Metsäliitto plans further production cuts in 2010

Metsäliitto Wood Products Industry, owner of the Finnforest business, has launched negotiations at all its sawmills with a view to restricting production next year.

The negotiations cover the temporary layoffs of 450 employees at six sawmills for up to 90 days until the end of June 2010.

“The market situation and operational environment in the sawmill industry continue to be challenging,” said Ole Salvén, Metsäliitto Group executive vice-president.

“With possible production restrictions, we aim, when necessary, to prepare for a shortage of wood raw material with a competitive price, as well as for changes taking place in the market situation of sawn timber.”

Metsäliittto’s sawmills have already been operating production curtailments throughout 2009, with the Kyröskoski and Karihaara sawmills currently suspended until further notice.

The combined capacity of the group’s sawmills at Hämeenkyrö, Kannus, Kemi, Lappeenranta, Merikarvia, Pöytyä, Renko and Vilppula is about 2.2 million m³ of spruce and pine sawn timber and processed products.

Metsäliitto has also agreed to sell its blockboard factory in Romania to Austrian company Holzindustrie Schweighofer.

The sale of Finnforest Baco Production srl’s 80,000m³ blockboard capacity plant in Comanest is designed to help Metsäliitto concentrate on its core business.

The factory has annual net sales of €20m and employs more than 400 people.

“Blockboard production in Romania is not our core business and by agreement we can direct resources to other operations according to our strategy,” said Mr Salvén.