Finnish Paper Exports to Decline Through 2014, PTT Forecasts

Paper exports from Finland will contract for a third year in 2013 as low demand prompts capacity cuts, PTT Research Institute said.

Paper sales abroad will decline as much as an annual 3 percent this year and as much as 4 percent in 2014, the Helsinki-based organization said in an e-mailed statement. Reduced output means paper prices will increase 2 percent at most in 2013 and 2 percent to 3 percent in 2014, PTT said.

Finland’s stalwarts Stora Enso Oyj (STERV) and UPM-Kymmene Oyj (UPM1V) are battling a slump in the European paper industry. Europe’s two biggest papermakers have shuttered production lines and cut jobs in response to falling demand for paper, in part as consumers shift to online media.

UPM Chief Executive Officer Jussi Pesonen said he sees a negative impact from prices, volumes and exchange rates on the European paper business, according to an April 4 statement. The structural changes will benefit the industry, Pesonen said. UPM yesterday said it will shutter paper machine 3 at the Rauma mill in Finland and paper machine 4 at Ettringen in Germany, cutting 237 jobs.

Pulp exports will increase as much as 5 percent this year and the next, and paperboard sales abroad will increase this year by as much as 3 percent, PTT said. The Finnish sawmill industry could grow as much as 5 percent in 2013 and is set to benefit from the euro’s estimated weakening against the Swedish krona, according to PTT.

To contact the reporter on this story: Kasper Viita in Helsinki at kviita1@bloomberg.net

To contact the editor responsible for this story: Tasneem Brogger at tbrogger@bloomberg.net

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