Oji Fibre Solutions (OjiFS) has today announced the outcome of a consultation process to simplify operations at Kinleith Mill, aimed at further action to stabilise and strengthen the company.
Chief Executive Officer Dr Jon Ryder says: “We are grateful to our people for their thoughtful feedback, and for their continued focus on safety and maintaining critical production at Kinleith Mill throughout this unsettling time.
“After extensive work and considering a variety of options and feedback from Unions and our team, we see no feasible alternative to our proposal to simplify operations, which will keep Kinleith Mill operating, maintain jobs in the region and continue reliable supply of product to our customers.
Therefore, we will proceed with our proposal to transition the mill to a new operating model by focusing on pulp and ceasing loss-making paper production. We can confirm, we will permanently shut the PM6 paper machine at Kinleith Mill at the end of June 2025 and move to a paper import model for our packaging operations.
“We expect this decision will result in the loss of around 230 jobs. We will now work with our people on a new mill structure and processes, and the outcome of that work will define role requirements moving forward.
“We know for many of our people and the local and regional community, this is not the news anyone was hoping to hear.
“We recognise the impact on our people and their loved ones and will be wrapping support around them.
“This difficult decision is in no way a reflection of the experience, skills and dedication of all the team and leadership at Kinleith Mill. We will now be focused on a transition plan to close the paper machine safely, ensure the welfare of our affected people, and continue sustainable pulp operations at Kinleith Mill. We look forward to working closely with the Government as we move through this period and into the future.
“We plan to continue producing paper at Kinleith Mill through to the end of June 2025. This provides a period in which options for affected staff can be explored; while ensuring we meet our customer obligations and provide a smooth transition to alternative paper supply arrangements for our packaging operations.
The decision to discontinue production of paper at Kinleith Mill will:
- Keep the mill operating and reduce the complexity involved in running the mill
- Maintain continuous supply to our pulp customers
- Introduce a new supply model for our packaging operations
- Create projected profit rather than ongoing losses for the mill
- Reduce our energy footprint and exposure to the NZ energy market
- Avoid exposure to expensive saw log fibre supply
- Provide the opportunity for synergies with Tasman Mill through simplified product configuration.