EUROPE Example of optimization of rail transports PPI Baltimore October 30, 2013 Mats Erkén 1

ScandFibre Logistics Founded year Initiative to reduce logistic costs and improve reliability on rail. Now 3 rd 5-year period. 4 companies / 10 mills in Sweden Total production 4,5 million tons – Rail:40% – Sea35% – Road25%

Cost structure – Swedish Paper Mill Delivery to Central Europe (= main market) 3

Rail 11 System 4 Antwerp Irun Perpignan Dijon Woippy Dortmund Kehl Milano Modena Berlin Maschen Austria Serbia Hungary Malmö Hallsberg Volume paper:2 mio ton Wagon fleet:1.500 Wagons paper30.000/y Train departures:300 / wk Terminal stops:60 Return filling rate55%

Challenges Market privatized, but oligopolistic structure Different standards between countries Own fixed trains vs. draining single wagon systems 5 Infrastructure bottlenecks and disturbances

Opportunities Sulphur Emission / vessel cost aspects -> increased demand ? 6 Intermodal Environmental discussion

Conclusion Possible to save logistic costs by pooling volumes and utilize return cargo – hard work needed… Growing interest for rail transports Delivery reliability has improved, but still issues 7 Mill Rail Terminal Return cargo