{"id":11623,"date":"2022-04-28T20:48:49","date_gmt":"2022-04-28T20:48:49","guid":{"rendered":"https:\/\/www.smithcorona.com\/blog\/?p=11623"},"modified":"2022-09-28T18:00:14","modified_gmt":"2022-09-28T18:00:14","slug":"the-upm-strike-has-ended-now-what","status":"publish","type":"post","link":"https:\/\/www.smithcorona.com\/blog\/the-upm-strike-has-ended-now-what\/","title":{"rendered":"The UPM Strike Has Ended &#8211; Now What?"},"content":{"rendered":"<div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-1 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-0 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><div class=\"fusion-text fusion-text-1\" style=\"text-transform:none;\"><p><span style=\"font-weight: 400\">After 112 days, the <\/span><a href=\"https:\/\/www.smithcorona.com\/blog\/the-upm-paper-mill-strike-why-it-matters\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">UPM mill strike in Finland<\/span><\/a><span style=\"font-weight: 400\"> has officially ended.<\/span><\/p>\n<p><span style=\"font-weight: 400\">Both UPM and the Paperworkers\u2019 Union came to a collective labor agreement for 5 UPM businesses: UPM Pulp, UPM Communication Papers, UPM Specialty Papers, UPM Raflatac, and UPM Biofuels.\u00a0<\/span><span style=\"font-weight: 400\"><br \/>\n<\/span><\/p>\n<p><span style=\"font-weight: 400\">Estimates from <\/span><a href=\"https:\/\/www.printweek.com\/news\/article\/upm-puts-price-tag-on-strike-for-first-time\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400\">Q1 put the strike costs between \u20ac180-\u20ac220 million<\/span><\/a><span style=\"font-weight: 400\"> ($192-$235 million USD).<\/span><\/p>\n<p><span style=\"font-weight: 400\">While the paper industry and global supply chains breathe a sigh of relief, it\u2019s only temporary.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">Now the question is how long will it take to get an order from UPM?<\/span><\/p>\n<\/div>\n            <div class=\"smith-corona-featured-image\">\n\n                <img src=\"https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2022\/09\/aftermath-of-upm-mill-strike-hero-splash.png\" alt=\"\" width=\"760\" height=\"460\" \/>\n\n            <\/div>\n        <\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-0{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-0 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-0{width:100% !important;order : 0;}.fusion-builder-column-0 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-0{width:100% !important;order : 0;}.fusion-builder-column-0 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-1 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><div class=\"fusion-text fusion-text-2\" style=\"text-transform:none;\"><p><span style=\"font-weight: 400\">The strike ended on April 22, 2022 with production immediately resuming, <a href=\"https:\/\/www.upm.com\/about-us\/for-media\/releases\/2022\/04\/upm-and-paperworkers-union-agree-on-first-ever-business-specific-collective-labour-agreements--strike-ends-at-upm-mills-in-finland\/\" target=\"_blank\" rel=\"nofollow noopener\">according to UPM<\/a>. <\/span><\/p>\n<p><span style=\"font-weight: 400\">Orders previously placed will take precedent and be handled first. UPM says they will begin accepting additional orders as early as week 19.\u00a0<\/span><\/p>\n<p>But considering the almost 4 month idle time for the mills and machinery,<span style=\"font-weight: 400\">\u00a0this seems like a fast turnaround time.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">As we\u2019ve discussed in previous articles, preventative maintenance is crucial for <\/span><a href=\"https:\/\/www.smithcorona.com\/blog\/the-progression-of-paper-mills\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">paper and pulp mill machines<\/span><\/a><span style=\"font-weight: 400\"> to run at full efficiency, which many do in order to procure a profit.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">Without this service, it takes time to get equipment up and running properly. This can be anywhere from days to weeks or even longer. (A <\/span><a href=\"https:\/\/www.euwid-paper.com\/news\/companies\/upms-mills-in-finland-expected-to-come-on-stream-in-the-course-of-this-week-270422\/\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400\">Domtar paper machine<\/span><\/a><span style=\"font-weight: 400\"> took months to restart and become fully operational after being idle for over a year).<\/span><\/p>\n<p><span style=\"font-weight: 400\">While UPM states they cannot give a detailed timetable of the runtimes, <\/span><a href=\"https:\/\/www.printweek.com\/news\/article\/upm-strike-resolved-industry-reacts\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400\">a spokesperson for the company<\/span><\/a><span style=\"font-weight: 400\"> mentioned how much less time it takes for pulp mills to ramp up than paper mills.<\/span><\/p>\n<p><span style=\"font-weight: 400\">Their current lead times are 3-4 months for European deliveries and 5 months for overseas deliveries.<\/span><\/p>\n<p><span style=\"font-weight: 400\">But with the damage done to the supply chain due to the <\/span><a href=\"https:\/\/www.smithcorona.com\/blog\/threat-of-us-paper-shortage\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">massive paper shortage<\/span><\/a><span style=\"font-weight: 400\">, businesses and companies are in dire need of supplies.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">To make up for lost time (and profits), is it possible we\u2019ll see UPM ramp up production? This depends on the state of their inventories.<\/span><\/p>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-1{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-1 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-1{width:100% !important;order : 0;}.fusion-builder-column-1 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-1{width:100% !important;order : 0;}.fusion-builder-column-1 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-2 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><div class=\"fusion-text fusion-text-3\" style=\"text-transform:none;\"><p><span style=\"font-weight: 400\">Even before the strikes and war in Ukraine began, raw material supplies were at an all time low from the <\/span><a href=\"https:\/\/www.smithcorona.com\/blog\/2021-supply-chain-chaos\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">chaos caused by the global pandemic<\/span><\/a><span style=\"font-weight: 400\">.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">Given the current raw materials shortages, compiled with the sanctions against Russia, does UPM have enough materials to begin operations at full efficiency?\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">As it turns out, Finland obtains a portion of its raw materials from Russia, which it\u2019s currently having to do without.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">The <\/span><a href=\"https:\/\/www.luke.fi\/en\/news\/paperboard-became-the-most-important-exported-forest-industry-product\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400\">Finnish forest industry imported<\/span><\/a><span style=\"font-weight: 400\"> 9.3 million cubic meters of wood from Russia in 2021. That\u2019s about 10% of its raw material needs.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">The sanctions not only led to a drop in trade between Finland and Russia but ultimately removed these key materials at a time when supplies are already dangerously low.<\/span><\/p>\n<p><span style=\"font-weight: 400\">However, UPM says this isn\u2019t the case.<\/span><\/p>\n<p><span style=\"font-weight: 400\">The company claims that order fulfillment will begin immediately, indicating they have the supplies on hand to accommodate what is likely to be a massive order volume from the months of no production.<\/span><\/p>\n<p><a href=\"https:\/\/www.euwid-paper.com\/news\/companies\/upms-mills-in-finland-expected-to-come-on-stream-in-the-course-of-this-week-270422\/\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400\">Sources say<\/span><\/a><span style=\"font-weight: 400\"> several paper mills will possibly begin production as soon as week 17 and as late as the end of week 18. These include:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">J\u00e4ms\u00e4nkoski paper mill (630,000 tons per year)<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">Rauma paper mill (665,000 tons per year)<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">Kymi paper mill (700,000 tons per year)\u00a0<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400\">However, statements from those in the paper and <\/span><a href=\"https:\/\/www.smithcorona.com\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">labeling industries<\/span><\/a><span style=\"font-weight: 400\"> claim stock and inventory are nonexistent and have been throughout the entire strike period.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">Will Parker, a label industry expert and FINAT committee member, <\/span><a href=\"https:\/\/www.printweek.com\/news\/article\/upm-strike-resolved-industry-reacts\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400\">spoke to Printweek<\/span><\/a><span style=\"font-weight: 400\"> about his disappointments with the entire situation and how it has ultimately affected customers.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">\u201c[N]o planning was given to building stock and inventory to cover the convenience to the customer,\u201d he said. \u201cHad [UPM] built stock, which they could have done last year, the market wouldn\u2019t have felt the pain.\u201d <\/span><\/p>\n<p><span style=\"font-weight: 400\">That pain has left an abundance of damage in its wake, including to one <\/span><a href=\"https:\/\/www.printweek.com\/news\/article\/label-printer-goes-bust-in-wake-of-upm-supply-crisis\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400\">\u201clong-established label printer<\/span><\/a><span style=\"font-weight: 400\">\u201d in the UK. Parkers, a 70-year old business that produced a wide range of self-adhesive labels, flexible packaging, and more, went into administration before the strike ended.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">Lack of supplies caused by the strike is being cited as one of the main reasons.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">Despite the conflicting information, we&#8217;re left wondering: if UPM does get their operations moving quickly, where will the supplies be triaged to first?<\/span><\/p>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-2{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-2 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-2{width:100% !important;order : 0;}.fusion-builder-column-2 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-2{width:100% !important;order : 0;}.fusion-builder-column-2 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-3 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><div class=\"fusion-text fusion-text-4\" style=\"text-transform:none;\"><p><a href=\"https:\/\/www.reuters.com\/article\/upm-kymmene-oyj-strike-paper-shortage\/update-1-strike-at-finlands-upm-is-causing-acute-paper-shortage-in-europe-industry-idUSL1N2V00YE\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400\">UPM accounted for<\/span><\/a><span style=\"font-weight: 400\"> 21% of Europe\u2019s graphic paper capacity and 7% of global volumes in 2021. Based on these numbers, are we likely to see shipments make their way around Europe before they\u2019re shipped overseas?\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">European association FINAT <\/span><a href=\"https:\/\/www.finat.com\/news\/finat-addresses-imminent-supply-chain-collapse-at-eu-commission-level\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400\">appealed to the EU Commission<\/span><\/a><span style=\"font-weight: 400\"> in early April about the anticipation of \u201csevere disruptions in downstream industries like food and pharma\u201d likely to occur in Q2 because of the paper shortage.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">Jules Lejeune, FINAT Managing Director, claimed the issues had a \u201cpan-European dimension that demands a European answer.\u201d\u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">Or will orders be dispersed evenly across the globe?<\/span><\/p>\n<p><span style=\"font-weight: 400\">Associations like the <\/span><a href=\"https:\/\/tlmi.com\/news\/north-american-tag-and-label-trade-association-urges-swift-resolution-of-finnish-paper-mill-strike\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400\">Tag &amp; Label Manufacturers Institute<\/span><\/a><span style=\"font-weight: 400\"> (TLMI) described the strike shortages as having \u201ccrippled a fragile global supply chain [that] supports the North American tag, label, supply chain, and other material input companies.\u201d\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">In essence, everyone is desperate for paper supplies <\/span><b>now<\/b><span style=\"font-weight: 400\">.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">With lead times hovering around 5 months for overseas shipments, we have to really consider how long it will take for U.S. supplies to arrive.<\/span><\/p>\n<p><span style=\"font-weight: 400\">Take into account the time it takes shipments to: cross the Atlantic, berth at a port, unload supplies, pass through customs, load shipments onto a truck (assuming there are some available), etc. <\/span><\/p>\n<p><span style=\"font-weight: 400\">And all of this barring complications during transit.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">Everything considered, we\u2019re not likely to see supplies arrive until Q4, past the end of summer when the market begins preparing for the busy holiday season.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">Which begs the looming question, where will this leave all of us once the holidays roll around?<\/span><\/p>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-3{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-3 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-3{width:100% !important;order : 0;}.fusion-builder-column-3 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-3{width:100% !important;order : 0;}.fusion-builder-column-3 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-1{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div>\n","protected":false},"excerpt":{"rendered":"<p>After lasting 112 days, the UPM strike in Finland officially comes to an end. Estimates put costs of the strike in the hundreds of millions. Operations are set to resume immediately but that begs the question on everyone&#8217;s mind: with severe delays already occurring, how soon will it take for desperate businesses to get orders from UPM?<\/p>\n","protected":false},"author":13,"featured_media":12459,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[59],"tags":[],"acf":{"theme_color":"","estimated_reading_time":4,"include_in_most_popular_sidebar":false,"hero_splash_image":12457,"grid_listing_thumbnail":12458,"sidebar_most_popular_thumbnail":12460},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v19.7.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>The UPM Strike Has Ended - Now What? - Barcode Blog<\/title>\n<meta name=\"description\" content=\"After 112 days the UPM strike is over. 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