Stora Enso launches plan to permanently close pulp and paper production at mills in Kvarnsveden and Veitsiluoto

Stora Enso will enter into co-determination negotiations with employees at the mills in Kvarnsveden in Sweden and Veitsiluoto in Finland regarding a plan to permanently close the pulp and paper production at both plants. The planned closures would take place during the third quarter of 2021 and affect 670 people in Finland and 440 people in Sweden.

Paper demand in Europe has been declining for over a decade. This trend has further accelerated due to the pandemic, which has led to changes in consumer behavior. As a result, there is a significant overcapacity in the European paper market, which has caused low price levels and challenged the cost competitiveness of many paper mills. The mills in Kvarnsveden and Veitsiluoto are both loss-making and their profitability is expected to remain unsatisfactory also in the future.

The planned closures of the mills would reduce Stora Enso’s papermaking capacity by 35% to 2.6 million tonnes per year. Stora Enso’s paper sales would decrease by approximately € 600 million and operating profit (EBITDA) is expected to improve by approximately € 35 million annually. After the planned closures, the paper division’s share of the group’s sales would be reduced to just over 10%.