UPM is planning to permanently close its mill in Hürth, Germany and a paper machine at Nordland Papier in Dörpen, Germany. If brought to completion as planned, these shutdowns would see UPM remove 330,000 tpy of newsprint capacity and 280,000 tpy of uncoated fine paper capacity from the market. Both machines are set to halt operations by the end of 2024 at the latest. Nordland’s remaining paper machines will continue operating as before.
UPM announced that it would immediately enter into consultations with employee representatives. The number of positions potentially affected by the closures was estimated at 135 in Hürth and 210 in Dörpen. UPM will recognise related restructuring charges of €113m in its second-quarter financials. The company expects that the planned actions will reduce its annual fixed costs by €45m.
UPM stated that it had taken this decision because of the continued decline in demand for graphic paper driven by digitalisation. The company said the downturn in demand was especially pronounced last year, adding that it did not expect a lasting recovery. The closures were needed to keep costs competitive and ensure the efficient and flexible use of its remaining production assets, UPM concluded.
The Nordland Papier mill in Dörpen can make 1.2 million tpy of coated and uncoated fine paper and various types of speciality paper. In 2019, UPM converted a fine paper machine at the site to produce release paper. The Hürth mill solely produces newsprint (standard and heatset).
Over the past few years, UPM has closed a significant amount of production capacity to adjust to a slump in demand for printing and writing paper that has now lasted for 18 years. The company shut publication paper assets, including its Plattling mill in Germany, which made roughly 210,000 tpy of SC paper and around 380,000 tpy of LWC, in November 2023. Last June, it had also closed PM 6 (165,000 tpy) at its Schongau mill, also located in Germany, which made newsprint and SC paper.
At the same time, the group sold its Steyrermühl mill in Austria (320,000 tpy of newsprint) to Heinzel for a project that will see the site converted to make packaging paper. In September 2021, UPM closed the doors of its Shotton mill in the UK (250,000 tpy of newsprint) and sold it to Modern Karton, which is also switching capacity to packaging paper production. In 2020, UPM removed a total of more than 720,000 tpy of newsprint and LWC/MWC by shutting its Kaipola mill in Finland.
