Sault papermaker to 'curtail' glossy paper production

St. Marys Paper announced March 8 it will "curtail" production of specialty supercalender paper at its Sault Ste. Marie pulp and paper mill for an indefinite period starting March 12. The No. 5 paper machine is impacted.

Combined with the shutdown of two other machines last December, the company said 300 employees will be laid off indefinitely.

St. Marys said in a news release it will be managing the curtailment process so paper production can continue when market and business conditions warrant.

The company blames the shutdown on low product prices, an unfavourable exchange rate against the U.S. dollar and recent increases in the mill's "key input costs."

Management heaped some of the blame on U.S. government subsidies last year to competing American paper producers through their Alternative Fuel Tax Credit Program.

Company president Gord Acton was not available for comment but said in a statement that management will take this down-time to "recalibrate its business plan" and review some recommendations made in a new marketing and sales study to determine what operational changes are needed to stay cost competitive.