Cramlington, Newcastle-based Europa Magnetics, the European operation of CMC Magnetics Corporation, a leading producer of data storage media, has ceased all optical disc manufacturing activities.

In a letter to customers, the company says “the cost of raw materials has dramatically increased but the market unit selling price has continued to decline at accelerated rates. With high losses for 2005 and also projected losses for 2006 it was agreed that it was no longer viable to continue in the CD Replication Business.

The business will ramp down with immediate effect. Europa will continue to manufacturer up until the end of April and “will do its utmost to honour and fulfil all orders already placed.”

Europa will continue to trade as CMC's European distribution centre for recordable media for all of its OEM customers.

Originally established in 1993 for production of floppy diskettes and distribution of CD-R, Europa extended its capabilities to manufacture CDROM during the late 1990's. Europa also offered a printing and packing service on CD and DVD products.

In 2003, Europa invested £20 million in a new manufacturing plant, housing all aspects of optical media production including pressing lines, screen and litho print machines, automated packing lines and “some of the most advanced mastering equipment in the world with the capacity to produce up to 40 gold masters in a day.”

The company increased its CDROM manufacturing capabilities to 10.8 million per month.

While Europa advertised its new DVD manufacturing capability, the company apparently never actually produced these discs.

Story filed 11.04.06