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Interviews

Valmet: Now, Independent & More Focused

With net sales at approximately EUR 2.5 billion in 2014, over 12,000 professionals around the world, and a new identity as Valmet, its vision to become the global champion in serving its customers has never been distant.

Valmet’s industrial history ranges 200 years and it has the current reincarnation as a result of the demerger of the pulp, paper and power businesses from Metso Group in December 2013. The company’s service to pulp, paper and energy industries is long and significant through the supplies of technologies, automation and services.

Its services cover everything from maintenance outsourcing to mill and plant improvements and spare parts. The strong technology offering includes pulp mills, tissue, board and paper production lines, as well as power plants for bio-energy production. Valmet’s advanced automation solutions range from single measurements to mill wide turnkey automation projects.

Valmet 1Paper Mart recently interviewed Mr. Jari Vähäpesola, President, Paper business line – Valmet, to know more about its priorities and perspectives in relation to its business with pulp and paper industry. Mr. Vähäpesola elaborated on changing dynamics of pulp and paper industry vis-à-vis technological commitments over a period of time. Below is the verbatim transcript of the interview:

Paper Mart: Tell us in brief about Valmet and its relation with Metso Corporation.

Jari Vähäpesola: Valmet develops and supplies competitive technology, automation and services to the pulp, paper and energy industries. Our services cover everything from maintenance outsourcing to mill and plant improvements and spare parts. The strong technology offering includes pulp mills, tissue, board and paper production lines, as well as power plants for bio-energy production. Our advanced automation solutions range from single measurements to mill-wide turnkey automation projects.

Valmet has 12,000 professionals around the world who work close to our customers and are committed to moving our customers’ performance forward.

Until December 31, 2013 Valmet was part of Metso Corporation as one of its business areas, called Metso Pulp, Paper and Power. Since the demerger on December 31, 2013, Valmet has been an independent stock exchange company. In April, 2015, Valmet acquired the automation business from Metso, which has made us an even stronger partner to our customers.

PM: Valmet Corporation has been a leading service and technology provider to the pulp, paper and energy industry since many decades. How have you seen the pulp and paper industry changing over the period and with that its technological requirements?

JV: A lot of changes have really taken place during the couple of last decades. In the paper industry, global trade and digitalization have shifted the focus from printing papers to board grades. At the same time the machine sizes have come down. Regarding technology, the focus is in lowering the customers’ investment costs as well as developing the competitiveness of paper and board machines e.g. through modular solutions. Good examples of this are Valmet’s modular OptiConcept M paper and board machine technology and standardized Advantage DCT tissue technology. As regards the end products, today’s board makers are targeting lighter board grades. In the tissue industry, the demand for high-class structured tissue grades is calling for more advanced production technology.

In the pulp industry, the demand for environmentally friendly technology has increased and sustainability is on top of the agenda. The need for innovative solutions has increased along with these demands. New emission limits have put pressure on countries and companies to improve their performance. The utilization of raw materials has improved; chemical, water and energy consumption has decreased and emissions from mills have been reduced.

The biggest changes in the energy industry have taken place in the fuels. In the last 30 years that Valmet has been supplying fluidized bed boilers to the pulp and paper industry, the fuels have changed from wood-based by-products of the mill to multiple-design fuelswith more demanding chemical composition. These include a variety of bio fuels, which decrease the use of fossil fuels.

The boiler technology has changed accordingly. Valmet’s multifuel boilers enable energy production with high efficiency, fuel flexibility and low emissions.

PM: What does Valmet do to stay relevant in the fast changing technological landscape of the industries it serves? Where does your technology flow from – from the bottlenecks experienced by the industry, or the vision to find better replacements for the existing ones?

JV: The main driver for all our development actions is customer needs. We want to take our customers’ performance forward by offering a unique combination of advanced technologies, automation and services to the pulp, paper and energy industries globally. Our technologies are designed particularly for high operational and environmental efficiency, flexibility and reliability. The current focus is on modularized and standardized technology concepts which create significant savings in energy, water and raw-material consumption.

Driven by climate change mitigation and bio-economy promotion, the role of industries utilizing renewable raw materials increases. Interesting new applications for wood, other renewable bio raw materials and their side streams are opening up totally new opportunities to complement the traditional businesses. There is plenty of optimism e.g. around micro and nano-fibrillated cellulose, bio-refineries, or foam forming, just to mention a few of these. Valmet is actively developing these new opportunities together with our customers and other partners.

PM: Coming to the pulp and paper industry, will you briefly tell us about where your expertise lies the most in terms of time and resource invested?

JV: Valmet strongly believes in innovation and R&D. We keep introducing process innovations that genuinely help advance our customers’ performance in new, unprecedented ways. Our goal is to develop advanced and competitive technologies and services, enhance raw material and energy efficiency and to promote the use of renewable raw material.

Examples of our recent innovations are e.g. the OptiConcept M modular paper and board production line that creates significant savings in energy, water and raw-material usage. Our Advantage NTT tissue making technology creates savings in energy and fiber consumption, enabling quick and flexible grade changes between conventional and textured tissue. Various layering innovations at paper machines and coaters produce engineered properties in thickness-direction and bulk preserving calendering solutions, helping our customers to lightweight their products.

We develop solutions to replace fossil materials with renewable ones. One of the recent innovations taken to industrial scale is the LignoBoost lignin separation technology. Lignin is separated from chemical pulping black liquor and can be used as fuel or be further processed into valuable biobased chemicals or materials.

Strong R&D commitment is in-built in the Valmet strategy. Our expenses in research and development amount to USD 70 million in total annually.

PM: After demerger from Metso Group in 2013 as Valmet Corporation, have you seen any appreciable difference both in ways you conduct your business and the outcomes?

JV: As an independent company with a focused business scope, we are able to concentrate on serving the pulp, paper and energy industries, and develop our operations efficiently towards even greater customer value. Our customers can rely on our commitment and knowhow in this area.

It has been a pleasure to see how quickly and without hesitation the customers have accepted Valmet. Many of them have expressed their satisfaction about there being a dedicated company specifically for their needs. We are very happy about the way Valmet has been received.

PM: Effective April 2015 Valmet bought automation business from Metso, tell us something about this. Would you tell us something about your automation assignments in India?

JV: As a result of the acquisition, Valmet has become a stronger and unique technology and services company in its field, with a full automation offering. The acquisition strengthens Valmet’s competitiveness by combining pulp, paper and power plant technology offering, services, process know-how and automation into one customer value-adding entity. With this combination, we can serve our customers even better than before and move our customers’ performance forward.

India is an important market for Valmet’s automation business and we see a lot of potential especially in the paper industry. Recently we have been able to grow our market share especially in quality management solutions with several orders received in India in the recent months. We have just recently launched a new Valmet IQ product family for quality management, bringing new features and benefits to help our customers reach their quality goals.

In the energy market we have a partnership with BHEL (Bharat Heavy Electricals), the market leader in India in the power generation market. BHEL has utilized Valmet’s automation technology in its power plant deliveries.

To make this all happen, we have an automation office in Mumbai, employing 50 persons who work close to our customers, serving the Indian market.

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PM: As a crucial technology partner for the Indian pulp and paper industry, tell us your opinion about industry’s present growth retardation, the ways to recovery and estimated time for the recovery.

JV: India is an important market for us. However the market has not really performed its potential in a sense of adding new capacity. Recently the business has been focusing on rebuilds and process improvements. We understand there is an imbalance between domestic demand and supply and the high level of imports.

Cost-efficiency, low energy and raw-material consumption and better environmental performance are areas where the paper and board industry is striving today all over the world. Also the paper and board industry in India would benefit from technological upgrading, which would enable moving from the domestic markets towards exporting. In my mind, this would also help speed up the recovery of the industry.

As a technology partner, Valmet can offer the Indian pulp and paper industry a large range of products and services from wood handling to full manufacturing lines and service packages.

PM: At last, you may add whatsoever you wish to this very interesting and fact-filled conversation.

JV: Valmet sees the future of the pulp and paper industry in India very promising. During my visit to Paperex a couple of weeks ago I was encouraged by the face-to-face meetings with many of our customers. These discussions further strengthened my trust in the positive development of the industry. The good growth of the GDP in India gives reason to expect a growth potential in all paper grades, provided that necessary upgrades will be carried out.

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