Stora Enso confirms exit from coated woodfree market
Tuesday, May 28, 2019
Stora Enso has signalled the end for Lumi coated woodfree paper and its exit from that market after confirming plans to convert its Oulo Mill in Finland into packaging board production.
Oulu is Stora Enso’s only coated woodfree fine paper mill and currently produces more than a million tonnes of paper a year.
The project will involve a major investment of €350m (£309m), with ground works due to begin this summer. However, 365 jobs will go as a result and a sheeting plant and one of two paper machines at the mill will be shut down.
Oulu’s pulp mill and drying machine will be modified to produce unbleached brown pulp, and PM7 will be converted for the production of high-quality white- and brown-top kraftliner from virgin fibre. Once complete, the annual production capacity will be 450,000 tonnes and the mill will employ around 180 people.
The manufacturer said the project would further transform Stora Enso “from declining and low EBITDA business to growing higher profitability business”.
“Following the conversion, Oulu Mill’s EBITDA margin is expected to improve by 15–20 percentage points, once the kraftliner machine is running at full capacity approximately four years after start-up,” the firm said.
Production of LumiPaper will continue until autumn next year. Around 140,000 tonnes are sold into the UK, via merchants Premier Paper and Ovendens, and through direct sales.
LumiPaper UK managing director Mario di Lieto said supplies would be available as normal in the meantime.
“Production of LumiArt and Silk, for both reel and sheetfed printing, will continue until September 2020. As such, raw material for Stora Enso’s direct printer and merchant customers will be available deep into next year,” he said.
“Regardless if the customer buys bespoke or standard sheets from our UK conversion facility, or CutStar or HSWO reels from our extensive UK stock – LumiArt and Silk will continue to be available with the market-defining service our customers have come to expect.”
One merchanting source commented: “It’s such a shame as this is one of the best woodfree coated papers there is on the market – everyone knows LumiArt and LumiSilk.”
PrintWeek understands that the future for the Mendlesham sheeting plant in Suffolk, and its sister plant in the Netherlands, will be decided as part of the next stage of the project.
A Stora Enso spokesperson said: "We have no decisions yet and we will continue sheeting operations in the UK as usual."