Shutdown in Niagara Could Help Local Mills

By Nathaniel Shuda
Wisconsin Rapids Daily Tribune Staff

While about 320 employees will lose their jobs when NewPage's Niagara mill shuts down Saturday, company officials hope the closure will foster growth in its central Wisconsin facilities.

The shutdown will reduce annual production by a total of 230,000 tons of coated paper used in magazines and catalogs -- one of the many types of paper the Wisconsin Rapids mill produces.

President and Chief Operating Officer Rick Willett said officials expect the closure of the Niagara mill and other facilities to help offset increased expenses and boost production at other mills.

Niagara is in northeastern Wisconsin, near Iron Mountain, Mich.

Because of the December purchase of Stora Enso North America, "we believe we have a competitive advantage," Willett said last month in the company's earnings call. "We could see some price softness ... if the U.S. economy doesn't see (any improvements)."

Earlier this week, NewPage officials changed the Niagara mill's shutdown date to Saturday, citing a need to compensate for a recent decline in orders and a significant increase in inventory.

"After reviewing many options, this decision was determined to be the best solution," Niagara mill manger John Reichert said Monday in a statement.

The announcement came 11 days after the company pushed up the closure of the facility's pulp mill and two paper machines from Aug. 16 to July 12, based on a change in market conditions.

In March, NewPage announced it would continue running the two machines until the fall of 2008 — they were previously scheduled to shut down in April — because of unusually high market demand earlier this year.

Of the Niagara mill's 325 employees — all but six of whom will lose their jobs — 10 are members of the Office and Professional Employees International Union Local 95 in Wisconsin Rapids.

After purchasing Stora Enso North America for $2.6 billion, the Miamisburg, NewPage, the Ohio-based papermaker announced it would shut down mills or paper machines in Niagara, Kimberly and Rumford, Maine, and a converting facility in Chillicothe, Ohio.

NewPage officials have said they will hire about 50 production workers in central Wisconsin, as the company plans to move equipment from the Chillicothe facility to Wisconsin Rapids.

The company also is seeking about 70 engineers companywide and is in the process of transferring its research and development headquarters to Biron, where local company officials expect crews to arrive today to complete the move.

SOURCE: Wisconsin Rapids Daily Tribune

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