Berlin pulp mill to close

Fraser Papers, the Canada-based multinational paper firm, announced Tuesday afternoon it will close its pulp mill in Berlin on May 6, throwing 250 employees out of work.

Under union seniority rules, many of those people can “bump” workers at the nearby Fraser paper mill in Gorham, which still employs some 300 people. Eddie Deblois, immediate past president of United Steel Workers Local 75, has worked in the Berlin mill for 30 years.

“I don’t know yet if I’m losing my job,” he said. “I was very surprised by the timing. I thought they’d give the pulp mill more time to show a profit.”

The mill’s workforce weathered a similar closing in September 2001 after the facility’s former owner, American Tissue, declared bankruptcy. The plants reopened in 2002 after Fraser acquired them.

“The union may have to decide if it can survive the way it’s now structured,” Deblois said. “These are all good jobs that pay $45,000 and $55,000, with benefits. You take that buying power out of a community and the ripples will shoot out to Vermont and Maine. This will be devastating for the whole northern part of New Hampshire.”

He blamed political leaders for letting the country lose its manufacturing jobs to foreign countries, whether steel, paper or auto. “The exodus is going to leave the country in a big hole,” he said. “We can’t all flip burgers.”

Gov. John Lynch pledged full state support to help the dislocated workers.

“I know how extremely difficult this closure will be for the employees of the plant, the city of Berlin, and the entire North Country,” he said. “I pledge that the state will do everything possible to assist the employees of the pulp mill, and their families. I have activated the state’s rapid response team, and its members will be on the ground as soon as possible to begin offering assistance.”

Berlin City Councilor Tim Donovan said the closing will be difficult over the short term, but the economy can and will absorb the job losses.

“I’ve expected this for the last 15 years,” he said. “But now the chains are broken from the paper mills that held us hostage for years. We’ll push to expand the state prison here and bring in a federal prison. That’s a done deal, by the way. We’re also expanding Route 11 to attract business, and Issacson Structural Steel is expanding within the Berlin Industrial. Park.”

Lynch held a conference call Tuesday afternoon with the Workforce Opportunity Council and the state Departments of Resources and Economic Development, Labor and Employment Security to begin a rapid response to the crisis. He plans to meet today with more state agencies to get them helping the displaced workers, their families and the affected communities.
Fraser Papers CEO Dominic Gammiero blamed the downsizing on the rising costs of wood, energy and chemicals in the past three years.

“We considered the short- and long-term market outlook for hardwood fiber costs, other rising input costs and capital requirements and determined that it was appropriate to reduce our exposure to market pulp,” he said.

The company listed the value of the pulp mill at $48 million on Dec. 31. It expects a cash restructuring charge of $3 million and other losses, depending on what happens to the assets, especially a small power plant at the facility.

Gammiero said the Gorham facility would buy its pulp from new sources, giving it a chance to focus more on specialty paper grades. One of the five paper machines in Gorham also may have to shut down too, he said. That mill bought 55 percent of the pulp made by the plant in Berlin last year. Fraser sold the surplus on the open market and to a sister mill in Madawaska, Maine. The pulp-making part of the company will now move to Thurso, Quebec. – CHRIS DORNING/GOLDEN DOME NEWS

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