Northern Ont. officials call on feds, province to stop Kap Paper mill closure

Hundreds rallied in Kapuskasing, Ont., after the sudden idling of the town's historic Kap Paper mill. Lydia Chubak reports.

Officials and residents of a northern Ontario community gathered Wednesday to call on provincial and federal governments to work with the town to keep a paper mill from closing, urging them to “not point fingers at each other.”

Earlier this week, Kap Paper in Kapuskasing announced it will begin winding down operations after failing to secure immediate financial support from the federal government. The company said Monday it received $50 million in loans from the Ontario government and had approached Ottawa for funding, but the timing “doesn’t appear to be aligning” for a solution to keep the mill open.

The company said it employs about 420 people directly and a total of 2,500 jobs in the region depend on its operation.

Community rallies

Kapuskasing Mayor Dave Plourde told a rally on Wednesday that the mill’s idling will hurt the local economy, and they’re asking the province for a three-month loan to allow them to apply to the federal government for long-term funding.

Kap Paper has been around for more than a century and has survived wars, recessions and the COVID-19 pandemic, he said, adding that the company has multi-generational workers.

“We need Ontario and the federal government to work with us on a solution and not point fingers at each other,” Plourde said. “The fate of our towns, mills, workers and families are too important for these games.”

Ottawa said Tuesday that it would keep working to help save the mill, with Industry Minister Melanie Joly’s office saying it had offered supports such as the Strategic Innovation Fund and targeted programs.

“We’ve come to the table with federal supports, and we urge the provincial government to remain in lockstep with us as we continue fighting for these jobs,” Joly’s office said in a statement.

Meanwhile, the provincial government said Monday it has provided Kap Paper with millions to help cover operating expenses and is “disappointed” that the federal government has failed to join in providing immediate support.

A joint statement from Ontario Natural Resources Minister Mike Harris and Associate Forestry Minister Kevin Holland said the province has “continuously pushed the federal government to come to the table as an equal partner, standing up for Canadian forestry jobs and treating Ontario forestry workers fairly.”

Guy Bourgouin, the NDP member of provincial parliament for Mushkegowuk--James Bay, said Ottawa and the province must put politics aside and create a path forward for the community.

“Our workers, our families, deserve action, not empty words,” Bourgouin said at the rally Wednesday, adding that local businesses and residents will unite together to save the mill.

Peter Politis, mayor of nearby Cochrane, Ont., said the issue doesn’t just impact Kapuskasing but the entire northern Ontario community. The province and Ottawa should invest in the region because it’s emblematic of what a “united Canada” looks like, he said.

“Premier, prime minister, this is not the time to divest. This is the time to invest in your greatest asset, the grassroots people that built these communities,” said Politis.

“This mill is a perfect example of what that is.”

This report by The Canadian Press was first published Oct. 1, 2025.

Rianna Lim, The Canadian Press