Town comes to terms with axing of at least 120 positions

The looming loss of more than 100 jobs from the Tasman paper mill does not mean the death of Kawerau, says the town's mayor.

At least 120 jobs at the Tasman Mill will go after Norwegian newsprint giant Norske Skog announced on Monday that it would halve newsprint production at the Kawerau operation.

The loss of jobs would be sorely felt in the small Eastern Bay of Plenty community but Kawerau mayor Malcolm Campbell said it would not be a death blow for the town.


"I was asked if Kawerau was dying and the simple answer to that is no but obviously this hasn't helped our situation," he said.

"We the council talked about this 10 years ago just after I became mayor as to what would happen if the company rang us one morning and said they wouldn't be operating any more.

"We have been working with company partners and iwi partners as to how to rectify that problem. There has been de-manning since then and we seem to have got over that quite well."

There has been a gradual decrease in numbers of staff at the mill which once had more than 2400 employees - that number is now about 280.

A worker at the mill, who asked not to be named, said officials told him and his colleagues that they would be closing the plant's 150,000 tonne number two paper machine before the end of the first quarter of next year - a move signalled about three weeks ago.

He believed between 120 and 170 of the mill's staff would lose their jobs.

"They said it was due to a lack of customer orders and with kids who don't read papers, they get all their stories on the phone.

"All of this came out of the blue about three weeks ago ... there are a lot of people panicking."


The man believed the job losses would be felt more in places like Whakatane, Rotorua and Tauranga where a lot of Tasman staff travelled from.

The company would not comment on how many jobs were involved, saying the consultation processes would take about two months, but the Engineering, Printing and Manufacturing Union said more than 100 positions could go.

Consolidation in the newsprint industry has been a familiar theme for Norske Skog over the last few years.

Tasmania-based pulp and paper analyst Robert Eastment said newsprint is under pressure globally because of the digital delivery of news, information and advertising.

New Zealand production of newsprint has been in decline since 2005, when it hit a peak of 377,000 tonnes, falling to 276,000 tonnes last year.

- Additional reporting: Jamie Gray of APNZ