Nordic Paper to Discontinue Pulp Production at Säffle Mill, Will Purchase Pulp Externally

The Säffle Mill in Sweden operates two paper machines that, combined, produce 33,000 tonnes per year of natural greaseproof papers, while the pulp mill produces about 25,000 tonnes per year of pulp.

May 3, 2021 - Nordic Paper on April 28 announced its decision to initiate consultations with trade unions regarding a restructuring of production at its pulp and paper mill in Säffle, Sweden. The decision involves the discontinuation of pulp production at the mill during the fourth quarter 2021 after which the mill would purchase pulp externally.

In addition, Nordic Paper announced an investment of approximately SEK 70 million at the mill, which would be primarily focused on increasing the efficiency in the handling of external pulp. Work in this area would be carried out during 2021.

The Säffle Mill operates two paper machines that, combined, produce 33,000 tonnes per year of natural greaseproof papers, while the pulp mill produces about 25,000 tonnes per year of pulp.

Nordic Paper explained that the Säffle Mill is one of the largest producers of greaseproof paper in the world, but the pulp production line is among the smallest in Europe, and that the planned measures would enable the mill to increase paper production by approximately 10%.

"The restructuring at the Säffle plant is an important step in the long-term development of Nordic Paper," said Anita Sjölander, CEO of Nordic Paper. "The plant has a long history in pulp production and by restructuring the production according to the proposal, we would increase our competitiveness and secure our position as a world leading producer of greaseproof papers."

Nordic Paper estimates that the fixed costs, excluding depreciation, of the plant would be reduced by approximately SEK 30-40 million on an annual basis at full utilization of the production capacity.

Nordic Paper estimates that the staffing would be reduced by about 20 positions.

As a result of a discontinuation of the pulp production, one-off effects of SEK 110 million will be incurred of which approximately SEK 80 million are reservations related to remediation of buildings and land and approximately SEK 30 million are write-downs of the existing pulp line, the company said.

Nordic Paper is a Scandinavian specialty paper producer of kraft and natural greaseproof paper. The company has four mills and about 630 employees. To learn more, visit: www.nordic-paper.com.

SOURCE: Nordic Paper