Jefferies warns of tough quarter for European paper and packaging players, cuts UPM to 'hold'

Svenska Cellulosa Aktiebolaget SCA

07/10/2025 08:47

** Jefferies expects another challenging quarter for European paper and packaging companies citing low pricing, weak demand, currency impact, and warns of potential production shutdowns

** "Softwood producers are taking downtime, and the risk of permanent closures increases if we see sawmill closures," Jefferies says

** It downgrades UPM-Kymmene UPM.HE to "hold" from "buy", seeing no catalysts for the Finnish forestry group in the absence of pulp recovery

** It expects a slowdown in mid-term pulp demand growth amid rising uncertainty in the global trade

** Following Mondi's MNDI.L profit warning on Monday, the broker cuts its 2025-26 earnings forecasts for UPM, SCA SCAb.ST and Stora Enso STERV.HE by 0-5% and stays 12-16% below consensus on Q3

** SCA, UPM, Stora Enso and Mondi slip 0.2-1%, extending Monday's losses

(Reporting by Boleslaw Lasocki)

((boleslaw.lasocki@thomsonreuters.com; +48 58 769 66 00;))