(Bloomberg) -- Resolute Forest Products Inc. said it will idle its pulp and paper operations at a Tennessee mill because of “significant financial losses,” the latest in a series of production shutdowns in the industry that has dented supplies across North America.
The company's Calhoun site has an annual capacity of 147,000 metric tons of pulp and 149,000 tons of paper, the Montreal-based company said in a statement Thursday. On a trailing 12-month basis, those businesses had an operating loss of $62 million in September before corporate expense allocation. The mill also faced “significant production upsets” this month and last.
The announcement comes at a time when paper production across North America is already down sharply, with some mills converting to cardboard to meet the jump in e-commerce deliveries and others shutting down altogether. More than 2.5 million metric tons of North American printing and writing paper capacity—or nearly one-fifth of 2019 levels—has come offline since the start of last year.
“The company continues to accumulate significant financial losses at the mill, even with the current strong market conditions for both the pulp and uncoated freesheet paper it manufactures,” according to the statement.
The company anticipates that the decision will directly affect 350 hourly and salaried positions at the Calhoun mill. Pulp and paper operations will continue for up to 60 days, the company said.
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