Reading into the pulp mill fictions
Judith Ajani
http://canberra.yourguide.com.au/detail.asp?class=your+say&subclass=general&story_id=1053684&category=opinion
The silent sleeper in the Gunns pulp mill debate is its commercial viability. Perhaps Environment Minister Malcolm Turnbull, with his business blood, cannot imagine a company advancing a $1.5billion investment without having done its sums, carefully. Turnbull is not alone here, most people would think it incredible.
But Gunns is no ordinary company. It has never experienced a conflict-free business day since its mid-1980s beginnings. Its business battles are as much battles against greens as they are for market share.
Gunns is a company lifted by a cheer squad rooted in four decades of battles over hydro-electric dams, mining, woodchipping and pulp mills in an island state of just 500,000 people. While its cheer squad bears little commercial responsibility for Tasmania's largest-ever investment, financial prudence requires that Gunns' board somehow keeps its feet firmly on the ground.
Gunns is reserving its final judgment on the viability of the mill until the approvals are in. But because the environmental and political debate precedes the economic judgment, the mill's commercial viability has slipped under the radar. It is quite possible it will fail the test.
In Tasmania, a grudge factor has simmered since the late 1980s when Canadian paper maker Noranda pulled out of the Wesley Vale joint venture pulp mill proposal with North Broken Hill. The public understood the pull-out as industry's response to then federal environment minister Graham Richardson's tightened requirements. This was just half the story.
Since Noranda's decision, globally traded chemical pulp prices have halved in real terms, a scenario they had not planned for and an economic reality of little interest to grudge-bearers. In the shadow of Wesley Vale, Gunns' proposed pulp mill is so emotional and politically complex that neither Turnbull nor his shadow, Peter Garrett, should assume economic rationalism drives the show.
Despite the mill's commercial viability remaining untested publicly, both Gunns and the Tasmanian Government promote its wider economic benefits. If the pulp mill's financials do not stack-up, neither does the $6.7billion boost to Tasmania's economy and the 1617 new jobs calculated by the Allen Consulting Group as input to Gunns' integrated impact statement.
Allens did not investigate the financial viability of the mill before calculating these figures. The study's project director later argued that "it is difficult to see why this [the mill's commercial viability] is anything other than a matter for Gunns and the company financiers" and questioned the legitimacy of government or the public interest in the commercial viability of major industrial projects. Allens, however, ignores the Tasmanian public's business interest through Forestry Tasmania who will supply most of the wood from public native forests.
It also ignores the risk of more Federal Government hand-outs if Tasmania's public purse is used to keep an uneconomic mill alive. ITS Global, the consultants engaged by the Tasmanian Government to review the social and economic benefits of the pulp mill, also started with the premise of the mill's commercial viability.
CommSec, using information Gunns presented in its impact statement and its own market analysis, concluded the mill would be marginally positive for Gunns but emphasised the project was highly risky, strongly leveraged to a volatile commodity price and subject to approval and construction risk. Its analysis was hamstrung by data constraints, especially on native forest log prices that remain confidential to Gunns and the Tasmanian Government. Other broker reports agree with CommSec's risk assessment but give a more positive assessment of the mill.
Five years ago, Visy Industries broke through the pulp mill barrier in Australia when it commissioned its softwood plantation mill near Tumut. Environmentalists gave it a tick having passed the first hurdle no native forest logging and the second concerning emissions. Visy also engaged in real public consultation. On environmental and consultation matters, the two pulp mills are fundamentally different. They also differ in their market orientation, and herein lies the high economic risk CommSec associated with the Gunns mill.
Visy processes softwood pulp into paper to supply its domestic box-making plants. It enjoys the transport and familiarity advantages of a domestic market. Visy's strategy copies the global corporate structure of integrated pulp and paper production. Gunns can't follow suit, as its hardwood pulp is geared for printing and writing paper. This is because PaperlinX, Australia's monopoly producer of such paper, has the domestic market effectively stitched up through its own production or its subsidiaries' imports. Gunns must therefore compete in the global pulp market, a market that's both a dumping ground in economic downturns for old players and the target of new, extraordinarily low-cost producers in South America. CommSec believes Gunns cannot match their costs.
For many decades now, real (inflation-adjusted) pulp prices have followed a roller coaster down in this gruesome market. Gunns' forceful lobbying to keep costs down is no surprise. The problem lies in the Tasmanian Government who leads the cheer squad.
Under intense political pressure, Turnbull brings in scientists to help fix the growing political problem. An economic evaluation would be equally valuable. It would help shape how the Federal Government might best bring Australia's native forest pulp mill saga to a close. For Opposition Leader Kevin Rudd, this task includes managing the forestry union and Labor politicians who will not forget Wesley Vale days.
Judith Ajani is an economist at the Australian National University and author of the recently published The Forest Wars, by Melbourne University Publishing, 368pp, $34.95.
Saturday, September 15, 2007
Friday, July 20, 2007
Stora Enso found not guilty of anticompetitive conduct in the USA
Stora Enso found not guilty of anticompetitive conduct in the USA
Friday July 20, 3:02 am ET
HELSINKI, FINLAND--(MARKET WIRE)--Jul 20, 2007 -- Stora Enso Oyj News Release July 20, 2007 at 07.00 GMT
ADVERTISEMENT
HELSINKI, Finland - Stora Enso (NYSE:SEO - News) today announced that On 13 December 2006 the US Antitrust authorities announced that Stora Enso North America Corp. had been indicted for its alleged anticompetitive conduct in connection with the sale of coated magazine paper in the USA in 2002 and 2003.
On Thursday 19 July 2007, following a jury trial in the US Federal District Court in Hartford, Connecticut, the jury found Stora Enso not guilty of the charges.
For further information, please contact:
Per Lyrvall
Friday July 20, 3:02 am ET
HELSINKI, FINLAND--(MARKET WIRE)--Jul 20, 2007 -- Stora Enso Oyj News Release July 20, 2007 at 07.00 GMT
ADVERTISEMENT
HELSINKI, Finland - Stora Enso (NYSE:SEO - News) today announced that On 13 December 2006 the US Antitrust authorities announced that Stora Enso North America Corp. had been indicted for its alleged anticompetitive conduct in connection with the sale of coated magazine paper in the USA in 2002 and 2003.
On Thursday 19 July 2007, following a jury trial in the US Federal District Court in Hartford, Connecticut, the jury found Stora Enso not guilty of the charges.
For further information, please contact:
Per Lyrvall
Thursday, July 19, 2007
By gum, it might just be a solution
By gum, it might just be a solution
Email Print Normal font Large font July 19, 2007
Page 1 of 4 | Single page
Selective crossbreeding to speed the growth of trees offers a breakthrough in meeting the increasing world demand for timber and at the same time saving forests, writes Louise Williams.
Advertisement
AdvertisementIn a secure, sterile greenhouse just south of the Arctic Circle trees are flowering in four weeks that would otherwise have taken 10 to 15 years to mature. The genetically modified seedlings are a huge step forward in the race to produce bigger, faster-growing trees.
It's a race which must be won to meet insatiable global demand for wood and forest byproducts without pushing commercial logging even deeper into the world's dwindling native forests.
"The post-fossil fuel era will see human society turn back to its traditional dependency on wood," says Professor Ove Nilsson, the scientific co-ordinator at the Umea Plant Science Centre in northern Sweden.
But, he says, projected demand dramatically outstrips forest production. Soaring global consumption, especially in Asia, is colliding with new demands on forests for carbon-neutral biofuels for electricity, industrial furnaces, heating and vehicles.
"Everyone agrees that if we are going to solve this puzzle we have to make commercial forests more productive," Nilsson says. "We have to grow bulkier trees faster so we get much higher yields per hectare. Otherwise we risk cutting down every stand of rainforest left on the planet."
In China, the forest products industry grew from $US4 billion to $US17.2 billion in the five years to last year, paper consumption has doubled in a decade and forests, especially in Indonesia and Russia, are being rapidly felled to feed the Chinese industrial machine. Elsewhere, scientists are eyeing wood for biofuels because it is at least twice as "energy dense" as crops used to make ethanol for green vehicles, and trees require much less land and fertiliser.
The commercial forests of the future, Nilsson says, will be fast-growing plantations "tailor-made" for bio-energy, pulp and paper, new wood fibre products and sawn wood and logs for construction and furniture.
And it's not all science fiction; a plant enzyme has been identified in Sweden which makes paper highly water resistant, a potential replacement for petroleum-based plastics, and a wood fibre composite is being tested to replace plastic components in cars. Millions of cloned high-yield trees are being planted in the US, following decades of research and breeding to select the most productive trees. The most dramatic breeding gains have been achieved in Brazil, where massive eucalyptus plantations grow to 35 metres in seven years, a 300 per cent increase on the original Australian species. But most trees are still only 20 to 40 per cent bigger than their ancestors. Genetic engineering is the next frontier.
The futuristic seedlings are locked inside a pressurised greenhouse on the roof, to prevent cross-contamination of pollen and spores with native forests. Unlike work on crops such as corn and soy, the genetic modification of trees is in its infancy. In agriculture, extraordinary improvements in food crops have been achieved through millennia of selective breeding, irrigation, fertilisers and, more recently, the biotechnology revolution, which began in the US in 1995. Wild tomatoes were originally no bigger than a strawberry and corn was about the size of a finger.
"You could argue that biotech has an even bigger potential for trees than crops because crops were already greatly improved before GM, but in forestry we are still at the beginning," Nilsson says.
The trouble with trees is that, unlike crops, selective breeding takes decades. Many cold climate trees such as spruce and aspen take 10 to 15 years to flower, meaning superior trees can only be picked out and crossbred - in the hope of even more productive offspring - a couple of times in a forester's career.
Eucalypts have galloped ahead because they flower in two to three years, allowing rapid crossbreeding to emphasise favourable characteristics such as fast growth and straight stems, boosting harvests in Brazil from 20 cubic metres of wood per hectare to up to 60 cubic metres.
What Nilsson and his team have managed to do is to mimic one of the earliest flowering plants on the planet, the Arabidopsis, a member of the mustard family that flowers in four to six weeks. They discovered poplars and other trees have the same FT (flowering locus T) gene which triggers early flowering in the Arabidopsis, but in nature it is dormant for up to 15 years. By isolating the gene, activating it, then returning it to the seedling, they've turned on almost instant flowering in several of the slowest-maturing trees.
"The flowers are formed normally and they produce pollen," Nilsson says of the first batch grown last year, which created waves in the global scientific community.
The seedling themselves aren't much use in forests; they're not necessarily bigger or stronger. The idea is to use the GM early-flowering trees for cross-breeding; giving researchers the chance to select the best trees using molecular markers a couple of times every year, instead of once every two decades for cold forests such as those in Sweden.
The way the remotely activated FT gene has been delivered into poplars also opens the door for other genetic modifications from a bank of 250 tree genes identified at the Umea centre. The genetic delivery mechanism is a naturally occurring soil bacterium which readily infects plant cells, transferring part of its own genes into those cells. The bacterium has been hijacked by scientists looking for way into a tree's genetic structure.
"We just replace the bacterium's genes with the genes we want to introduce into the tree and the bacterium (or the plant) won't notice the difference.
"If you take the gene that controls the production of growth hormone and turn it off you get a bonsai, but if you make it more active you get a tree that produces almost twice the amount of wood fibres," Nilsson says.
An Australian PhD candidate, Jonathon Love, is at the Umea centre searching for his tree accelerator. His research focuses on how trees seek to correct a lean by generating more wood on one side to straighten the stem.
"If you identify the gene that is responsible for the localised growth stimulation, turn it on, then put it back, you can stimulate faster growth in the entire trees," he says.
Turning laboratory super seedlings into super forests is likely to rely increasingly on embryonic cloning. When genetically superior parents have been created, embryos can be excised from their seeds and grown in tissue culture, where they can be stimulated to make copies of themselves. The embryos can be stored in liquid nitrogen while the copies are planted out to identify which of the original seeds produced the best characteristics. Cloned tree embryos are not difficult to handle; they can be dried, shipped all over the world, and planted without a seed.
Love has worked in commercial forestry in Tasmania and says he's acutely aware of the pressure rapidly growing demand for wood products is putting on wilderness regions.
"The benefit of using forest sustainably is that you can have a carbon-neutral process. Wood is solar power harnessed by trees; you fix the same amount of carbon growing trees as you lose when you harvest them.
"Science can help with technical solutions to maximise productivity, but you still need good management and political commitment to replanting," Love says.
Umea lies in Sweden's biofuel region of vast forests. Wood waste from local timber industries fuels the power plant, providing carbon-neutral electricity, hot water and heating. Garbage is also tossed into the furnace. There's enough emissions-free hot water to run pipes under the city centre, keeping streets free from snow in winter, when the temperature plunges to minus 20 and the sea, lakes and rivers freeze over.
Forest industry waste is being used to generate electricity and heating in Europe, and in Brazil forest offcuts are replacing fossil fuels in the likes of smelting and food processing. Wood and wood composites must eventually replace high-emissions building materials such as steel, bricks, concrete and synthetic composites. In Sweden's south, Europe's first high-rise wooden apartment block is under construction.
Most significant, perhaps, are Swedish experimental factories turning wood and forest waste into second-generation automotive biofuels, raising the prospect of vehicles running on trees. GM trees are being tested in the US for biofuel production and New Zealand and Denmark are also investing in wood-to-vehicle fuel research.
How close we are to commercial GM forests is a matter of conjecture. China has planted out GM trees modified to resist pests, but many governments are cautious. Nilsson plans to use the fast-flowering mechanism only for breeding in sealed greenhouses. Once high-yield trees have been created, the gene can be bred out, leaving genetically normal trees to be cloned and planted.
GM eucalypts, he says, may be only five for six years away, but genetically modified hardwoods are unlikely in cold climate forests before 2015.
And there's still the contradiction between environmental demands for carbon-neutral biofuels and building materials to reduce greenhouse gas emissions and the traditional opposition to commercial forests from green groups concerned about biodiversity, especially with single-crop plantations.
But, says Nilsson: "The only way we are going to cope with rising demand is increase forest productivity. GM is one tool but this is a new way of thinking and working and we need more experience to fully understand its potential."
Louise Williams visited Sweden at the invitation of the Swedish Institute for the 300th anniversary of the birth of Carl Linnaeus, the world's first ecologist and the father of the binary nomenclature system of scientific classification.
Email Print Normal font Large font July 19, 2007
Page 1 of 4 | Single page
Selective crossbreeding to speed the growth of trees offers a breakthrough in meeting the increasing world demand for timber and at the same time saving forests, writes Louise Williams.
Advertisement
AdvertisementIn a secure, sterile greenhouse just south of the Arctic Circle trees are flowering in four weeks that would otherwise have taken 10 to 15 years to mature. The genetically modified seedlings are a huge step forward in the race to produce bigger, faster-growing trees.
It's a race which must be won to meet insatiable global demand for wood and forest byproducts without pushing commercial logging even deeper into the world's dwindling native forests.
"The post-fossil fuel era will see human society turn back to its traditional dependency on wood," says Professor Ove Nilsson, the scientific co-ordinator at the Umea Plant Science Centre in northern Sweden.
But, he says, projected demand dramatically outstrips forest production. Soaring global consumption, especially in Asia, is colliding with new demands on forests for carbon-neutral biofuels for electricity, industrial furnaces, heating and vehicles.
"Everyone agrees that if we are going to solve this puzzle we have to make commercial forests more productive," Nilsson says. "We have to grow bulkier trees faster so we get much higher yields per hectare. Otherwise we risk cutting down every stand of rainforest left on the planet."
In China, the forest products industry grew from $US4 billion to $US17.2 billion in the five years to last year, paper consumption has doubled in a decade and forests, especially in Indonesia and Russia, are being rapidly felled to feed the Chinese industrial machine. Elsewhere, scientists are eyeing wood for biofuels because it is at least twice as "energy dense" as crops used to make ethanol for green vehicles, and trees require much less land and fertiliser.
The commercial forests of the future, Nilsson says, will be fast-growing plantations "tailor-made" for bio-energy, pulp and paper, new wood fibre products and sawn wood and logs for construction and furniture.
And it's not all science fiction; a plant enzyme has been identified in Sweden which makes paper highly water resistant, a potential replacement for petroleum-based plastics, and a wood fibre composite is being tested to replace plastic components in cars. Millions of cloned high-yield trees are being planted in the US, following decades of research and breeding to select the most productive trees. The most dramatic breeding gains have been achieved in Brazil, where massive eucalyptus plantations grow to 35 metres in seven years, a 300 per cent increase on the original Australian species. But most trees are still only 20 to 40 per cent bigger than their ancestors. Genetic engineering is the next frontier.
The futuristic seedlings are locked inside a pressurised greenhouse on the roof, to prevent cross-contamination of pollen and spores with native forests. Unlike work on crops such as corn and soy, the genetic modification of trees is in its infancy. In agriculture, extraordinary improvements in food crops have been achieved through millennia of selective breeding, irrigation, fertilisers and, more recently, the biotechnology revolution, which began in the US in 1995. Wild tomatoes were originally no bigger than a strawberry and corn was about the size of a finger.
"You could argue that biotech has an even bigger potential for trees than crops because crops were already greatly improved before GM, but in forestry we are still at the beginning," Nilsson says.
The trouble with trees is that, unlike crops, selective breeding takes decades. Many cold climate trees such as spruce and aspen take 10 to 15 years to flower, meaning superior trees can only be picked out and crossbred - in the hope of even more productive offspring - a couple of times in a forester's career.
Eucalypts have galloped ahead because they flower in two to three years, allowing rapid crossbreeding to emphasise favourable characteristics such as fast growth and straight stems, boosting harvests in Brazil from 20 cubic metres of wood per hectare to up to 60 cubic metres.
What Nilsson and his team have managed to do is to mimic one of the earliest flowering plants on the planet, the Arabidopsis, a member of the mustard family that flowers in four to six weeks. They discovered poplars and other trees have the same FT (flowering locus T) gene which triggers early flowering in the Arabidopsis, but in nature it is dormant for up to 15 years. By isolating the gene, activating it, then returning it to the seedling, they've turned on almost instant flowering in several of the slowest-maturing trees.
"The flowers are formed normally and they produce pollen," Nilsson says of the first batch grown last year, which created waves in the global scientific community.
The seedling themselves aren't much use in forests; they're not necessarily bigger or stronger. The idea is to use the GM early-flowering trees for cross-breeding; giving researchers the chance to select the best trees using molecular markers a couple of times every year, instead of once every two decades for cold forests such as those in Sweden.
The way the remotely activated FT gene has been delivered into poplars also opens the door for other genetic modifications from a bank of 250 tree genes identified at the Umea centre. The genetic delivery mechanism is a naturally occurring soil bacterium which readily infects plant cells, transferring part of its own genes into those cells. The bacterium has been hijacked by scientists looking for way into a tree's genetic structure.
"We just replace the bacterium's genes with the genes we want to introduce into the tree and the bacterium (or the plant) won't notice the difference.
"If you take the gene that controls the production of growth hormone and turn it off you get a bonsai, but if you make it more active you get a tree that produces almost twice the amount of wood fibres," Nilsson says.
An Australian PhD candidate, Jonathon Love, is at the Umea centre searching for his tree accelerator. His research focuses on how trees seek to correct a lean by generating more wood on one side to straighten the stem.
"If you identify the gene that is responsible for the localised growth stimulation, turn it on, then put it back, you can stimulate faster growth in the entire trees," he says.
Turning laboratory super seedlings into super forests is likely to rely increasingly on embryonic cloning. When genetically superior parents have been created, embryos can be excised from their seeds and grown in tissue culture, where they can be stimulated to make copies of themselves. The embryos can be stored in liquid nitrogen while the copies are planted out to identify which of the original seeds produced the best characteristics. Cloned tree embryos are not difficult to handle; they can be dried, shipped all over the world, and planted without a seed.
Love has worked in commercial forestry in Tasmania and says he's acutely aware of the pressure rapidly growing demand for wood products is putting on wilderness regions.
"The benefit of using forest sustainably is that you can have a carbon-neutral process. Wood is solar power harnessed by trees; you fix the same amount of carbon growing trees as you lose when you harvest them.
"Science can help with technical solutions to maximise productivity, but you still need good management and political commitment to replanting," Love says.
Umea lies in Sweden's biofuel region of vast forests. Wood waste from local timber industries fuels the power plant, providing carbon-neutral electricity, hot water and heating. Garbage is also tossed into the furnace. There's enough emissions-free hot water to run pipes under the city centre, keeping streets free from snow in winter, when the temperature plunges to minus 20 and the sea, lakes and rivers freeze over.
Forest industry waste is being used to generate electricity and heating in Europe, and in Brazil forest offcuts are replacing fossil fuels in the likes of smelting and food processing. Wood and wood composites must eventually replace high-emissions building materials such as steel, bricks, concrete and synthetic composites. In Sweden's south, Europe's first high-rise wooden apartment block is under construction.
Most significant, perhaps, are Swedish experimental factories turning wood and forest waste into second-generation automotive biofuels, raising the prospect of vehicles running on trees. GM trees are being tested in the US for biofuel production and New Zealand and Denmark are also investing in wood-to-vehicle fuel research.
How close we are to commercial GM forests is a matter of conjecture. China has planted out GM trees modified to resist pests, but many governments are cautious. Nilsson plans to use the fast-flowering mechanism only for breeding in sealed greenhouses. Once high-yield trees have been created, the gene can be bred out, leaving genetically normal trees to be cloned and planted.
GM eucalypts, he says, may be only five for six years away, but genetically modified hardwoods are unlikely in cold climate forests before 2015.
And there's still the contradiction between environmental demands for carbon-neutral biofuels and building materials to reduce greenhouse gas emissions and the traditional opposition to commercial forests from green groups concerned about biodiversity, especially with single-crop plantations.
But, says Nilsson: "The only way we are going to cope with rising demand is increase forest productivity. GM is one tool but this is a new way of thinking and working and we need more experience to fully understand its potential."
Louise Williams visited Sweden at the invitation of the Swedish Institute for the 300th anniversary of the birth of Carl Linnaeus, the world's first ecologist and the father of the binary nomenclature system of scientific classification.
Monday, July 16, 2007
Kruger idles No. 4 machine 11
Kruger idles No. 4 machine 11
Company blames high loonie for two-week shutdown
Post a comment | View comments (11) | View latest comment
CLIFF WELLS
The Western Star
The economy of the region was dealt its second blow this week when Corner Brook Pulp and Paper announced Friday it was shutting down a paper machine.
In a terse and vague press release, Jean Majeau, Kruger’s vice-president of corporate affairs, said “one newsprint paper machine” at the Corner Brook facility and the super-calendared machine at the Wayagamack mill in Trois-Rivieres, Que. faced “production curtailments.”
The statement gave no time line on the shutdown, other than it begins July 22. It also said the two machines produce 145,000 tonnes of annually.
The three-paragraph release cited the high Canadian dollar as the reason. According to the Bank of Canada website, the loonie was trading at 95 cents US on Friday.
The announcement came the same week Lafarge Gypsum announced its Corner Brook plant was shutting down, taking 53 jobs with it.
Bruce Randell, president of the Communications Energy and Papermakers Union Local 242, said the shutdown of No. 4 will likely affect a total of 25 or 26 jobs, but he doesn’t expect the shutdown to be long-lived.
He said it’s expected that the machine will be back up and running within a couple of weeks, although he doesn’t have any official notice of the length of the shutdown.
He said the hardest hit group will likely be the students hired for the summer. He said senior staff will likely move their holidays to coincide with the down time and some may get some training, but the relief workers won’t be needed as badly with the peak vacation season used.
“If it’s going to be a two-week duration and they start up the machine again — which we assume they will — it’s not too bad,” said Randell.
“It’s the summer time and a lot of people have their holidays and spend some time with their families. If this is a long-term thing — which we don’t believe it is — obviously it’s going to be dramatic.”
As the 4 p.m. mill whistle sounded Friday, there were few smiling faces as employees headed home. There were many questions unanswered, and there was a feeling of concern among mill workers.
Tradesmen Rick White and Ross Edison said the rumours have been around for a long time, but that doesn’t help when the news comes down. They heard the closure is for two weeks, after which an assessment will be done.
“It’s been spoken of for the last couple of years that it was potentially going to be shut down, that one machine,” White said. “Apparently, it is supposed to be temporary.”
Edison said it appears Kruger is taking every measure to ensure as little work time as possible is lost.
“What they are asking the men to do now is for a percentage to come forward and take extra vacation during that period, so that nobody is affected with any layoffs,” he said. “They are saying that you can allow 30 per cent more guys off now on vacation for whoever wants to take it.”
Being tradesmen, they said they feel protected from the closure, but said the people in the labour pool will have less work. In particular, they said there will be fewer hours for those on call.
Economic impact
Mayor Charles Pender said it’s hard to guage how hard the area will be hit by the shutdown.
“Any shutdown of any machine for any length of time is going to have an effect on the economy and is a concern to us, no doubt,” Pender said.
“I’ve already had a chance to speak with somebody in government on this
“We met with Kruger twice over the last two months and they were impressing upon us the gravity of the situation, given the rising cost of the dollar, which is the major cause for this shutdown. I think more than half of the paper from the Corner Brook mill goes to the United States, so obviously it’s having a major impact on them.”
Tom Marshall, Finance minister and Tory legislature member for Humber East, said the industry as a whole needs to find a way to be competitive in a world with a pricey loonie. He said Corner Brook Pulp and Paper is coming up with innovative ways to save money, whether it’s burning peat in their boilers to save oil or setting up a co-generation plant.
“The market is terrible as we know,” Marshall said. “We saw the results of that with Abitibi (in Stephenville) and from the shutdown of plants in the rest of the country... We do know Kruger are smart operators and experienced operators. We’ve worked closely with them in terms of helping them on the energy side, on the silviculture side and the roads side. We’ll continue to work with them to ensure this operation is efficient and can compete in the global market even under challenging circumstances.”
Shawn Woodford, president of the Greater Corner Brook Board of Trade, said more questions than answers were raised by the news release.
“We’re certainly going to ask Kruger the details of what this actually means and what the impact will be,” he said. “We’re hoping it’s a temporary measure, and a short temporary measure to correct the market conditions that are being seen in the paper supply.
“After the news this week of Lafarge, something like this obviously is something I take quite seriously.”
Gerry Byrne, Liberal legislature member for Humber-St. Barbe-Baie Verte, said this business in particular has been innovative in trying to invest in cost-saving measures, but haven’t always received the support it needs.
He said the shutdown is evidence the manufacturing sector in the country is being let down, especially by the laissez-faire monetary policy of the federal government.
“I’m extremely concerned with this being the second shoe to drop in the manufacturing sector in Corner Brook in seven days, more announcements like this may follow,” Byrne said.
“The Harper administration has failed to do anything to assist the manufacturing sector in this country and the competitiveness challenges they faces as a result. They (federal Conservatives) have walked away from Canadian jobs.”
Company blames high loonie for two-week shutdown
Post a comment | View comments (11) | View latest comment
CLIFF WELLS
The Western Star
The economy of the region was dealt its second blow this week when Corner Brook Pulp and Paper announced Friday it was shutting down a paper machine.
In a terse and vague press release, Jean Majeau, Kruger’s vice-president of corporate affairs, said “one newsprint paper machine” at the Corner Brook facility and the super-calendared machine at the Wayagamack mill in Trois-Rivieres, Que. faced “production curtailments.”
The statement gave no time line on the shutdown, other than it begins July 22. It also said the two machines produce 145,000 tonnes of annually.
The three-paragraph release cited the high Canadian dollar as the reason. According to the Bank of Canada website, the loonie was trading at 95 cents US on Friday.
The announcement came the same week Lafarge Gypsum announced its Corner Brook plant was shutting down, taking 53 jobs with it.
Bruce Randell, president of the Communications Energy and Papermakers Union Local 242, said the shutdown of No. 4 will likely affect a total of 25 or 26 jobs, but he doesn’t expect the shutdown to be long-lived.
He said it’s expected that the machine will be back up and running within a couple of weeks, although he doesn’t have any official notice of the length of the shutdown.
He said the hardest hit group will likely be the students hired for the summer. He said senior staff will likely move their holidays to coincide with the down time and some may get some training, but the relief workers won’t be needed as badly with the peak vacation season used.
“If it’s going to be a two-week duration and they start up the machine again — which we assume they will — it’s not too bad,” said Randell.
“It’s the summer time and a lot of people have their holidays and spend some time with their families. If this is a long-term thing — which we don’t believe it is — obviously it’s going to be dramatic.”
As the 4 p.m. mill whistle sounded Friday, there were few smiling faces as employees headed home. There were many questions unanswered, and there was a feeling of concern among mill workers.
Tradesmen Rick White and Ross Edison said the rumours have been around for a long time, but that doesn’t help when the news comes down. They heard the closure is for two weeks, after which an assessment will be done.
“It’s been spoken of for the last couple of years that it was potentially going to be shut down, that one machine,” White said. “Apparently, it is supposed to be temporary.”
Edison said it appears Kruger is taking every measure to ensure as little work time as possible is lost.
“What they are asking the men to do now is for a percentage to come forward and take extra vacation during that period, so that nobody is affected with any layoffs,” he said. “They are saying that you can allow 30 per cent more guys off now on vacation for whoever wants to take it.”
Being tradesmen, they said they feel protected from the closure, but said the people in the labour pool will have less work. In particular, they said there will be fewer hours for those on call.
Economic impact
Mayor Charles Pender said it’s hard to guage how hard the area will be hit by the shutdown.
“Any shutdown of any machine for any length of time is going to have an effect on the economy and is a concern to us, no doubt,” Pender said.
“I’ve already had a chance to speak with somebody in government on this
“We met with Kruger twice over the last two months and they were impressing upon us the gravity of the situation, given the rising cost of the dollar, which is the major cause for this shutdown. I think more than half of the paper from the Corner Brook mill goes to the United States, so obviously it’s having a major impact on them.”
Tom Marshall, Finance minister and Tory legislature member for Humber East, said the industry as a whole needs to find a way to be competitive in a world with a pricey loonie. He said Corner Brook Pulp and Paper is coming up with innovative ways to save money, whether it’s burning peat in their boilers to save oil or setting up a co-generation plant.
“The market is terrible as we know,” Marshall said. “We saw the results of that with Abitibi (in Stephenville) and from the shutdown of plants in the rest of the country... We do know Kruger are smart operators and experienced operators. We’ve worked closely with them in terms of helping them on the energy side, on the silviculture side and the roads side. We’ll continue to work with them to ensure this operation is efficient and can compete in the global market even under challenging circumstances.”
Shawn Woodford, president of the Greater Corner Brook Board of Trade, said more questions than answers were raised by the news release.
“We’re certainly going to ask Kruger the details of what this actually means and what the impact will be,” he said. “We’re hoping it’s a temporary measure, and a short temporary measure to correct the market conditions that are being seen in the paper supply.
“After the news this week of Lafarge, something like this obviously is something I take quite seriously.”
Gerry Byrne, Liberal legislature member for Humber-St. Barbe-Baie Verte, said this business in particular has been innovative in trying to invest in cost-saving measures, but haven’t always received the support it needs.
He said the shutdown is evidence the manufacturing sector in the country is being let down, especially by the laissez-faire monetary policy of the federal government.
“I’m extremely concerned with this being the second shoe to drop in the manufacturing sector in Corner Brook in seven days, more announcements like this may follow,” Byrne said.
“The Harper administration has failed to do anything to assist the manufacturing sector in this country and the competitiveness challenges they faces as a result. They (federal Conservatives) have walked away from Canadian jobs.”
Tuesday, June 26, 2007
Tembec shuts Louisiana paper mill, 540 jobs cut
Tembec shuts Louisiana paper mill, 540 jobs cut
CALGARY, Alberta, June 1 (Reuters) - Tembec Inc. (TBC.TO: Quote, Profile, Research) said on Friday it will shut its coated-paper mill in St. Francisville, Louisiana, at the end of July, cutting 540 jobs.
The Canadian paper maker said high costs and inconsistent production at the mill, and what it called "challenging market conditions in terms of both price and demand," provoked the closure.
The shutdown is the latest of a series of facility closures by Tembec over the past year. The company has been cutting capacity and looking to boost margins at its operations.
In a statement, Tembec chief executive James Lopez said the company had unsuccessfully attempted to boost the profitability of its only coated-paper mill last year by lowering costs and changing its product mix.
"Despite these changes this facility continues to be hampered by high energy costs, low machine productivity and difficult market conditions," the statement said.
Tembec said it is reviewing alternatives for the St. Francisville operation but offered no other details.
The mill has a capacity of 325,000 tons of coated and specialty papers used in catalogues, magazines and for cover stock.
Tembec shares were unchanged at C$1.18 on Friday on the Toronto Stock Exchange. The stock has dropped 22 percent over the past 12 months.
($1=$1.06 Canadian)
((Reporting by Scott Haggett, editing by Peter Galloway; scott.haggett@reuters.com; Reuters Messaging: scott.haggett.reuters.com@reuters.net; +1 403 531-1622)) Keywords: TEMBEC/CLOSURE
(C) Reuters 2007. All rights reserved. Republication or redistribution ofReuters content, including by caching, framing or similar means, is expresslyprohibited without the prior written consent of Reuters. Reuters and the Reuterssphere logo are registered trademarks and trademarks of the Reuters group ofcompanies around the world.nN01364932
CALGARY, Alberta, June 1 (Reuters) - Tembec Inc. (TBC.TO: Quote, Profile, Research) said on Friday it will shut its coated-paper mill in St. Francisville, Louisiana, at the end of July, cutting 540 jobs.
The Canadian paper maker said high costs and inconsistent production at the mill, and what it called "challenging market conditions in terms of both price and demand," provoked the closure.
The shutdown is the latest of a series of facility closures by Tembec over the past year. The company has been cutting capacity and looking to boost margins at its operations.
In a statement, Tembec chief executive James Lopez said the company had unsuccessfully attempted to boost the profitability of its only coated-paper mill last year by lowering costs and changing its product mix.
"Despite these changes this facility continues to be hampered by high energy costs, low machine productivity and difficult market conditions," the statement said.
Tembec said it is reviewing alternatives for the St. Francisville operation but offered no other details.
The mill has a capacity of 325,000 tons of coated and specialty papers used in catalogues, magazines and for cover stock.
Tembec shares were unchanged at C$1.18 on Friday on the Toronto Stock Exchange. The stock has dropped 22 percent over the past 12 months.
($1=$1.06 Canadian)
((Reporting by Scott Haggett, editing by Peter Galloway; scott.haggett@reuters.com; Reuters Messaging: scott.haggett.reuters.com@reuters.net; +1 403 531-1622)) Keywords: TEMBEC/CLOSURE
(C) Reuters 2007. All rights reserved. Republication or redistribution ofReuters content, including by caching, framing or similar means, is expresslyprohibited without the prior written consent of Reuters. Reuters and the Reuterssphere logo are registered trademarks and trademarks of the Reuters group ofcompanies around the world.nN01364932
Thursday, June 21, 2007
Domtar paper machine to halt again
Domtar paper machine to halt again
By Diana Graettinger
Wednesday, June 20, 2007 - Bangor Daily News
BAILEYVILLE — For the third time this year, the Domtar Inc. pulp and paper mill, Washington County’s largest employer, announced Tuesday that it is shutting down its paper machine.
The move will idle about 90 employees indefinitely. The mill, which dates to 1906, has about 500 workers.
The company blamed the latest shutdown on poor market conditions.
"We will run through the 24th [of June], and we will conclude on the 25th," Domtar spokesman Scott Beal said Tuesday.
The cut-size operation, which cuts large rolls of paper into 8½-by-11-inch sheets, went down around June 4.
So far there is no announced restart date for the paper machine, but Beal cautioned that the company wasn’t saying there would be no return to production.
In previous shutdowns, some workers have been kept on board to do maintenance. But not this time.
"We will be working hard to minimize our expenses during this period when we have one of our production machines down," Beal said.
The company will be asking employees to take vacation time if possible.
In May, the same 90 employees returned to work after being out of work for about a month. The cut-size machine was switched back on the day after Memorial Day after having been turned off April 5.
The first time the paper machine was shut down was in March. And just last November the company announced it was cutting back on production for two months because of the same market-related conditions. Production resumed in January.
The shutdown is not restricted to Domtar.
"I have read some headlines that some of our competitors are taking downtime," Beal said. "We also are seeing some of our own sister mills within Domtar. It isn’t just a localized problem in Down East Maine. I know that doesn’t do a lot to put food on the table — we understand that — but this issue is bigger than just Domtar."
Town Manager Scott Harriman said Tuesday he was sorry to hear about the latest shutdown.
"We’re disappointed to hear the news that Domtar is going down for an indefinite period, and we hope that they will be able to get back up and running in a very short time frame," he said.
Harriman said shutdowns were difficult. "The up-and-down nature of these shutdowns [is] very tough on local people," he added.
Although the paper machine is down, the production of pulp — the raw material that Domtar ships worldwide and that is used in the papermaking process — will continue.
George "Bud" Finch, chairman of the Eastport Port Authority, said Tuesday it has been a good year for shipping pulp out of the port at Estes Head. As of the end of May, the port had shipped out more than 145,000 metric tons of pulp. The port expects to ship upward of 360,000 metric tons by the end of the year — a record amount, he said.
"While we recognize that the downturn in the paper industry is certainly a significant blow to the economy of Washington County, we have great hope that the global market for Domtar pulp will remain strong," Finch said.
Domtar, based in Montreal, is the third-largest producer of uncoated, free-sheet paper in North America. It is also a leading manufacturer of business papers, commercial printing and publication papers, and technical and specialty papers.
By Diana Graettinger
Wednesday, June 20, 2007 - Bangor Daily News
BAILEYVILLE — For the third time this year, the Domtar Inc. pulp and paper mill, Washington County’s largest employer, announced Tuesday that it is shutting down its paper machine.
The move will idle about 90 employees indefinitely. The mill, which dates to 1906, has about 500 workers.
The company blamed the latest shutdown on poor market conditions.
"We will run through the 24th [of June], and we will conclude on the 25th," Domtar spokesman Scott Beal said Tuesday.
The cut-size operation, which cuts large rolls of paper into 8½-by-11-inch sheets, went down around June 4.
So far there is no announced restart date for the paper machine, but Beal cautioned that the company wasn’t saying there would be no return to production.
In previous shutdowns, some workers have been kept on board to do maintenance. But not this time.
"We will be working hard to minimize our expenses during this period when we have one of our production machines down," Beal said.
The company will be asking employees to take vacation time if possible.
In May, the same 90 employees returned to work after being out of work for about a month. The cut-size machine was switched back on the day after Memorial Day after having been turned off April 5.
The first time the paper machine was shut down was in March. And just last November the company announced it was cutting back on production for two months because of the same market-related conditions. Production resumed in January.
The shutdown is not restricted to Domtar.
"I have read some headlines that some of our competitors are taking downtime," Beal said. "We also are seeing some of our own sister mills within Domtar. It isn’t just a localized problem in Down East Maine. I know that doesn’t do a lot to put food on the table — we understand that — but this issue is bigger than just Domtar."
Town Manager Scott Harriman said Tuesday he was sorry to hear about the latest shutdown.
"We’re disappointed to hear the news that Domtar is going down for an indefinite period, and we hope that they will be able to get back up and running in a very short time frame," he said.
Harriman said shutdowns were difficult. "The up-and-down nature of these shutdowns [is] very tough on local people," he added.
Although the paper machine is down, the production of pulp — the raw material that Domtar ships worldwide and that is used in the papermaking process — will continue.
George "Bud" Finch, chairman of the Eastport Port Authority, said Tuesday it has been a good year for shipping pulp out of the port at Estes Head. As of the end of May, the port had shipped out more than 145,000 metric tons of pulp. The port expects to ship upward of 360,000 metric tons by the end of the year — a record amount, he said.
"While we recognize that the downturn in the paper industry is certainly a significant blow to the economy of Washington County, we have great hope that the global market for Domtar pulp will remain strong," Finch said.
Domtar, based in Montreal, is the third-largest producer of uncoated, free-sheet paper in North America. It is also a leading manufacturer of business papers, commercial printing and publication papers, and technical and specialty papers.
Saturday, June 16, 2007
Publisher of Men’s Magazines Is Sold to Private Equity Fund
Publisher of Men’s Magazines Is Sold to Private Equity Fund
By RICHARD PÉREZ-PEÑA
Published: June 16, 2007
http://www.nytimes.com/2007/06/16/business/media/16mag.html?_r=1&oref=slogin
Dennis Publishing, the magazine company behind three of the most successful publications aimed at young men in the United States — Maxim, Stuff and Blender — was acquired for an undisclosed price by the private equity fund, Quadrangle Capital Partners II, Quadrangle said yesterday.
Kent Brownridge, an industry veteran, is a junior partner in the purchase and will be chief executive of the magazine group. Mr. Brownridge, 66, spent 31 years at Wenner Media — publisher of Rolling Stone, US Weekly and Men’s Journal — most recently as senior vice president and general manager, before leaving Wenner in 2005.
Dennis Publishing is the American arm of Dennis Publishing Ltd., a British company owned by Felix Dennis. It will retain one of its American magazines, The Week.
A spokesman for Quadrangle said the group would be renamed when the sale is completed, which is expected to be in the third quarter. Quadrangle was represented in the deal by Davis Polk & Wardwell. Dennis was advised by Allen & Company and Jones Day.
Maxim was a pioneer among the “lad magazines,” the upscale-but-raunchy publications, including Stuff and FHM, for young men. Blender, a music magazine, also appeals mostly to men under 35, a favorite target of advertisers.
Blender, Stuff and Maxim, all monthlies, have a combined paid circulation of 4.5 million in the United States, and together they average more than 400 ad pages each issue.
The deal includes the magazines’ Web sites, which attracted more than four million unique visitors during April, and other related ventures including the Maxim satellite radio channel on Sirius and Maxim-themed resorts and restaurants.
Quadrangle is a major investor in a number of media companies, including Cablevision Systems and Metro-Goldwyn-Mayer Studios. The company is led by Steven Rattner, the former deputy chairman of Lazard.
By RICHARD PÉREZ-PEÑA
Published: June 16, 2007\
Dennis Publishing, the magazine company behind three of the most successful publications aimed at young men in the United States — Maxim, Stuff and Blender — was acquired for an undisclosed price by the private equity fund, Quadrangle Capital Partners II, Quadrangle said yesterday.
Kent Brownridge, an industry veteran, is a junior partner in the purchase and will be chief executive of the magazine group. Mr. Brownridge, 66, spent 31 years at Wenner Media — publisher of Rolling Stone, US Weekly and Men’s Journal — most recently as senior vice president and general manager, before leaving Wenner in 2005.
Dennis Publishing is the American arm of Dennis Publishing Ltd., a British company owned by Felix Dennis. It will retain one of its American magazines, The Week.
A spokesman for Quadrangle said the group would be renamed when the sale is completed, which is expected to be in the third quarter. Quadrangle was represented in the deal by Davis Polk & Wardwell. Dennis was advised by Allen & Company and Jones Day.
Maxim was a pioneer among the “lad magazines,” the upscale-but-raunchy publications, including Stuff and FHM, for young men. Blender, a music magazine, also appeals mostly to men under 35, a favorite target of advertisers.
Blender, Stuff and Maxim, all monthlies, have a combined paid circulation of 4.5 million in the United States, and together they average more than 400 ad pages each issue.
The deal includes the magazines’ Web sites, which attracted more than four million unique visitors during April, and other related ventures including the Maxim satellite radio channel on Sirius and Maxim-themed resorts and restaurants.
Quadrangle is a major investor in a number of media companies, including Cablevision Systems and Metro-Goldwyn-Mayer Studios. The company is led by Steven Rattner, the former deputy chairman of Lazard.
By RICHARD PÉREZ-PEÑA
Published: June 16, 2007
http://www.nytimes.com/2007/06/16/business/media/16mag.html?_r=1&oref=slogin
Dennis Publishing, the magazine company behind three of the most successful publications aimed at young men in the United States — Maxim, Stuff and Blender — was acquired for an undisclosed price by the private equity fund, Quadrangle Capital Partners II, Quadrangle said yesterday.
Kent Brownridge, an industry veteran, is a junior partner in the purchase and will be chief executive of the magazine group. Mr. Brownridge, 66, spent 31 years at Wenner Media — publisher of Rolling Stone, US Weekly and Men’s Journal — most recently as senior vice president and general manager, before leaving Wenner in 2005.
Dennis Publishing is the American arm of Dennis Publishing Ltd., a British company owned by Felix Dennis. It will retain one of its American magazines, The Week.
A spokesman for Quadrangle said the group would be renamed when the sale is completed, which is expected to be in the third quarter. Quadrangle was represented in the deal by Davis Polk & Wardwell. Dennis was advised by Allen & Company and Jones Day.
Maxim was a pioneer among the “lad magazines,” the upscale-but-raunchy publications, including Stuff and FHM, for young men. Blender, a music magazine, also appeals mostly to men under 35, a favorite target of advertisers.
Blender, Stuff and Maxim, all monthlies, have a combined paid circulation of 4.5 million in the United States, and together they average more than 400 ad pages each issue.
The deal includes the magazines’ Web sites, which attracted more than four million unique visitors during April, and other related ventures including the Maxim satellite radio channel on Sirius and Maxim-themed resorts and restaurants.
Quadrangle is a major investor in a number of media companies, including Cablevision Systems and Metro-Goldwyn-Mayer Studios. The company is led by Steven Rattner, the former deputy chairman of Lazard.
By RICHARD PÉREZ-PEÑA
Published: June 16, 2007\
Dennis Publishing, the magazine company behind three of the most successful publications aimed at young men in the United States — Maxim, Stuff and Blender — was acquired for an undisclosed price by the private equity fund, Quadrangle Capital Partners II, Quadrangle said yesterday.
Kent Brownridge, an industry veteran, is a junior partner in the purchase and will be chief executive of the magazine group. Mr. Brownridge, 66, spent 31 years at Wenner Media — publisher of Rolling Stone, US Weekly and Men’s Journal — most recently as senior vice president and general manager, before leaving Wenner in 2005.
Dennis Publishing is the American arm of Dennis Publishing Ltd., a British company owned by Felix Dennis. It will retain one of its American magazines, The Week.
A spokesman for Quadrangle said the group would be renamed when the sale is completed, which is expected to be in the third quarter. Quadrangle was represented in the deal by Davis Polk & Wardwell. Dennis was advised by Allen & Company and Jones Day.
Maxim was a pioneer among the “lad magazines,” the upscale-but-raunchy publications, including Stuff and FHM, for young men. Blender, a music magazine, also appeals mostly to men under 35, a favorite target of advertisers.
Blender, Stuff and Maxim, all monthlies, have a combined paid circulation of 4.5 million in the United States, and together they average more than 400 ad pages each issue.
The deal includes the magazines’ Web sites, which attracted more than four million unique visitors during April, and other related ventures including the Maxim satellite radio channel on Sirius and Maxim-themed resorts and restaurants.
Quadrangle is a major investor in a number of media companies, including Cablevision Systems and Metro-Goldwyn-Mayer Studios. The company is led by Steven Rattner, the former deputy chairman of Lazard.
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