Amcor to Close Petrie Recycled Cartonboard Mill in Australia

Amcor said due to several structural changes in the competitive environment the mill is no longer covering its cash costs.

Feb. 19, 2013 - Amcor yesterday in its half-year earnings statement said that it has made the decision to close its Petrie recycled cartonboard mill, located in Queensland, Australia. The mill employs 160 people.

In Amcor's half-year 2012 statement, within its "Australasia and Packaging Distribution" business, "Fibre" segment, the company said, "Earnings for the half were lower due to a reduction in earnings at the recycled cartonboard mill in Petrie, Queensland. Due to several structural changes in the competitive environment the mill is no longer covering its cash costs."

A news report in The Courier-Mail said that Australian Workers Union Queensland branch secretary Ben Swan said workers had no idea that a review of the plant had been underway and were told of job losses yesterday morning.

"We have been advised that at least 160 positions would be made redundant," Swan told The Courier-Mail. "The closure of the mill will begin in September."

Swan said Amcor blamed the decision on the high Australian dollar and international competition.

Asked about union concerns about more job cuts in manufacturing, Swan said a key issue at this week's AWU national conference was "the need to support manufacturing and encouraging businesses to invest and innovate."

The Petrie Mill began operation in 1957. Since that time the mill has undergone numerous grade changes and investments. In 2004, Amcor invested $55 million in a wet end rebuild and in 2005 the mill's annual production capacity was increased to 140,000 tonnes.

The Petri Mill consumes over 120,000 tonnes of waste paper and cardboard annually, which is converted into new cartonboard products.

SOURCE: Amcor, and The Courier-Mail