The Finnish forest-based bio-industry company UPM has planned to end paper production in Kaukas, Lappeenranta and shift coated mechanical paper production in Finland to its Rauma mill, said UPM in a press release on Thursday.
As per the initial estimation, the planned shutdown will affect about 220 employees of the mill.
The closure of the paper machine (PM 1) is planned for the end of the year 2025.
UPM’s pulp, sawn timber and biofuels production and R&D activities at UPM Kaukas integrate, however, will continue as before.
Decisions on final plans would be made after the co-determination processes have been concluded in line with local legislation in Finland.
“UPM is well positioned to grow in several segments, while global demand for graphic paper continues to decline due to digitalization, macroeconomic challenges, and changing consumer habits. We are aware that these plans will have a big impact on our committed employees in Lappeenranta and we will find solutions according to local practices. UPM will engage now into dialogue with employee representatives,” said Gunnar Eberhardt, Executive Vice President, UPM Communication Papers.
“Unfortunately, the market development requires steps such as this plan, which is a continuation of difficult but necessary steps to proactively ensure competitiveness of our overall paper operations. With the plan to shift UPM’s coated mechanical paper production in Finland from Kaukas to our Rauma mill, we are striving to optimize the asset structure and improve cost efficiency, particularly in our production and logistics processes,” said Antti Hermonen, Senior Vice President Operations, UPM Communication Papers.
UPM would recognize restructuring charges of €78 million (€35 million cash impact and an impairment of €43 million) as items affecting comparability in its Q3 2025 result.
The planned actions are estimated to result in annual fixed cost savings of €32 million.
- UPM
- Ends paper production
- Kaukas
Source: www.dailyfinland.fi
