HELSINKI, July 30 (Reuters) - Production of paper and board at mills in Finland fell two percent year-on-year in the first half of 2001 to 6.37 million tonnes, reflecting the global economic slowdown, the industry said on Monday. Finland is the world's second biggest exporter of forest products after Canada. ``In Finland, the forest industry's production in the second quarter of the year was about five percent less than in the first quarter,'' the Finnish Forest Industries Federation said in a statement. Production rose in the mechanical wood industry, but fell in the pulp and paper industry, it said. Production curtailments in the second quarter knocked average paper and board mill operating rates in Finland down to 86 percent from 93 percent in the first quarter, it said. Paper and board output in the second quarter fell by 377,000 tonnes, or by about 11 percent versus the first quarter, the federation said. Pulp production at Finnish mills fell 1.1 percent year-on-year in the first half to 5.62 million tonnes, but pulp output rose two percent in the second quarter on the same period a year ago, it said. Sawmills' production of sawn softwood in January-June rose 2.5 percent to 6.95 million cubic metres, and first-half plywood production was flat at 600 million cubic metres, it said. The figures refer only to production by the Finnish forest industry in Finland, though about half the capacity of the country's paper and board groups is abroad. Finnish-Swedish Stora Enso , the world's number two papermaker, last week posted a sharp drop in second-quarter profits due to massive production cuts in the face of weak demand and said the market would remain difficult this year. Finnish fine-paper group M-real and tissue maker Metsa Tissue are scheduled to report second-quarter results on Wednesday, with the world's third-biggest papermaker UPM-Kymmene due to post results on Thursday. ``The production of all paper grades fell in the second quarter,'' the federation said and added: ``The decrease was most noticeable in fine paper production.''