The company, which is part of the Metsäliitto Group, said the target of the negotiations is to prepare production temporarily for lower demand.

In a statement it said: “This is thus an anticipated measure if no significant improvement in the demand situation experienced in late 2008 emerges.”

In December, M-real warned its 2008 full-year operating result excluding no-recurring items would be “clearly weaker” than in 2007.

Its results warning is on the back of its larger-than-expected second-quarter operating loss of €21m (A$42m), announced by the company in 2008.

Throughout this year, European papermakers have faced rising production costs and a decrease in the sales volumes of fine paper, causing many to cut jobs and capacity, and to raise their prices.

Read the original article at www.printweek.com.

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