FREDERICTON — A small New Brunswick community has been left reeling after the owners of an aging pulp mill that has been the area’s economic driver for more than half a century announced it would halt production. AV Group NB Inc., an affiliate of the India-based Aditya Birla Group, said Thursday it would temporarily idle its AV Nackawic facility west of Fredericton around the end of October. “The decision follows a careful assessment of the continuing challenges presented by prevailing market conditions and broader macroeconomic factors,” the company said in a brief statement. The mill employs about 350 people and produces dissolving grade pulp used in the production of textiles, according to AV Group NB. Union officials with Unifor said the closure of the mill is a “devastating decision” that will put more than 200 of its members out of work as of Nov. 4, delivering a serious blow to the local economy. Tim Fox, mayor of the Nackawic-Millville Rural Community, said the closure will create anxiety and disruption for a community of 4,400 residents, where just about everyone knows someone who will be affected by the layoffs. However, Fox said he’s hoping the workers, community and province can find a way to keep the mill running. “We’d much rather spend our time working on potential solutions, as crazy as they might be,” Fox said in an interview with The Canadian Press on Friday. It’s not the first time the mill has shut down. The St. Anne-Nackawic Pulp and Paper Company first opened a mill in 1970, with the village of Nackawic growing around it to house the workers. Then the mill closed without warning in September 2004 after it went bankrupt. Soon after, the province said it would spend more than a million dollars to clean and winterize the mill. It re-opened in January 2006 after Aditya Birla Group and Tembec Inc. purchased and retooled the plant, with the support of public and private investors. On Friday, Fox said it might be possible to once again find new investors and repurpose the mill. “Hopefully we ... make sure that it’s temporary and not a permanent closure,” he said. Mike Legere, a spokesperson for the owner, said rising production costs and stronger competitors have lead to at least five years of economic headwinds as costs are now outpacing profits. For the time being, he said shifting the plant into a “temporary idling” mode will allow AV Group NB to keep it in a ready state rather than implementing a full shutdown. He said the company is now focused on fulfilling legal obligations to its employees and suppliers. The mill sells all of its pulp to the textiles industry, he said, adding that most of the company’s customers are in Asia. Despite the mill’s lack of reliance on American customers, Legere said U.S. President Donald Trump’s penchant for tariffs has created instability in global markets, reducing consumer demand. Meanwhile, politicians in New Brunswick say they are disappointed by the planned closure of a mill they say is crucial to the province’s economy. Provincial Natural Resources Minister John Herron said various government departments are working on a plan to support those who need immediate help. Liberal Premier Susan Holt said the pending closure will be very difficult for the workers, their families and the entire community. “Your government has your back,” she said in a social media post. “We will be there for you, for your community, and for the region as we work through this difficult time together.” Opposition Green Party representative David Coon called on Holt’s government not to move too quickly. “This is no time for the premier and her cabinet to panic and risk making a terrible deal concerning the future of the mill and the Crown land licence that supports it,” Coon said in a statement Friday. “The wood needs to stay allocated to the Nackawic region, while options are being explored.” Richard Bragdon, the Conservative MP for the area, described the mill’s closure as “deeply troubling” for the province. “The impact will extend beyond the mill to forestry contractors, truckers, woodlot owners, local businesses, and everyone who depends on the economic activity it generates,” Bragdon said Thursday. This report by The Canadian Press was first published Sept. 18, 2026. Eli Ridder, The Canadian Press
