Stora Enso to shut newsprint machine in Sweden

Plan to close PM3 and deinking plant at Hylte

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Stora Enso's Hylte paper mill in Sweden Creator Patrik Leonardson via Stora Enso internet
Stora Enso's Hylte paper mill in Sweden Creator Patrik Leonardson via Stora Enso internet

16 September 2020 – Stora Enso will start codetermination negotiations with employees at its Hylte Mill in Sweden regarding a plan to reorganize the mill, including permanent closure of paper machine PMhttps://indianprinterpublisher.com/blog/2019/10/12/wan-ifra-entering-virtual-reality/3 that produces standard newsprint and the deinking plant (DIP). After the planned restructuring, the mill would run on 100% thermomechanical pulp (TMP), improving the mill’s competitiveness. The planned closure of PM3 and the reorganization of the mill would impact a maximum of 140 persons. PM3 is intended to be closed by the end of 2020 and the DIP latest in Q2 2021.

The plan would result in annual cost savings of Euro 14 million. Stora Enso will book restructuring costs of approximately Euro 12 million as an item affecting comparability (IAC) in its Q3 2020 results, of which about Euro 8 million will have a cash impact. According to the press release, the planned closure would not have a material impact on Stora Enso’s sales or operational EBIT.

Newsprint demand not expected to recover

“The decline in global newsprint demand continues due to changes in consumer behavior, and it is not expected to recover. 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 site’s future to produce formed fiber products and biocomposites,” says Kati ter Horst, EVP, Paper division.

No decisions regarding the planned reorganization or employee impact will be taken until the conclusion of the codetermination negotiations. Hylte Mill currently operates two newsprint machines with an annual capacity of 480,000 tonnes. Production at Hylte Mill would continue on one line, PM4, for standard newsprint paper. The planned shutdown would decrease Stora Enso’s annual newsprint capacity by 26% or 235,000 tonnes, representing 4% of total European newsprint paper capacity. The planned shutdown would reduce Stora Enso’s total paper capacity by 5%.

Stora Enso will continue to produce standard newsprint at Hylte, Langerbrugge, and Sachsen mills. The closure of Hylte Mill PM3 would not impact Stora Enso’s newsprint product offering, and the company says it would be able to serve its customers as well as it does currently.

The Covid-19 pandemic led to the country-wide lockdown on 25 March 2020. It will be two years tomorrow as I write this. What have we learned in this time? Maybe the meaning of resilience since small companies like us have had to rely on our resources and the forbearance of our employees as we have struggled to produce our trade platforms.

The print and packaging industries have been fortunate, although the commercial printing industry is still to recover. We have learned more about the digital transformation that affects commercial printing and packaging. Ultimately digital will help print grow in a country where we are still far behind in our paper and print consumption and where digital is a leapfrog technology that will only increase the demand for print in the foreseeable future.

Web analytics show that we now have readership in North America and Europe amongst the 90 countries where our five platforms reach. Our traffic which more than doubled in 2020, has at times gone up by another 50% in 2021. And advertising which had fallen to pieces in 2020 and 2021, has started its return since January 2022.

As the economy approaches real growth with unevenness and shortages a given, we are looking forward to the PrintPack India exhibition in Greater Noida. We are again appointed to produce the Show Daily on all five days of the show from 26 to 30 May 2022.

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