Nippon Paper Chemicals Europe was established in Hungary in 2022 to produce and sell CMC (carboxymethyl cellulose) for lithium-ion batteries used in electric vehicles, and began local production in 2025.
Sept. 8, 2026 - Nippon Paper Industries Co., Ltd. ("the Company") announced that it has decided to temporarily suspend the business of Nippon Paper Chemicals Europe Zrt. ("NPCE"), its consolidated subsidiary in Hungary, effective December 31, 2026. As a result, the Company expects to recognize an extraordinary loss for the expenses associated with the temporary suspension of business.
In its Medium-Term Business Plan 2030 announced on May 28, 2026, Nippon Paper Industries set forth three basic strategies: balance sheet optimization, decisive structural reforms, and profitability improvement. Under these strategies, the Company is working to improve capital efficiency and achieve sustainable growth.
NPCE was established in Hungary in 2022 to produce and sell CMC (carboxymethyl cellulose, product name: SUNROSE MAC®) for lithium-ion batteries ("LiBs") used in electric vehicles ("EV"), and began local production in 2025. However, around the time local production started, the external environment surrounding the EV market has grown increasingly challenging, with successive reviews of environmental regulations by countries in Europe and North America, changes in policies to promote EV adoption, and revisions to subsidy systems. Together with the slowing growth of the EV market in those regions, this has left NPCE facing fiercer competition than ever before on a global scale.
Nippon Paper Industries has worked to develop new customers for NPCE while strengthening its cost competitiveness. However, with changes in the market environment that were difficult to anticipate, under current conditions, securing stable earnings for the time being is likely to prove difficult, and returns commensurate with the investment can no longer be expected. Accordingly, under the basic strategies set out in the Medium-Term Business Plan 2030, the Company has decided to temporarily suspend the business of NPCE in order to prevent the further losses and deterioration in cash flows that continued operation would entail.
Nippon Paper Industries will consolidate production of CMC at its Gotsu Mill in Japan and strengthen its competitiveness by improving production efficiency. It will also continue to implement the initiatives set out in the Medium-Term Business Plan 2030, thus enhancing the corporate value of the Nippon Paper Group.
Nippon Paper Industries produces a wide range of products, including newsprint, coated and uncoated paper, paperboard, tissue, pulp, lumber, chemicals and more.
SOURCE: Nippon Paper Industries Co., Ltd.