The South Taranaki township of Waverley is reeling today from news that its largest employer, Waverley Sawmills, will close.
Sixty-five jobs have been lost, dealing the township and surrounding areas a devastating economic blow.
Waverley's population stands at 861.
South Taranaki mayor Ross Dunlop described the news as "a major shock.'
Whanganui MP Harete Hipango described it as distressing for the owner, his family and sawmill staff.
Despite no public statement from the sawmill's owner, sources have told the Chronicle that staff were told late last month that their jobs were gone and were encouraged to look for other jobs.
The Chronicle was yesterday refused entry to the site by managing director Peter Martin, who declined to comment, or allow staff to be interviewed on site.
The Chronicle reported last month that the sawmill was for sale and was told by Martin that the sale process had been going on for 18 months, was at a sensitive stage and that an announcement was imminent.
It is understood the mill has been sold to Wade Glass and he intends to shut the mill down. In the meantime activity will continue as product is sold.
There is currently no agreement to sell several local forests.
Glass has been approached for comment, but is on holiday, and said he would make a statement next week.
I have spoken with the new owners and urged them to employ the current workers but unfortunately it seems like that won't happen.
According to the Companies Office the mill was owned by 21 shareholders, and Forestry Resource Supply, based in Whanganui, has had a controlling 50.5 per cent interest.
An independent statutory supervisor, Covenant Trustee Services Ltd, has ensured the mill followed financial law and the interests of investors are protected.
Ups and downs in the sawn timber market have made keeping the mill economical tricky.
The forests guaranteed a loan to the mill, which allowed it to install a state-of-the-art heat plant, kiln and board edger and pay off debt in 2013.
Things hummed along, until Chinese demand for timber lifted prices to a level where it wasn't economic for the mill to cut anything other than clear, pruned timber.
Three of the shareholding forests agreed to supply that grade of timber and the mill hooked up with export firm LumberLink, which was to use a new process to change the pine into a hardwood equivalent and had orders in Europe.
Cutting 150 cubic metres of timber a day for this process would have made money and paid back debts - but the mill needed an extra kiln to do the work and the statutory supervisor got cold feet in mid 2017. It decided the mill and associated forests had to be sold.
The seller was Cranleigh Partners and the package went out to bidders in March 2018. An initial bidder didn't follow through.
Glass initially offered to purchase the mill but lowered his offer with the intention of closing it. Cranleigh and the statutory supervisor have agreed to this.
Whanganui MP Harete Hipango said she was aware of the situation at Waverley Sawmills and that a number of the employees have been offered employment elsewhere both within and outside of the region.
"Despite the pending closure of the Waverley Sawmills it will remain operational (not log processing) for the next 2-3 months with some staff on hand as it winds down to full closure in time.
"Despite the challenges of businesses confronted by and with increasing demands, costs, impediments and impacts of government policy change (another being the latest uncertainties and challenges faced by the CGT review), our communities remain resilient, despite the hardships and struggles to cope and draw strength from each other to help where we can."
Dunlop said the closure was a sad loss for the community and he had visited the mill on Thursday.
"I have spoken with the new owners and urged them to employ the current workers but unfortunately it seems like that won't happen.
"They did offer some of the staff employment at sawmills they own in other regions but we don't want these good people to have to leave our district."
Dunlop said firms within the South Taranki region have also offered some positions.
"I really hoped that a local buyer would be able to purchase the sawmill but their offers were unsuccessful which is really disappointing."
Edited March 03, 2019: Corrected report that local forests have also been sold.