A discussion document released by the Environmental Paper Network (EPN) unveils the social and environmental risks associated with the Finnish company UPM-Kymmene and its operations in Uruguay, and highlights the importance of strong social and environmental risk management policies and close scrutiny of individual investments.
UPM is one of the world’s largest producers of pulp and bioenergy and recently announced that CDP, formerly Carbon Disclosure Project, had recognised “UPM’s exceptional leadership for its environmental performances, for its actions to mitigate climate risk”. However the scale of the UPM’s claims are not supported by current science.
EPN objects for instance to the company’s claims that its exotic tree plantations established in Uruguay constitute a carbon sink of approximately 24 million tonnes “that did not exist 30 years ago.”
Sergio Baffoni, EPN International forest campaign coordinator said: “The 24 million tonnes carbon sink exists only in theory, not in reality. The trees planted by UPM in Uruguay will not store carbon indefinitely, but will be intensively managed, logged and used to produce paper (1), while part of it is immediately burned to generate electricity.”
A recent scientific study from Uruguay measured the loss of 16.6 tonnes of soil organic carbon per hectare in soils under 20 year-old Eucalyptus sp. plantations. Across the country, UPM controls around 184,000 hectares of land planted with Eucalyptus sp. and Pinus Radiata. A simple calculation of the research’s conclusion (16.6 tonnes/ha) and multiplying it by UPMs land base, (154,800 ha of Eucalyptus sp. plantations) results in an estimated loss of more than three million (3,054,400) tonnes of soil organic carbon degraded by UPM in establishing its plantations. The inclusion of those plantations managed by UPM’s 600 independent suppliers in Uruguay would further increase the amount of attributable soil carbon loss.
Luisa Colasimone, EPN International coordinator, said: “UPM’s claims to climate change leadership, preventing deforestation and improving water security do not stand a realistic fact check. UPM’s projects in Uruguay, which include the further expansion of eucalyptus plantations, and the building of a new pulp mill in Paso de los Toros, can have serious impacts on water resources and climate protection, as well as other environmental and social impacts.” (2)
The replacement of historical natural grasslands with eucalyptus plantations has eroded biodiversity and carbon storage. For centuries, natural grassland, partially used as traditional extensive pasture, extended in the areas now occupied by UPM plantations. The subtropical Campos savannah in Uruguay not only hosts unique biodiversity, but also stores large amounts of carbon in their extensive root systems under the ground. This is also true for the grasslands used as traditional pasture. A large part of this stored carbon has been released from the soil where eucalyptus plantations substituted the natural grasslands.
EPN strongly encourages all financiers and investors to reduce their social and environmental risk in the pulp and paper industry by strengthening their institutional policies following the EPN’s Green Paper, Red Lines recommended standards, which list the minimum requirements for pulp and paper industry projects to avoid harm to people and the environment.
Notes to Editors
(1) Paper is a product with a very short lifespan. A large majority of sub-products are disposed of within a few hours of their first use. While some wood products do store a portion of their carbon in long-term carbon ‘pools,’ for paper products this is simply not the case.
(2) UPM-Kymmene Corporation: UPM signs a EUR 750 million revolving credit facility with a margin tied to long-term biodiversity(…).
Sergio Baffoni, sergio [at] environmentalpaper.org, +49 162 3812528
Ville-Veikko Hirvelä, ville-veikko.hirvela [at] maanystavat.fi