Cepi Calls on EU Commission to Continue Negotiations on US Tariffs to Avoid Supply Chain Disruptions

March 18, 2025 (Cepi) - The imposition of import tariffs by the US would have a significant impact on EU pulp, paper and board exports. While a positive issue to transatlantic negotiations may still be possible, Europe's pulp and paper industry in coordination with the European Commission has been preparing for the effects of a potential EU retaliation.

On March 12, the United States government-imposed tariffs on steel and aluminium and signaled that it may impose tariffs on a broader range of EU goods, potentially including pulp and paper products, in April. Cepi, representing the European pulp and paper industry, is now taking part in a consultation launched by the European Commission on the list of American products targeted by European retaliation measures.

The list of products presented is open to consultation by industry representatives until 26 March. It will then be submitted to EU member states for approval. The Commission is aiming for entry into force in mid-April.

Cepi advocates for a 'negotiation first' approach. But in the event negotiations fail and US tariffs on EU exports of pulp, paper or board would be imposed, Cepi urges the EU Commission: to respond quickly, vigorously and in a proportionate manner with EU restrictions on imports of US goods and services.

If, however, US tariffs do not cover EU pulp, paper and board products, such EU retaliation should similarly exclude US pulp, paper and board products, to exclude from such EU retaliation list products that risk being in short supply in the EU, and to monitor and address possible trade flows from third countries that may flood the EU market because of US tariffs, including by means of using EU trade defence instruments to protect the EU industry.

Jori Ringman, Cepi Director General, commented, "Cepi regrets the imposition of US tariffs and the increased risk of a trade war and supply chain disruptions this creates. Against this background, Cepi calls on the European Commission to continue negotiations to avoid further supply chain disruptions and prevent the imposition of additional tariffs."

The EU and the US are very important trade partners in pulp, paper and board. The EU imports around 900,000 tonnes per year of pulp from the US and close to 600,000 tonnes of paper and board. On the contrary, the EU exports a lot of paper and board to the US — about 1.6 million tonnes per year of paper and board, and around 350,000 tonnes of pulp.

Since a multilateral agreement of all major pulp and paper producers in January 2004, there have been no import tariffs on both sides of the Atlantic, to the benefit of both US and EU businesses and consumers.

"It is not just about the competitiveness of our sector, it is about the EU and US consumers who need basic hygiene products, EU and US workers in factories losing their jobs, and ripple effects on the wide range of sectors using paper packaging on both sides of the Atlantic," Ringman concluded.

Brussels-based Cepi (Confederation of European Paper Industries) is the European association representing the paper industry. Cepi is a non-profit-making organisation.

SOURCE: Cepi

UPM to Reduce Paper Capacity in Germany; Streamline Its Structure to Ensure Performance

March 11, 2025 - UPM continues to selectively align its paper capacity with profitable customer demand to ensure performance and therefore plans to permanently close its paper mill in Ettringen, Germany, reducing the annual capacity of uncoated mechanical paper by 270,000 tonnes during July 2025.

Should the plans be implemented, the number of positions affected in Ettringen is estimated at 235. The participation process with the workers council will start immediately in line with local legislation.

“In a dynamically changing market that has been characterized by overcapacity for years, operational competitiveness is key to underpinning our long-term commitment to the still sizeable graphic paper markets and remaining the reliable partner our customers know us to be,” said Gunnar Eberhardt, Executive Vice President, UPM Communication Papers.

“With the plans announced today, we are continuing to selectively adjust our paper capacity to a profitable customer demand. This would ensure an efficient and flexible use of our remaining paper assets. While we see these planned changes to be necessary to safeguard our strong position and future, we are aware that today’s announcement demands much from our employees in Ettringen. We aim to handle the restructuring measures in a socially responsible way and will engage now into dialogue with employee representatives,” Eberhardt said.

Additional Measures with Clear Focus on Operational Efficiency

As one of the largest producers of graphic papers, UPM Communication Papers is constantly working to remain relevant and competitive in the long term. Even when production capacities must be adjusted to meet customer demand, the global paper market remains sizeable, presenting opportunities for agile and competitive players.

By benchmarking and sharing best practices across all mills, UPM Communication Papers aims to enhance efficiency, improve cross-departmental flexibility, and streamline organizational structures within its mill operations in Augsburg, Schongau, Kaukas, Kymi, Rauma, Jämsänkoski, Blandin and Caledonian.

In addition, UPM sees further optimization potential by centralizing processes and organizational structures within logistics operations in the German mills.

In order to realize further benefits of a scalable and efficient Sourcing organization, UPM plans to discontinue the Central European Mill Support (CEMS) team and streamline its Mill Sourcing and RCP Sourcing teams according to new capacities.

All affected mills and functions will follow up with their own implementation steps during 2025, and the company is committed to working closely with affected employees, handling possible employment actions in accordance with local legislation.

According to the plans, UPM estimates approximately 227 positions to be affected in its mill organizations and functions.

Antti Hermonen, Senior Vice President Operations, UPM Communication Papers, stated, “With the planned measures we improve cost efficiency and competitiveness, while ensuring a reliable supply from our production locations in Finland, Germany, the UK and the USA.”

Considering all planned changes announced today by UPM Communication Papers, there would be a total of 462 positions impacted: 107 in Finland, 314 in Germany, 34 in the UK and 7 in the USA.

These plans are a continuation of necessary steps to proactively align with customer demand and ensure competitiveness. UPM would recognize restructuring charges of EUR 74 million (EUR 60 million cash impact and an impairment of EUR 14 million) as items affecting comparability in its Q1 2025 result. The planned actions are estimated to result in annual fixed cost savings of EUR 39 million.

UPM Communication Papers offers the industry’s widest portfolio for newspaper, magazine, marketing and book printing as well as for home and office applications. With headquarters in Germany, UPM Communication Papers employs approximately 5,000 people and has 10 modern paper mills globally. Its annual production capacity is 4.3 million tonnes of graphical paper.

SOURCE: UPM

Metsä Board to Close Tako Board Mill in Tampere, Finland in 2Q 2025

March 10, 2025 - Metsä Board has concluded the change negotiations that began in January to improve the company's profitability and cost competitiveness. As a result of the negotiations, Metsä Board will permanently close Tako board mill and enhance the operational efficiency of Kyro board mill.

The measures will lead to a total reduction of 208 jobs.

The Tako board mill has two folding boxboard machines with annual production capacities of 70,000 and 140,000 tonnes. This represents approximately 13% of the company's current annual production capacity of approximately 1.6 million tonnes of folding boxboard.

Mika Joukio, CEO of Metsä Board, said, "The change negotiations with the personnel were conducted in a constructive spirit. Finding new jobs for the people being laid off is our primary goal, and we also aim to help with employment by offering reemployment training and support."

Production at the Tako board mill is planned to end by the end of the second quarter of 2025 at the latest. The closure of the mill will not affect customer deliveries, as Metsä Board's total annual folding boxboard production capacity is sufficient to meet current demand. After the mill closure, Metsä Board's annual folding boxboard capacity will be approximately 1.4 million tonnes.

Metsä Board estimates that the measures now decided will improve the annual comparable EBITDA by approximately EUR 30 million, mainly from the second half of 2025. A one-off profit impact of approximately EUR -28 million will be recorded in connection with the closure of the Tako mill, mainly related to the impairment of assets. It will be recorded in Metsä Board's operating result for the first quarter of 2025 as an item affecting comparability. The one-off cash impact is approximately EUR -1 million.

Metsä Board is a producer of lightweight and high-quality folding boxboards, food service boards and white kraftliners.

SOURCE: Metsä Board

Metsä Group’s Tissue Paper Transports in Scandinavia Switch to Renewable Fuels

Jan. 3, 2025 - Metsä Group’s tissue paper business is taking an important step towards more sustainable transports of its tissue products by arranging part of its outbound transports to customers in Scandinavia with fossil-free fuels. This shift is part of the company’s strategic Lean Supply Chain programme aiming for efficient and lean value proposition to local markets.

Approximately 40 percent of Metsä Tissue Scandinavia’s outbound transports are now powered by HVO or bio-diesel. These biofuel transports represent a vast majority of the outbound transports that Metsä Tissue organizes by itself in the region and the company’s short-term target is to extend the biofuel coverage of own transports to 100 per cent.

Also the customers that organize their own transports are encouraged to collect their tissue products from Metsä Tissue’s Swedish mills with transportations using fossil free fuels.

"By setting high standards for our transportation partners and choosing renewable fuels such as HVO, we can reduce our emissions by up to 90 percent per truck transport. This is an important step in our strategy and in reaching our ambitious sustainability targets 2030. It also demonstrates well our commitment to more responsible future in our transports - for us and for our customers," says Daniel Stenberg, Vice President Supply chain, Metsä Tissue Scandinavia.

In addition, the increased localized production with the expansion and modernisation of Metsä Tissue’s Mariestad mill will further reduce transportation emissions per transported tonne.

Today, more than 85 percent of the company’s deliveries are made within a 500-kilometer radius from the mills and the increase in local capacity will provide even more local products with shorter transport distances. Combined with the target to transition to 100% fossil-free fuels, the company continues to strengthen its efforts in achieving more sustainable transportations.

Metsä Group’s Tissue and Greaseproof Papers business, or Metsä Tissue, produces hygiene products for households and professionals, and greaseproof papers for food preparation and packaging. Its high-quality locally produced brands include: Lambi, Serla, Mola, Tento, Katrin and SAGA.

SOURCE: Metsä Tissue