Sappi Considers Closing Paper Mill in Biberist, Switzerland

April 4, 2011 - Sappi Fine Paper Europe (SFPE) said that it is looking into the possiblity of closing its Biberist Mill in Switzerland due to overcapacity in the market and steadily rising input costs.

About 550 employees would be affected should the mill close. In addition, Sappi would reduce its coated fine paper capacity by 435,000 tons per year and its uncoated fine paper capacity by 65,000 tons per year.

In a written statement, Sappi said, "As a result of continued overcapacity in the European Coated and Uncoated Fine Paper markets, it has not proved possible to recover the sharply increased costs of raw material and energy over recent years. Sappi has therefore undertaken a review of its European production activities.

"Despite our best efforts to curb costs and gain better margins, Biberist Mill has been unable to generate acceptable returns. Consequently, SFPE has [on March 31] announced that it will enter into a consultation process with its Biberist mill employee representatives and social partners. The aim is to identify the best way of improving SFPEs profitability, which may also include a full closure of Biberist mill," Sappi said.

"The continued unrelenting increases in input costs and the excessive local energy prices, combined with the overcapacity in the European market have led to unacceptable returns for Sappi Fine Paper Europe and it therefore became necessary to review production capacity," the company added.

Sappi noted that if it does close the Biberist Mill, customers of the coated fine paper products produced by the mill would be offered comparable products and services from other Sappi sites in Europe.

Sappi also said the uncoated product lines consisting of the Cento family of brands would be discontinued.

The sales office in Switzerland will continue operations, Sappi said.

SOURCE: Sappi Fine Paper Europe