Holmen Cutting 29 Jobs at Madrid Mill, Mulling Alternatives for PM 61

Oct. 14, 2010 - Holmen said that it will cut 29 jobs at its paper mill in Madrid, Spain as part of an ongoing efficiency program.

The efficiency program also includes looking into alternative options for the mill's PM 61, Holmen added.

Holmen said PM 61 is the smaller of the mill’s two paper machines and is operating at a loss, which it has done so for some time despite active improvement measures. These measures included switching production of newsprint to coated printing paper, LWC, based on 100 percent recovered fiber.

Since September, employees have been temporarily laid off due to the shortage of recovered paper.

The workforce reduction now being announced is part of a wider review of costs, Holmen said.

“The market situation for printing paper continues to be tough," said Arne Wallin, head of Holmen Paper.

"The shortage of recovered fiber and the resulting cost increase means that in parallel to workforce reduction, we’re looking into different courses of action for PM 61. One possible path is to switch to other product areas, which can be achieved in partnership or in their entirety by another player,” Wallin noted.

The 29 staff cuts are effective immediately — 7 production and 22 administrative jobs.

Holmen said the cuts take place in parallel with a new organization entering into force. After these measures have been taken, Holmen Paper Madrid will have 320 employees.

Holmen Paper acquired the mill in Madrid and PM 61 in 2000. The machine has a capacity of 170,000 tonnes of printing paper. PM 62 was commissioned in 2005, and has a capacity of 330,000 tonnes of newsprint.

SOURCE: Holmen