The company's CEO says his decision was forced when a major customer opted to no longer purchase the mill's pulp.
MONTREAL—Resolute Forest Products today announced the indefinite idling of the kraft mill and paper machine number five (PM5) at its pulp and paper operation in Fort Frances, Ont.
Approximately 239 employees will be impacted.
The kraft mill has an annual production capacity of approximately 200,000 metric tons of market pulp, while PM5 has an annual capacity of 105,000 metric tons of groundwood specialty printing papers.
“The markets for these products are challenging and are expected to remain so. The kraft mill situation is particularly difficult given Fort Frances’ operating configuration and the recent decision by a key customer to stop consuming the pulp supplied by Resolute to its mill,” said Resolute’s President and CEO Richard Garneau. “Our kraft mill’s drying capacity is limited to about 40 per cent of its production capacity, making it impossible to continue operating the mill in a profitable manner.”
Resolute is exploring alternative product possibilities for its Fort Frances pulp mill, which it says will be idled in a manner that will protect the equipment.
The idling of PM5 is driven by the decrease in consumption as well as the high value of the Canadian dollar.
The running down of fiber inventories and orderly shutdown of the mill and paper machine is expected to be completed by late November.
Resolute says employees affected will be considered for job vacancies and opportunities at other company facilities.