Katahdin Paper plan will affect at least 140

Katahdin Paper plan will affect at least 140


BANGOR DAILY NEWS FILE PHOTO
A tractor-trailer truck leaves Katahdin Paper Co., LLC in East Millinocket in October of 2008. Buy Photo

EAST MILLINOCKET, Maine — Katahdin Paper Co. LLC announced Thursday that about 140 hourly and an undetermined number of salaried workers will be furloughed for up to 28 days starting next week as part of efforts to build cash flow by running paper machines only with orders in hand.

Effective Monday, Katahdin will shut down its No. 5 paper machine temporarily and begin weekly reviews of orders for its two paper machines, said Rick Grunthaler, the company’s human resources manager.

“We are aggressively looking at options to utilize the [No. 5] machine and we are optimistic that we will land some business or orders soon,” Grunthaler said Thursday. “If we get enough orders to effectively restart the machine [before 28 days lapse], we will do that.”

The company’s No. 6 machine will remain operational, Grunthaler said. He declined to comment on the orders backlog on that machine or whether shutdowns and furloughs are planned for it.

Managed by Fraser Papers Inc. and owned by parent company Brookfield Asset Management, the Main Street mill employs 491 hourly workers making directory-grade papers.

Thursday’s announcement reflects a Fraser policy to manage cash flow by avoiding the creation of speculative inventory. Citing stiffening worldwide competition in the paper market, the recessed national economy and a lack of confirmed orders, Fraser began idling some of its six machines and furloughing workers at its Madawaska mill in January.

Fraser also shut down two Madawaska machines from Dec. 24 to about Jan. 5 to balance inventory levels with customer demand. That mill employs about 712 workers producing technical specialty, fine printing and writing papers and groundwood papers

Jeff Dutton, Fraser’s South Portland-based chief operating officer, did not immediately return a telephone message seeking comment on Thursday. He was attending a meeting in Toronto, officials said.

Katahdin Paper Co.’s other Katahdin region mill, in Millinocket, temporarily shut down in early September as part of efforts to convert its oil burners to biomass, idling as many as 207 workers. Company officials have said they would announce the status of that conversion project this month.

East Millinocket union officials and members were briefed early Thursday of the furloughs, Grunthaler said. It is the first time in years a machine has been idled for that long at the Main Street mill.

Katahdin will do everything it can to limit the number of furloughed workers, Grunthaler said. Workers are being encouraged to use vacation time now and to fill in wherever possible in overtime situations with workers who have been idled.

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Comments
44 comments on this item

Better start praying folks we are in for a long slow ride and it ain't going to be pretty, tighten our belts a little more we will get by, we here in the other Maine are survivors.

Unless the paper mills get control of energy costs, meaning alternative energy sources, they will fail. The companies must cut all overhead costs. The scant amount of funding for alternative energy sources in the so called stimulus plan, should be targeted to saving industry.

"About 140 hourly and an undetermined number of salaried workers"

Yeah, "undetermined". As in none.

The papermaking industry, along with the other industries (textiles, shoes, furniture) in Maine is over because people are buying cheap junk from China.

"The papermaking industry, along with the other industries (textiles, shoes, furniture) in Maine is over because people are buying cheap junk from China."

Yup, the country wants cheap, crappy, likely contaminated goods, and that's what they get. The jobs will come back, as soon as Americans are willing to work for pennies an hour. It's a shame people don't see they're screwing themselves in the long run. Oh well, at least thet can get a dozen tube socks for a buck today!

Think they'll change there tune on consolidation now?

Rick Grunthaler was a half assed nurse in first aid in the 1990's. Way to go Rick, your moving on up. Right out the door..... You will not survive in this economy out of Millinocket.

Very few salaried workers were let go..they are now all bosses in the mill in East now. There are more bosses then workers. And as for orders, they shut down the Millinocket mill and took their orders up to Frazier and the customers hated their paper and cancelled all further orders. They are now going to shut down #5 machine and lay off the hourly and will keep all the bosses...where is there any savings in that? More chiefs then there are indians...wow. Great move Katahdin Paper!!! No wonder they are in a financial mess. Pay those 6 figure saleries to the bosses and let the little 5 figure hourly worker go. Makes ton of sense!!!! ( And I mean the workers making $20,000 + compared to the $100,000, $200,000+)

And what is their excuse for not starting up the Millinocket Mill? Oil prices are less then half of what they were so its not oil prices...it's the fact that their Frazier mill had no orders so they took #11 orders and then lost them too. They were making over a million dollars a month in clear profit, but they LIED to everyone as always. What do we expect...Canadians!!!! Berdard cleaned us out and then sold us to another Canadian company so they could finish the process. Insurance premiums have jumped up again and coverage has dropped again too.

It all depends on whos got the pencil that day!!! Let the lies continue until we have less than nothing..and that's coming fast!!

Well what is East and Medway going to do when the cash cow dries up and they aren't paying 80% of their taxes. Probably should have worked together with surrounding communities and consolidated. As for the laid off workers, well maybe they should cut back everyone's hours and work more people like they did in years before, too hear that they are working overtime with people laid off shouldn't be happening. So much for the Biomass boiler in Millinocket. Like one of the people above said not running Millinocket Mill when the price of oil is low tells me that they never had a plan to start it back up........PEOPLE the paper industry is dead..........by 2012 there wont be one operating in maine!!!! u can say you heard it first here!!!

You people in the paper industry complain about no work or paper orders and blame it on everything but the fact that YOU READ THE PAPER ONLINE . ....no need for paper.

One thing that I will mention that hasnt been, is that the health care in the US needs to be shut down & recreated w/ the fact that companies cant pay wokers & there health care in mind. The health care is just as bad as big oil. They make trillions of $$ off the small companies in the US. Bottom line, health care keeps wages low & forces comp. to look over seas where they pay NO HELATH.

I am all for using paper instead of plastic. They are equally harsh for the enviroment. The one good thing about the paper is it's RENEWABLE It also keep our families in work! Remember, next time you here someome ranting about the ernvoroment or the economy tell them to start using paper!!!!

If you are so sure of yourself littleboy, put your name out there and we can make a nice large bet on it. A couple other things, they are not going to spend millions on reopening the mill on oil during the winter when prices are still unsure. If the mills are doing this to truly save money, it is cheaper to pay someone overtime than it is to pay the extra person all the benefits that go with keeping him hired. None of us like to hear of layoffs anywhere, but if you are going to biatch about it, do it with proper facts.

Let's put this puzzle together. Brookfield Energy owns Brookfield Asset Management, BAM owns KPC. BE is a GREEN energy company that makes hydro power. They bought the mills for energy distro potential only to have the State step in and tell them they can't just shut down the mills. So BE has been letting them fail. One way to do this was to keep all salaried personell from #11(Illinocket) and stick them in East to create an imense overhead.

Now, where does Fraser fit in? At the onset, Brookfield only owned about 48% of Fraser stock(Remeber the botched sale of KPC to Fraser? The majority stockholders said no). Now, Brookfield owns a controlling stock in Fraser. Fraser has been "managing" KPC. Anyone pick up on the conflict of interest here? Fraser runs KPC in the best interest of Fraser. That's not good business. The ultimate goal for Brookfield is to shut the mills down, err... let them close due to market conditions so they can make electricity and sell it on the grid. I think that plan will accelerate as we get closer to tying Northern Maine into the grid and getting rid of the bottle kneck in Orrington.

Many valuable people and there ideas have been ignored and silenced by the upper management of KPC for what seems like no good reason until you understand the ultimate goal. Close the mills and make it look like we had no choice so we can skirt the State contract sell power like we wanted to in the first place.

Forgot to mention... there is a grid connection in Millinocket. You don't just go and set one of those up. The red tape in crazy.

How many more manufacturing jobs have to be lost before our illlustrious government leaders pull their heads out of the proverbial sand and put working people back to work...We cannot go another 4 or 8 years like it has been making tax cuts for the wealthy and passing the tax burden onto the middle class...How much more to we have to endure before it sinks in!!

To concerned1: conolidation for these three towns should have happened back in 2003..not 2009 when the mill in Millinocket has been closed and you are looking for somebody to bail you out!

Two dead and dying mills in a Ghost Town. Millinocket is finished.

MaineBorn -

What's even more sickening about the situation is that very credible people in the KPC organization have warned the governor and his people repeatedly about Brookfield’s end game. For some reason they've chosen to sit on their hands and watch this sad story unfold.

Interesting comment previously regarding health care. Take a moment and think about the following:

The reason for buying insurance is to protect yourself in the event of a catastrophic event. For example, you buy life insurance to protect your family in the event you unexpectedly (or predictably) die. Death is a catastrophic event. You purchase homeowners insurance to protect your investment in the unlikely, but still catastrophic, event that your house burns down (or gets washed away in a flood).

Now, think about health care insurance. Government, insurance companies, and our own ignorance has us convinced that the reason for buying health care insurance is NOT to protect us in the event of a catastrophic event, but rather, so we can have a $25 dr visit co-pay and a $10 prescription co-pay. And, just like sheep led to slaughter, we don't think or research the issue, and we end up believing what our elected "leaders" want us to believe.

Think about the money that is spent on health care insurance, both by individuals AND by the companies they work for.....that amounts are astronomical! When you buy your insurance at work, do you have a choice? Perhaps you can choose between a couple of different plans, but they are plans from the same company! So the STATE dictates what must be covered, and in Maine, every policy must cover some 75+ RARE medical conditions......the insurance companies make the claims process so cumbersome and expensive for doctors that they must hire extra staff, and as a result, charge higher prices, driving costs up........the insurance companies do this intentionally!!!!!!! All the while, you and me, as consumers, have NO CHOICE in what coverages we buy, what deductibles we want, whether we want to buy just a low cost, high deductible major medical policy to protect us in the event of a catastrophic problem. No, we have to buy EVERYTHING, without choice. Our costs escalate, employer costs escalate and the insurance companies and corrupt elected officials they "influence" have it made. Truly brilliant on the part of the insurance companies and politicians, but just one more example of how business is NOT the bad guy, and how businesses AND individuals in this country keep getting it handed to us.

Fact is, we all want lower taxes, smaller government, secure borders, safe streets, and opportunity like our parents had and our children deserve. We want choice in health care, and we want those who are retired or are approaching retirement to be free from worry during their golden years.

You see, the things that unite us are many. The common ground that most Americans stand upon is ground made up of the sacrifice and values and ideals and heritage passed down from generation to generation. Our country is one steeped in personal responsibility and self-reliance, NOT generational dependence on government to provide for us.

I urge you to check out my blog, located at http://729days.blogspot.com/

We truly are at a turning point in the history and direction of this country. One one side, we can choose the path blazened for us by our ancestors, the path that made America the envy of the world. Or, we can follow Obama and the big government "one worlders" into socialism, lower standard of living, bigger and bigger government and the end of self-reliance and personal responsibility........

Again, yes we should have one high school for the three towns. However, the consolodation vote was NOT for that. It was ONLY to combine administrative costs (something that's already being done). We would not have combined any kids or closed any schools or even saved any money.

to flyfishin. why you telling me this? I knew it then and I know it now. we're both on the same page dude...

Thank you Mr. Baldacci and democratic friends. :) Good work!

You hit the nail right on the head MaineBornNBred - only a true hard-working Mainer can see the real 'crap' in the bureaucratic bull- - - -. It takes some

down-home common sense to know when to read between the lines. As for Mr BigBoy who believes there truly is a 'cash cow' hiding in the North Maine Woods - you need to become your local town's elected official for a couple of years so you can see the real picture of how much 'moo milk' actually gets pumped into the systemwhen the cow cries dry. Trust me we will survive, not on someone's dime; but on our wits and steel will -- thank you for getting our dander up -- it helps jump-start the survival mode that much faster. We owe you one.

It never ceases to amaze me how people like MaineBornNBred can stitch together lunatic theories about conspiracies to turn paper manufacturing plants into electrical generating stations while sitting at computers that suck up electricity. Of COURSE there is a bigger market for electricity than paper! Why shouldn't there be?

How do you so easily ignore the horrible worldwide economy in spewing your theories? If Brookfield's ultimate goal is to shut down the mill, why should they not be allowed to? To save your job? Since when were you guaranteed employment? You sound like one of those Millinocket folks who thinks only conspiracy accounts for the demise of their industry. You might rail about Brookfield putting its money where it earns the most, but just think how loud you would be if somebody tried to control how you invest your cash. The Chinese and other foreigners might be taking over huge chunks of the international paper market that you thought was your own private domain, but how do you stop them from doing that? Especially when you never questioned American dominance of the world paper market for so many decades.

You might not like Brookfield or Fraser, but these people are spending millions to upgrade their mill in Millinocket and have already lost hundreds of millions in Maine paper plants over the last several years. Accusing them of bad faith in the face of that is ludicrous. Or is it all just a giant lie to keep you out of a job?

"the Main Street mill employs 491 hourly workers making directory-grade papers."

When was the last time you actually picked up a phone book? Along with mills that make the same product, phone books are dying as well.

I haven't used a telephone book in a long time. I use WhitePages.com...free and it is nation wide.

If the Phone companies had any brains they would mail out hand heldi computer pads with all the phone numbers on them. Like the free calculators they give away. Very cheap, No transportation fees for tons and tons of paper. Then printing fees for tons and tons of paper. Then distribution fees for heavy phone books. A 3 onze cheap computer with a cheap chip can replace all that paper. You could even carry this phone book in your pocket. Maybe they can assemble the new computer phone pads in Millinocket.

Karen -

As unbelievable as it sounds, MaineBorn's accounting of events is pretty close to accurate and at this point I believe that even Brookfield regrets what it has done because it has been a finacial disaster. Unfortunately, you can't "unring the bell". There is also no question that the economy in general and the paper industry in particular is FUBAR. The facts are however that the Millinocket mill was profitable at the time it was shut down and would be moreso today given the lower cost of oil. In shutting down the mill, they seriously over estimated the profit that they would make selling the power and at the same time destroyed the cost base of the East Millinocket mill.

I don't think the point is that Brookfield can't do whatever it wants to with what it owns. There is however the issue that Brookfield is a Canadian company making money off a waterway in Maine - a waterway which is legally owned by the citizens of the state (look it up if you don't believe it).

I wouldn't say that Fraser or Brookfield has operated in bad faith. I would say that they have operated like a bunch of incompetant boobs and destoyed a couple of towns and a bunch of peoples livelihoods in the process.

I have no pity for greedy union workers. Don't blame the company, blame the unions. Unions were useful once, but now they are just greedy and killing businesses. Ask the U.S. auto makers.

Yea,It must be our fault.

Bosox21fan, you really don't know what you are talking about.

Bosox21fan you are about as stupid as they come....oh ya blame the unions............18.4 billion in bonus's for wall street CEO's and you are calling unions greedy I dont hear unions asking for bailouts. The wage that you are making now is attributed to unions whether you like it or not. Both mills gave back millions to keep these places running yes union people gave up money not management, so before you open your little piehole again get some facts you really are making youself look foolish especially having bosox in your user name. GO YANKEES!!!

BigBoy, I think most of us agree with you except for the Go Stankees, did you see the news today where A-Fraud popped on a steroid test.

movethen yah big deal they all were on the juice during that era so lets put a big asterisk there and call it good. Jeeze ruin someones career just because they wanted an edge, baseball has been ever changing over the years from the the balls to the size of the mound etc.....I understand the resentment from you bosox people everyone hates a winner and with 26 WS we understand. Oh cant wait to celebrate the new stadium with a WS!!! GOOOOOO Yankees!

So many of you here know what you are talking about and Im so glad to see your interest in posting a comment. Those of us that live this life up here do know and we know many more facts than anyone from south or north of here could possibly know or even begin to comprehend. Those people should just basically keep there mouts shut. One for example "poormainiac" listen stupid you cant read these comments in the paper thats why we read it here on line just like you do! Thanks for putting your stupidity out there for us all to recognize so we dont waste time reading anymore of your comments! Fact! Management is twice what is required to run one mill and that is one reason the east mill is struggling. Fact when they are are layed off " management" they still recieve a paycheck in the tune of 2000$ per week. If they are let go they recieve one years salary to the tune of 65 to 120000$. We workers recieve nothing but use of vacation time in the tune of 400$ for one week a total of 6 is what we have .IF they allow you to take them!!!!!!

Lay us off we get unemployment wow what a break there!!!!! WE make the paper they dont so thus the reason for unions. Remember the past , unions are there to protect the " workers" not the idiots behind a desk who will rape the workers if given the chance. Our mill workers have lost and voluntarilly given back much in the way of wages and benefits to keep these mills running. The time for fighting back is here. No more concesions unless management does the same. We cant sustain anymore losses and expect to feed our families and pay our bills. If people out there dont care to have concern just remember , whe we are out of work does it effect your job security? The trickle down effect will get you too. I perssonally will laugh at your struggles then if fail to see the reality now.

I’ve read through some of the posts and skimmed through most as the repetitive message being portrayed became quite boring. Of course – let’s blame it on the economy, of course let’s blame it on energy, of course let’s blame it blah blah blah. What it really comes down to is management ability. The ability to recognize weaknesses and prevent such instances from occurring comes right down to management decisions. For crying out loud, we can’t go a day without hearing about the economic status of the nation let alone the globe. I wonder if management was listening. To implement such an action leads me to believe the management lacks the necessary skill, knowledge and ability to operate ANY industry. Taking care of your people should always be number one and it is quite apparent that has not occurred in this instance. The final deciding factor was to lay off employees – wow talk about morale building huh? Where’s the fund raiser? I implore all who are affected to knock on the doors of these management types requiring them to contribute to your mortgage payments, food contributions, and any and all other bills you must pay in order to survive. These SOB’s have been able to circumvent policies, procedures, regulations, you name it, not really giving a darn about the backbone of the industry. Do I have the solution? No. The solution lies in the past with poor management planning not implementing the appropriate action to circumvent and prevent such instances from occurring. Any thoughts?

To all you union workers in what is left of the old GNP monoply, yes it is true back in the early 1900's unions were a great thing...key word "were"...what makes it right now to get paid $14-20 per hour to push buttons every fifteen or twenty minutes because of moderation compared to days of old... all I can say is welcome to the "real" world ... when people actually get paid for what they do and not what time they put in!

It is comments from people like Bigboy that show the true union mentality, it is all the managements' fault for their failure, not the unionized labor that creates a "two-headed" monster when dealing with you people, protecting the lazy and comp. cases! When are you going to get it, that a job that pays less per hour with full benefits is better than no job at all! Hello!!!

Wake up and say good bye to something that is going to be in the past!

FLyfishin if you knew the takebacks that our unions brothers gave or had any idea of what is going on then maybe you could talk about it. Maybe you should go fishing and leave the "real world" to us. Oh yes unions protect seniority and people who get hurt "WORKING" on a high risk job! So when the unions are all gone and your job that pays less with full benies are gone you can blame yourself and not us union workers who not only protect the people who are in unions but also "Scabs" like you who benefited over the years from the pay increases we bargained for and benefits you have received not from nice employers but from bargaining! I hope you never get hurt in the workforce and need that help!!! BUt if you do nothing then it is pretty hard to get hurt! GO UNION!

Lets talk about takebacks, if the unions did not give some thing back like a few dollars per hour and paying for health insurance like everybody else has to in the "real world" so YOU WOULD HAVE A JOB! What don't you understand is that a closed mill does not pay anything!

Like I said before you go union and say goodbye to a JOB and the union mill mentality!

The truth about the Katahdin mills is that the unions have taken substantial cutbacks and stripped away many of the benefits they had accrued. Blaming unions for this is useless.

wow bad management, bad unions all the millinocket mills need now is a radical group of wood bugars in the mix up there to make sure these mills never run again. At some point people need to figure out that the back bone of this stats economy is the forest products industry. From our early beginings Maine has been a leader in the forest products industry. And by the way pulp and paper mills are a key part of this industry. we can blame poor managment and unions, i'm sure they both play an equal role the demise of these facilities, but truth be known there are other factors that contibute to the demise of this industry, some of them have been hit on like health care and china and don't forget our friends in Brazil who are exploding on the the global pulp and paper market. The economy plays a big role on things as well, although oil price have fell recently, many other petroleum products used in manufacturing haven't fallen, also chemicals and wood pricing used in the pulp and paper making process are connected to other markets as well such as the housing market. Efforts need to be made to diverisfy these mills and maxamize their assets, in makeing other value added products in addition to pulp and paper from maine best natural resource, rest assured the wood bugars and nay sayers will be there every step of the way, but if we can't get by the pointing of fingers between union supporters and management supporters these wood bugars can just stay quite and we'll do the dirty work for them. and with all the hopeless and sensless programs that the us government dumps money into, that money should be focused where it will stimulate the econmomy and i don't believe there would be anything better for this states economy than to see everyone of the pulp and paper mills, as well as other forest products in the state, thriving once again i think then you would see a signifigant stimulation of our economy. 600 million for condems 600 million subsidy for industry you tell me where the bes bang for the buck is.

We were diversified we owned over 2.1 million acres of land our own harvesting equipment and road to get fiber to mills (sold by GP management) not the unions.........we owned one of the largest watersheds systems of dams in the country at one time (sold by Bowater) not the unions............we made paper plus the wrap and cores plus Millinocket had its own pulp grinder room....removed by GP....not a union decision. Our facility was self sufficient but after 5 buy-outs nothing was left but the machinery and workers. SO don't go blaming the unions for the problems at hand it was and still is the problem of MANAGEMENT or should I say lack of that is the demise of these mills. They were making 1million a month with oil @$94 a barrel so they told us they had to shut it down because of HIGH OIL prices well now the prices have dropped and there is no talk of starting it back up and there never will be. PUT THE BLAME WHERE IT BELONGS ON THE BACK OF ALL THE BAD MANAGEMENT DECISIONS................

flyfishin obviousley is a very uneducated person. Please study some more on the unions and what they have meant to the middle class. After that, please research on all the concessions these millworkers have made in the last 15 years. When you decide to educate yourself, your opinions may be useful someday.

movethen ought to heed your comment..unions and what they have meant to the middle class in the PAST...no more... the unions have lost there way in today's work place...it just so happens the union mill workers of the last 15 years caught the brunt of the the downfall...so movethen

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