Sappi cuts production by 20% and plans further cuts of 25%

Posted: 12 January 2009 in Europe, Sappi

In December 2008, Sappi cut its European fine paper output by 20 per cent. The company is now considering a further 25 per cent cut in production. A decision will be reached this week.

Reuters reports that

The paper industry in much of the world has for years suffered from overcapacity, which has kept a lid on prices, while higher wood and energy costs have hit already low margins.

Producers responded with sharp output cuts last year and said they were prepared for more reductions, in new signs the global slowdown was hitting demand for basic materials.

Engineering News reports that Sappi is considering closing a paper machine at its Maastricht mill in the Netherlands and is in discussions with staff about permanently closing its mill in Blackburn in the UK.

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