HELSINKI: The world's largest graphic paper maker UPM-Kymmene said it is preparing temporary lay-offs in several Finnish paper mills due to weak demand, following rival Stora Enso's similar announcement earlier this week.
UPM, which had last month warned of a "heavy winter" ahead, said on Friday it started talks to possibly lay off some employees next year for up to 90 days at its mills in Rauma, Kymi, Kaukaa, Jokilaakso and Tervasaari. The sites, which produce mainly magazine paper, employ altogether some 2,900 people.
UPM spokeswoman said there was no plan for the scale of manufacturing curtailments yet. "It all depends on the market development, demand for different paper grades," spokeswoman Sini Paloheimo told Reuters.
The global economic slowdown is exacerbating problems in the European paper industry, which was already struggling with shrinking demand, overcapacity, and rising Asian competition.
Stora Enso on Wednesday said it was considering whether to lay off people and cut paper and board production at its Veitsiluoto, Anjala and Inkeroinen mills in Finland for up to one week per month during the first half of 2012. UPM in October started similar preparations to adjust its Finnish plywood production.
In another fresh sign of weak paper markets, chemicals firm Kemira on Friday warned full-year profit could fall, partly because demand from its paper industry customers weakened.
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