CEOs at Rottneros and SCA criticizes energy politics in Sweden

December 10, 2010 by timbercommunity

TEMPORARY LIMIT ON PRODUCTION AT ROTTNEROS MILL
The CTMP line at Rottneros Mill has been at a standstill for around ten days, which corresponds to a loss of production of approximately 2,500 tonnes. The stoppage is due to the combination of extremely high electricity prices and high timber costs resulting in sales of marginal volumes being unprofitable.

The strong Swedish currency also contributes to reducing export margins. The production volume for the remaining part of December depends on how these factors develops further.The production line for groundwood pulp at Rottneros Mill has not been affected by the halt. The Group-s other manufacturing unit, Vallvik Mill, which produces chemical pulp, is not as sensitive to electricity prices and is running at full capacity.

Rottneros produces market pulp, i.e. paper pulp that is sold on the open market, in contrast to pulp that is produced at mills with integrated paper production.In a commentary in the business magazine DI Ole Terland, CEO of Rottneros says: "Sweden can not live with dual energy prices to the world and believe that we can have energy-intensive production to go. It will never work". The big problem according to Terland is that Sweden has no energy policy."

Particularly critical is he to how nuclear power plants run. "We are terribly poor maintenance and operational availability of our nuclear power plants. It is the core problem. Why Sweden is much worse than other countries here, that I do not understand."

Also SCA is making adjustments at the paper mill in Ortviken due to the high energy price. "Ortviken adjusts production of mechanical pulp (TMP) to the currently very high prices for electricity. This means a higher production of TMP during nights and other periods of lower electricity prices -and a lower production of TMP when electricity prices are highest, "said SCA's CEO Jan Johansson in a written comment to Nyhetsbyrån Direct.

"I think we have the exorbitant electricity prices in Sweden. This is something very serious for our export industry, "says the paper group SCA's CEO Jan Johansson to Realtid.se.