Rottneros has announced the layoff of 47 employees, primarily affecting its mechanical pulp production at Rottneros Mill in Sunne (Sweden).
This decision follows last week’s profit warning, driven by rising raw material costs, weakening global demand for mechanical pulp, and a declining dollar exchange rate.
“These are sad news we notify our skilled employees today. Unfortunately, we need to slow down quickly to be able to benefit from our investments when the market turns,” said Lennart Eberleh, CEO of Rottneros.
The company has faced mounting challenges, including a 15% increase in pulp wood prices over the past year and persistently high electricity costs. With the weaker dollar, Swedish mechanical pulp has struggled to remain competitive globally, forcing Rottneros to act swiftly to weather the downturn.
“Since it is at Rottneros Mill that we produce mechanical pulp, this is unfortunately where the biggest reductions need to be made,” Eberleh explained. “The big investments we have made in the mill over the past two years show that we have a long-term belief in the future. There is a strong market for high-quality pulp for paperboard in the world, but right now all parameters are wrong for us to be able to produce at competitive prices.”
Of the 47 affected positions, 38 are at Rottneros Bruk AB and 9 at Rottneros AB. Employees were informed of the layoffs this morning, and negotiations are set to begin soon.
Rottneros is one of the world’s leading suppliers of high-quality pulp for selected niche markets, listed on Nasdaq Stockholm. The Group also develops and manufactures innovative and sustainable molded fiber packaging solutions.
