Finland's Stora eyes billion-euro investment in plastic-free packaging (updated)

Metsa Board Oyj

23/02/2022 11:45

(Adds comments, detail)
    By Anne Kauranen
    HELSINKI, Feb 23 (Reuters) - Finland's Stora Enso  STERV.HE 
is considering an investment of up to 1 billion euros ($1.13
billion) to produce more consumer packaging board as customers
increasingly seek renewable materials over plastic, the forestry
company said on Wednesday.
    It said customers such as food group Nestle  NESN.S  or
online fashion retailer Zalando  ZALG.DE  are responding to
consumer demands by replacing plastic with wood-based board in
packaging. 
    To meet the growing demand, Stora Enso is exploring the
possibility of converting an idle paper machine at its Oulu site
in Finland into a line to produce renewable consumer packaging
board.
    The plan would involve an investment worth 900 million to 1
billion euros ($1-1.13 billion) spanning 2023-2026, it said.
    "If the world doesn't transform and our investment case
stays where it is, then there is very high likelihood that this
will go through," Hannu Kasurinen, Stora's head of packaging
materials, told Reuters.    
    Once a feasibility study is completed, Kasurinen said a
final investment decision could be taken in the fourth quarter
with start-up in 2025.
    The conversion would mean potential annual top line sales of
800 million euros, an 8% increase from the group's current
level, while packaging materials and solutions already account
for nearly 50% of Stora's sales.
    "For the first time, we have seen that the demand for
wood-based packaging material has overtaken that of plastic and
that is very encouraging," Kasurinen said.
    Stora Enso said it is the largest consumer board maker in
Europe where it competes with Finland's Metsa Board  METSB.HE 
and Austria's Mayr Melnhof Karton  MMKV.VI , while globally it
competes with U.S. firms Westrock  WRK.N  and Graphic Packaging
 GPK.N . 
    
    


($1 = 0.8818 euros)

 (Reporting by Anne Kauranen; editing by Jason Neely)
 ((anne.kauranen@thomsonreuters.com; +358401895560))