Information manager Ulf Gunnarsson said the company had made the decision following a change in market conditions for long fibre pulp.

The cost of the investment will also be rather high, and we feel this is not the best thing for Sdra at this time, he said.

Baltic Pulp was formed by Sdra Cell, Metslitto and the Latvian Republic to look at the prospect of a new sulphate mill for the Baltic region in an investment totalling around 562m (EUR900m) (PrintWeek, 30 March 2001).

Market conditions have changed, with additional capacity due to come on-stream from 2005. This reduces the need for the 300,000 tonnes Sdra would have brought to the market from the project as of 2010.

But Gunnarsson said Sdra would still keep its eyes open for new projects.
Weve always said Asia will be the most interesting region in the next 10 years, he said. Sdra is currently not active in that market.

The Baltic project had involved 100,000-200,000 of initial investment from Sdra, which Gunnarsson said had been recouped from the sale of its share.

The start-up date for the Baltic pulp project is set for 2006-2007.

Ownership was split between Metslitto (34%), Sdra Cell (33%) and the Latvian Government (33%).

Story by Andy Scott