3 Closed Plants, 310 Employees, 500M Sq.-Ft. of Corrugated Packaging

Cascades Inc. has announced a strategic realignment of its Containerboard Packaging operations. As part of this optimization effort, the company will permanently close three facilities while bolstering production capabilities at its Bear Island mill and its converting network, which the company describes in its written announcement as having “available capacity and more modern equipment.”

Credit: NAPCO Media, Linda Casey, contains AI-generated elements

The closures could also introduce several hundred workers with manufacturing experience back into the job market — whether internally at Cascades or externally into the greater paper and packaging labor pool. Of the fate of the 310 workers impacted by the closures, Charles Malo, president and COO of Cascades Containerboard Packaging said, “I would also like to sincerely thank the Cascaders affected by this announcement. We will stand by them through this process, and we will assist in the relocation of those employees wishing to continue working for Cascades at one of our other locations.” Employees who cannot or do not wish to relocate to other plants will receive support in their search for other employment.

Other key points and details from the announcement include:

Plant Closures:

• The Trenton (Ontario) corrugated medium mill will remain idled, with no plans for reactivation.
• The Belleville (Ontario) and Newtown (Connecticut) converting plants will be phased out progressively by May 31, 2024.

Enhanced Production:

• Recent equipment investments in the Bear Island mill and its advanced converting network enable the facilities to take on the work from the shuttered plants.
• Cascades reports the more modern facilities with the newer equipment will have ample capacity to transition the corrugated work.

Capacity Impact:

• The shuttered plants collectively represent an annual production capacity of 175,000 short tons of corrugated medium and 500 million sq. ft. of corrugated packaging.

Strategic Decision:

• The decision is part of Cascades’ commitment to optimizing asset performance.
• Market dynamics, rising operating costs, aging infrastructure, and the need for substantial capital investment are among the factors driving the closures.

Financial Implications:

• The company anticipates recording $61 million in impairment and environmental obligation charges related to these closures in its Q4 2023 financial results.
• Additional restructuring charges of approximately $35 million are expected in the coming years.