The Kapuskasing mill has the capacity to produce 220,000 metric tons per year of newsprint and directly employs about 420 people.
Sept. 30, 2025 - Kap Paper yesterday announced that it is idling production at its paper mill in Kapuskasing, Ontario, Canada, due to insufficient financial resources to keep the mill in operation.
The mill has the capacity to produce 220,000 metric tons per year of newsprint and directly employs about 420 people.
Although the company did not say whether or not the shutdown is permanent, the mill's future is questionable.
"With deep regret, Kap Paper today announced it will begin an orderly idling of operations at its Kapuskasing facility," said Terry Skiffington, CEO of Kap Paper. "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.
"This is a heartbreaking day for our people and the community," Skiffington said. "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."
In a written statement, the company said, "At the urging of the Province, Kap Paper approached the Government of Canada for a longer-term solution through the Strategic Response Fund. While we have initial positive responses, the timing doesn't appear to be aligning for an immediate solution to keep the mill operational. Unfortunately, Kap Paper does not have the resources to continue operations and are forced to idle our operations."
On September 20, Kap Paper released a statement asking the Government of Canada for help and to act now.
"Kap Paper reiterates its request for immediate federal action to stabilize Canada's forestry supply chain — the backbone of the federal housing plan. The company urges the Government of Canada to work with Ontario and industry on practical, near-term steps to keep the integrated system of pulp and paper mills, by-product markets, and sawmills intact, while protecting 2,500 jobs in Northeastern Ontario.
"Today's call supports a letter issued earlier this week by the Federation of Northern Ontario Municipalities (FONOM) and the Northwestern Ontario Municipal Association (NOMA). Kap Paper is the backbone of forest operations in Northeastern Ontario. A financially viable Kap Paper enabled by a new cogeneration facility and a corresponding Power Purchase Agreement will provide regional sawmills with a facility that uses wood chips, sawmill residues, bark, and tree debris. A strong forestry industry is built on a pulp and paper facility.
"The company acknowledges and appreciates recent steps by the Province of Ontario, including a $6 million loan extension and the establishment of a structured working table with provincial and federal officials to advance long-term solutions such as innovation and cogeneration. Kap Paper looks forward to working with Ottawa on this constructive, solutions-focused process.
"Kap Paper's ask is straightforward and urgent: act now to keep the supply chain intact so pulp and paper mills remain financially viable; Canadian lumber remains affordable and available, supporting Canada's housing targets; and Northern communities, employees, and families continue to have a great place to live, work, and play."
The Kapuskasing mill was formerly owned by Rayonier Advanced Materials (RYAM), which took ownership of it after RYAM's acquisition of Tembec. Four years later, in 2021, GreenFirst Forest Products took over the mill operations in Kapuskasing. In 2024, GreenFirst restructured, leading to the formation of the standalone company, Kap Paper.
SOURCE: Kap Paper