Resolute Forest Products has announced the permanent closure of its newsprint mill in Iroquois Falls, Ont., and the permanent closure of two paper machines at mills in Quebec. The move will remove 465,000 tonnes of newsprint capacity from the market, and result in job losses for about 300 employees.
Resolute's decision to reduce newsprint capacity is a result of the ongoing weakness in the global newsprint business, exacerbated by fiber-related issues, including both availability and costs, as well as transportation challenges. In Quebec, power costs played a role in these decisions, as well as the spruce budworm infestation.
“Market conditions have had a major impact on our newsprint operations in both Ontario and Quebec, and the cost position of these operations has made them vulnerable to the structural decline in newsprint," said Richard Garneau, president and chief executive officer.
The Iroquois Falls mill employs approximately 180 people and has an annual production capacity of 210,000 tonnes of newsprint. It will permanently close on December 22, 2014, with closure-related activities running into January 2015. The currently idled paper machine #1 at Baie-Comeau was permanently closed as of Dec. 5, and paper machine #4 in Clermont will be permanently closed on or about January 30, 2015. The closures at Baie-Comeau and Clermont will result in the loss of approximately 120 positions and the permanent removal of approximately 255,000 metric tons of newsprint capacity.
“The decision to rationalize our newsprint capacity was difficult, as we are mindful of the impact it will have on affected employees," added Garneau.
Garneau also used the closure announcement to go on the offensive with regard to the company’s ongoing public relations battles with environmental groups.
“There is another issue that cannot be ignored in these decisions: the ill-founded attacks of environmental activist groups. Their inaccurate and deceptive campaigning, which misrepresents the company's forest management practices, was also a factor.”
Resolute Forest Products produces newsprint, specialty papers, market pulp and wood products. The company owns or operates nearly 40 pulp and paper mills and wood products facilities in the United States, Canada and South Korea, and power generation assets in Canada.