New fine paper machine at UPM's Changshu mill starts up, ahead of schedule

The new fine paper machine at UPM's Changshu mill has started-up successfully. The first reels of the new paper machine were produced 4 weeks ahead of schedule on May 24.

After the investment, UPM will become the biggest producer of uncoated fine papers in China. The investment also significantly increases the mill's capacity to produce coated, high-quality graphic paper. Coated fine paper is used for magazines, books and advertising materials. The investment will increase Changshu's production capacity to 800,000 tons, of which some 200,000 tons will be coated papers. The investment has been carried out according to the original budget of USD 470 million.

Two thirds of the mill's production is sold through UPM's sales network to the Chinese market. The rest is exported to the Asia Pacific region. Changshu mill sells its paper to wholesale merchants and office machinery manufacturers. The products are sold also directly to the big printing houses and publishers.

"Today, China is the fastest growing market in the world. Due to economic growth, the demand for office papers and graphic papers continue to be strong. UPM's paper machine investment will increase the company's paper offering locally and creates new opportunities to serve Asian markets," says Matti Lievonen, President of UPM's Fine and Speciality Papers Division.

UPM's new paper machine is the world's biggest and fastest paper machine producing uncoated fine papers. The new machine more than doubles UPM's fine paper capacity in China. The first paper machine at Changshu started production in 1999.

The mill is logistically well located by the Yangtze River, about 100 kilometres from Shanghai and its 16 million inhabitants. The nearly 200 hectare mill site has a harbour, a power plant and an effluent treatment plant. Most of the output is shipped in containers to other Chinese ports and for exporting.

The main raw material of the mill is tropical hardwood pulp. UPM has ensured availability and sufficiency of short fibre pulp in long term by participating in Botnia's pulp mill project in Uruguay. The Changshu mill has an ISO 14001 environmental management system in place.

For more information, please contact:
Mr Matti Lievonen, President, UPM Fine and Speciality Papers, tel. +358 40 589 6009


UPM
Corporate Communications
May 24, 2005

Photos of the new Changshu paper machine are available on UPM's web site www.upm-kymmene.com in section Media relations > Press kits >UPM Changshu paper mill in China.