Pulp-Paperworld.com / European News

Stora Enso plans to consolidate the Finnish spruce (whitewood) production to Varkaus sawmill. The plan includes a permanent closure of Kitee sawmill and production increase to Varkaus. The objective is to improve profitability and competitiveness by creating a fully integrated sawmill for spruce production in Varkaus, optimising the synergies from the existing LVL (Laminated Veneer Lumber), pulp and board mills.

The consolidation plan is part of Stora Enso’s profit protection programme of EUR 120 million targeting reductions in variable and fixed costs. The possible consolidation is subject to completion of the co-determination negotiations at Kitee sawmill which will start in August. The production at Kitee sawmill is planned to be stopped gradually until the end of 2019.

stora new 2017“The planned consolidation would enable us to optimise the full potential of Varkaus mill as an integrated mill, delivering a variety of value added wood products such as further processed sawn wood and LVL. This would provide us possibilities for improved product mix, stronger R&D and innovation as well as opportunities for efficient and automatised production. In Varkaus we also see strong synergies with Stora Enso’s pulp and board mills when it comes to shared raw material, logistics, infrastructure and energy usage. This consolidation would further enhance Stora Enso’s position as a global provider of high quality wood products and innovative wood-based solutions”, says Jari Suominen, Head of Stora Enso’s Wood Products division.

At Kitee sawmill the planned closure would result in a reduction of maximum 85 FTEs (full-time equivalents). Varkaus sawmill and LVL mill currently employ a total of 105 people. An increased production in Varkaus would require an additional 20 FTEs. Decisions regarding the planned consolidation, closure and employee reduction will be taken after the co-determination negotiations have been concluded.

Stora Enso will record restructuring related costs and write-downs of EUR 11 million as an item affecting comparability (IAC) in the second quarter 2019 results. Approximately EUR 5 million of the provisions will have a cash impact.

The planned closure would not have a significant impact on Group sales or operational EBIT this year.

Part of the bioeconomy, Stora Enso is a leading global provider of renewable solutions in packaging, biomaterials, wooden constructions and paper. We believe that everything that is made from fossil-based materials today can be made from a tree tomorrow. Stora Enso has some 26 000 employees in over 30 countries. Our sales in 2018 were EUR 10.5 billion. Stora Enso shares are listed on Nasdaq Helsinki (STEAV, STERV) and Nasdaq Stockholm (STE A, STE R). In addition, the shares are traded in the USA as ADRs (SEOAY). storaenso.com

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Stora Enso has decided to invest approximately EUR 350 million to convert the Oulu paper mill in Finland into packaging production. The investment includes converting paper machine 7 into high-quality virgin-fibre-based kraftliner production, and the closure of paper machine 6 and sheeting plant. Production on the converted machine is estimated to start by the end of 2020.

“The conversion of Oulu Mill will enable Stora Enso to further improve its position in the growing packaging business and take a major step forward in its transformation. We have proven competence in running large conversion projects successfully, as we have already converted one paper machine at Varkaus Mill to produce kraftliner,” says Stora Enso’s CEO Karl-Henrik Sundström.

The typical end uses for kraftliner are in packaging segments that require high strength, quality and purity, such as food, fruit and vegetables as well as heavy duty packaging. Production will target global export markets.

“Economic growth, sustainability and food safety are key market drivers in the packaging business. This conversion will allow us to provide customers with an innovative kraftliner product with high-performance qualities in terms of strength, printability and food safety,” says Gilles van Nieuwenhuyzen, EVP, Stora Enso’s Packaging Solutions division.

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To transform Stora Enso further from declining and low EBITDA business to growing higher profitability business, the Group will invest approximately EUR 350 million in the conversion during 2019–2022. This will increase the Group’s earlier estimated capital expenditure for 2019 from EUR 540–590 million to EUR 610–660 million. The market dynamics of woodfree coated paper have deteriorated further, and therefore Stora Enso must accelerate its transformation by increasing capital expenditure from the earlier estimate. Following the conversion, Oulu Mill’s EBITDA margin is expected to improve by 15–20 percentage points, once the kraftliner machine is running at full capacity approximately four years after start-up. At full capacity, the investment is expected to meet the Packaging Solutions division’s profitability target, operational return on operating capital (ROOC) of 20%.

The investment will include a new world-class line for virgin-fibre based kraftliner (both brown and white-top) with an annual capacity of 450 000 tonnes, the modification of the pulp mill and drying machine for unbleached brown pulp, as well as investments to enhance the mill’s environmental performance. The project will start with ground work in the summer of 2019, and about 200 contractors will work at the Oulu Mill site during the project.

The converted Oulu Mill will directly employ approximately 180 people. Wood consumption at the mill will increase by 0.5 million m3 to 2.4 million m3 annually. Wood will be purchased mainly from private forest owners in Northern Finland.

As an outcome of the co-determination process started on 25 March 2019, 365 people will be permanently laid off. The initial estimate on the maximum number of employee reductions was 400 people. The redundancies will mainly take place by the end of year 2020, when Oulu Mill will cease to produce woodfree coated papers. Stora Enso will provide support to the people who will not continue working at the Oulu Mill after the conversion. At maximum 20% of the redundancies can be managed through pension arrangements.

“We will be working closely together with other Stora Enso locations, the city of Oulu and other stakeholders to support in re-employment for those employees who will not have a position in the new organisation. Our support will include outplacement services as well as individual and group trainings for re-employment. We will also offer financial support for employees starting up their own companies,” says Kati ter Horst, EVP, Stora Enso’s Paper division.

Stora Enso will book a cost of EUR 31 million as an item affecting comparability (IAC) relating to layoffs, restructuring expenses, asset write-downs and impairment reversals, of which EUR 7 million will be recognised in the second quarter of 2019 and EUR 24 million in the following five quarters. The restructuring related costs will have a cash impact of approximately EUR 19 million when paper production at the mill ends.

Oulu Mill’s current capacity is 1 080 000 tonnes of woodfree coated papers annually. Typical end-uses for woodfree coated papers are e.g. high-quality advertising and magazines. Paper production is expected to continue until the end of September 2020.

Part of the bioeconomy, Stora Enso is a leading global provider of renewable solutions in packaging, biomaterials, wooden constructions and paper. We believe that everything that is made from fossil-based materials today can be made from a tree tomorrow. Stora Enso has some 26 000 employees in over 30 countries. Our sales in 2018 were EUR 10.5 billion. Stora Enso shares are listed on Nasdaq Helsinki (STEAV, STERV) and Nasdaq Stockholm (STE A, STE R). In addition, the shares are traded in the USA as ADRs (SEOAY). storaenso.com 

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Stora Enso aims to start recycling used paper cups on a large scale at its Langerbrugge Mill in Belgium. Based on production trials, Stora Enso possesses the technical feasibility to recycle paper cups for use in other paper applications. Stora Enso is now looking into partnerships for the collection and sorting of used paper cups to ensure that this high-quality fibre material is captured and given a second life.

Recycled fibre is an important raw material for Stora Enso as it is aligned with the company’s commitment towards a renewable and circular business. The paper board for cups is made of high-quality, renewable fibres, which can have several lives due to recycling. Recycling a paper cup can reduce its life cycle carbon footprint by half. Stora Enso sees this as an opportunity for driving more effective paper cup recycling by developing circular models with partners across the value chain.

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“With efficient recycling processes, food service companies using wood fibre-based cups can improve their environmental footprint. Recycling must be made easy for consumers, that is why we want to invite partners and customers to jointly develop business models for collecting paper cups,” says Annica Bresky, Executive Vice President of the Stora Enso Consumer Board division.

In recycling trials at Langerbrugge Mill, half a million baled post-consumer paper cups collected from fast food restaurants and coffee houses were re-pulped and recycled into magazine paper. The result confirmed that paper cups can be recycled at the mill without any additional process equipment, and that the fibres are well suited for other paper applications, such as magazine paper production.

Stora Enso’s Langerbrugge Mill is one the largest paper mills in Europe, producing 540 000 tons of recycled newsprint and magazine papers annually. The production is exclusively based on paper for recycling. The mill is conveniently located in Continental Europe with about 80 million people living within 300 kilometres of the mill, thus providing a large enough source for recycled raw materials.

“We see paper cups as a valuable raw material for our process. Used paper cups provide a potential source of high-quality fibre for the production of magazine paper. Langerbrugge Mill has the technical readiness to accept billions of used cups for recycling within our sourcing area. The challenge is more about getting these cups to us on the industrial scale that our production would require,” says Rik Van Bostraeten, Sourcing Manager, Multifuel & Business Innovation, Stora Enso Langerbrugge Mill.

As part of the bioeconomy, Stora Enso is a leading provider of renewable solutions in packaging, biomaterials, wooden constructions and paper globally. We believe that everything that is made from fossil-based materials today can be made from wood tomorrow. Stora Enso has approximately 26 000 employees in over 30 countries. Our sales in 2018 were EUR 10.5 billion. Stora Enso shares are listed on Nasdaq Helsinki (STEAV, STERV) and Nasdaq Stockholm (STE A, STE R). The company’s shares are traded in the USA as American Depositary Receipts (SEOAY). www.storaenso.com 

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Stora Enso starts co-determination negotiations with employees at Oulu Mill in Finland regarding a plan to convert the paper mill into packaging board production and the closure of paper machine 6 and a sheeting plant. The planned change could result in a reduction of a maximum of 400 employees at the mill. The decision on the potential conversion will be made by the Stora Enso Board of Directors during the first half of 2019 after the co-determination process has been completed.

stora new 2017
Stora Enso announced in June 2018 that it would evaluate development opportunities for the Oulu Mill, because current coated wood-free paper production is facing challenges with market demand and profitability. The feasibility study focused on converting the mill into packaging board grades. Based on the technical and financial aspects of the feasibility study results, the proposed plan is to convert paper machine 7 into kraftliner production and close down paper machine 6 and the sheeting plant by the end of 2020 at the latest. The capital expenditure for the potential investment is estimated to be approximately EUR 350 million during the years 2019–2021 instead of the EUR 700 million estimated in the initial feasibility study scope.


The potential investment would include a new world-class kraftliner line with a capacity of 450 000 tonnes per year and the modification of the pulp mill and drying machine to produce unbleached brown pulp. Moreover, it would include investments to enhance environmental performance.

The potential conversion of Oulu Mill would enable Stora Enso to further improve its position in the growing packaging business and take a major step in its transformation. The aim of the change is to improve the competitiveness of Oulu Mill and to ensure a long-term future for the mill.

The environmental permit will be filed in March. The permit application will also include a description of a potential conversion for paper machine 6, in case this option would be considered at a later date.

The entire personnel of Stora Enso Oulu Oy, approximately 600 people, falls within the scope of the negotiations, which will start on 25 March 2019. In line with Finland’s co-determination law, the negotiations are based on the proposed conversion plan and include the reorganization of structures, functions, resources and job roles. The negotiations are expected to take at least six weeks. The potential changes affecting personnel would take place by the end of year 2020.

No decisions regarding the planned conversion or redundancies will be taken until the co-determination negotiations have been concluded.

Part of the bioeconomy, Stora Enso is a leading global provider of renewable solutions in packaging, biomaterials, wooden constructions and paper. We believe that everything that is made from fossil-based materials today can be made from a tree tomorrow. Stora Enso has some 26 000 employees in over 30 countries. Our sales in 2018 were EUR 10.5 billion. Stora Enso shares are listed on Nasdaq Helsinki (STEAV, STERV) and Nasdaq Stockholm (STE A, STE R). In addition, the shares are traded in the USA as ADRs (SEOAY). storaenso.com

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Stora Enso received the highest scores in the FINDIX report, which was published for the first time today. The study examined the diversity of 89 Finnish companies through five different variables. These include gender distribution, age distribution, international background, educational background and industry-specific background of management teams and board of directors. The variables are based on the Finnish Securities Market Association’s corporate governance code, where they are highlighted as factors promoting diversity.

stora new 2017“At Stora Enso, we believe diversity strengthens our competitiveness and we aim to reflect the societies in which we operate. Diverse working teams enable us to explore different perspectives and challenge our way of thinking, contributing to better decision-making,” says Karl-Henrik Sundström, Stora Enso’s CEO. “To benefit from diverse working teams, we need inclusive work environments that respect and appreciate individual differences. Dimensions such as skills and experiences, gender, age, cultural background and personality are important to Stora Enso when we strive for diversity.”

You can read more about the diversity of Stora Enso’s Board of Directors and Group Leadership Team in the recently published Governance report. For more information on diversity work, please read the company’s Sustainability 2018 report. Both reports are published on the company’s website.

For further information, please contact:
Ulrika Lilja, EVP, Communications, tel. +46 72 221 9228

Part of the bioeconomy, Stora Enso is a leading global provider of renewable solutions in packaging, biomaterials, wooden constructions and paper. We believe that everything that is made from fossil-based materials today can be made from a tree tomorrow. Stora Enso has some 26 000 employees in over 30 countries. Our sales in 2018 were EUR 10.5 billion. Stora Enso shares are listed on Nasdaq Helsinki (STEAV, STERV) and Nasdaq Stockholm (STE A, STE R). In addition, the shares are traded in the USA as ADRs (SEOAY). storaenso.com

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Stora Enso has been top-rated in combatting global warming by the international non-profit organisation CDP, which works to build a sustainable global economy. CDP has included Stora Enso on its new 2018 Climate A List, which identifies the global companies that are taking leadership in climate action.

stora new 2017“We are proud of this recognition of our long-term work to reduce our emissions,” says Noel Morrin, EVP Sustainability at Stora Enso. “For over a decade we have been actively reducing the energy intensity of our operations and our dependence on fossil fuels. In December 2017, Stora Enso became the first forest products company to set ambitious science-based targets for reducing greenhouse gas emissions throughout our value chain.”

Stora Enso has also signed a Revolving Credit Facility (RCF) loan where part of the pricing is based on the group’s performance in reducing greenhouse gas emissions. This progress is reported in Stora Enso’s annual and interim reports. In addition, Stora Enso has published a Green Bond Framework and asks suppliers about their carbon dioxide emissions in all tenders.

“Ultimately, it is our renewable materials that make a difference,” Morrin says. “They are a key solution to combatting global warming as they store carbon and replace fossil-based materials.”

Paul Simpson, CEO of CDP says: “Congratulations to all companies that made it onto CDP’s A List this year. We need to urgently scale up environmental action at all levels in order to meet the goals of the Paris Agreement and the Sustainable Development Goals. It’s clear that the business world is an essential player in this transition and the A List companies are set to make a substantial contribution to those goals.”

Thousands of companies annually submit climate disclosures to CDP. In 2018, disclosures were requested by 650 investors representing over USD 87 trillion in assets, and over 7 000 companies submitted their climate data.

In addition to the CDP rating, Stora Enso has been top-ranked in both the quality of greenhouse gas management and carbon performance by the Transition Pathway Initiative (TPI). TPI is a global initiative led by asset owners and supported by asset managers and looks into how companies’ carbon performance now and in the future might compare to the international targets and national pledges made as part of the Paris Agreement.

Stora Enso’s fossil carbon emission summary for 2017

CDP is an international non-profit that drives companies and governments to reduce their greenhouse gas emissions, safeguard water resources and protect forests. Voted number one climate research provider by investors and working with institutional investors with assets of US$87 trillion, we leverage investor and buyer power to motivate companies to disclose and manage their environmental impacts. Over 7,000 companies with over 50% of global market capitalization disclosed environmental data through CDP in 2018. This is in addition to the over 750 cities, states and regions who disclosed, making CDP’s platform one of the richest sources of information globally on how companies and governments are driving environmental change. CDP, formerly Carbon Disclosure Project, is a founding member of the We Mean Business Coalition. cdp.net 

Part of the bioeconomy, Stora Enso is a leading global provider of renewable solutions in packaging, biomaterials, wooden constructions and paper. We believe that everything that is made from fossil-based materials today can be made from a tree tomorrow. Stora Enso has some 26 000 employees in over 30 countries. Our sales in 2017 were EUR 10 billion. Stora Enso shares are listed on Nasdaq Helsinki (STEAV, STERV) and Nasdaq Stockholm (STE A, STE R). In addition, the shares are traded in the USA as ADRs (SEOAY). storaenso.com 

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Stora Enso has chosen six startups to join its second Accelerator Programme, a joint startup initiative organised by Stora Enso, Aalto University Developing Entrepreneurship (Aalto ENT) and Vertical Accelerator.

stora new 2017
The Accelerator programme provides an exceptional opportunity for disruptive startups and Stora Enso to actively ideate and innovate new solutions. This year’s programme focuses specifically on the circular economy, especially in regard to circular solutions, raw material management, packaging, separation and sorting, and energy.

“With global megatrends, the circular economy will play a significant role in business and society in the coming years. We are teaming up with startups to further explore how Stora Enso can best contribute,” says Malin Bendz, Executive Vice President, HR. “We have been greatly encouraged by our first Accelerator programme, which has resulted in two ongoing partnerships, with Sulapac and Trä Group, building on renewable solutions.”

The final six startups emerged from a rigorous and competitive selection process. After submitting a written application and video, more than 85 startups were evaluated and filtered down to the top 40. Reviewed by Stora Enso Scouts and Vertical, 20 of these startups were invited to Selection Days, a two-day event for presentations and intensive interviews. A shortlist of twelve startups presented to Stora Enso’s Group Leadership Team for the selection of the final six.

The startups invited to join the 2019 Accelerator Programme are:

Over the next few months, the startups will work side by side with Stora Enso participants, delving into and advancing know-how, capabilities, technologies and market opportunities. Co-location takes place at Vertical accelerator, one of the largest and most prominent startup communities in Finland.

Part of the bioeconomy, Stora Enso is a leading global provider of renewable solutions in packaging, biomaterials, wooden constructions and paper. We believe that everything that is made from fossil-based materials today can be made from a tree tomorrow. Stora Enso has some 26 000 employees in over 30 countries. Our sales in 2017 were EUR 10 billion. Stora Enso shares are listed on Nasdaq Helsinki (STEAV, STERV) and Nasdaq Stockholm (STE A, STE R). In addition, the shares are traded in the USA as ADRs (SEOAY). storaenso.com 

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Stora Enso’s Sustainability Report 2017 has been included in the top ten sustainability reports globally according to the latest Reporting matters publication by the World Business Council for Sustainable Development (WBCSD).

In WBCSD’s Reporting matters publication, Stora Enso’s Sustainability Report is praised for its disclosure of internal sustainability management processes. The external assurance of the report’s sustainability information also received good feedback as it strengthens the credibility of Stora Enso’s disclosure.

stora new 2017“We are proud of our transparent reporting being acknowledged,” says Noel Morrin, EVP Sustainability at Stora Enso. “It is especially encouraging to see that the four-tier reporting structure we use to present the most material opportunities and challenges is recognised as good practice.”

“In addition to being coherent and highly informative, good reporting requires continuous development. Our report should reflect our ambition to ensure a positive contribution to society and meeting the challenges along the way,” Ulrika Lilja, EVP Communications at Stora Enso, concludes.

“We are pleased to highlight Stora Enso’s strong reporting practices. Their 2017 Sustainability Report clearly articulates the potential impacts of external trends and regulations and describes the approaches the company has taken to manage and address this. We hope other companies will see Stora Enso as an example of good practice as they approach sustainability reporting across their own companies,” says Rodney Irwin, Managing Director of Redefining Value, WBCSD.

The WBCSD produces Reporting matters to help improve the effectiveness of non-financial corporate reporting. The report lists Stora Enso’s Sustainability Report as one of the top ten in the world out of the 158 reviewed in the scope of the publication without disclosing the exact rankings.

The Stora Enso Annual Report 2017 consists of the Progress Book, the Financial Report, the Sustainability Report, and the Corporate Governance Report. All parts of the Annual Report are available in PDF format at storaenso.com/annualreport.

WBCSD’s Reporting matters publication is available here.

Part of the bioeconomy, Stora Enso is a leading provider of renewable solutions in packaging, biomaterials, wooden constructions and paper globally. We believe that everything that is made from fossil-based materials today can be made from a tree tomorrow. Stora Enso has some 26 000 employees in over 30 countries. Our sales in 2017 were EUR 10 billion. Stora Enso shares are listed on Nasdaq Helsinki (STEAV, STERV) and Nasdaq Stockholm (STE A, STE R). In addition, the shares are traded in the USA as ADRs (SEOAY). storaenso.com

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Stora Enso and energy company Gasum have signed a contract to build a biogas plant at Stora Enso’s Nymölla paper mill in Sweden. The plant, built and operated by Gasum, will turn the mill’s wastewater effluent into renewable energy. 

Gasum plans to upgrade the biogas into Liquefied Biogas (LBG) and sell it as fuel for cars, buses, trucks, and ferries. The expected LBG production of the plant is 75-90 GWh per year, equivalent to the amount of fuel needed annually for more than 200 average long haul lorries in Sweden. Production is expected to start during 2020.

stora new1“We are happy to be part of a project that will turn waste into valuable renewable energy,” says Michael Lindemann, Mill Director at Nymölla Mill. “For Stora Enso, substituting fossil-based fuels in our society with renewable solutions is a vital way to combat global warming. The cooperation with Gasum is a good example of the collaborative efforts Stora Enso is taking to do this.”

”We are pleased about the circular economy cooperation with Stora Enso. The biogas plant is a sustainable solution for the processing of wastewater. Gasum is actively building a gas ecosystem for industry, marine and road transport segment in the Nordics,” says Johanna Lamminen, Chief Executive Officer of Gasum.

The total investment of the project for Gasum is around EUR 27 million and for Stora Enso around EUR 5 million. Gasum has been granted an investment subsidy of SEK 121.5 million (EUR 12.7 million) by the Swedish Environmental Protection Agency under the Climate Leap (‘Klimatklivet’) programme.

Located in southern Sweden, Stora Enso’s Nymölla Mill has an annual production capacity of 340 000 tonnes pulp and 485 000 tonnes woodfree uncoated (WFU) paper for office and postal use. Stora Enso’s well-known office paper brand Multicopy is produced in Nymölla.

Part of the bioeconomy, Stora Enso is a leading provider of renewable solutions in packaging, biomaterials, wooden constructions and paper globally. We believe that everything that is made from fossil-based materials today can be made from a tree tomorrow. Stora Enso has some 26 000 employees in over 30 countries. Our sales in 2017 were EUR 10 billion. Stora Enso shares are listed on Nasdaq Helsinki (STEAV, STERV) and Nasdaq Stockholm (STE A, STE R). In addition, the shares are traded in the USA as ADRs (SEOAY). storaenso.com

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Stora Enso has decided to install a new steam turbine with a closed-loop cooling system and additional biomass storage at its mill in Maxau, Germany. The investment cost is approximately EUR 25 million and implementation of the project is scheduled to start during the third quarter of 2018 with completion in 2020.

stora new 2017Stora Enso wants to secure the long-term profitable energy production in Maxau Mill by increased electricity generation and higher efficiency. The new 57 MW extraction-condensing turbine complements the existing Combined Heat and Power (CHP) plant which started up in 2010. The investment will reduce the energy cost and secure long term cost competitiveness of the paper mill. Once installed, the payback time will be around four years.

The investment contributes to Stora Enso’s carbon neutral roadmap and science-based targets through higher share of biomass and higher efficiency ( >50 000t CO2 savings per year). The closed loop cooling system will relieve the Rhine River significantly by less thermal output and considerably lower river water extraction.

“We are happy to announce this important investment which underpins our long-term commitment to serve our customers with high-quality paper products from cost-efficient and sustainable operations. It also highlights our ambition to replace fossil-based materials and to contribute to a greener economy,” says Kati ter Horst, EVP Head of Paper Division.

Maxau Mill
Located on the Rhine River near Karlsruhe in southwest Germany, Maxau Mill is the key pillar in the Uncoated Magazine Paper (SC) product segment. The mill is strategically and geographically well located to serve its customers, including major European publishers, retailers and printing houses. It has a short distance access to all raw materials and biofuels. The two paper machines produce approx. 530 000 tonnes of uncoated magazine papers per year. Paper for Recycling (PfR) serves as the main raw material for the paper production.

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    Part of the bioeconomy, Stora Enso is a leading provider of renewable solutions in packaging, biomaterials, wooden constructions and paper globally. We believe that everything that is made from fossil-based materials today can be made from a tree tomorrow. Stora Enso has some 26 000 employees in over 30 countries. Our sales in 2017 were EUR 10 billion. Stora Enso shares are listed on Nasdaq Helsinki (STEAV, STERV) and Nasdaq Stockholm (STE A, STE R). In addition, the shares are traded in the USA as ADRs (SEOAY). storaenso.com

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