Stora Enso’s Oulu paper mill conversion ‘credit positive’ for European sector

Stora Enso is to invest around €350m to convert its Oulu paper mill in Finland into a paper packaging mill, helping address the sector’s supply-demand imbalance.

This will result in the closure of almost 1.1 million tonnes of coated woodfree paper (CWF) production capacity by the end of September 2020.

According to Moody’s the move is credit positive not only for Stora Enso but also for other CWF paper producers in Europe, such as Sappi, UPM-Kymmene and especially Lecta (see Exhibit 1) because it should support prices for this paper grade by tightening the supply-demand imbalance.

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