Domtar Kingsport Mill to be Repurposed and Eventually Make Recycled Linerboard in 2023
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Domtar announced in a quarterly report that it is shutting down uncoated freesheet manufacturing at the Kingsport Mill, but will repurpose assets at the plant and will eventually employee 160 people in 2023.
The mill has been idle since April 2020 and around 300 employees were furloughed.
Clay Walker, the CEO of Networks Sullivan Partnership, which promotes economic development across Sullivan County, said this is a positive move for the city of Kingsport.
"I don’t take the job number being reduced lightly," said Walker. "But look at what is going on in the world today. We are playing defense on so many fronts. We had an opportunity to pursue a project and I make no apologies for pursuing that project hard, and wanting to get that project there. The alternative is an empty building and all 300 jobs gone from our community."
Walker said the dynamics are changing in so many industry sectors.
"The product that was being made at Domtar, was already in decline," he said. "Not many people use copy paper anymore. When COVID-19 came it accelerated that downward trend remarkably quickly."
Domtar plans to enter the linreboard market with the conversion of the Kingsport paper machine. The conversion is expected to be completed by the first quarter of 2023. The company expects the location will employ about 160 employees.
Walker said there is a growing demand for cardboard, with more people shopping online. The repurposed plant will make cardboard products.
"This was the best scenario that was available to us," he said. "There's no bad guys in this. The company has been nothing but responsible corporate citizens."
Kingsport Chamber President and CEO Miles Burdine said multiple city leaders came together in order to keep Domtar in the city.
"We retained 150 to 160 jobs... good paying jobs that will come into effect as soon as the mill reopens and is repurposed," he said. "So we've got about a 2 and a half year period to get the mill going again."
Domtar said plant will officially close on October 8th, 2020.
“Repurposing the Kingsport mill provides Domtar with the best strategic entry point into a growing market with a very competitive, low-cost asset and represents a first step to building a large and cost-competitive business,” said Mr. Williams.
“Kingsport is well positioned to be the go-to supplier to independent converters for quality, service and innovation as the mill is less than a day’s drive from over 60 customers representing an addressable 3.9 million tons of annual container board demand.”
