Staples Inc., the world's largest office-supply retailer, ends its contracts with Asia Pulp & Paper Co. (APP) because of its environmental practices

Office-supplies retailer Staples Inc. has severed all contracts with Singapore-based Asia Pulp & Paper Co. Ltd., one of the world's largest paper companies, in a move that shows concerns over forest destruction and global warming are having an impact on big U.S. paper buyers.

Until recently, Staples sourced about 9% of its total paper supply from APP and used the paper for its own Staples-branded stock, mainly photocopy and office paper. Staples had stuck with the company even as other large paper sellers in the U.S., Europe and Asia, including Office Depot Inc., stopped buying from APP in recent years because of alleged environmental misdeeds.

The Framingham, Mass., company canceled its contracts late last month, said Mark Buckley, vice president for environmental issues at Staples. Staples is expected to announce the move next week.

"We decided engagement was not possible anymore," Mr. Buckley said. "We haven't seen any indication that APP has been making any positive strides" to protect the environment. Remaining a customer of APP was "at great peril to our brand," he added.

APP representatives didn't return calls seeking comment. In the past, it has said it is moving toward relying for all of its wood on plantation trees but needs to cut natural forest to maintain production levels.

APP runs one of Asia's largest pulp mills on the Indonesian island of Sumatra and has operations in China. The retailers worry that APP is destroying natural rainforest to feed its mills.

Concerns over rainforest destruction have been heightened in recent months because new data show that Indonesia is the world's third-largest emitter of carbon dioxide, the heat-trapping greenhouse gas, behind the U.S. and China. Fires set to clear natural forests and forested peat swamps after they have been logged are the major cause of those emissions.

APP last year sought permission to use an environmentally friendly logo issued by the Forest Stewardship Council. In October, after inquiries from The Wall Street Journal about APP's planned use of the logo, the FSC barred the company from using it.

Here is the full article from the Wall Street Journal.

Chile forestry company Empresas CMPC nine month profit doubles

SANTIAGO, Oct 25 (Reuters) - Chilean forestry and paper company CMPC (CAR.SN: Quote, Profile , Research) said on Thursday its profit in the first nine months of the year more than doubled as world prices for wood pulp rose and production volumes grew.

The company said its profit in the Jan-Sept period was 188.389 billion pesos ($368.5 million) compared with 85.518 billion pesos in the year-ago period.

Revenue for the period rose 26 percent to 1.183 trillion pesos. However the company said that in dollar terms the increase was 32 percent, led by growth in wood pulp sales.

"During the period wood pulp prices rose," the company said in a statement, citing a reduction in North American production and booming demand in China and Europe.

The company's intensive investment in pulp production capabilities over the past three years also yielded benefits.

"Additional production capacity, greater forestry harvest volumes and favorable price scenarios had a positive impact on the company's operating results," CMPC said.

Here is the full article.

Celulosa Arauco y Constitución (CELCO) of the Angelini Consortium to be protested at Ibo American Summit

Paper Pulp Manufacturers Creating Environmental Problems Throughout Southern Cone

(Nov. 6, 2007) Environmental activists from the Argentine city of Gualeguaychú disclosed their intention this week to protest at the upcoming Ibo American Summit. Their protests will focus on the cellulose industry’s detrimental environmental effects in their country.

The issue is of growing importance Chile, where environmentalists and politicians are increasingly outspoken against the long and troubled environmental history of cellulose manufacturer CELCO – Latin America’s second largest paper pulp manufacturer.

(The Angelini Consortium which owns CELCO is also a minority owner of Colbun SA which is partnered with Endesa in the HydroAysen project to dam the Rio Baker and Rio Pascua. The environmental group, Forest Ethics withdraws support: ForestEthics Challenges Chile's Matte and Angelini Economic Groups )

The Ibo American Summit, to be held November 8-10 in Santiago, brings together the heads of state Latin American countries and their EU counterparts from Spain, Portugal and Andorra. This year’s event will focus on social cohesion and greater equality through increased cooperation between Latin America and the Iberian nations.

Still, Argentine environmentalists want to ensure that environmental concerns, especially relating to cellulose production, receive ample attention.

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The Argentine protests coincide with growing concern in Chile about the environmental record of Celulosa Arauco (CELCO). CELCO, which runs five pulp mills around Chile and is owned by the politically well-connected Angellini group. The Angellini group has donated generously to the Concertacion political coalition that has dominated Chilean politics since the country’s transition to democracy in 1990.

The Region VII Environmental Commission (COREMA) ordered CELCO’s Licancel plant shut down in June after the plant’s waste materials contaminated the nearby Mataquito River, killing thousands of fish. A second, smaller waste spill occurred one week later, also contaminating the same river (ST, June 20). In the five months since the complex has been closed, it would have produced more than 53,000 tons of cellulose.

Region VII Sen. Jaime Gazmuri (PS) recently told the Santiago Times that he is convinced that CELCO must do more in order to show that the company has cleaned up its act.

“There is plenty of technology available in order to prevent these occurrences from happening again. Still, the plant has yet to guarantee that it is using the right type of technology. They need to show proof that they have cleaned up their act because, until this point, the plant has had detrimental environmental effects,” Gazmuri said.

CELCO officials disclosed two weeks ago that the plant’s closure has thus far cost the company US$35 million. But Gazmuri says they have no one else to blame but themselves.

“Those losses fall completely on CELCO’s shoulders. There was an environmental catastrophe which caused terrible damage to the (Mataquito) River. The pollution levels did not come anywhere close to meeting the company’s own standards. This was no accident. This was a bad decision made by the company management (…) their responsibility is absolute” (ST, Oct. 25).

Still, CELCO showed an overall profit of US$534 million through the third quarter of this year, a 25 percent increase compared to the same period last year (ST, Nov. 2). The positive numbers are attributed mostly to record prices for cellulose and a sharp increase in production capacity.

Huge profits notwithstanding, the company has a long history of environmental abuse and degradation.

Prior to the Mataquito River fish kill, CELCO received tremendous national and international publicity for its 2004 poisoning of the Cruces River with poorly treated waste from its Valdivia cellulose plant. The poisoning resulted in the death and migration of Valdivia’s emblematic black swan population and numerous lawsuits. (ST, June 6, 2005, Apr. 2, 2004) Still, the company initially refused to acknowledge its responsibility for the Cruces River spill and submitted false information to local courts in an effort to exculpate itself. (ST, Oct. 25)

More recently, CELCO is seeking to pump its Valdivia plant contamination to the Pacific Ocean and has offered large sums of money to buy-off opposition to its waste duct project (ST, Aug. 27). The opposition is coming primarily from artisan fishermen (fearing their livelihoods will be jeopardized by the duct) and from Chilean and international NGOs.

The Angelini group used its influence in 2004 with then-president Ricardo Lagos to keep the Valdivia plant from shutting down when the black necked swan kills became international news.

Here is the full article.