By By GREG KATSKI
Community Editor
Domtar announced on Tuesday that it will convert its Martin County-based mill from paper to full-scale fluff pulp production, saving hundreds of jobs in the region.
Without the conversion, the paper-making company was expected to shut down its area mill completely. The conversion, which is expected to be completed by late 2010, will still force the company to reduce its work force at the mill from some 500 employees to 360.
The conversion calls for a $73.5 million investment from the company. An investment that wouldn’t have been made without some support from the state of North Carolina, according to Pascal Bosse, vice president of corporate communications and investor relations with the Montreal-based company.
“State support was certainly instrumental in the decision,” he said.
The company expects to receive up to $7.5 million in grant funding from the state during the conversion process, Bosse said.
The Martin County Board of Commissioners has been lobbying for the company to receive grant funding from the state, according to commissioner Mort Hurst.
He said the move means Martin County can “keep on rolling.” Hurst noted that the company is the highest commercial taxpayer in the county, and the loss of the mill would’ve been devastating to its economy.
“I was worried to death,” he said.
Hurst compared the economic impact of Domtar on Martin County to PCS Phosphate on Beaufort County.
“That’s the reason we were pushing so hard,” he said.
With the move, Domtar’s annual fluff pulp making capacity will increase almost threefold to 444,000 metric tons at the mill, while its paper making machine will be completely shut down.
Domtar expects the mill to be competitive in the fluff pulp market — a market growing by 4 to 6 percent a year, according to Bosse.
“What the move really does is reposition the mill from exposure in a declining market to exposure in a growing market,” he said.
The company cited the mill’s proximity to major seaports, such as Newport, Va., and Wilmington in the decision.
“Plymouth is well-positioned geographically with ready access to export markets through ocean ports as well as competitively-priced fiber ideally suited for the manufacture of premium quality fluff pulp,” said John D. Williams, president and chief executive officer of Domtar, in a written statement.
“Upon completion, Plymouth will become a world-class fluff pulp operation with direct access to a dynamic export market,” he added.
Fluff pulp is bleached softwood cellulose fiber used worldwide in absorbent applications such as baby diapers, feminine hygiene and adult incontinence products, according to Domtar.