MADISON — The Madison Paper Industries mill will close by the end of May, company owners announced Monday, in another blow to the paper industry in Maine.

Only a handful of maintenance workers out of the current 214 employees will be retained to maintain buildings and a hydro facility at the mill after June 1, said Ruud van den Berg, vice president of UPM Paper’s division for North America and Europe.

The decision was made after the mill’s corporate parents, Finland-based UPM-Kymmene Inc. and New York Times Co. subsidiary Northern SC Paper Corp., decided there was no path to profitability.

“The major reason obviously is the continue decrease of paper demand. There is an unhealthy supply and demand balance in the paper industry,” van den Berg said.

Recent duties imposed by the U.S. government on subsidized paper from Canada didn’t have as big of an impact as the operators had hoped, he added. Madison and Verso Paper Co. had alleged that Nova Scotia was providing illegal subsidies to the Port Hawkesbury Mill.

The announcement is likely the end of the line for the mill.

Mill owners are willing to sell to another paper company only if the new owners would produce a different type of paper, van den Berg said. If the company fails to find such a buyer, then the mill would likely be sold to a liquidator, he said.

Maine’s paper manufacturing industry now employs about half of the nearly 13,000 people who worked in the industry as recently as the early 2000s, according to the Maine Pulp and Paper Industry.

Verso, which operates a mill in Jay, Maine, has filed for bankruptcy. The Lincoln Paper and Tissue mill also has filed for bankruptcy.

Expera Specialty Solutions has closed its Old Town mill, and the former Verso mill in Bucksport is being dismantled. Other mill closings include the former Great Northern Paper mills in Millinocket and East Millinocket.


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