Key Points:

Two hundred families will be "suffering tonight" after Carter Holt Harvey announced the closure of the Putaruru mill.

More than 300 jobs are to be cut at Carter Holt Harvey's sawmills in Putaruru and Mount Maunganui.

Mayor of South Waikato Neil Sinclair said the small town of Putaruru will be hit hard economically and emotionally.

"The town is just devastated as I walked through the town it is quiet and sombre. The workers have just gone home and are trying to take it in," Mr Sinclair said.

Mr Sinclair said the council will be talking to the Ministry of Social Development and the Department of Labour about what can be done for the town.

He said the mill has been in the town since 1903 and the town was built on forestry.

The announcement was made this afternoon at the company's Putaruru sawmill and the union was told yesterday.

There will be 104 job losses at the Mount Maunganui Plywood Mill, and another 212 jobs will go at the Putaruru sawmill, the Waikato Times reported.

The cuts come a month after CHH closed the Kinleith Planer Mill in Tokoroa, with the loss of 22 jobs.

Engineering, Printing & Manufacturing Union national secretary Andrew Little said the union has so far not seen the books so could not comment on whether the closures are justified.

"They've told us that it was the same issues that forced them to close the Kopu Mill - soft domestic demand and they can't sustain it and all the rest of it," Mr Little said.

He said the first round of meetings between Carter Holt Harvey and the union will take place on Thursday.

Mr Little said for the small Waikato township of Putaruru, the effect will be devastating.

"There will be some additional jobs available at Tokoroa [sawmill] some 20 minutes drive away but even still, when you take out that many jobs in a single hit, it has a big impact on that community," he said.

Putaruru ward councillor Anne Edmeades said the closure will effect the small town "greatly".

"The mill's been there and employed a lot of people for a long time," Ms Edmeades said.

In May Carter Holt Harvey closed the Kopu sawmill near Thames in the Coromandel with the loss of around 140 jobs.