Sixty-five jobs to go at Blue Mountain Lumber

Otago timber mill Blue Mountain Lumber is set to lose 65 jobs out of 110 as a result of the economic slowdown and "longstanding challenges".

The mill at Conical Hill near Tapanui is owned by Winstone Pulp International (WPI), itself a subsidiary of Malaysian company Ernslaw One Ltd since April 2008.

Six years ago the mill laid off 80 employees.

The latest blow comes nearly a week after news of 60 jobs going from Nelson Pine Industries' 265-strong workforce, as a result of falling demand for medium density fibreboard (MDF).

WPI is significantly reducing operations at the timber mill, WPI managing director Dave Anderson said.

"We will be seeking further consultation with all employees at Blue Mountain over the next two days, but expect that approximately 65 positions out of the 110 would be made redundant," Mr Anderson said.

"We have been working for a long time to address issues of viability at this mill. However the challenges it faces have only been made worse by the current economic environment and it is simply no longer possible to continue as we were before."

The company hoped to make the mill viable by radically downsizing and focusing on products with the potential to sell well in current markets.

"We cannot guarantee the outcome, but we will be trying the best we can to turn this mill's prospects around."

Workers were told of the planned staff cuts today. WPI would pay redundancy and provide assistance to employees.

WPI also operates a pulp mill in Karioi near Ohakune, sawmills at Tangiwai near Ohakune and in Gisborne, and a remanufacturing plant at Conical Hill.

- NZPA