Winstone Pulp International closes operations at Ruapehu mills; hundreds of jobs lost

Winstone Pulp International has been operating for 45 years.

The closure of Winstone Pulp International’s central North Island mills is “a massive blow to Ruapehu and our communities”, the district’s mayor says.

On Tuesday, Winstone Pulp International (WPI) announced the official closure of operations at the Karioi pulp mill and the Tangiwai sawmill after rising energy prices forced an operational pause last month. The mills provide more than 200 permanent jobs in the district.

Chief executive Mike Ryan said it was not a decision taken lightly.

“We gave due consideration to the feedback and alternatives put forward by staff and unions but have been unable to identify any viable options that enable the company to continue operations on a sustainable basis,” Ryan said.

“There were a number of good ideas put forward that would make incremental improvements to our operations, but not enough to offset the dual impacts of internationally uncompetitive energy prices in New Zealand, and the relatively low current and forecast market prices for pulp and timber.”

WPI was now shifting its focus to supporting its staff, including helping them into jobs with other industry players, working with the Ministry of Social Development and IRD, and ensuring they could access the company’s wellbeing providers and independent financial advisors, Ryan said.

“All of our people have been on full pay during the operational pause and consultation period.

“They will receive their redundancy entitlements in full, including working through their notice period.”

An operational pause was placed at the two sites on August 5, with Ryan saying energy prices were the main driver behind the move.

During a public meeting in Raetihi on August 27, workers said the closure was turning their lives upside down.

Ruapehu Mayor Weston Kirton said he was deeply concerned and disappointed by the news of the closure, which would mean the loss of more than 200 permanent jobs.

“The closure is a massive blow to Ruapehu and our communities,” Kirton said.

“Our immediate concerns are now with the people and communities affected by this decision, and we are committed to doing everything we can to support them through this incredibly difficult time.”

Kirton said the council had already initiated preliminary discussions with Work and Income NZ and its iwi partners to co-ordinate support for the affected workers.

“I would like to especially recognise the workers, their families, and everyone who advocated for them in an attempt to avoid today’s outcome.

“Your strength and determination during this incredibly unsettling period have been truly inspiring.”

Ryan said since announcing the operational pause, WPI had worked hard to consider all available options, including seeking long-term price certainty for electricity at levels that would enable the company to be internationally competitive.

“Even though current spot pricing has fallen significantly from the August highs, current electricity futures pricing indicates that nothing is going to materially change in the medium-term regarding wholesale market electricity pricing.”

Ryan said WPI had also engaged with Government ministers and their officials.

“We haven’t been alone in this effort and would like to thank our team, local community leaders, unions, iwi, mayors, MPs and the Minister for Regional Development Shane Jones, who have all spoken out strongly on our behalf, organised hui, and set up public petitions to try and save local jobs.”

The decision would hit “our people and the community hard”, Ryan said.

“As tough as this news is, our people need certainty to get on with their lives.

“Thank you to the community for the support they’ve shown us, and our teams over the past 45 years.”