The mill will continue to produce office paper for M-real until the end of 2008.

It will then cease to produce paper and be switched over to production of raw material for corrugated board.

M-real chief executive Mikko Helander said: "We are streamlining our office paper production by concentrating it on the newer mills.

"The continuation of the present production in the New Thames mill would require major investments."

DS Smith group communications manager Peter Aubusson said there would be no immediate changes to staffing, although there would eventually be a shuffle in the process of converting the machine.

M-real's New Thames mill paper machine has an annual capacity of 230,000 tonnes of office paper. The mill employs 280 people and has sales of £119m (€160m).