UPM announced plans to end paper production at its Kaukas mill in Lappeenranta, Finland, by the end of 2025. The company plans to relocate its coated mechanical paper manufacturing operations to its Rauma mill, aiming to enhance operational efficiency and long-term competitiveness. The Kaukas site’s paper machine 2 (PM2), with an annual capacity of 280,000 tonnes, is expected to be shut down by the end of the year, pending consultation and regulatory approvals.
The planned restructuring is driven by declining global demand for coated mechanical paper and aims to balance UPM’s production capacity with market realities. UPM Paper ENA’s head Anu Ahola explained that concentrating production at Rauma will improve profitability, reduce costs, and better utilise existing assets in a market where overcapacity continues to challenge profitability. While the Kaukas site will end its paper operations, the pulp, sawmill, and energy operations at the site will continue.
This transition will impact approximately 200 employees at the Kaukas mill. UPM has initiated a consultation process in accordance with Finnish labour law and has committed to providing support for those affected, including potential relocation and reskilling opportunities.
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