Finnish paper and pulp company Metsä Board is planning a €38m investment for its Husum mill in Sweden.
The investment, which will be made to install a new extrusion coating line and for related infrastructure at the facility, is in line with the firm's intention to increase its paperboard offerings for the food service sector.
Metsä aims to make the line, which has an yearly paperboard extrusion coating capacity of approximately 100,000t, operational in 2017.
Metsä Board CEO Mika Joukio said: "Extrusion-coated paperboard based on renewable fresh forest fibre competes on many occasions with plastics.
"Transferring to paperboard offers food service companies an opportunity to improve their responsibility.
"As our paperboards are lightweight and stiff, they also bring many additional benefits to logistics and converting."
In October, the firm also announced it was installing a folding boxboard machine BM1 at the Husum mill as a part of its €170m investment programme.
BM1 has a production capacity of 400,000t/a, and is expected to be installed by January next year.
Metsä also intends to increase folding boxboard prices in Europe from December.
Joukio said: "The increased paperboard deliveries improved our profitability in the third quarter of 2015.
"Our result was burdened by a strike, which stopped our entire production in Finland for 24 hours.
"The new production will mainly be marketed to the Americas, as well as for food service packaging applications globally."