Terrafame initiates change negotiations due to a challenging market situation

In 2024, Terrafame’s business environment has continued to be difficult, mainly due to the slower than estimated progress of the electrification of mobility, especially in Europe, as well as the clearly lower market prices of metals and battery chemicals compared to the previous year. The company estimates that the battery chemicals market will continue to be challenging in late 2024 and early 2025. In addition, Terrafame expects the Vaasa Administrative Court to make final decisions on two permits in 2024. If said decisions were to be delayed, the previous interim decisions by the Vaasa Administrative Court could impact the company’s production and net sales.

Due, above all, to the challenging market situation and its impact on Terrafame’s business, the company has decided to initiate change negotiations concerning the entire personnel on production-related and financial grounds. According to the company’s initial estimate, the maximum personnel reduction need would be in total 75 person-years. The possibility of, for example, layoffs, changes to job descriptions, and shifting to part-time work is also considered in the negotiations. At the end of September 2024, Terrafame employed a total of 826 people.

“The battery chemicals market in particular has continued to be challenging, which has been reflected in the demand for Terrafame’s products and thereby in our net sales and profitability. At the same time, Terrafame is currently implementing the largest investment programme of its history regarding, among others, the new secondary leaching area needed for bioleaching. To improve the company’s profitability, in early 2024 we initiated a profitability programme aiming for EUR 10 million in annual savings, which has progressed as planned. In spite of the positive development of our cost efficiency, we are now forced to initiate change negotiations due to the continued challenging operating environment,” says Seppo Voutilainen, CEO of Terrafame.

“Despite a temporary market downswing, the electrification of mobility is inevitable. Terrafame is a significant part of the European battery value chain, and we believe in the demand for battery chemicals in the longer term. Our strength is the flexible production process, which enables selling our nickel product as an intermediate when the battery chemicals market does not meet the expectations,” Voutilainen concludes. 

The aim of the change negotiations between the company and the personnel is to find a solution for adjusting personnel resources, working time patterns and general work arrangements to better meet the changed needs and outlook of the company’s business. Terrafame will announce the outcome of the negotiations after they have ended.

Terrafame published its Interim Report for January–September 2024 on 25 October 2024.
 

For further information, please contact:

Seppo Voutilainen, CEO, tel. +358 20 7130 800, seppo.voutilainen[a]terrafame.fi

Terrafame enhances low-carbon mobility by delivering responsibly produced battery chemicals to the global battery industry. One of the world’s largest production lines for chemicals used in electric vehicle batteries is located on Terrafame’s industrial site. The plant is capable of producing nickel sulphate for around 1 million EVs per year. The carbon footprint of the nickel sulphate produced by Terrafame is among the smallest in the industry.

Terrafame’s integrated, unique and energy-efficient production process from the mine to battery chemicals is located on a single industrial site. It provides customers with a transparent, traceable and truly European battery chemical supply chain.

Terrafame Ltd was founded in 2015. Its net sales in 2023 were EUR 560.9 million. Around 1,900 people work on its industrial site, slightly over half of whom are employees of partner companies.