Groundwood pulp production to close at Rottneros mill

A dramatic reduction in demand for groundwood pulp due to declining printing paper consumption is forcing Rottneros to close groundwood pulp production at its Swedish Rottneros mill. CTMP production, however, is to be continued. The company decided to immediately commence negotiations with employee representatives.

Rottneros Mill has around 100 employees, 50 of whom will be given notice. CTMP production at the mill will continue, and limited investments will facilitate the development of quality for those customers that manufacture board at the same time as slightly increasing capacity.

Rottneros tried to raise the efficiency of the mill repeatedly. In 2011, the company announced an improvement programme that included staff reductions. Secondly, the book value of fixed assets was written down at Rottneros mill. According to the company, these measures have now been carried out, but appear to be insufficient.

Groundwood pulp production is to cease this winter, but the actual date depends on the outcome of union negotiations and also agreements with customers affected, Rottneros stated in a press release.

“It naturally feels very sad to have to conclude that the market for this product is shrinking. Thanks to raw materials and the high level of professional skills at the mill, we are producing a select and leading product in terms of quality, but this is still not enough,” said Ole Terland, President of Rottneros AB. “It is of course worse for our employees who have to leave us and we are therefore attempting to make the transition as smooth as possible,” Terland concluded.

The company now intends to focus on CTMP production. “The improved preconditions for CTMP will make us a leading manufacturer in terms of quality, primarily for the board and packaging segment, which is where we see the greatest potential for customer value," says Olle Dahlin, Managing Director of Rottneros Bruk AB.

“The production line for groundwood pulp will be left where it is, as it is not out of the question that demand could return, for example owing to changes in the supply of suitable recycled fibres. This will result in an opportunity to alternate staff between the two production lines, thereby generating flexibility," continued Dahlin.