Planned closure of two PMs at UPM is imminent

Printing and writing paper producers throughout Europe are taking downtime and close down machines in order to bring output in line with decreasing demand.

The closure of PM 4 for newsprint at UPM's Steyrermühl mill will take place towards the end of the second quarter, as last planned. Resolutions to this effect have already been passed, according to sources close to the company. The date mentioned is 26 June.

The end of production of improved newsprint and SC paper on PM 6 at UPM's Schongau mill, announced in March this year, could also be imminent. Negotiations on the shutdown were still underway at the end of the second week of June, but according to current estimates by stakeholders, they could be concluded soon. UPM had stated in March that a closure would take place after the negotiations had been concluded; the closure was planned for the end of the second quarter.

PM 4 at the Steyrermühl mill, which will be taken over by Heinzel at the beginning of 2024, can produce up to 320,000 tpy of newsprint and MFS papers. Heinzel will convert the other machine, PM 3, which has been shut down for some time, to the production of kraft papers from the beginning of next year. Further plans for PM 4 are not yet known.

The market for newsprint but also for other printing and writing papers has been very weak in the past two quarters. At present, most production plants in Europe for the most common paper grades are running at only 60-75% of their full capacity, according to estimates by market players. Price pressure and price declines were and are the result. Paper manufacturers are reacting with shutdowns and production cutbacks of various types and sizes. On the supply side of the market there are further production restrictions with PM 6 at Norske Skog Saugbrugs (260,000 tpy of SC paper) shut down due to damage. Norske Skog had announced that the PM would be out of action "for a long time" because the building and parts of the PM were substantially damaged.

 In addition, the planned production shutdown at Mondi's Duino mill, formerly owned by Burgo, is imminent towards the end of this year for the conversion to corrugated base paper by the new owner Mondi next year. According to the company's plans LWC production (200,000 t/y) will run until the start of the conversion. A similar timetable is announced for Heinzel's Laakirchen mill, where PM 11 for SC paper (330,000 tpy) is still to produce press papers until the end of 2023, after which it is to be converted to the production of recycled corrugated case material. So far there have been no indications that the schedules for Duino and Laakirchen will be changed.

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