Nippon Paper Industries willwithdraw from the pulp and paper business at Kushiro Mill. As one of the leading manufacturers of newsprint and printing paper, the Company has reduced approximately 760,000 tonnes of annual production capacity with the aim to achieve a proper balance between demand and supply during the period of the Sixth Medium-Term Business Plan.
On the other hand, domestic demand for newsprint and printing paper has been exacerbated by significant decreases due to stagnant economic activities in the backdrop of the spread of the COVID-19 in addition to structural demand decreases with the ongoing advancement of information technology. In this environment, the Company has been implemented cost-reduction measures to improve profitability. However, it is expected that the decrease in demand for newsprint, printing paper and other types of paper will continue in the future.
Accordingly, this withdrawal from the pulp and paper business at Kushiro Mill will be an action to optimize demand and supply balance and increase profitability. All paper machines and relevant facilities at Kushiro Mill will cease production in August 2021 and will be shut down in September 2021. The Company plans to transfer the large part of products at Kushiro Mill to other machines across the Company and to outsource a part of its products to other companies.