The company's plan is the permanent closure of its Kitee sawmill and a production increase in Varkaus. The goal is to improve profitability and competitive capability by creating a fully integrated sawmill for spruce production in Varkaus and optimize synergies between existing laminated veneer lumber, pulp and cardboard plants, the company informs.
The consolidation plan is part of Stora Enso's profit protection programme of €120 million targeting reductions in variable and fixed costs. The potential consolidation is subject to reservations concerning the finalization of co-determination negotiations at Kitee mill that will commence in August. The production at Kitee sawill will be discontinued gradually until the end of 2019.
"The planned consolidation would enable us to optimize 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 automatized 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 the Wood Products Division of Stora Enso.
The shutdown of Kitee would affect 85 full-time employees. Varkaus currently has 105 employees. The production increase would mean a staff increase by 20 people.
The planned closure is not expected to have significant impact on the group's turnover or the operative EBIT, Stora Enso informs.
