March 31, 2005

Nippon Paper Industries Granted Japanese Forest Certification by SGEC
for All 18,000 Hectares in Kyushu

Nippon Paper Industries Co., Ltd.

Nippon Paper Industries Co., Ltd. (President: Takahiko Miyoshi) acquired on March 24 forest certification by the Sustainable Green Ecosystem Council (SGEC)*, Japan's unique forest certification system, for all of the Company-owned forests located in the Kyushu region. The Company first acquired the SGEC certification for its Kitayama Forest (Fujinomiya-shi, Shizuoka; 670 hectares) in December 2003, and now the certification has been granted for its extensive forests in Kyushu, which cover 18,317 hectares.

Nippon Paper Industries has categorized its forests into “operating forests” from which lumber can be continuously harvested and produced and “environmental forests” aimed at conserving the natural environment and biological diversity. It manages both types of forests in an appropriate way.
Of the forests owned by the Company in Kyushu, 80% are “operating forests” consisting of plantations of cedar and Japanese cypress and regrowth-forests of hardwoods such as castanopsis and oak. The accredition body in the SGEC forest certification system (Japan Forest Technology Association; JAFTA) recognized that cedar and Japanese cypress trees in the forests have grown well as they were planted on carefully selected lots, and that the trees have been thinned and harvested properly to suit their growth rate. Moreover, JAFTA acknowledged the efforts by Nippon Paper Industries to actively develop the lumber market in spite of the recent decline in the forestry industry of Japan and to promote effective use of thinned trees and other low-quality lumber.
The remaining 20% of the forests are “environmental forests,” which feature regrowth-forests of relatively old hardwoods. As these forests grow, they are expected to yield significant public benefits by sustaining biological diversity and performing functions to prevent disasters and to absorb CO2 gas, which causes global warming.

Nippon Paper Industries intends to operate its forests in a way that harmonizes with the natural environment, pursuant to the action guidelines “Create and Conserve Forest Resources” indicated in the Environmental Charter. The Company aims to obtain forest certification for all of its forests in Japan and overseas by 2008. Of its forests in Japan, which total about 90,000 hectares, work will be conducted in fiscal 2005 to acquire the SGEC forest certification for all of its forests in Hokkaido (about 44,000 hectares), following the Kitayama Forest in Shizuoka and the forests in the Kyushu region.

※SGECEstablished in June 2003 as a “system that enhances Japan's forest management quality and ensures sound forest cultivation with the coexistence of abundant natural environment and sustainable lumber production.” Guided by internationally recognized philosophy of Sustainable Forest Management, SGEC has set out seven criteria and 35 indicators developed with careful consideration given to the natural environment, social customs and culture unique to Japan.