Valmet gains benefits as Chinese demand for paper industry tech ups

China's focus on environmentally-friendly paper industry technologies has a direct impact on Finnish providers. And for Finnish industrial equipment producer Valmet, the Chinese demand now plays a key role in its overall performance, reported Xinhua, quoting Finnish language business daily Kauppalehti on Monday.

In 2020, some 13 percent of the annual turnover of Valmet came from its Chinese business. Chinese orders amounted to 885 million euros last year, accounting for 24 percent of all its orders, the report quoted the company's chief executive officer (CEO) Pasi Laine as saying, adding that the year 2020 was exceptional for the company.

The positive trend for Valmet -- the developer and supplier of technologies, equipment, automation systems and services for the pulp, paper and energy industries -- continued in 2021. Five of the big orders so far are from China. The largest one, for the Fujian Liansheng Paper Industry Co. Ltd in southeastern China's Fujian Province, is worth 200-240 million euros, Laine disclosed.

The development of China's logistics and express industry has been driving the demand for paper and pulp products. Meanwhile, as China is pursuing sustainable development, optimizing the industrial structure and energy structure, and carrying out intelligent manufacturing and green upgrades are becoming the inevitable choice for the country's paper industry in the context of economic transformation, which releases a huge demand for more advanced and environmental-friendly technologies in the field.

It is a new trend that pulp production plants are being built in China and require more technology and equipment. For example, Chinese paper manufacturer Nine Dragons Paper (Holdings) Limited has ordered pulp technology from Valmet, the business daily reported, describing this trend as a "supercycle of paper and pulp investments."

"Last year the largest orders of Valmet were related to the increased demand for folding box boards in China," said Laine, noting that the increase in the standard of life in China triggered the demand for better packages.

Demand for recyclable and environment friendly packaging material increases. And pulp production lines equipped with better technology are being built in China so that the industry can be integrated in an energy-efficient way, Laine explained.

Tomi Amberla, director of AFRY Management Consulting, estimated to Kauppalehti that development in the pulp sector in China would mean a production increase of 22 million tonnes and this would be a marked increase globally. The current global demand for pulp is around 70 million tonnes.

Amberla also noted that Chinese recovery measures following COVID-19 pandemic and the country's transition to greener development are incentives for investments.