Metsä Group has begun a market-driven shutdown at its Joutseno pulp mill in Finland as demand for softwood pulp remains weak in both Europe and China, as reported in its first-quarter financial results.
Demand for market pulp was subdued throughout the quarter, with pricing trends diverging by region. Average softwood pulp prices declined by 4% in Europe but increased by 2% in China compared with the previous quarter.
Packaging and tariffs weigh on volumes
Paperboard delivery volumes declined during the period, mainly due to U.S. import tariffs affecting demand. In Europe, overcapacity continues to pressure the market, while in North America, folding boxboard demand remains sensitive to trade measures.
The outlook for coated white kraftliner is more stable, supported by limited substitution options.
Rising costs add pressure
Energy and logistics costs are increasing, driven in part by geopolitical tensions and disruptions in global supply routes. Metsä noted that higher oil and natural gas prices are pushing up raw material and transport costs, with a lag before these increases can be passed on to customers.
Tissue stable, wood products under strain
Demand for tissue products remains stable, with moderate long-term growth expected. However, the greaseproof paper segment faces continued uncertainty in Europe due to increased competition from China.
In wood products, weak construction activity across much of Europe is weighing on demand for sawn timber, plywood and engineered wood products such as Kerto LVL.
Strategic moves and investments
During the quarter, Metsäliitto Cooperative increased its stake in Metsä Fibre, strengthening control over pulp operations.
Metsä Group also advanced several strategic initiatives, including:
- the acquisition of a paperboard sheeting and distribution hub in the Netherlands
- the launch of pre-engineering work for a carbon capture facility at its Rauma site in Finland
These projects aim to strengthen service capabilities and support long-term decarbonization efforts.
Metsä Group is a Finnish forest industry company owned by approximately 90,000 forest owners through its parent company, Metsäliitto Cooperative. The group focuses on pulp, paperboard, tissue and greaseproof papers, wood products, and wood supply and forest services. In 2025, it reported sales of EUR 5.8 billion and employed around 8,800 people.
