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Friday, May 16, 2008

Pope & Talbot To Shut Three Remaining Pulp Mills - Report / Pulp and Paper Network

I read in Pulp and Paper Network that the Pulp and Paper mills are not out of the trouble zone.

Pope & Talbot To Shut Three Remaining Pulp Mills - Report / Pulp and Paper Network: "VANCOUVER - Insolvent forestry company Pope & Talbot Inc. (PTBT) is preparing to shut its three remaining pulp mills - employing nearly 1,000 workers in British Columbia and Oregon - after creditors declined to extend financing to the bankrupt wood products company, The Canadian Press reported Tuesday.

Mark Rossolo, a spokesman for the Portland, Ore. company, said Tuesday the company began the wind down of the two Canadian mills Monday afternoon after a Canadian bankruptcy court extended the company's bankruptcy protection for only 48 hours to Wednesday. The court provided the short term extension when creditors refused to provide financing to keep the mills alive, while the company seeks a new buyer.

The two British Columbia mills in Nanaimo and Mackenzie employ around 780 people while the Oregon mill at Halsey, south of Portland, had a workforce of 180 in February. The future of all three mills is uncertain after the collapse of a deal last week that would have seen the pulp businesses sold to an Indonesian company. The U.S. company's lumber operations were sold in separate transactions nearly a week ago."

"Pope & Talbot, a 160-year-old Portland-based wood products company, filed for bankruptcy in November after fighting a losing battle with the slumping U.S. housing market, a strengthening Canadian dollar which hurt its exports from B.C. into the United States, and high debt," the report continues.

What are we going to experience in Europe? What will happen to Nordic pulp and paper mills and sawmills?

"The same difficult market conditions have led to the closure of sawmills across Canada by companies squeezed by rising inventory in the wake of slumping demand from the battered American new homebuilding market," Pulp and Paper Networks writes.

The pulp sector has also been hurt by technological changes and a move to Internet publication that have reduced demand for newsprint and other papers.

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