Stora Enso, a global forest products company headquartered in Helsinki, has announced plans to reorganize one of its paper mills in Sweden and to permanently close one of its paper machines and a deinking plant at that mill.
The company is in the process of codetermination negotiations with employees at its Hylte Mill in Sweden regarding a plan to reorganize the mill as well as close its paper machine PM3 and the deinking plant. According to a news release from Stora Enso, the company is planning to close the PM3 machine by the end of the year and its deinking plant by the second quarter of 2021. After the planned restructuring, the mill will run on 100 percent thermomechanical pulp, the company states.
Kati ter Horst, executive vice president of Stora Enso’s Paper division, says the decline in global newsprint demand has affected the firm’s decision to close PM3 at its Hylte Mill.
“The decline in global newsprint demand continues due to changes in consumer behavior, and it is not expected to recover,” Ter Horst says. “This has led to global overcapacity, low operating rates, and poor profitability at the Hylte Mill. The planned measures would improve the competitiveness of the mill. Also, Stora Enso has invested in the future of the site to produce formed fiber products and biocomposites.”
Stora Enso says this plan will save the company about 14 million euros (or about $16.6 million).
The Hylte Mill currently operates two newsprint machines with an annual capacity of 480,000 metric tons. The company says production at the Hylte Mill will continue on one line, PM4, for standard newsprint paper. The planned shutdown will decrease Stora Enso’s annual newsprint capacity by 26 percent, or about 235,000 metric tons, which represents about 4 percent of total European newsprint capacity, Stora Enso says. The shutdown also will reduce the company’s total paper capacity by 5 percent.