Juken New Zealand recently announced it was looking to sell its timber mill operations in Northland. Photo / Peter de Graaf
Juken New Zealand recently announced it was looking to sell its timber mill operations in Northland. Photo / Peter de Graaf
The future of Kaitāia looks “hopeful and encouraging” after it was announced a buyer may have been found for two timber mills under threat of closure.
The Far North mills face uncertain times after Japanese-owned Juken New Zealand (JNL) recently said it was looking to sell up and was engagingwith employees and unions as part of a consultation process.
Northland MP Grant McCallum said he’d spoken to an investment group that wants to buy the mills.
The group was in discussions with the company, he said.
“There is an investment group, which includes some local business people, who are advancing discussions with JNL to purchase the mills as a going concern.
Managing director Hisayuki Tsuboi said ongoing structural and market pressures were affecting operations, including declining demand in key export markets and increasing operating costs.
“We have been working over several years to improve financial performance at these sites, including increasing production and exploring new markets.
“Despite these efforts, we have not been able to return the mills to a sustainable footing under their current operating model.”
Tsuboi said the company was exploring whether the mills could continue operating under a different structure, including a potential sale or joint venture.
“We are taking the mills to market to assess whether there is interest from potential buyers.”
Juken is one of Kaitāia’s biggest employers, with the two mills employing more than 200 people.
McCallum said he understood the importance of the mill to the Kaitāia community, given the number of people employed there.
Northland MP Grant McCallum says he has spoken to an investment group interested in buying the timber mills. Photo / Tania Whyte
“I understand the level of stress and uncertainty this situation is for the current employees and remain hopeful we can reach a successful conclusion.”
Northland Regional Council (NRC) and Far North District Council acknowledged the uncertainty created by the JNL announcement.
Far North Mayor Moko Tepania said the news would be challenging for employees, their whānau, and the wider community.
He said councils would be seeking support from central government, “given the scale of the potential economic impact”.
“Our priority now is to understand the situation fully and work alongside Juken as they explore options in a very tough economic environment.”
NRC chairman Pita Tipene said the councils and Northland Inc were committed to supporting Juken as it worked through the consultation process.
“We have already had initial discussions with Juken and will continue to engage closely with them to understand what pathways may exist.”
Juken has been approached for comment about the potential buyer.
The possible mill closures come after Heinz Wattie’s recently announced it was shutting down manufacturing sites in Christchurch, Dunedin and Auckland.
New Zealand is also experiencing a wave of sawmill and pulp mill closures driven by high energy costs, reduced demand and economic pressures.
They include the paper production line at Kinleith Mill in Tokoroa, and the Karioi Pulp Mill and Tangiwai Sawmill in the Ruapehu district.
Jenny Ling is a senior journalist at the Northern Advocate. She has a special interest in covering human interest stories, along with finance, roading, and social issues.
