New Page Announces Mill Closure

NewPage Closes Kimberly, Wisconsin Facility

MIAMISBURG, Ohio. – July 30, 2008 – NewPage Corporation today announced that it will close its Kimberly, Wisconsin, mill at the end of August. The Kimberly mill currently operates two paper machines, Nos. 96 and 97, which produce approximately 500,000 tons annually of coated freesheet paper used for a variety of commercial printing and specialty applications. “The coated paper market is being hit with a slowdown in demand as the uncertain economy is reflected in a reduction in print advertising. At the same time, we are experiencing higher input costs for raw materials and transportation driven by oil and natural gas prices. To balance the somewhat reduced demand in a manner that helps us reduce costs, we are closing our mill in Kimberly, Wisconsin. We continue to work to offset the negative influences by raising prices and driving productivity programs harder. We have made sufficient progress with the integration of our recently acquired facilities and we now have more flexibility to respond to customer needs. We can readily meet our customers’ needs with our remaining facilities and at the same time improve our cost advantage versus our peers,” said NewPage Chairman and Chief Executive Officer Mark A. Suwyn. “We are proactively taking this step to stay on our committed path to achieve financial returns that exceed our cost of capital.” “We are committed to setting production levels to match demand without over-supplying the marketplace. We also believe it is imperative to continue to look for ways to lower our costs. While the Kimberly mill has first-class paper machines and is operated by an excellent workforce, it doesn’t have a pulp mill to support the paper operations. Because purchased pulp has become extremely expensive, the cost to run that facility is much higher than making the same products at our other fully-integrated, lower-cost locations,” said Richard D. Willett Jr., NewPage president and chief operating officer. “We now have the capacity and flexibility to produce a number of freesheet, supercalendered and groundwood grades on several different machines. For example, our Escanaba, Michigan and Rumford, Maine, mills which have traditionally manufactured mostly coated groundwood grades, will now become swing mills producing both coated groundwood and freesheet products. Therefore, while we are idling 500,000 tons of coated capacity at the Kimberly mill, the effect is likely to be approximately 200,000 tons of coated freesheet and 300,000 tons of coated groundwood.” Approximately 475 employees will be affected by the shutdown of Kimberly. This is in addition to the 125 employees affected by the shutdown of Kimberly No. 95 paper machine in May 2008. “Our decision to close the mill is the result of a weak economy, the continued effects of low priced imported products and sky-rocketing costs. We realize these decisions have a significant impact on our employees and they are difficult to make. We will continue helping individuals at the Kimberly mill to stay focused on working safely so that no one gets hurt prior to the mill closing, while simultaneously assisting them in identifying new employment opportunities, offering Employee Assistance Programs or providing severance benefits to those who are displaced,” said Michael T. Edicola, NewPage vice president, human resources. -----------------------------------------------------------------------------------------------------------------------------------

When will our community take its head out of the sand and prepare for such events? New Page gave the 30 day notice. If you wait until the notice, it is too late.

I hope that the River Valley community is looking over your collective shoulder. With the price of fossil fuels going through the roof and the Chinese practicing predatory manufacturing by exploiting their labor pool, the domestic pulp, paper and wood products industries (as well as many others in the manufacturing realm) are on the ropes. Meanwhile, that same country is expanding their military spending by factors unheard of in this country. They are building submarines at a rate of 4 per year while we are producing one every two years. The dragon is feeding, and soon it will start looking outside its hemisphere for more. But I digress...
As Kevin has pointed out, NewPage is closing that mill with 30 days' notice. What makes Rumford feel that they are any more secure than Kimberly, WI? You're just an entry on their corporate balance sheet, and one that they will divest if economic conditions warrant...with 30 day's notice. And while I don't necessarily favor a casino in my hometown or anywhere close nearby, I would caution you that you must look for another stable industry in order to ensure the perpetuation on the town and all of River Valley. Sometimes the "medicine" has a bad taste or other unpleasant effects, but it may be the only way to cure the "disease". Time to stop squabbling and start cooperating. God Bless.

RUMFORD - The closure of a NewPage Corp. paper mill in Kimberly, Wis., may have a beneficial effect on the local mill....


http://www.sunjournal.com/story/276575-3/RiverValley/Wis_closure_may_benefit_other_mills/

If the mill closes many of the employees would have to relocate as there aren't any jobs locally that would pay what the mill does. As things stand right now most would find they couldn't sell their homes in order to be able to move elsewhere.