SCA's need for global shipping - cost efficient and environmentally friendly

The wood, pulp and paper producer SCA is Europe’s largest private forest owner with 2.6 million hectares of forest in Northern Sweden. The forest company has been working with Wagenborg for decades to ship these products to ports worldwide.

SCA consists of five business units: Forest, Wood, Pulp, Paper, Renewable Energy, and our supporting unit Sourcing & Logistics, primarily serving customers around Europe, the Mediterranean, Americas and Far East. The group’s head office and production mills are located in Sweden, with terminal and distribution centers in North West Europe.

SCA Sourcing & Logistics, which is based in Sundsvall, is responsible for the entire supply chain of all SCA forest products. From the forest up to the client. Over land and sea. The forest company mainly ships containerized products and break bulk on a global scale.

“We have large volumes, which we cover in a yearly logistic setup. On a contract basis we work with about 6-10 ship owners during a year. We are looking for those supplier who are able to deliver our products in the same way as they were loaded,” explains Mikael Toft, who is based in Sundsvall.

Early 2020, SCA has establishes the Group’s sustainability targets. As the official announcement states: sustainability is integrated in every part of SCA’s operations. This includes striving for a positive climate effect in all parts of the value chain. This ambition also results in various requirement to logistic suppliers.

“Besides our own targets, sustainability is also important for our European and American customers. That is why we evaluate our logistic suppliers by using Ecovadis questionnaires and audits. And although Wagenborg has a performance above industry score, there is work to do. All logistic players on the market now need to have a  sustainability plan. If you don’t have it, it will be tough to act on our market. The ship owners we work with, such as Wagenborg, have the latest cutting edge technologies to comply with rules and regulations. But regulations will adapt over time,” says Toft.

With the introduction of Sulphur Emission Controlled Areas (SECA) and the recent IMO 2020 sulphur cap first steps were being made to reduce the environmental impact of marine logistics. “The introduction of the SECA was big. The shipping industry was simply pushed to switch fuels within certain areas. However, we believe - when selling products on a global scale - different regulations in different areas is not good for both our market as the shipping industry. Now it is time for shipowners to make a next step and figure out how to adapt their vessels,” says Toft. 

SCA is using Wagenborg’s shipping services to ship their products to Europe, the Mediterennean and the US East Coast. This assignment has been ongoing for 25 years, something that implies a variety of vessels to pass by over time. 

“I am working about 20 years for SCA and looking to the early years, the overall quality of vessels was not  that good. Nowadays, the old and bad ship are not in the market anymore. This is important to us, since we  looking for clean and quality vessels to ship our products free of damage. Looking at Wagenborg this quality is  really there. Also we noticed a new building development at Wagenborg of smaller to bigger vessels, which fits perfectly to the growing parcel sizes from our side. This spread in various vessels gives us the flexibility we are looking for,” says Toft.

The booming trade from Sundsvall to the United States is a good example. SCA is investing heavily in the US market with growing volumes of wood pulp. Where beofre the 15.750 DWCC A-type vessels were  deployed on this trade on a regular basis, now the 19.500 dwt T-type becomes a well-known vessel in the port of Tunadal. Recently the m.v. Trinityborg set a new record by loading 18.500 mton of wood pulp and the next planned voyage will be even bigger.

“The Wagenborg service as a product mix matches perfectly with the changing needs we have. No matter where we are selling our products, Wagenborg is present in the geographical markets we cover. Since we  see a transformation from publication paper to pulp and kraftliner, a grow in the breakbulk segment can be expected. This can be a good development for both our companies,” says Toft.

The challenge of transporting SCA Logistics’ forestry-based cargoes is largely in the massive volumes and the amount of space required. “Wagenborg’s extensive fleet is an excellent match and suitable to continue our collaboration for a long time to come. We follow the fleet development within Wagenborg with great interest and are waiting to welcome new cost-efficient ships, environmentally friendly as possible,” concludes Toft.