After having stopped the sales process for its Anjala paper mill, Stora Enso is now planning to concentrate book paper production on one of the two machines at the site.
Stora Enso plans to permanently close down one of its two paper machines for publication paper grades at its Anjala site in Finland. The unit produces coated and uncoated book paper, coated magazine paper and improved newsprint on two machines with a combined capacity of 435,000 tpy. Due to weak paper demand all book paper production is to be concentrated on one PM. The planned closure is to reduce the mill's output capacity by 250,000 tpy, mainly uncoated mechanical grades. Stora Enso says it will be able to continue producing its range of book paper grades. The closure of the PM is to take place in the fourth quarter of 2023.
The company reports that the decline in demand for newsprint and publication paper has further accelerated and has also reached the previously more stable book paper market. However, Stora Enso is determined to serve its book paper customers, concentrating its output on the remaining PM at the Anjala unit.
The closure will not have a material impact on its Ebit, Stora Enso explains, but due to the long-term deterioration of the market, it recorded €19m of non-cash asset write-downs related to the Anjala site in its Q1 2023 results. Additional costs of about €16m as items affecting comparability are expected to be recorded relating to the potential lay-offs and restructuring expenses at the site. The closure would affect 110 people.
Stora Enso's Anjalankoski site in Finland includes the Ingerois packaging and board production unit and the Anjala paper production unit. The integrated Anjanankoski site is reported under the Packaging Materials division since the beginning of the year. Stora Enso says it will continue to harness the site's synergies between paper and board production.
The planned closure of the PM is part of Stora Enso's strategy to withdraw from the market for printing and writing paper. Last year, the company had announced to sell its four printing and writing paper mills. The Hylte, Nymölla and Maxau mills were sold and continue to produce printing and writing paper, but sales plans for the Anjala mill had been stopped recently and the company had decided to keep the mill within its group.
During the past three years, about 7 million tpy of printing and writing paper capacity has been shut down or rebuild in Europe, reflecting the declining demand for these grades.