Resolute Forest to permanently shut down paper machine, lay off 111 workers

MONTREAL – Resolute Forest Products (TSX:RFP) will lay off about 111 employees as it permanently shuts down a paper machine at its Laurentide mill in Shawinigan, Que.

The company said Tuesday it made the decision after a drop in demand for the type of paper produced on that specific machine.

The mill’s paper machine No. 10 will stop producing on Nov. 26.

Resolute Forest chief executive Richard Garneau says other factors played into the decision, including a strong Canadian dollar, rising freight and fuel costs and the continuing high cost of fibre.

“Resolute must prove that it is profitable with mills that perform well, which forces us to improve our competitive edge by focusing on our best assets and cutting costs,” he said in a release.

The Laurentide mill employs a total of 388 staff over two machines, which produce a combined 350,000 metric tonnes per year of commercial printing paper.

Machine No. 10 produced about 125,000 metric tonnes per year.

Resolute Forest, formerly known as AbitibiBowater, produces newsprint, commercial printing papers, market pulp and wood products.

The company owns or operates 22 pulp and paper mills and 22 wood products mills in Canada, the United States and South Korea.