17 August 2012

Norske Skog's Tasman mill in Kawerau has announced plans to reduce its output capacity by 150,000 tonnes, half of its current capacity.

According to PF Olsen's Wood Matters e-zine, the mill is currently a two machine operation making 300,000 tonnes of newsprint a year. But a dramatic reduction in newsprint consumption in both New Zealand and Australia, combined with low global newsprint prices and a high New Zealand dollar has forced its hand.

A consultation process with the mill workforce has begun and an update is expected early to mid September.

As a result of the dramatic decline in newsprint consumption in both New Zealand and Australia, the mill now exports more than two-thirds of its production to a weak Asian market, up from less than 10% just three years ago.   This has resulted in a significant and unsustainable reduction in the mill's profitability.

The mill states that is remains committed to manufacturing newsprint in the local market, the renewable energy projects (which include – generation and selling of geothermal energy, pellet manufacture, bio-crude production) and to the Kawerau Industrial Symbiosis project.

Source: PF Olsen's Wood Matters