UPM Declares Shut Down of Paper Machine, Sale of Newsprint Mill

SEATTLE (Scrap Monster): Helsinki, Finland-headquartered UPM announced significant cut to its paper capacity in Europe, as part of its strategy to remain competitive in the challenging market. The company plans to sell newsprint mill and permanently shut down the operations of a paper machine. This will help the company to manage its total production capacity to be in line with the existing demand situation.

According to company press release, UPM plans to sell its newsprint mill in Grand-Couronne, France, which in turn will reduce 240,000 metric tons of newsprint capacity. In addition, it also plans to close a supercalendered (SC) paper machine in Rauma, Finland. This is expected to reduce the total SC production capacity by 265,000 metric tons.

The closure of the Rauma mill paper machine is scheduled to be completed by the end of the current year. Meantime, the production from the remaining two paper machines will be unaffected, said the company release.

UPM plans to complete the sale process of the newsprint mill by the end of Q2 2020. It plans to start a consultation process for potential mill closure, in case the bidding process fails to identify a credible buyer.

The graphic paper demand has been on a continuous decline since the past decade or so. The adverse economic conditions have accentuated the decline this year, noted Winfried Schaur, executive vice president of UPM Communication Papers. The proposed reduction plans are necessary to ensure profitable paper production in the region, he added.