UPM plans to take out around 155,000 tonnes of magazine paper capacity by closing down a paper machine at its Plattling mill in Bavaria.
Plattling makes coated and uncoated LWC and SC magazine papers and currently runs three paper machines. Its capacity at present is 785,000tpa.
UPM intends to permanently close PM10, which it said was the lowest capacity coated mechanical machine across all of its European papermaking operations. It was also described as having the “highest technical age”.
Around 160 jobs out of 590 at the mill will go as a result, and the move will involve restructuring charges of circa €30m (£25.6m). UPM said closing the machine down would result in savings of €17m a year. Consultation with employees will begin this month.
Winfried Schaur, executive vice president at UPM Communication Papers, pointed to the consistent decline in global paper markets over the past decade: “UPM Communication Papers has responded to this development by selective capacity reductions, always considering the competitiveness of our business – and we will continue to do so in future,” he said.
“The planned closure… is in line with this approach and focuses on maintaining the most modern and competitive assets.”
Production on PM1 and PM11 at Plattling will continue.
“PM10 is a relatively small machine and not much paper from this mill comes to the UK, but there will be a knock-on effect,” said a paper industry source. “It might give someone like Kabel & Kriebstein an opportunity.”
UPM’s forest-based bioindustry businesses include pulp, paper, wood, biofuels and biomaterials. The Finland-headquartered group had overall sales of €10.5bn last year.