Forest-based industries have a significant role in promoting sustainable development. Well-managed forests play an essential role in natural carbon and water cycles, biodiversity and wellbeing of local communities.
FAQ
These are the most frequently asked questions we receive
The main raw material of UPM’s products is renewable wood originating from forests or plantations, both being an important carbon sink or carbon storage. We are committed to climate positive forestry, meaning that we harvest less than we grow and respectively, ensure that our forests remain carbon sinks
In 2022, the annual carbon sink from our own forests in Finland and in the US and owned and leased plantations in Uruguay has averaged 2.3 million tonnes of CO2 equivalent over the past five years. Our aim is to constantly improve our understanding of carbon and have, for example, initiated a project with the Natural Resources Institute Finland (Luke) to improve soil carbon models for Uruguay.
Our wood-based products and fossil CO2 free energy can replace fossil-based alternatives. At the same time wood-based products store carbon during their lifecycle. We calculate the temporary carbon storage and the substitution effects of our wood-based products. In addition, we report the substitution effects originated from replacing fossil-based energy. These are calculated based on our sales of CO2 free energy in Finland and its Guarantees of Origin.
Our production and operations generate fossil CO2 emissions. We aim to decrease our own emissions by 65% by the year 2030. In 2022, the fossil CO2 emissions totaled to 9,5 million tons, including fossil CO2 emissions from our own operations (Scopes 1 and 2) and indirect emissions caused by our operations, but generated elsewhere (Scope 3). There was a decrease of 11% compared to the previous year. To calculate these emissions, we apply the widely-known Principles of the Greenhouse Gas Protocol. In addition, we have set a target to decrease the fossil CO2 emissions of our supply chain by 30% by the year 2030.
In solving the climate crisis, it is most important to reduce the emissions coming from fossil sources. Majority of global carbon emissions originates from energy production. Emission reduction plays a major role in achieving the company's climate commitment. At the same time we take care of our forests’ ability to bind carbon and replace fossil materials with renewables. Active, timely forest management increases forest growth, and ensures that forests contribute to mitigating the climate change.
We are committed to our forests being a carbon sink in a long term. Forest is a carbon sink when it binds more carbon than releases it. In practice this means that the growth of our forests is more than the amount of harvested and naturally dying trees. When forests are a carbon sink, their carbon storage grows.
Forestry practices that maintain or increase the carbon sink of forests, can be called climate positive. Climate positive forestry means also actions to increase the forest growth and to create new carbon sinks through tree plantations or by reforesting new areas.
As far as we know, UPM is the first global forest industry company to publish this kind of commitment.
The commitment applies to our own forests in Finland and the US and the plantations in Uruguay. We anyhow operate on the same sustainable forestry principles in private forests and provide our best climate positive forestry practices for private forest owners.
UPM has commissioned carbon calculations of its own and leased forests in Finland, Uruguay and the US. The calculations are based on internationally approved calculation models, and they are executed by Natural Resources Institute Finland (Luke). Results of carbon calculations are published annually as a part of UPM’s Annual Report.
Climate science develops fast. We are actively supporting the work to create more reliable and accurate methods to calculate the carbon impact of forestry together with climate science experts.
When looking at climate impact, it is not reasonable to look at the impact at a level of an individual logging site, but at a wider area. In our case, we look at our forest property.
Crucial to the climate impact is the overall impact of the activity: the ratio of carbon bound to and released from forests. We make sure that on a long term our forests always grow more than the use and natural removal is. By doing so, our forests remain as carbon sink. This means, that an individual logging site may temporarily be a source of carbon.
There are two ways to increase the carbon sequestration:
1) To manage forest so that they grow as efficiently as possible. In practice, this means for example timely seedling stand management and thinning, which release more growth resources for the best trees to grow. Using traditionally breeded tree seed and seedling origins can increase the forest growth by tens of percentages. According to the sustainable forestry principles forests are always regenerated after harvesting and harvesting amounts are maintained on a sustainable level on a long term. If forests are managed as continuous-cover forests, we always secure the growth of new trees.
2) To manage forests to be more resilient to damages. Also in this case, timely, good forest management is the best way to maintain forests health and vitality. When forests are grown as mixed-species forests, they are more diverse and thus more resilient towards different kinds of damages and disturbances that could lead to carbon emissions from the forest (forest fires, windfalls, pests and diseases). In Finland this means increasing the share of broadleaved trees.
No, we do not accept deforestation and UPM’s wood sourcing does not cause deforestation anywhere in the world. We know the origin of the wood we use and are using third-party verified chain-of-custody systems to trace the origin of it. We always make sure, that our whole supply chain operates responsibly, and we do not accept deforestation in any parts of the chain. We always regenerate the forests after harvesting. Wood harvesting as a term should not be confused with deforestation.
Forests are important carbon storages and sinks. When forest grows more than it releases carbon through loggings and naturally decaying wood, it is a carbon sink. Decreasing logging levels would increase the carbon sinks in short term. That would however mean that we would get less wood for the products that we need in our everyday life, and we would have less wood material to replace fossil materials. To reach the climate targets, it is essential to reduce the use of fossils as much as possible.
In sustainable forestry it is always ensured that a new tree will start to grow to replace the harvested one. While this tree grows, it binds the carbon that was removed from the forest with the harvested tree. Standing seedling management and thinning improve forest growth and ability to bind carbon. When trees get older, their growth, and at the same time the ability to bind carbon, slows down and the forest becomes more vulnerable to different kinds of damages and disturbances. With time, unmanaged forests may turn to carbon sources. Good and timely forest management practices ensure that forests remain vital and healthy.
Sustainable harvesting levels are based on national forest inventory data. In Finland the forest harvests and naturally dying wood (together called removals) have been substantially smaller than forest growth since 1970’s. The forest growth has doubled in 50 years, which has meant that we have been able to increase the harvest levels remarkably in Finland over time.
Active forest management increases forest growth, and availability of wood raw material. If demand for wood grows, we should focus on enhancing the forest growth.
Forest area in Europe is increasing, but globally deforestation and illegal loggings are a problem, and must not be accepted. Globally, sustainably established plantations have potential to increase the use of wood.
We constantly develop our ways to work, and the 1.5 degrees climate commitment makes us to pay more attention to the climate impact of our operations. We are developing our operations based on scientific research and utilise new ways to further develop our operations towards climate positivity. As an example, in May 2020 we published our new target to double the number of broad-leaved trees in our forests in Finland. This will have positive impact on climate change adaptation and mitigation as well as biodiversity in our forests. In addition, we offer guidance for the private forest owners to increase the share of broadleaved trees.
Biodiversity is safeguarded in our daily operations which always include nature management actions such as buffer zones or leaving decaying deadwood in the forest. We protect the valuable key biotopes and habitats and have protected also wider forest areas. By maintaining and improving the biodiversity of our forests we also can adapt to changes and risks that climate change is causing to our forests.
The calculations are executed by the Natural Resources Institute Finland (Luke) which also has experience in conducting greenhouse gas inventories on international level. The Natural Resources Institute Finland is at the forefront of constantly developing the calculation methods.
Calculations are based on best available data. In Finland and Uruguay, the calculations include the carbon balance of both trees and soil. In USA only trees are considered. Protected forests owned and leased by us are included in the calculations.
The annual average carbon sink for the last five-year period is -0.9 (-0.9) million tons CO2 eq in Finland and -1.6 (-2.9) million tons CO2 eq in Uruguay. In the latest calculation annual five-year average resulted carbon source of 0.1 (0.5) million tons CO2 eq in USA. In parentheses the previous five-year average for comparison.
Carbon sinks vary year-by-year due to several parameters, e.g., harvesting levels, damages, age-class distribution, changes in model parameters, etc.
Calculations are based on internationally approved accounting methods. The same methods are also used in international greenhouse gas inventories. The reliability of the output data is on a high level, and the results of the calculations can be considered reliable to describe the level of forests carbon sink, source, and storage. Calculations are constantly developed to further improve the reliability and accuracy of the results.
Biodiversity
Diverse and well-functioning forest ecosystems are productive. Forests provide many benefits – also called ecosystem services. Forests provide wood raw material, habitats for many species, food and recreation. They also sequester carbon from the atmosphere, circulate and purify water and support soil formation, pollination, and nutrient cycling. So, from a business perspective it’s clear why we are interested in biodiversity: our business is based on sustainable use of forests on a long-term. That’s why we want to keep forests healthy and growing for generations to come. It’s a business fundamental.
In our operations forest’s biodiversity is safeguarded through best forest management practices, legal requirements, and forest certification. We safeguard biodiversity by several means: protecting habitats that are critical to biodiversity, ensuring diverse tree species composition and structural variation in the boreal forests, leaving buffer zones around water systems, increasing deadwood, and protecting threatened species. In addition to our everyday actions, we are actively developing new ways to enhance forest biodiversity by carrying out biodiversity projects. As a recent example of ground-breaking initiatives, Natural Resources Institute Finland (Luke) has started testing the impacts of transplanting threatened wood-inhabiting fungi into UPM’s forests in Finland.
UPM’s certified eucalyptus plantations are situated on natural grasslands (the largest natural vegetation type in Uruguay) previously used for cattle grazing. Plantations are established on forest priority soils (which is a legal status given by the authority), which are sites with poor productivity for agriculture but suitable for tree plantations. UPM does not, and will not, convert natural forests into plantations. Natural forests cover around 5% of the country and are protected by law. Even though the biodiversity values in the planted stands are lower than in the natural surrounding areas, in each farm a significant percentage of the area remains in its natural condition being a harbour for a big part of the local flora and fauna. Thus, on average, 60% of UPM-owned land is planted and 40% unplanted.
UPM’s biodiversity approach in Uruguay focuses on diverse landscape management, where planted and natural unplanted areas coexist. Currently, 20% of the total own land is already defined as conservation areas by the design of a Natural Conserved Ares Network, and after 30 years of biodiversity monitoring, we can demonstrate that 70% of the local flora, and around 50% of the tetrapod fauna (birds, mammals, reptiles, and amphibians) are being protected in UPM lands. In 2020, UPM defined biodiversity indicators for its land in Uruguay as part of its global biodiversity program established back in 1998.
The aforementioned network comprises different types of unplanted areas that are defined to conserve representative and complimentary samples of biodiversity at all levels and contribute to the connectivity of natural ecosystems. Significant concentrations of biodiversity have been recorded in environmental surveys. A total of 33 species were identified for the first time in Uruguay’s flora by UPM. At the same time, a worldwide unknown species was detected – the news was published in a specialized scientific magazine under the scientific name Antyphythum charruasorum. The goals of the network include biodiversity at regional, ecosystem, and species levels.
Our target is to improve the level of biodiversity in company-owned forests and land in Finland and in Uruguay. Together with external experts we have defined indicators which are used to monitor our progress towards the target. We have nine biodiversity indicators for Finland and three for Uruguay, which are part of our target for net positive impact on biodiversity (NPI). The target is not monitored on a level of a single forest site. The idea is to monitor the total impact on all company forests.
The status of forest nature is monitored by using selected biodiversity indicators for Finland: tree species, forest age, forest structure, protected areas, valuable habitats, habitat restoration, species and habitat projects, deadwood, and indicator development. For Uruguay, the indicators are: 1) developing the nature conservation area network; 2) maintaining and enhancing endemic and threatened species populations in formal conservation areas; 3) controlling and decreasing invasion of exotic woody species populations in conservation areas. We report our progress regularly.
Plantation operations in Uruguay
The start of the forest industry in Uruguay is based on the national forest law passed by the Uruguayan government in the 1980s – through which the country sought to diversify its land use and industrial structure, and to advance the protection of native forests. In addition, the country has created a taxation practice that attracts capital-intensive investments from various industries. These investments have created jobs, export income, educational opportunities and better transport connections and services for the country, especially in rural inland areas. In the case of the pulp industry, the entire value chain from wood supply to logistics is located in Uruguay. UPM operations alone represent more than 3% of Uruguay’s GDP. UPM continuously assesses the environmental, social and economic impacts of its operations and engages in active dialogue with its stakeholders.
In May 2023 water levels in the Paso Severino freshwater reservoir, which serves more than half of Uruguay's 3.5 million people, were reported at historical lows, according to state water company Obras Sanitarias del Estado (OSE). Meteorologists say 50 mm of rain is needed daily through to June for reservoir levels to start to recover.
The reason for the water crisis in Montevideo is the exceptional drought and lower rainfalls received in Uruguay during the last three years because of the La Niña weather pattern. This drought is the worst in 74 years in the region, and Argentina is also seriously impacted.
Uruguay has six major watersheds: the Uruguay River, Plata River, Atlantic, Merin Lake, Negro River and Santa Lucía River. 96% of all forest plantations in Uruguay are located outside the Santa Lucia water basin supplying the metropolitan area. This means that the plantations are not the cause of the current water scarcity in the Montevideo area. UPM plantations are scattered in rural areas in Uruguay as a mosaic between natural grasslands, which are mainly used for cattle grazing. All natural forests in Uruguay are protected.
Both UPM mills are located outside the Montevideo water basin area. The water used by the mills is not potable water, but surface water from the river. Most (80%) of the water used in the pulping process is returned to the river after effective treatment.
Located in the temperate zone, Uruguay is a humid subtropical country where rainfall makes it well suited for growing tree plantations. The annual rainfall is 1,200 to 1,500 mm and it is well distributed during the year without a regular dry season.
On average, water reaching the water courses, which finally ends up going to six major water bodies (e.g. the rivers Río Uruguay and Río Negro), represents around 35% of the total rainfall. This means that water is an abundant resource in Uruguay.
The flows of the superficial water streams in Uruguay depend primarily on the rains, much more than on land use, and is therefore very fluctuating. This fluctuation reflects the amount of rain fallen in previous days, ranging rapidly from a minimal flow to a flooding situation.
For plantations in general the distribution, regularity and availability of sufficient water is essential. In addition to the amount of annual rainfall and its variability over the years, it is important to analyse the monthly distribution of rainfall. Apart from nursery activities, eucalyptus plantations are not irrigated.
Water usage of eucalyptus plantations has been studied and monitored for decades in different geographical contexts, including Uruguay. It should be noted that the water use of eucalyptus and its effects are very context specific, and therefore results from international research projects should not be directly applied to the Uruguayan context due to the differences in natural conditions such as climate, geology, soils and catchment geomorphology.
Apart from nursery activities, eucalyptus plantations are not irrigated. Plantation forest management minimises the impact on water e.g. with unplanted buffer zones and natural drainage areas, or with a mosaic of different age classes to prevent major changes in land cover. Plantations also have positive effects, including, for example, reduction of soil erosion from water runoff and flooding, and mitigation of impacts of extreme events such as flash floods and storms.
During periods of severe drought, which have historically not been common in Uruguay, eucalyptus trees reduce their growth and recycle the water inside their own biomass. They can even start dropping leaves to keep their need for water for survival at a very minimum level if there was a more severe drought.
UPM has been undertaking long-term water monitoring studies since 2007 in cooperation with Uruguay’s National University (UDELAR). The key findings of these paired catchment studies, comparing plantations and grasslands, indicate so far that:
- Plantations capture more rainfall and reduce surface water runoff volumes – this reduction coincides with the amount of water that is intercepted by the forest canopy and evaporated to the atmosphere
- The effect of this reduction becomes less noticeable as the size of the catchments increases
- Groundwater recharge is not affected
- Water quality is not affected.
Based on the above and other research, there is no evidence of eucalyptus affecting groundwater resources in the Uruguayan context, where soils are shallow, and the effective rooting depth of eucalyptus does not usually exceed the first metre due to clay-rich or rocky layers of soil.
Changes in precipitation and water availability have always been one of the key considerations in planning any industrial operations including plantations grown by UPM.
In 2019 UPM engaged with the Finnish Meteorological Institute to further study the physical impacts of climate change, considering aspects such as water availability and weather extremes.
UPM does not use potable water for irrigation in its nurseries. The nurseries use untreated water, mainly from the nearby rivers and reservoirs, which are not the primary sources of drinking water for the surrounding communities. All three of our nurseries are located next to UPM’s eucalyptus plantations in Paysandú and Durazno.
The water sources used are adapted to each nursery, all of them being sources that ensure supply at any time of the year without affecting other users
The average daily water usage in the nurseries is 550 m3 of which 35% is recycled in the nurseries.
A centralised precision irrigation system working through a centralised fertigation delivery enables to supply water and nutrients according to the needs of the plants.
The design of the nurseries allows the recovery of excess irrigation water, minimising nutrient inputs to watercourses. In addition, substrates with high water retention are used.
The agrochemicals used in plantations are all accepted and regulated by FSC™ and PEFC certification. All UPM plantations are certified. The amount of chemicals used has been minimised over the years.
In 2022 UPM received fines from the Uruguayan authorities, because the Santana Nursery was using agrochemicals, which were not registered for tree nursery use, only for agriculture. Most of the same agrochemicals are now registered also for tree nursery use and the remaining few are in the process of being registered.
Eucalyptus plantations require relatively low amounts of nutrients to grow and are very efficient in using the available nutrients, especially when compared to agricultural crops. This is supported by the harvesting method used by UPM where leaves, branches and bark are left on site to decompose and recycle nutrients back to the soil.
Long-term monitoring studies have been undertaken to assess the soil impacts of plantations. These changes include an increase of organic carbon, pH reduction and a reduction of cations (positively charged ions) such as calcium, magnesium and potassium. These modifications are not affecting forestry productivity, at least for the initial three or four rotations. If needed, these can be managed by adding standard natural soil amendments (e.g. dolomite or calcite) and minor amounts of fertilisers, clearly lower than the amounts used in agricultural crops.
All UPM plantations are certified to both FSC™ (SGS-FM / COC-000606) and PEFC (UY11 / 20080091) forest standards. We only use agrochemicals and fertilisers that are allowed by both these certification schemes. The intensity of use of agrochemicals in forest plantations is much lower than, for example, in agriculture, as these products are required only during the first year of rotation cycles. Eucalyptus in UPMs plantations are harvested every 10 to 12 years. Environmental aspects of the plantations are controlled annually by external audits as part of the external certification process.
If plantation areas were to return to pastures or other land uses in the future, changes in the soil chemistry can be managed with proven, simple and affordable agricultural practices.
UPM does not acquire land irresponsibly. UPM has established its eucalyptus plantations in Uruguay on purchased and leased lands. There is a well-established land sale market in Uruguay and the related legislation is robust – therefore the context for land ownership and sale is very similar to that in Finland. The lands purchased or leased by UPM in Uruguay are privately owned and the acquisition follows defined processes and applicable legislative requirements.
Land acquisition is conducted through willing-buyer willing-seller transactions, the transactions are negotiated, and sellers are provided with fair compensation based on prevailing market values. In Uruguay land is not expropriated for the use of plantation forestry, nor can the government allocate land to forestry companies by bypassing the rightful private landowners. The prevailing market prices for land transactions are established transparently and fairly in the market. UPM’s plantation development does not result in involuntary resettlement of people.
UPM plantations are established as a mosaic – several smaller forest management units – what enables access opportunities and other land uses in between the plantations.
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