International Paper on Tuesday announced that it will eliminate 75 positions at its Augusta mill when it shuts down one of its three paperboard production lines next month.
The move is prompted by a global slowdown in demand, said Greg Gibson, the vice president of International Paper’s coated paperboard business.
“The projected growth of global coated paperboard supply, coupled with slower growth in the demand for our products, has
made it necessary to permanently reduce our manufacturing footprint,” Gibson said.
The paperboard production machine, running since the 1960s, is the smallest in the system, which includes sister plants in Riegelwood, N.C., and Texarkana, Texas. It produces about 140,000 tons of coated paperboard annually, which is used to make folding cartons and packaging liners.
The shutdown will reduce the capacity of the Mike Padgett Highway mill by about 20 percent, said Samantha Hood, the company’s communications manager.
“It is 75 positions, but it will not be 75 people. We have some open positions that we won’t be filling,” Hood said. The company is also hoping retirements will satisfy the job elimination.
“The decision to shut down Augusta’s No. 2 machine is difficult because of the impact it will have on good, hard-working people who have been our valued colleagues,” Gibson said. “This decision will enable us to more efficiently balance our production with current and projected customer demand.”
Hood said the Augusta mill will continue to employ more than 700 people. The other two production machines will continue to operate at capacity.
“We are well-positioned for the future, and we’re still going to have two great low-cost machines,” Hood said.
Plans are to permanently shut down the line by the end of February, but the machine will not be dismantled.
“We’re going to do everything we can in the next 30 days to shut it down the right way, intact, in the event that we would repurpose it in the future,” Hood said.
The facility has been in Augusta for 52 years and was acquired by International Paper in 1996.
International Paper, based in Memphis, Tenn., employs about 70,000 people in more than 24 countries. It will release its quarterly earnings Jan. 29.