The Spain-headquartered papermaking group said that the downward trend in demand for CWF paper – with overall sales in Europe down 9% last year – had worsened in recent months, and the decision to shutter PM 8 at the mill would be re-evaluated in the coming months “depending on market developments”. The shutdown came into effect at the end of April.
Lecta said the group’s ability to meet customer demand for this type of paper was “assured”.
“Condat’s brand product range and service levels during this period are guaranteed due to efficiency improvements and streamlining on Condat’s Line 4 as well as through the contribution of the Group's other CWF paper mills.”
Condat’s production capacity was 414,000 tonnes per year, according to the company, while the overall group has CWF capacity of more than 850,000 tonnes.
Premier Paper’s ‘Essential’ range of coated papers is made at the mill. Group marketing director David Jones said supply would be unaffected.
“This is a planned shutdown and they have made enough to keep all customers supplied without interruption. We’ve got plenty of stock and they’ve got plenty of stock so we see no issues with supply,” Jones said.
Lecta is evaluating a potential conversion project that could see PM 8 switch to the production of speciality papers for labels and flexible packaging. “Lecta continues working on a strategic transformation plan that will allow Condat to move forward with greater chances of success, although this project needs further definition over the next few months,” the firm stated.
Net sales of paper at Lecta nudged up from €1.46bn (£1.23bn) to €1.49bn last year, while EBITDA slipped from €120m to €116m. The volume of paper sold by the group fell by nearly 7% to 1.43bn tonnes.
A major shake-up across European papermaking is underway, with Lecta, Stora Enso and Burgo all involved in conversion projects amid other mill and paper machine closures, and the still-pending sales of three ArjoWiggins mills in the UK.
Scheufelen filed for insolvency again in February, and the largest ArjoWiggins mill in France went into liquidation at the end of March. Workers in France are now calling for the Bessé-sur-Braye mill, which had employed 580 staff, to be temporarily nationalised.
The sale of the ArjoWiggins Creative Papers mills in the UK at Stoneywood, Aberdeen and Chartham in Kent is still believed to be imminent, although there was no official update at the time of writing.
It’s not clear if there is a potential buyer in the frame for synthetic paper maker Arjobex in Clacton.