Paper mill closes in Iroquois Falls

By Jeff Labine
Published: Dec. 5, 2014

Hundreds of workers in Iroquois Falls will be out of a job before Christmas.

Resolute Forest Products announced Friday morning the permanent closure of the newsprint mill in the small Northern community. In a media release, officials with the company site weakness in global newsprint business, fiber-related issues and transportation challenges as some of the reasons for the decision.

The mill in Iroquois Falls, which had an annual production capacity of 225,000 metric tons, will close on Dec. 22 with further closing activities running into the New Year.

The mill employed about 180 workers.

“The decision to rationalize our newsprint capacity was difficult, as we are mindful of the impact it will have on affect employees,” Richard Garneau, president and CEO of Resolute, said in a media release.

“There is another issue that cannot be ignored in these decisions – the ill-founded attacks of environmental activist groups. Their inaccurate and deceptive campaigning, which misrepresents the company’s forest management practices, was also a factor.”

Iroquois Falls Mayor Michael Shea said the unexpected news is devastating for the town and its residents. He said the town is going through an evolution never seen before.

“Who would have known that Resolute Forest Products would have announced to every single soul in Iroquois Falls that they would be permanently choosing to close the mill here forever?” he said. “It’s unbelievable. People are having a hard time processing that. (Permanently) is a word you don’t often want to hear. I think we’re in a dream zone right now. It’s just something we’ve never experienced in our whole life.”

He explained that just a few months ago the president of Resolute came to Iroquois Falls with a positive image about the community.

He said just two years ago, the town was celebrating its 100th anniversary and now they have to think about how they will continue to survive the next 100 years.

He stressed that this announcement will have far reaching effects.

“This is something that’s unheard of before,” he said. “It’s going to affect every village in Northern Ontario. This employs (about 180) people but 264 direct jobs as well. It’s the economy of Timmins, Cochrane, it’s all the economies around here that will be affected by this.”

He said they have to look at securing funding to ensure the future of the community and he explained that the tax burden can’t be put entirely on residents. He said Resolute was their secondary tax base, so they have to find a solution to make sure resident’s tax don’t go up to the point that people have to leave.

He added it is unbelievable that at on Monday he and the new town council were sworn in and only a few days later this happens.

Peter Jones, president of Unifor Local 90, said he received a conference call Friday morning and had a feeling that there was going to be bad news, but not to this extent. He said they were told last week that they would be running the mill through Christmas and he believes people haven’t had enough time to absorb the news.

“I know there’s a lot of frustration, of course that’s going to be natural, but the timing is unbelievable,” he said. “This is the mother mill. This was the first Abitibi mill. I was told the vice-president was coming last week then they said he’s not coming now.

“I walked into the room this morning at 8:15 and I saw the VP. The first thing I said to him was ‘this can’t be good.’ He said to me ‘you are 110% right.’ They went through the speel about shutting down a machine in Clermont, Que. and a machine in Baie-Comeau, Que. We knew what he was leading up to, which was the permanent closure. Even when we were having the discussions about the Christmas run through, they knew.”

He explained that the decision came from the board.

Jones said employees will be getting letters for their severance and that counsellors will be available on site. The average age at the mill is around 52 years old and Jones explained to lock in retirement, workers need to be 53.

He added that there’s not much demand now for paper workers.

“There’s a lot of issues I have to deal with,” he said. “We’ll be strong through it but that doesn’t make right. My main issue is to ensure that there’s something that we can try and do. I’m at a standstill right now. Everything is happening so quickly. It’s great that they wait until Friday when you have the whole weekend to not be able to do anything but answer your phone.”

MPP Gilles Bisson (NDP — Timmins-James Bay) called the decision to close the mill “terrible news for Northern Ontarians” and “devastating” for Iroquois Falls. He promised that he and fellow New Democrat MPP John Vanthof (Timiskaming-Cochrane) will be doubling their efforts to work with the community to find a solution.

He said they raised red flags when Resolute wanted to sell the power dams a few years ago because it would lead to the closure of the mill. He said the provincial government’s decision to allow that sale is partially the reason why this closure is happening.

“There’s going to be a lot of questions asked at Queen’s Park next week and we have to look at the decision of Resolute where they are saying they are not going to allow the mill to be heated past February and not interested in selling,” he said. “Well, I’m sorry they don’t own the trees. These are Crown resources and if we can find a successor employer we should have the ability to do that. I think the government has some questions to answer.”

Bisson acknowledged there’s many reasons for the challenges forestry companies face including commodity prices and the increase in cost to transport, but he believes the big issue is energy costs. He said since the government allowed the selling of the dams they have to be a part of a solution.

Bisson said there needs to be a balance between economic activity and environmentalism.

“Maybe the pendulum has swung too far is what the company is saying and they are free to say that but there are some who would disagree,” he said. “I voted against the Endangered Species Act when it was first proposed and one of the reasons I voted against it was exactly what’s going on now. I felt the government wasn’t trying to find the balance between industry and environmentalist and I think we can coexist.

“For example, the sustainable forestry redevelopment act. It created forest management planning that puts First Nations, environmentalists, cottagers, local communities, (Ministry of Natural Resources and Forestry) and everybody at the table. To have legislation that pits one against the other, I think, is problematic.”

This year marks the centennial anniversary of the first time the mill began producing newsprint. Montreal businessman Frank Anson was given the pulpwood concession in that area back in 1912. Right away, his workers began clearing land and by 1914 the founding mill of the Abitibi Paper company, which later became Resolute, was up and working.

It was the largest newsprint mill in North America at the time. At the same time, the Temiskaming and Northern Ontario railroad had been pushed through to bring in heavy machinery. Within months, it would be shipping out fresh newsprint.

By 1915 the Town of Iroquois Falls was incorporated and on its way to becoming one of the North’s most vital communities. Despite the destruction of the Great Fire of 1916, the town was able to rebuild and carry on.

Dale Romain, president of the Iroquois Falls and District Chamber of Commerce, continued to be optimistic about the situation.

She said it was disappointing news and believes the economic impact will be immense. She said that the selling of the dams as well as the increase in transportation costs lessened the mill’s competitive advantage.

“Those 180 jobs are very important to this community, the tax base that the mill provides is extremely important to this community so we have to look at something whether we can attract new industry to our area and this isn’t something that happens overnight,” she said. “We only have a few short weeks. Our council as well as other municipalities will certainly have a big challenge facing them. The writing is sometimes on the wall. No one wants to believe that it can happen but unfortunately for us in Iroquois Falls it did happen. We have to deal with it. We have to find creative solutions.”

Bill Mauro, Minister of Natural Resources and Forestry, called the news with Resolute upsetting in a written statement.

“As a Northern member, I understand the difficult times that the workers and their families must be going though and our government will continue to work with Resolute and the union to ensure that all the impacted workers receive the support they need,” he said. “My Ministry remains committed to working with industry and local communities to ensure the longevity of the forestry sector in Ontario.”

Cochrane Mayor Peter Politis called the mill an integral part of the entire region’s economy as it once employed more than 1,200 people. While the workforce has diminished, he said the mill remained the community’s largest employer and an important part of its viability.

“Our first thoughts are with our friends in Iroquois Falls as they go through this trying situation,” he said in a media release.

“I’ve spoken to Mayor Shea and offered our support. The families in Iroquois Falls can count on their friends in Cochrane to be there in whatever way we can. This is not just an Iroquois Falls challenge. The forest industry is an intricate web of synergies and when you pull out such a significant wood supply, the chain of reaction will be felt across the province. Each impact will create an adjustment and it will be the outliers who feel the final pinch.”

Jamie Lim, president and CEO of the Ontario Forest Industries Association put the blame for the mill’s closing on the environmental organization Greenpeace. She, along with other organizations like the Federation of Northern Ontario Municipalities, has been asking provincial leaders to standup for the forestry sector and specifically criticized Ontario Premier Kathleen Wynne for not doing enough to reassure buyers.

“That’s the only way that these bullying campaigns from radical groups like this are going to be put to an end,” she said. “I don’t think people get this. Greenpeace is not some ma and pa little group that cares about Mother Earth. Greenpeace is a huge company. They are targeting customers of our forest industry companies. You know what’s sad? Today with Resolute’s announcement Greenpeace would be celebrating that.”

She said if companies don’t have customers then issues like power and transportation don’t matter and added both buyers and companies need to know that the government will have their back.

Richard Brooks, forest campaign co-ordinator with Greenpeace Canada, responded to the criticism put against environmental groups by saying Resolute’s president and CEO should look at their own operations and actions.

“In a difficult market, as is the case in North America and Europe right now, a forest products company like Resolute needs to demonstrate the commitment to sustainability through Forest Stewardship Council certification in order to stand out and remain competitive,” he said in an email.

“This is where Resolute’s leadership urgently needs to re-focus their efforts for the sake of the long-term health of the forest and viability of their operations and the communities that depend on them.

“Big forest products customers are requiring sustainable paper, pulp and timber. It’s their criteria for contracts.”

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s