Papermaker UPM has finalised its plans to reduce production capacity with the announcement that it will close its unprofitable Albbruck paper mill in Baden-Württemberg, Germany.

The company says discussions with employee representatives and local authorities did not lead to a solution for continuing the operations at the mill, and it failed to find an investor.
Some 508 mill employees affected by the closure leave their jobs on January 31.

UPM says Albbruck has been making a loss for several years due to the age and relatively small size of the machines and the mill is not cost competitive within UPM asset and global customer portfolio.

“Under the difficult circumstances the highly qualified employees have done an excellent job,” says Paper Business Group President Jyrki Ovaska. “Unfortunately, it would not have been possible to improve the mill’s profitability to an extent that would have allowed sustainable operations.”

UPM says it will implement a social plan in order to alleviate the effects caused by personnel reductions, and is in discussions about the future use of the mill premises.

The sheeting lines of the mill are being transferred to the company’s paper mill in Plattling in order to complement UPM’s product portfolio.

“UPM sees the coated mechanical sheets as solid business, and is committed to serve the customers after the Albbruck closure smoothly and promptly,” says Ovaska. Approximately 30 new positions will be created through this measure and applications from Albbruck specialists will be prioritised.

The Albbruck decision finalises the paper capacity closure plans that were announced by UPM last August. UPM Albbruck paper mill had a capacity of 320,000 tonnes of magazine papers. UPM Myllykoski paper mill in Finland with 600,000 tonnes of magazine papers was closed down on December 9 last year, and the paper machine 3 at UPM Ettringen paper mill in Germany with 110,000 tonnes of newsprint was closed down on December 14, 2011. The sales process of the Stracel paper mill in France is ongoing as planned, the company says.