1. Global Paper and Board Outlook Alejandro Mata Economist, European Forest Products October 2013 1

2. Alejandro Mata, Economist, European Forest Products, RISI Bachelor degree in Engineering, MBA degree earned in 2007 Worked in Business and Market Intelligence functions for one of Europe’s leading paper producers Has been analyzing and forecasting the industry since 2009 Recently joined RISI team Author of the Paper Trader Europe, the European Graphic Paper 5-Year and 15-Year Forecasts 2

3. 3 Where is the industry right now?... And where is it going? Tough Times?

4. World Paper & Board Demand… Is the Global Market in Decline? Million Tonnes 4

5. 5 Global State of the Industry Are there any regional differences? Industry segment differences?

6. Forecast Change, 2012-2014: +5% 86 mt (21%) 32 mt (8%) 30 mt (8%) 109 mt (27%) 145 mt (36%) -4% +9% +1% +6% +7% Printing & Writing Newsprint Tissue Cartonboard/ Other Containerboard Paper & Board Markets – Global US economy accelerating Euro area out of recession Emerging economies growing slower than before Newsprint papers declining globally Printing & writing: growth in emerging markets, contraction in mature markets Tissue and packaging driving growth The global picture keeps growing! 6

7. 7 Paper & Board Markets – Comparison

8. Paper & Board Markets – Europe +3% Forecast Change, 2012-2014: -0% 21 mt (21%) 8 mt (9%) 9 mt (9%) 29 mt (30%) 30 mt (31%) -8% +7% -5% +3% Printing & Writing Newsprint Tissue Containerboard Cartonboard/ Other No growth for the P&B markets as a whole Newsprint heavily impacted by new media Printing & writing grades showing mixed trends, UM doing better than coated grades Containerboard and cartonboard supported by economic recovery and inventory restocking Eastern Europe driving growing trends 8

9. 9 Paper & Board Markets – Europe Mature vs. growing segments Economy impacting segments differently New technologies impacting segments differently West vs. East Saturated vs. unsaturated markets

10. 10 Different Trends Emerging in the Region Growing vs. Declining Demand growth in East vs. contraction in West This applies not only to graphic grades, but also to packaging and tissue Capacity base shifting East will become more relevant in defining trends going forward * Percent change reflecting 2012 vs. 2011 apparent consumption levels for all paper and board grades.

11. 11 While There Is Limited Growth in Western Europe… Western European Apparent Consumption

12. 12 …Eastern Europe Keeps Showing Better Trends Eastern European Apparent Consumption

13. 13 Graphic Papers

14. Total European Graphic Demand by Grade Million Tonnes 14 Average Annual Growth 2013-2015 News-3.8% CWF-3.6% Cmec-3.7% UWF-1.6% Umec-0.4%

15. 15 Western European Profitability (All Grades) Price/Total Delivered Costs Note: Total costs include mill operating costs, depreciation, interest, SG&A and delivery.

16. 16 Western European Operating Rates (All Grades) Percent

17. Announced Net Newsprint Capacity Changes for 2013-2014 vs RISI Forecast of Demand Growth for the Same Period Thousand Tonnes 17

18. Announced Net P&W Capacity Changes for 2013-2014 vs. RISI Forecast of Demand Growth for the Same Period Thousand Tonnes 18

19. 19 Cash Manufacturing Costs* (Euro/Tonne) 2Q13 - Newsprint *Capacity Weighted Average

20. 20 Cash Manufacturing Costs* (Euro/Tonne) 2Q13 – Printing & Writing *Capacity Weighted Average

21. 21 Tough times?

22. World Graphic Paper 5-Year Forecast Global Newsprint Risk of Closure Study www.risi.com/gnr China’s Influence on World Graphic Paper Markets in the Coming Decade www.risi.com/chinagraphic Thank you for your attention! For more information: