PORTLAND, Maine — Cascades Inc. plans to close its de-inked pulp mill in Auburn on July 15, laying off 45 employees at the facility that uses recycled paper to make packaging and tissue products.
The Quebec-based Cascades had searched unsuccessfully for a buyer, but faced a dwindling market for its products and found competitors already had excess capacity.
“For the same reason that we were forced to cease our operations, the other players [selling de-inked pulp] have more capacity than they actually sell,” Cascades spokesman Hugo D’Amours said.
The price for its de-inked pulp continued to decline early this year, down about 4 percent per metric ton, according to Cascade’s latest earnings report, for the first quarter of the year.
The company plans to end production at the Auburn plant July 8 and close July 15, looking then to dismantle the equipment and sell the site.
“We want anybody involved in any kind of manufacturing to be able to take advantage of the site in the near future,” D’Amours said.
In its news release, Cascades said it also considered integrating the mill with its other operations but couldn’t make it work.
The mill was hit particularly hard by continued declines in demand for printing and writing papers, according to D’Amours. He said the mill lost about half its business for printing and writing products since acquiring the mill in 1998.
The announcement marks the 10th mill closure since 2008, including facilities similar to Auburn’s that did not process raw wood fiber. Seven Maine mills remain in operation, with all but Huhtamaki’s plant in Waterville primarily buying or making wood pulp to make their products.
Luc Langevin, president and chief operating officer of Cascade’s specialty papers group, said in a news release announcing the closure that the mill had pursued fixes as well.
“Despite major efforts to optimize in the past year, the situation at the plant remained extremely difficult,” Langevin said.
The company said it would explore relocating staff in Auburn to other plants and would assist employees to find new jobs. D’Amours said the company would hold a job fair in the next couple of days in Auburn, with representatives from its other business units.
If employees were to transfer within Cascades, it would certainly mean moving out of Maine and perhaps the Northeast.
Cascades, publicly traded on the Toronto Stock Exchange, has about 90 production facilities in North America and Europe, with about 11,000 employees.
D’Amours said the company is growing fastest in the Southeast and Northwest. Last week, Cascades announced it would invest $64 million in a tissue conversion plant in Oregon.
“Since the reputation in Auburn is very very good, we know that a lot of other units will be interested in hiring,” D’Amours said.
A spokeswoman for the Maine Department of Labor said the department first heard about the closure Wednesday afternoon.
The Auburn plant, at 586 Lewiston Junction Road, was the company’s last producer of de-inked pulp and one of two facilities in New England. It has a paperboard-converting facility in Connecticut.
“Cascades wishes to extend its sincere thanks to all Cascades Auburn Fiber employees for their loyalty since 1998 and for all the efforts made in an attempt to save the plant,” the news release states. “The company is counting on them to serve customers until closing.”