Logistics forestry shipping in Lapland
Photo by: Lapland Material Bank | Visit Sea Lapland

Port of Kemi Gears up for Forestry Boom

The Port of Kemi in the Bothnian Bay is now in the process of metamorphosis with a view to cope with the growth foreseen in the forest industry of Finland, more particularly of the Finnish Lapland.

The rationale for the change is fundamental: Forest is the most important industry for the port, accounting for almost three-fourth of its total traffic. So, as forests and forest industry grow in Lapland so does Kemi, the home port of Santa Claus.

– The port must and will grow to accommodate the upcoming growth, said Jaakko Ylinampa, the director general of Lapland’s Center for Economic Development, Transport and the Environment (Ely-keskus) summarizing the rationale.

– The impact of the forest industry is very significant on the Port of Kemi. Approximately 70 to 75 per cent of all its traffic is related in some way to the forest industry, said Jaakko Rantsi, the chief executive officer of the port consisting of the Ajos and the Veitsiluoto harbors in southwestern Lapland.

Lapland sets requirements for logistic infrastructure

Forests have always been vital to the Finnish economy, and nowhere in the country have they been more evident than in Lapland, with forestry and investments in it having wide-ranging impacts on transportation, employment, and the environment.

Moving so much lumber across a region of more than 100,000 square kilometers is no mean feat. To accomplish this, the industry has to utilize both land and water transports.

– Logistics in Lapland require sufficient infrastructure in all forms of transportation – sea, road, and railroad, affirmed Rantsi, adding that – Changes within the industry, therefore, will naturally influence the port.

Investments needed to gain competitiviness

A number of infrastructure projects are now underway, or in the pipeline, at the port that include paving and pier renovations and warehouse upgrades, depending on investments.

– We have just finished with paving the so-called ‘bulk area’. The investment was about 400,000 euros, said Rantsi, adding that – Last December we finished improving the pier number 1 at a cost of 3.10 million euros. We are now planning renovations of the pier number 2 for the next year, which would cost about 5 to 6 million euros. We also have an option to increase the warehouse capacity, if needed. The cost of this expansion would be roughly 650,000 euros.

Moreover, a proposal to deepen the port’s fairway is waiting for approval of the government. Although the project with an estimated cost of 21 million euros didn’t receive any funding in the autumn budget, – Certainly, it will proceed to the next spring budget framework talks and then to the autumn budget, said Suomen Keskusta lawmaker Katri Kulmuni to the national broadcaster Yle in the first week of September.

Kulmuni said the matter is being considered positively. If approved, the dredging project will see the port’s fairway deepened to 10 to 12 meters, providing for passage of bigger vessels than are being used now.

According to Ylinampa, – The Port of Kemi is able to handle the growth in the forest industry. One problem might be the smaller size of ship, which leads to higher price per tonne when compared to the closest rival ports in Oulu and Luleå. From my perspective, the dredging of the Kemi passage would be an extremely vital and environmentally friendly measure, taking into account the future as well.

The Ely-keskus DG believes that improvements to transportation infrastructure across Lapland are necessary to accommodate any growth in forestry and the forest industry.

– If and when a positive decision to invest comes, for example, like the Kaidi bio-fuel project in Kemi, or that of Boreal Bioref in Kemijärvi, there is a clear and immediate need for infrastructure improvement. Different roads require different improvements depending on their types of traffic… Increasing traffic also has an effect on the requirements. For example, if the number of heavy goods vehicles increases, there is a lack of space on certain highways [Valtatie 4, Kantatie 82, etc.]. There is also a need to renovate certain minor roads to enable swift delivery of timber to factories. We need thicker pavement on certain sections of the roads for [high capacity] transports, and we need to upgrade certain roads and bridges, Ylinampa explained.

Ely tracks the upgrades required by investments and increased traffic.

– We have carried out close studies to keep ourselves up to date with what is needed in each scenario. We hope that when positive investment decisions come, there will be a similar kind of infrastructure package available, said Ylinampa.

The impacts of forest industry in Lapland are comprehensive

According to Finnish Forest Association (FFA), – In 2011 [forestry and the forest industry] directly employed about 70,000 people or 2.8 per cent of all employees in Finland. One fifth of Finland’s export income comes from the forest industry.

In Lapland, forestry and the forest industry constitute the biggest livelihoods, with an economic value of more than 1.3 billion euros, according to a 2016 report by Dr. Kirsi-Marja Korhonen, Lapland regional director of the Administration of Forests (Metsähallitus). Korhonen also reported that half of the land available in Lapland is used for forestry, and 55 per cent of that land is state-owned.

So, any growth in the forest industry impacts Kemi as well as the entire Lapland directly and indirectly. According to Statistics Finland, Kemi had a population of about 22,000 in 2016, and nearly 15 per cent of that population was employed by the forestry industry.

Rantsi said, – The forest industry employs approximately 1,500 people directly. The indirect effect is also substantial, but I can’t give an exact figure. The Port of Kemi and Kemi Shipping have about 180 workers, and without the forest industry, that figure would be approximately 75 per cent less. So the industry has a big influence.

Speaking on this topic, Ylinampa said, – After a long period of diminishing population and employment, the growth of the forest industry gives a massive boost to the economic life of Kemi and especially of eastern Lapland. The growth in the forest industry will also radiate across Lapland and other areas.

On the other hand, the environmental impact of logging has for long been a concern. But, according to Korhonen’s report, commercial forests grow 12 million square meters a year, while around 5.5 million meters are logged for industrial and domestic use, allowing for Lapland to increase logging for at least the next 30 years.