• Lufkin, TX

Last month marked the one year anniversary of the announcement from Montreal-based Abitibi Consolidated Inc. to indefinitely idle their paper making facility located in the East Texas Piney Woods at Lufkin.

The announcement came in early December of 2003, and by March the company had laid off nearly all of its 579 employees citing weak market conditions and low demand for newsprint in North America.

Since then, the mill has been in an idled state employing about ten maintenance workers to keep the facility and equipment in operable condition. The idea is that someday, hopefully in the near future, the demand for paper will rebound and allow the Lufkin mill to reopen and operate competitively in the market.

Company officials state that a likely scenario is that the Lufkin facility could be reopened to produce value-added paper, rather than newsprint. Value-added paper is a quality uncoated paper that is of a higher grade than newsprint in terms of brightness, surface smoothness and opacity. It is made largely from groundwood or mechanical pulp and contains varying proportions of chemical pulp and fillers. Low prices and declining demand have taken a significant toll on the newsprint market, and for that reason the value-added paper is the most likely product to be manufactured if the Lufkin facility were to reopen.

This month will mark 65 years since the construction of the Lufkin mill in January of 1940 by Southland Paper Mills Inc.. Since then the facility has passed into the hands of St. Regis Corporation, Champion International, and Donohue Industries who sold the facility to Abitibi Consolidated Inc. in 2000.

With the merger of Canada's Abitibi-Price and Stone-Consolidated on May 29th, 1997, Abitibi-Consolidated became a global leader in newsprint and value-added groundwood papers. The company is the world's leading newsprint and groundwood paper company in the Asian-Pacific region, and owns or is a partner in 27 paper mills, 22 sawmills, 4 remanufacturing facilities and 1 engineered wood facility in Canada, the U.S., the UK, South Korea, China and Thailand. The company is also the world's largest recycler of newspapers and magazines, which they use as fiber in the paper making process.

Fourth quarter financial earnings numbers for Abitibi Consolidated aren't available yet, but third quarter 2004 showed growth over the previous year. Recent trends indicate that higher prices and increased demand are likely to be seen in 2005. While it's still too early to tell just what the fate of the Lufkin mill might be, many folks are optimistic that someday soon those paper rollers may be turning again.

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