Northern Ont. paper mill announces plans to close

We have reaction to the news that Kap Paper in Kapuskasing is closing, eliminating 300 direct jobs and endangering thousands more.

Kap Paper, located in Kapuskasing, Ont., announced Monday plans to close, affecting about 300 jobs directly and many more indirectly.

“With deep regret, Kap Paper today announced it will begin an orderly idling of operations at its Kapuskasing facility,” the company said in a news release.

“The decision follows months—and indeed years—of engagement with governments and partners and reflects the absence of near-term measures required to maintain the integrated forestry supply chain in northeastern Ontario," it said.

“This is a heartbreaking day for our people and the community,” CEO Terry Skiffington said in the release.

“We have done everything in our power to keep the mill operating. While we have had productive discussions with both levels of government, and mid- to long-term support could be available, it doesn’t appear that immediate support is available at this time.”

The company said it approached the federal government for help at the urging of the province, which has provided $50 million in loans, helping provide short-term stability and keep 2,500 workers in the northeast employed.

But federal aid won’t come fast enough to prevent closure, the company said.

“While we have initial positive responses, the timing doesn’t appear to be aligning for an immediate solution to keep the mill operational,” Kap Paper said.

“Unfortunately, Kap Paper does not have the resources to continue operations and are forced to idle our operations.”

Supporting employees

The company said it will sequence the wind-down to ensure a safe process and protect the environment and workers.

“Our employees are the best in the north, and our priority now is supporting them with dignity and clarity,” Skiffington added.

“We will keep engaging with unions, municipal leaders, Indigenous partners, and government to minimize impacts and to safeguard as much future opportunity as possible.”

Kapuskasing Mayor Dave Plourde said the closure of the mill would have a devastating effect on the community.

“The announcement of the idling of the Kapuskasing Mill is deeply troubling,” Plourde said in a news release on behalf of himself and local councillors.

“The mill has long been an anchor of our local economy, supporting hundreds of families and sustaining the vitality of northern Ontario. Our thoughts are with the employees, their families and the many businesses that rely on its operations.”

Plourde said they will keep fighting for the mill, despite Monday’s announcement. They will also advocate to help workers affected by the decision.

In an interview with CTV News later Monday, Plourde said he received a letter from Innovation, Science and Industry Minister Mélanie Joly on Friday indicating that they welcomed participation in discussions around the facility in Kapuskasing and working towards a resolution to the issues that exist within the facility.

“So this announcement comes as a complete surprise,” he told Eric Taschner of CTV News.

“I certainly won’t give up and ... I’m going to work as hard as I can to ensure that we come to a resolution.”

The Federation of Northern Ontario Municipalities also called on both levels of government to step in.

“FONOM is calling on both the Government of Ontario and the Government of Canada to work together immediately to provide the necessary support to keep the mill operating,” the group said in a statement.

“The closure of Kap Paper would have devastating consequences for families, workers, Indigenous partners, and communities across northeastern Ontario, and would threaten the stability of the forestry supply chain that is vital to Ontario’s and Canada’s economy.”

Disappointed in the feds

In response to the news, Mike Harris, Minister of Natural Resources, and Kevin Holland, Associate Minister of Forestry and Forest Products, issued a statement that said they were disappointed the federal government wasn’t able to provide support when it was needed.

“We have 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,” the statement said.

“We are deeply disappointed that the federal government has failed to join us in providing the immediate support required to keep Kap Paper operating, as Ontario has done repeatedly to date.”

The province is working to help affected employees and their families, the statement said.

“In the face of U.S. tariffs and increased softwood lumber duties, Ontario has repeatedly stepped up for forestry workers and businesses with record investments to help the sector diversify their operations and expand into new markets,” the statement said.

“Ontario continues to step up with significant provincial support, but cannot do so alone. We have repeatedly called on the federal government to take immediate action to support workers and businesses in this vital sector, and we will continue to do so.”