POWELL RIVER, B.C- Faced with a fibre shortage and American tariffs, Catalyst Paper has curtailed production at one of it’s paper machines in Powell River.
On Thursday, the company announced a move to not make product with Paper Machine No.11 for three weeks, running from April 16 to May 7.
Layoffs are not anticipated from the move. According to Powell River mayor Dave Formosa, the move is a combination of the fibre shortage and tariffs from the United States.
He was happy with the decision from the company to avoid layoffs.
“The company is keeping all the employees working,” said Formosa.
“Whether they’ll be able to follow their same shift, I’m not sure. But they are hoping to keep everybody working, as well as Paper Machine No.11, which will start trials of the paper towel product that we’re hoping we can perfect.”
Formosa was optimistic about a move to paper towel on the shuttered machine, with the aim of the product going to other markets beyond America.
“They’re trying to perfect it, to make it market ready,” said Formosa.
“So they’re going to use this downtime to see if they can make that happen.”
However, he was concerned about the company’s ability to keep going in the face of trade actions from the States.
“My concern is are they financially strong enough to put up a three year fight, with a six million dollar a month bleed, when they’re having a hard time staying in business as it is already, given the paper markets in the world,” said Formosa.
He did express hope, mentioning a recent trip to China with the school district where he had met with Chinese company Henan Yinge Industrial Investments, who were interested in wood pulp. Formosa described the meeting as a way to introduce Catalyst to the company.
“I’m always hopeful.
“I’m forever an optimist, and we do have struggles. The issue of fibre is huge in the province. There is fibre available, but it’s not economical for the contractors to take it out so it gets left behind. Government and contractors need to find a way that it works for everybody.”