UPM Plywood is planning to scale down plywood production in Finland

UPM Plywood is planning to permanently close its Jyväskylä plywood mill, which is producing spruce and birch plywood. The company starts a consultation process concerning the entire personnel working at the mill.

The Profitability of Jyväskylä plywood mill has been weak for a long time, even during periods of high-demand. Despite investments as well as savings and improvement activities, the profitability has not improved to a sustainable level.

Competition in the birch plywood market is increasing constantly. New birch plywood capacity has been built especially in Russia, where the production cost level is significantly more competitive than in Finland. If realized, the planned actions would strengthen UPM Plywood’s overall competitiveness and performance in the long run.

“In Finland, a full run of the capacity has not been feasible due to the terms in the woodworking industry. In addition, repeated labour market disturbances have weakened the delivery reliability of Finnish mills. According to the plan, the products currently manufactured in Jyväskylä would be produced in other UPM Plywood mills in Finland, Estonia, and Russia”, says Mika Sillanpää, EVP UPM Plywood.

UPM will recognise restructuring charges of approximately EUR 22 million as items affecting comparability in its Q2 2020 results. The planned actions would result in annual savings of approximately EUR 11 million.