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County hopes for best after Ashdown mill cuts jobs

by Lori Dunn | August 17, 2020 at 7:09 a.m.
Arkansas Democrat-Gazette/BENJAMIN KRAIN --05/29/2015-- Circles form around aerators in a water retention basin that churn waste-water from the Domtar Paper manufacturing plant in Ashdown.

ASHDOWN -- Little River County officials are concerned about the impact that lost jobs at Domtar's Ashdown Mill could have on the county but are also hopeful residents will persevere.

"As devastating as it to lose jobs, there are very resilient people in Little River County," said its county judge, Mike Cranford.

Domtar announced a week ago it was shutting down the Ashdown mill's remaining paper machine and will now focus solely on producing pulp. About 109 employees will lose their jobs, according to a Domtar officials.

"Of course, it affects the whole county and it's already a scary time for everybody," said Little River County Chamber of Commerce Director Jana Smith. "You never want to see this for any county, especially our county. We hate this for all of the ones impacted during an already difficult time."

The machine was put on idle in April but county officials and residents were hopeful it would start up again and not be shut down permanently.

"We were optimistic they might come back, and they could still come back in a different capacity," Cranford said. "The explosion of the Internet has really hurt the paper industry."

The covid-19 pandemic and resulting economic slowdown has continued to negatively affect demand for communications paper grades, according to Domtar officials.

"Some recovery in demand for communications paper has occurred as the economy has started to re-open. But unfortunately, Domtar has not seen enough demand recovery to justify restarting operations on the A62 paper machine at the Ashdown Mill. Therefore, we have decided to permanently idle the A62 paper machine to maintain a balance between our production needs and our customer demand.

"With this line closure, the mill will now solely produce pulp," said Tammy Waters, spokeswoman for Domtar's Ashdown mill.

In a financial report released by the company Aug. 7, Domtar reported an operating income of $14 million for the second quarter of 2020. Its operating income for the first quarter of 2020 was $19 million.

Depreciation and amortization totaled $71 million in the second quarter, according to the report. When compared with the first quarter, manufactured paper shipments were down 32% and pulp shipments increased 10%.

In a statement from Domtar's corporate office, John D. Williams, president and chief executive officer, said the company has been proactive in reducing risk and safeguarding the ability to weather the current crisis.

"We are taking the appropriate steps to optimize our operations and to remain an agile, reliable partner to our customers," he said. "Despite the significant challenges we faced in pulp and paper markets, we have been able to manage costs while initiating cash and cost conservation initiatives across the network."

Cranford said the layoffs will affect the local economy that has already had a rough few months with covid-19. However, he said Domtar has downsized before and the impact was not as bad as many feared it would be.

"Each time they have downsized, there has not been as significant of a ripple as I thought there might be," he said.

Smith is concerned about the local restaurants that were already forced to close this spring because of the pandemic.

"When the pandemic hit, so many places had to close down per the governor's orders," she said.

Cranford is hopeful some former Domtar employees will be able to find work in nearby Texarkana at Cooper Tire or other plants.

"Hopefully, there will be opportunities for some of these guys," he said.

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