ITOCHU Corporation (headquartered in Minato-ku, Tokyo; Masahiro Okafuji, President & CEO; hereinafter “ITOCHU”) announced today that it has decided to go ahead with plans to increase the scale of production at Metsä Fibre Oy (hereinafter “Metsä Fibre”), with an investment of approximately 1.2 billion euros (156 billion yen). ITOCHU has 24.9% stake in Metsä Fibre, a Finish company that is one of the world’s largest producers of pulp from coniferous trees, producing around 2.3 million tons of pulp annually.

With global demand for paper on the increase, Metsä Fibre has established a high level of cost competitiveness, making the most of Finland’s extensive forest resources to maintain consistent supplies of high quality raw materials.

Implementing this plan will increase annual pulp production at Metsä Fibre by approximately 800,000 tons, taking the total to around 3.1 million tons. In terms of production volume, this is expected to establish the company as the world’s leading producer of paper pulp from coniferous trees. Plans to increase production are scheduled to be completed in September 2017.

ITOCHU and Metsä Fibre began importing pulp into Japan in the 1970s, before entering into an official sales partnership in 2004. These days, ITOCHU sells coniferous pulp to markets across Asia as Metsä Fibre’s exclusive distributor. Of the scheduled 800,000-ton increase in production, it has been agreed that ITOCHU will handle around 700,000 tons. Of that total, ITOCHU is planning to sell approximately 500,000 tons to Asian markets, to cater to growing demand.

Making the most of its sales network, particularly in China, Europe and North America, figures show that ITOCHU handled 2.8 million tons of pulp in fiscal 2014, the largest volume of any of the world’s major pulp traders. This planned increase in production will take the total amount of pulp handled by ITOCHU to 3.5 million tons. As well as cementing ITOCHU’s position as the leading global pulp trader, this will enable the company to expand its sales network even further and strengthen its paper pulp operations.