The quarter-on-quarter improvement in Group EBITDA and overall return to profit of US$18 million was driven by strong dissolving pulp (‘DP’) prices and an excellent performance from the packaging and specialities segment. These gains were partially offset by ongoing global logistical challenges which impacted export deliveries and costs in all three regions and lower margins in Europe due to significant input cost inflation. Higher selling prices facilitated a substantial increase in EBITDA for the DP segment and sentiment generally remained buoyant on the back of steadily improving retail demand in the apparel sector. The average Chinese market price for hardwood DP increased 19% on the prior quarter to US$1,088 per ton. The EBITDA in the packaging and specialities segment reached a new record high and contributed almost half of the group EBITDA. Sales volumes increased by 23% compared to the equivalent quarter in the prior year and validate the strategic actions taken to reduce exposure to graphic paper through diversification into this segment.

UPM Raflatac and the Paper Workers' Union have reached an outcome in the collective labour agreement negotiations concerning UPM Raflatac’s Tampere factory in Finland. "The negotiations were conducted in a very good spirit and constructively from start to finish. I would like to thank the Paper Workers’ Union for its solution-oriented approach and for the good negotiations. The solution will enable the long-term development of the Tampere factory," says Antti Waajakoski, General Manager of UPM Raflatac’s Tampere factory. The new collective agreement will have a two-year contract period and it will enter into force upon approval by the Paper Workers’ Union’s Board. The union has announced that the Board will discuss the negotiation outcome at its meeting on 5 June 2024. Negotiations on the collective labour agreement for UPM Specialty Papers will continue.

Recent results from forest products producers suggest that lumber and pulp markets remain under pressure but are beginning to show early signs of stabilization. North American lumber markets remained difficult through the final quarter of 2025. Elevated U.S. countervailing and anti-dumping duties continued to weigh on exports, while a 10% tariff introduced under Section 232 in October added further uncertainty for Canadian producers. Demand conditions also softened across offshore markets. China’s prolonged housing downturn continued to suppress lumber consumption, while Japan saw weaker demand linked to declining housing starts. In Europe, high log costs and constrained spruce supply limited purchasing activity despite seasonal inventory restocking. However, supply conditions began to tighten late in the quarter. Industry-wide sawmill curtailments announced in mid-December, combined with already low inventories, helped support modest gains in benchmark lumber prices as observed late in the fourth quarter. These improvements have carried into early 2026, although market participants remain cautious amid ongoing economic uncertainty and unresolved trade tensions between Canada and the United States. Pulp markets showed a similar pattern of weakness followed by tentative stabilization.