) UPM launched its water footprint report. It is the first study of its kind for the paper industry. Both UPM’s Nordland Mill in Germany and the UPM Changshu Mill in China took part in the measurement and evaluation of the water footprint method. “By working with the Water Footprint Network, UPM has taken a leading role in moving towards sustainable water use in the paper industry.

By calculating the water footprint for paper products, their pilot study shows that when trees are grown in sustainable managed forests, paper products will have little contribution to the grow-

“Water is a key environmental principles in UPM, our goal is to have the best water footprint in our industry by reducing effluent quantity and improving effluent quality”, says Mary Ma. Over the past 15 years, UPM’s water consumption in the papermaking process has been reduced by half. Currently the UPM Changshu mill’s water consumption is five to six tons of water for each ton of paper produced, while the national industry standard is 30 tons of water. When it comes to responsible water use, the UPM Changshu mill is leading the paper industry.

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technology frontline

Unraveling the Metamerism Mystery

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Text: Liu Xin Photos: MOLI

technology frontline

For those outside the printing industry, it can seem puzzling why four color printing technology can reproduce so many different colors on printed material. The answer can be found by understanding an optical phenomenon called “metamerism”.

O

ne manifestation of metamerism occurs when two surfaces, each produced with different colorants as judged by their distinct spectral reflectance factors integrate to the same color perception under a given lighting condition and to a different color perception under other illuminants with respect to the human visual system.

The causes of metamerism

The best color-match is to reproduce the best spectral match whose color-match remains constant under most illuminants within a visual tolerance. In reality, this is extremely difficult because the paper materials, the illuminants and other conditions are not the same.

Grassmann’s Law tells us that light that shares the same color appearance, has the same effect on color mixtures whether they possess the same spectral composition or not. That is to say, colors which look the same visually are equivalent in effect. The significance is that colors which look the same visually can replace each other, regardless of their spectral composition. Hence, color reproduction can be realized in practice by visual confirmation.

The significance of metamerism

Metamerism is of great significance in theory and practice for color reproduction technology. It can be said that current four color printing technology would not have come out without the existence of metamerism, because in everyday production, the colorants used on the reproduction cannot be exactly the same as those of the original. But in fact with different spectral reflectivity curves, the color-

match can be realized due to metamerism.

For example, to duplicate an original object that has a wide variety of colorants, printers only use four colorants (cyan, magenta, yellow and black) for reproduction. Another example, the three primal inks (cyan, magenta and yellow) can overprint to produce neutral gray. The alternative is to use the black ink to obtain the same visual effect.

The danger of metamerism

Although metameric reproduction by CMYK color reproduction of conventional printing technology accomplishes pleasing results, the color mismatch under illuminants other than that standardized by the printing industry is always problematic for critical color-matching applications such as catalog sales, art-work reproduction, and computer aided design.

Nowadays, the demanded quality of color reproduction is skyrocketing. Consumers are more willing to invest extra capital in pursuing high fidelity color reproduction for its appealing results with respect to printing technology Solving the metamerism problem.

Solving the metamerism problem

In order to alleviated the problem of metamerismt. The direct way is adopting more inks for increasing degrees of freedom and enlarging the color gamut. The current multiple-ink printing systems, such as Pantone Hexachrome, Küppers 7-Color, and DuPont Hyper Color, employ six or more inks for high fidelity color reproduction, but their color separation algorithms are still based on trichromatic color reproduction. So the

increased degrees of freedom are used for expanding device color gamut. The problem of metamerism is not alleviated by these systems.

In order to reduce the degree of metamerism, a spectral approach which is proposed

by Munsell Color Science Laboratory, as opposed to a trichromatic approach, is the answer for critical color matching applications. The goal of spectral reproduction is to reproduce the best spectral match whose color-match remains constant under most illuminants within a visual tolerance. This ensures that the colors of merchandise reproduced in a catalog, or the colors of an original painting reproduced in an art book, will unambiguously be rendered under various illuminating and viewingconditions.

The spectral-based color reproduction system included multi-spectral acquisition systems and spectral-based printing algorithms. So as to enhance the spectrum duplication accuracy, the current research effort is devoted for the development of the spectral output system which is comprised of an ink8selection module, and the implementation of spectralbased printing algorithms for amultiple-ink printing device. At present, this method is being tested and there are high hopes that it will bring about a revolution in the printing technology field.

As color reproduction technologies develop, customers are willing to invest more in pursuit of higher fidelity color duplicates, but metamerism has become a major bottleneck.

It is therefore even more critical than before that those in the industry know how to tackle the problem.

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UPM Flash Readership Survey Dear readers, Thank you for your continued support of UPM Flash, the UPM customer magazine in Asia Pacific region.

We are always striving to improve our magazine and to this end we wish to invite you to participate in our 2011 survey, which aims to learn more about your readership habits and enhance our magazine content and quality.

All participants will have the chance to win the Apple iPod nano!

Winners will be confirmed via email and will receive their award by postal mail. To submit your feedback online, please visit https://www.surveymonkey.com/s/Flash_readership_survey Or fax your answer to +86 21 6448 5512 Or email: upm.flash@upm.com

Company and Personal Information

1. Please write down your personal contact information

4. Which region are you from?

China mainland Japan Australia Korea Singapore Hongkong/Taiwan Others (please specify)

Name

The information will remain confidential and will not be associated with your answers to any question in any way.

Telephone

Company Email 2. What’s your company type?

Merchant (Graphic paper) Merchant/Retailer (Cutsize paper) Printer/Publisher Media /Association Others (please specify) 3. Which age group are you in?

20-29 30-39 40-49

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50 and above

Reader Behavior 5. Where do you normally get the industry and market information from? a. Website b. Television d. Magazine c. Newspaper e. Broadcasting f. Others (please specify) 6. How do you sort the above media channels? (for example, a/b/c)

Than ks part for you icipa r tion!

7. Which websites do you visit most often? Please list top 3.

According to your reading experience, please judge the following content (1 means the lowest score, 5 means the highest score):

15. General assessment How would you judge the column setting?

1 2 3 4 5

8. What type of magazines did you read in the past 1 year?

Printing industry Business management Fashion magazine Office supplies Others (please specify)

How would you judge the written expression?

1 2 3 4 5 How would you judge the layout design 1 2 3 4 5

9. How much time in total do you usually spend reading each Flash?

Less than 15 minutes 15-30 minutes 30-60 minutes More than 60 minutes

How would you judge the UPM advertisement?

1 2 3 4 5 16. Content assessment

10. What sections do you normally read?

UPM news Corporate responsibility Customer Story Product & service Technology frontline Market information

A key way to effectively communicate the UPM biofore strategy and news 1 2 3 4 5

11. Would you like to read a bilingual version of Flash?

Yes, it’s convenient No, just keep it as is

UPM CSR information (e.g. UPM forest life, carbon footprint, forest certification) 1 2 3 4 5

12. Would you like to receive digital version of Flash?

Yes, it’s convenient No, I like print version

Customer story / character interviews 1 2 3 4 5

13. What format do you prefer for digital version of Flash?

PDF Download link Mobile browser Others (please specify)

Technology frontline / market information 1 2 3 4 5 Product & Service 1 2 3

4

5

14. Do you read other corporate industrial publications?

If so, which ones?

17. What other content would you like to read on Flash?

UPM FLASH / 3. 2011 /

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