UPM closes Kaipola paper mill by mid-December

The forest-based bio-industry company UPM on Thursday said employee consultations for UPM Communication Papers were concluded at the Jämsä River mills this week and the Kaipola paper mill in Jämsä will be closed permanently by mid-December.

UPM’s second paper mill in Jämsä, UPM Jämsänkoski, however, will continue operations with one graphic paper machine and two specialty paper machines, said UPM in a press release.

The parties were not able to identify an economically viable solution for the future operation of UPM Kaipola. Consequently, Kaipola’s three paper machines will be permanently closed, affecting altogether 448 positions at the mill, of which 20 positions will be transferred to UPM Jämsänkoski’s Specialty Papers operations.

Approximately 20% of the redundancies will be retirements, with discussions pending.

The closure will lead to an annual reduction of 720,000 tonnes of graphic paper capacity, which means 450,000 tonnes of newsprint and 270,000 tonnes of coated mechanical paper. An after-care team will ensure safe conditions at the mill after the closure.

“The recent weeks have been demanding. The mill personnel has been temporarily laid-off due to low order inflow. Still, the consultations were carried out in a constructive spirit. … Unfortunately, the current economic and market environments do not provide a business case for continuation of production at UPM Kaipola and actions need to be taken to ensure the future competitiveness of UPM Communication Papers,” said UPM Communication Papers Executive Vice President Winfried Schaur.

Earlier, in late August, UPM announced to shut down paper machines at different paper mills that will impact on about 840 positions.

The company announced plans for permanent closure of UPM Kaipola Paper Mill in Finland, sale of UPM Shotton Paper Mill in Wales and streamlining Communication Papers business function teams.

In addition, UPM Bio-refining and UPM Specialty Papers announce plans for reorganising and streamlining activities in Finnish pulp mills, UPM Forest, and UPM Tervasaari Mill in Finland.