The Heinzel Group-owned company will move from a four-shift to a three-shift production regime to ensure long-term competitiveness and operational sustainability. According to the company, the decision followed a thorough analysis of market developments, particularly the impact of globally weak demand and Estonia's seasonally volatile energy prices on its financial results.

"As an energy-intensive industry, we are significantly affected by energy costs — especially electricity prices and the associated regulated fees and taxes," said Meelis Kuzma, CFO of Estonian Cell. "The upcoming adjustment will be challenging, but it is essential to secure a stable and sustainable future for the plant and its employees."

Ahead of the temporary production halt, the company will build up its bleached chemi-thermomechanical pulp inventory to ensure uninterrupted customer deliveries during the shutdown. Upon restarting, the company plans to continue operating with three shifts, preserving jobs for the majority of its current workforce. Those who are laid off will receive support in accordance with applicable labor laws.

"The number of employees will decrease by about a quarter. Since this involves collective termination of employment contracts, the final number of job reductions will be determined on August 21 following consultations with employees on the proposed measures," said Kuzma, adding that the company currently employs 87 people.

In other words, at least 20 people will lose their jobs.

"Our goal is to act proactively and responsibly to safeguard production and jobs in the long run," said Heinzel Group CEO Sebastian Heinzel. "We remain in active dialogue with the government and other stakeholders to help establish a competitive economic environment for industry in Estonia. Sustainable production in Estonia is only possible through a combination of increased corporate efficiency and supportive economic policy."

The company also suspended operations in September of last year due to high electricity prices, but only for two weeks.

AS Estonian Cell is a bleached aspen pulp mill located in Kunda. It began operations in April 2006. The investment to build the entirely new facility totaled €153 million, making it the second-largest foreign investment in Estonia's industrial sector at the time. The company is owned by the Austrian-based Heinzel Group.

Estonian Cell reported a net loss of €8.8 million last year, which the company says marks an improvement compared to its €22.9 million loss in 2023.

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