Shutdowns and the impact for EU pulp players

Research evidence excerpt

Shutdowns and the impact for EU pulp players

Equity Research

18 June 2026 | 9:45PM BST

EUROPEAN PULP & PAPER

Today (June 18), UPM announced that it will temporarily shut down its Kaukas pulp Gabriel Simoes

+44(20)7051-6922 |

mill from the 3rd August for approximately 6 weeks. In addition, a potential gabriel.simoes@gs.com

Goldman Sachs International

temporary shutdown of the Pietarsaari mill is being planned for October. The

Georgina Fraser, Ph.D.company stated that these shutdowns are aimed to optimize production +44(20)7552-5984 |

levels/wood sourcing and ensure profitability in the current market and cost georgina.fraser@gs.comGoldman Sachs International

environment. This comes weeks after Stora Enso announced the shutdown of its Thomas Ward

softwood line in Skutskär (here) to focus on more niche-products and a few months +44(20)7051-2527thomas.ward@gs.com|

after Metsä Fibre (not covered) announced that its Joutseno mill would be shutdown Goldman Sachs International

von Scheeleindefinitely due to market conditions (here). Marcus | +44(20)7774-7676

marcus.vonscheele@gs.com

Given the weakness in the pulp market - especially concentrated in softwood pulp, Goldman Sachs International

we see these as steps in the right direction to rebalance the market, but believe

much more is still needed. However, given the low profitability of UPM’s Fibres North

division, we don’t believe the closures imply material downgrades for UPM’s earnings.

In case we see further capacity cuts leading to higher softwood prices ahead, we

believe SCA (Neutral) stands to benefit the most given the company’s high relative

exposure to softwood vs. peers and its significant underperformance since Sep/25.

That said, for the time being, we believe the market will remain loose and would