Botnia considering stopping production at Kaskinen mill

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The poor availability of wood raw material at prices that are competitive for
the mills has led to production curtailments at Metsä-Botnia's Finnish mills
and eroded their profitability. The available supply of wood will not permit
the mills to produce cost-competitively at full capacity in 2009. 

During the last two years there have been continuous production curtailments
and extraordinary shutdowns at all Botnia's Finnish mills. The lack of
availability of competitively-priced wood raw material will necessitate even
more severe production cutbacks in the future, and spreading them across all
Botnia's Finnish mills would significantly weaken the profitability of all the
mills and the company itself. 

The company is therefore considering a temporary shutdown of production at its
mill at Kaskinen during the first quarter of 2009. The closure of the mill is
also an alternative under consideration. The company is commencing statutory
cooperation negotiations with the employees accordingly. 

“The availability of the competitively-priced hardwood that Kaskinen needs will
become particularly problematic in the future. Kaskinen is the oldest of
Botnia's mills as far as technology is concerned, and it has the highest
production costs. It has also been using greater quantities of expensive
imported wood than our other mills. In concentrating our production curtailment
measures on Kaskinen we are trying to secure the profitability of our other
mills and the whole company in the future, too,” says Botnia CEO Ilkka Hämälä. 

A formal proposal for the start of statutory negotiations as required by
Finland's Act on Cooperation in Companies will be given on 6 November 2008, and
the negotiations will affect 223 employees. In the alternative of temporary
stop, the duration of stop is now estimated to exceed 90 days. 

For more information, please contact Mr. Ilkka Hämälä, President and CEO, at
+358 400 379 888 after 11.30 a.m. (CET-1). 

INVITATION TO PRESS CONFERENCE

Metsä-Botnia is arranging a press conference to be held at Kaskinen mill at
3.15 p.m. today, 5 November 2008. Metsä-Botnia CEO Ilkka Hämälä will be present
to answer questions, together with Ismo Nousinen, SVP, Production, and Pertti
Hietaniemi, VP, Mill Manager. 

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