In a press release, UPM of Finland unveiled a EUR 75 million annual savings plan that includes the closure of a mill, the sale of its UK newsprint business and the streamlining of its European and US operations.
The group stated that this restructuring was due to "?une continued long-term decline in demand for graphic paper combined with an economic outlook affaiblies?".
Devastating news
UPM will close its paper mill in Kaipola, Finland by the end of the year and shut down all three paper machines. This will result in the loss of 450 jobs and an annual reduction of 720?000 tonnes of graphic paper.
Winfried Schaur, Vice President of UPM Communication Paper Division, comments :
"?C" is devastating news for kaipola. Although Kaipola has competent staff and well-operated machinery, external factors such as high logistics costs, regulatory and tax burden, high labour costs and rising fibre costs make it the least competitive among UPM's paper mills.?»
Decrease in newsprint consumption
In the UK, UPM wants to sell its UPM Shotton mill in Wales for conversion. The mill's current production capacity is 250?000 tonnes of newsprint.
"?UPM Shotton is well positioned to serve the UK market. However, we are seeking external opportunities for long-term alternative use of the mill as newsprint consumption continues to decline. The paper machine is technically flexible to support conversion, particularly in the production of emballage? board, said Winfried Schaur.
In total, the plans announced today are expected to have an impact on around 840 positions, most of which are based in Finland.
