Pixelle to shutter Jay paper mill in beginning of 2023
About 230 employees at the paper mill in Jay will lose their jobs when it closes next year.
In a statement, Mill owner Pixelle Specialty Solutions said economic forces beyond its control have made operations at Jay unsustainable.
One of the pulp digesters at the mill exploded in 2020, leading to the layoffs of more than 170 employees.
Despite efforts to turn the business around, the mill hasn't been profitable since then, a company spokesperson said Tuesday. Operating and energy costs have gone up, and the mill’s energy bill is projected to increase by $5 million this winter, the spokesperson added.
Dana Doran, executive director of the Professional Logging Contractors of Maine, said he sensed the mill could close when Pixelle announced that it would not rebuild the digester, and it had to buy pulp to produce paper and packaging material.
Craft pulp was inexpensive and energy costs were low at the time, he said.
“What we predicted back then is now coming true,” Doran said. “Unfortunately energy costs have gone up. The prices of everything have gone up. And without having the ability to buy wood from the state of Maine, from Maine contractors and make their own pulp, they're not in a good place.”
But Doran said he’s heard from companies who might like to invest in the mill.
“I hope that Pixelle considers every open offer, they don't liquidate the facility and that our elected officials do everything in their power to get that facility purchased and back up and running,” he said.
In a statement, Governor Janet Mills said she was told there was nothing the state could do to keep the mill open. She's directing the Maine Labor Department to send a rapid response team to Jay to help displaced mill workers.
“I am deeply disappointed, but, more importantly, I am deeply concerned for the livelihoods and wellbeing of those who work at the mill,” Mills said.
U.S. Sens. Susan Collins and Angus King, as well as Rep. Jared Golden of Maine’s second congressional district, echoed Mills’ sentiments.
“The announcement of the Androscoggin Mill’s closure is devastating news for the dedicated employees and their families as well as for the Town of Jay and the surrounding communities,” the said in their statement.
Jay employees will receive one week of severance pay for every year of service, the Pixelle spokesman said. In addition, the company will subsidize employees’ COBRA insurance benefits for four months for those who stay at the mill until it closes.
Employees with fewer than 10 years of service will receive incentives to stay at the company until the mill formally closes. No specific date has been set, but the mill is expected to close some time in the first quarter of 2023. Employees will also be offered jobs at other Pixelle mills if they're willing to relocate.