- Following UPM and SCA’s announced capacity closures, Stora Enso could follow suit: According to Talouselämä, Stora is considering the closure of its Veitsiluoto and Anjala mills. As with the UPM and SCA closures, both mills are in Finland. Finland has recently been flagged for being uncompetitive, with high diesel and electricity taxes and wages 30% higher than Germany. The Veitsiluoto mill has 850ktpa paper capacity (light-weight coated; medium-weight coated and UWF). The Anjala mill has 435ktpa of paper capacity (book grade; magazine and newsprint).
- Coated mechanical market needs further closures: To reach a 90% utilisation rate, the coated mechanical reels market would need to take out a further 250ktpa this year.
- Uncoated mechanical market needs to take out at least 1mtpa this year: UPM and Stora account for c.60% of the uncoated mechanical market in Europe. Operating rate in Western Europe is currently 75% and in order to reach 90%, 1mtpa needs to be removed.
- Newsprint conversions pose risk to containerboard supply/demand dynamics: European newsprint producers need to take out at least another 800ktpa this year for operating rates to reach 90%. Slovenia’s largest producer of paper mulls over newsprint conversion. Papresa (Spain) also mimicked similar sentiment this past week.
- Pro-gest sees further delay (minor) to their Mantavo testliner (400ktpa) start-up in Italy: Minor delay this time, from September to October. The H1 EBITDA run rate for the mill was -EUR 2.9m.
- Mondi invests in new packaging lines at its Szczecin corrugated box plant in Poland: The new equipment includes a five-colour Bobst Masterline 2.1 HD and a Robot MUK and aims to meet growing
e-commerce demand in north-eastern Germany, Denmark, Sweden and Poland. The machines will be equipped with automatic palletizers, run at faster speeds to increase production capacity and ensure high-quality printing. The new machines will also reduce energy consumption. - UK is stepping up war on plastics: The UK is set to extend and increase the single-use carrier bag charge from April 2021. It is now being extended to all retailers and the levy will be doubled from
GBP 0.05/bag. The levy was first introduced in 2015 and helped cut plastic bag sales in major supermarkets by 95% as well as a 60% drop in the number of plastic bags on UK beaches. Additionally, the UK government will introduce a new tax on plastic packaging which does not meet a minimum threshold of at least 30% recycled content from April 2022 (subject to consultation). - Week ahead: DS Smith trading update (Tuesday); UPM CMD (Tuesday); and DS Smith 1/1 (Thursday).
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