DULUTH – Verso Corp. is idling its Duluth paper mill indefinitely, putting 235 employees out of work and placing the future of the mill in question.
The Ohio-based company will also close its Wisconsin Rapids, Wis., plant and will be “exploring viable and sustainable alternatives for both mills, including restarting if market conditions improve, marketing for sale or closing permanently,” the company said in a news release Tuesday morning.
The Duluth mill will be idled by the end of the month and the Wisconsin plant by the end of July, with 1,000 total employees losing their jobs.
“Decisions to idle facilities are always difficult because they impact employees, their families, and communities,” CEO Adam St. John said in a statement. “Verso is committed to treating all of our affected employees with fairness and respect.”
The Duluth mill opened in 1987 and Verso bought it in 2015. The company emerged from bankruptcy proceedings in 2016.
Verso paid more than $560,000 in property taxes last year and is a major source of revenue for Minnesota Power and the Western Lake Superior Sanitary District.
The company had been looking for $2 million in state support to upgrade the Duluth mill in order to remain open as the price of the mill’s products had dropped about $150 per ton in recent years.
The mill can produce about 270,000 tons of graphic and recycled kraft paper per year.
“Verso’s decision to reduce its production capacity was driven by the accelerated decline in printing and writing paper demand resulting from the COVID-19 pandemic,” the company said in a Securities and Exchange Commission filing. “The stay-at-home orders have significantly reduced the use of print advertising in various industries, including retail, sports, entertainment and tourism.”
The state’s overall natural resource economy has taken a dive amid the downturn, with a number of taconite mines idling and other paper mills slowing production.
The UPM Blandin mill in Grand Rapids announced it was temporarily shutting down in April, and the Sappi mill in Cloquet announced revolving layoffs soon after.
Duluth has been hard-hit by layoffs in a range of industries because of the pandemic.
Essentia Health recently announced it is permanently laying off about 450 employees in the Twin Ports area, and AAR Corp. is abandoning its lease at the Duluth airport, costing 275 aircraft maintenance jobs.