Paper Excellence announced Thursday afternoon the indefinite curtailment of its paper operations at the Catalyst Crofton mill starting in early December 2022.
The company says paper markets in China served by the mill have significantly weakened. There has also been substantial cost escalations for chemicals, energy and wood fibre used at Crofton and the intersection of the pressures has materially impacted the financial viability of the paper operation.
The curtailment affects 150 employees, 80 from Unifor and 70 from the Public and Private Workers of Canada union.
The company said it recognizes the hardship this will have on its employees and the Cowichan Valley.
“We hope to minimize these impacts through union discussions that will consider secondments, utilization of earned time off and employment insurance,” stated a press release. “The mill’s pulp operations will continue production during the paper curtailment.”
The paper machines are expected to continue for 60 days until the curtailment takes effect.
North Cowichan Mayor Al Siebring went on a conference call with the Province Friday morning to discuss the situation.
“We connected with Jobs, Economic Recovery and Innovation,” he said.
Through the Community Adjustment Program managers, it was a chance to put out some feelers in case some provincial support is eventually required.
“We don’t know how long it (the curtailment) is,” said Siebring. “It could be permanent, it could not be.
“Everybody’s looking to the future to mitigate as much as possible the effects of that.”
Options are being considered by bringing together a group of community stakeholders, representatives of the mill and Vancouver Island University for possible retraining for such things as heavy equipment operators, if necessary.
“I’m not 100 per cent sure if this will be needed,” said Siebring. “If it is, we’re putting the infrastructure in place to support those workers. We’re trying to be pro-active.”
Operations at the paper facility had previously been in a two-week production curtailment at Crofton that started Sept. 10 before workers returned.
That curtailment coincided with scheduled annual maintenance and 95 employees were affected with temporary layoff notices at that time.
Paper Excellence said it is reaching out to assist customers with the upcoming transition and will continue to meet supply needs with production from its Port Alberni mill, where possible. In 2021, the company invested in repurposing the Port Alberni paper machines to manufacture food and packaging grades.
Paper Excellence added it is working with both Provincial and Federal Governments while it conducts studies at Crofton to determine if it’s feasible to accelerate a conversion into natural food and packaging grades there as well.
“Paper Excellence continues to believe in Canada as a leader in the pulp and paper industry and remains committed to its long-term investments here,” the company added in the release.