Paper maker UPM is cutting capacity again, shutting a machine at its Plattling mill to cut coated mechanical paper capacity.

Closing paper machine 10 at the German mill will reduce annual capacity of coated mechanical paper in Europe by approximately 155,000 tons. UPM plans to continue production on paper machines 1 and 11, but 160 positions will be affected by the plans, with employee consultations to start this month ahead iof the closure.

Communication Papers executive vice president Winfried Schaur says paper markets have been declining consistently over the past ten years. "We have responded by selective capacity reductions, always considering the competitiveness of our business - and we will continue to do so also in future.

"The planned closure announced today is in line with this approach and focusses on maintaining the most modern and competitive assets."

He says Plattling PM 10 has "both the lowest capacity and the highest technical age" among UPM's coated mechanical machines.

Restructuring charges of about 30 million Euros will increase costs on the second quarter of 2019, but the move will bring annual savings of approximately 17 million Euros.