MM withdraws plans to invest in kraft paper capacity, plans closure of PM 3 at Kwidzyn mill

Austrian paper, board and packaging company Mayr-Melnhof has revised its capex plans for the Polish Kwidzyn mill.

The company will not invest in converting one woodfree paper machine at the site to kraft paper production. There are also no plans to enter kraft paper production at any other MM site, a company spokesperson told EUWID.

In addition, MM has entered in consultations with trade unions and work council on a potential closure of the small kraft paper machine (PM 3) and a reorganisation, which may include dismissal of around 110 employees. PM 3 has a capacity to produce up to 75,000 tpy.

These new plans would "significantly" reduce the originally announced investment sum of €660m, the MM spokesperson said without giving further details.

Instead of boosting paper production capacity, MM Kwidzyn will focus on further increasing its share of renewable energy of currently 69 per cent.

The reasons for this revision to capex plans are uncompetitive wood prices from the Polish State Forests and low demand across paper and board products markets, Mayr-Melnhof said.

Production of pulp and cartonboard (PM 4, 260,000 tpy of GC1 and GC2) at the Kwidzyn site will not be affected by the change of plans. Paper machines PM 1 and PM 2 will continue to produce up to 360,000 tpy of uncoated fine paper and 40,000 to 80,000 tpy of packaging kraft paper, the company stated.

In April 2023, MM announced plans to heavily invest in paper production at its Kwidzyn mill. However, these plans were already postponed in August due to unfavourable market conditions.

This article was updated on 21 November 2023.

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