Don't 'push the panic button' over Corner Brook newsprint mill hiatus, mayor says

The Corner Brook Pulp and Paper mill will start a weeklong shutdown starting Monday but voices are cautioning against sounding the alarm over its future.

The mill's parent company, Kruger Inc., made the announcement Wednesday, citing "the difficult business environment in the newsprint sector."

The move means about 300 employees will have no paid work for the week.

Greater Corner Brook Board of Trade president Ray Brake said demand for newsprint has been in decline for a number of years and he believes the mill is trying to hold on to its market share.

"But I think that we've got to take an optimistic approach as much as we can and realize that this isn't the first time that this has happened with the mill," Brake told CBC News. 

"And guess what, you know, they come out of it."

He also says many levels of the company are looking for solutions so the mill can remain competitive.

Kruger's statement also alluded to potential future shutdowns, but Brake says he believes the company made the decision to mitigate further turmoil.

Brake's organization represents scores of local businesses, some of which have commercial connections with the mill, which means the shutdown isn't good news for them, either. 

"Sometimes these are the tough decisions that need to be made in the short term to ensure viability in the long term," said Brake.

Shutdown in perspective

Corner Brook Mayor Jim Parsons said it's always a concern when there's a shutdown and the news there may be more to follow is not reassuring. 

"But it's also not time to push the panic button here. And I think the paper market is a really interesting beast, as we've learned," he said.

Parsons heard about the looming shutdown through the media first and has since had a brief conversation with the mill manager and hopes to have one again soon, he said.

But Parsons said a shutdown isn't new to the mill, pointing to COVID-19 pandemic's effect on the industry, adding that the mill is surviving it.

The local mill is better positioned than other mills, he said, because it has its own power, a wood supply and a stable labour force, as well as a port to ship the product to market.

"So there are a number of advantages to our location," Parsons said.

As a city, Parsons said, losing the mill isn't an option. He also said the mill has a "special place in Kruger's heart."

As he sees it, the shutdown is tied to a forecast of lower demand for its product in the next year.

"When that happens, of course, you know, prices go down and it becomes less profitable to produce paper" and producers drop or lower production, Parsons said.

Role for government

Brake would like to see the provincial government step in with monetary help, which could help the mill survive and improve consumer confidence and the economy.

If the mill closes, he said, there are 300 people and their families who might need more direct government assistance.

Parsons also said he believes the province has a role to play, as it has in the past.

Gerry Byrne, a provincial cabinet minister and a longtime MHA for the Corner Brook area, said the government has been in communication with Kruger. He also noted the mill has closed down in the past for maintenance and upgrading.

"Our paper mill has, you know, had great successes and found moments where there were troubling times. This is one of those times where we draw concern," said Byrne.

Holiday spinoff

As the demand for newsprint wanes in the coming years, Parsons hopes Kruger will diversify the materials it produces at the mill. But he's not interested in preparing for a future where there is no mill.

Brake said the area developed around the company, which still employs many people and depends on the surrounding small businesses for goods and services. It means more people are impacted than just the people directly employed by the mill, he said.

The shutdown could dampen the upcoming holiday season, he said, as people might be less willing to part with their money when their income is reduced.

"Money may not be going through the economy the next little while … because of this," said Brake.

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