The magazine, newsprint and fine paper manufacturer said operations at the Leivonmäki sawmill will stop this year because it has been operating at a loss for "a long time".

Since UPM entered into discussions with staff in June, it said a continually weakening market in sawn timber, uncertainty affecting wood raw material supply and high wood prices had exacerbated already tough market conditions.

Meanwhile, in Germany, UPM has blamed falling demand for paper and over-capacity for the continued "temporary" shutdown of the PM2 line of its Nordland Papier mill.

The shutdown has been extended until the end of the year, when the situation will be reviewed. The annual production capacity of the line was 200,000 tonnes of paper.

In April, UPM announced the temporary shutdowns of its fine paper mills in Central Europe for a one to three-month period following poor profitability.