Whakatane Mill saved, but caution expressed

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Whakatane Mill owners SIG Combibloc have announced the sale of the mill to a consortium of investors led by European investor Dr Dermot Smurfit.

The announcement means that besides staff who have chosen to take redundancy, more than 200 mill staff will keep their jobs.

Whakatāne mayor Judy Turner said she was thrilled by the news.

“I’m particularly thrilled for the contractors outside the direct employment of the mill as this has been a very nervous time for them and their staff.”

Turner said she was relieved the mill had been saved as its closure and loss of jobs would have been devastating for the local economy.

“To the new owners, congratulations and well done. We’re really pleased to have you on board.”

Relief at the announcement

Karl Gradon of Toi Economic Development Agency said close to 300 families would be breathing a sigh of relief with the announcement.

“We really welcome Smurfit to the business community.

“We have a wonderful opportunity to take the momentum that Smurfit brings to their alternative to plastic packaging technology, and it looks like we will have an impressive customer base that they will link Whakatāne Mill into globally,” he said.

“It’s very exciting for us.”

However, Gradon expressed caution, saying while this was good news there were still clouds on the horizon with the fibre-processing sector.

“China has announced self-sufficiency in logs by 2035, which creates significant risk for the forestry sector.

“The majority of New Zealand logs are exported to developing countries in their raw form in anticipation of their domestic logs becoming available in just a few years. Toi EDA encourages the government to work on policy that incentivises investment in added value processing in New Zealand, rather than shipping the value creation offshore.”

The Smurfit Consortium includes New Zealand investors, and many have experience in owning and operating paper packaging businesses.

A spokesman for the Smurfit Consortium, Ian Halliday, who will become chairman of the Whakatāne Mill, said the consortium looked forward to developing a more competitive operation to support customers in New Zealand and around the world.

“We believe that the Whakatāne Mill has a very bright future as the only folding box board mill in Oceania, and we intend to invest heavily in the mill to support both our customers and New Zealand’s forest products industry,” he said.

The mill will stop producing liquid packaging board and going forward will focus on its customers’ requirements for high-quality folding box board, carrier board and food service.

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