ND Paper mill in Rumford. Russ Dillingham/Sun Journal

RUMFORD — With the COVID-19 pandemic battering its economic activity, the ND Paper mill announced this week it’s expanding into packaging grades. But the price of that transformation is going to potentially cost more than 100 jobs by the end of the year.

With more than 650 employees, the number of layoffs is expected to equal nearly 20% of the workforce.

Gary Hemingway, president of the United Steel Workers Union Local 900, said Friday that the mill is talking about permanently laying off at least 122 people.

“They’re talking right now of 130 hourly positions,” he said, “but eight of those positions are empty right now. Their plan is to lay off maintenance and electrical.”

Brian Boland, vice president of government affairs for ND Paper, said the COVID issue definitely accelerated their time table for the transformation.

In a statement, ND paper said the demand for printing and writing paper has plummeted; coated woodfree and coated mechanical papers — primary Rumford grades — are expected to decline 23.5% and 30.3% year-over-year, respectively. That is equivalent to over 1.4 million tons of output.

The transformation includes permanent curtailment of mechanical pulping operations and R15 coating and supercalender assets.

Regarding layoffs as a result of the transformation, Boland said, “At this point, it’s too early to talk about that. We’re going to be working very closely with the unions to come up with something that works.”

Hemingway said the union has approached them on a package and provided them with an example of one that Sappi mill in Westbrook was presented when they shut down their No. 9 machine.

“They’re really taking a strong cut here,” he said. “I understand that the paper market has dropped out, that COVID hasn’t helped, and people are working at home and not using a lot of paper. So we’re changing over to packaging products.”

One area yet to be discussed is early retirement.

“We told them what Sappi gave, which was fair. I’m just hoping they don’t cheap us out,” Hemingway said.

Regarding those with 30 or 40 years in the mill, Hemingway said, “We’ve got quite a few people that are over 60 years old that if they came up with a decent package, people could get out, and let the junior people stay. Not all of them, but quite a few.”

He said these job losses will probably take effect before the end of year, which is when the mill hopes the conversion will be completed. “There may be some people left over through January, but that will probably be about it.”

Boland said the transformation is exciting “because it enables the mill to basically jump into a new market. And it’s challenging because there are workforce implications with that. And frankly, that’s what makes it really difficult.

“But the alternative of not doing anything is a much more dire conclusion,” he said. “We’ve seen that across the industry where many other mills over past months shut their doors. And we’re not doing that. These moves are going to be required and necessary to set up the mill for long-term success. And that’s to everyone’s benefit.”

Rumford Town Manager Stacy Carter said, “The town is saddened by the fact that employees are going to lose their jobs. We’ll do whatever we can to try to help in business to create other employment opportunities.”

He noted that the job losses are not only going to affect mill employees, but area businesses as well.

“But we’re also grateful that the owners of ND Paper are willing to invest money into the mill to try to change to other paper products so that it remains an open and viable asset to the community,” Carter said.

Hemingway noted, “It’s going to be really rough on the River Valley. People are probably going to end up selling a lot of houses.”

Notable changes in the Rumford mill with this transformation include:

• Commissioning of an unbleached recycled pulp line to provide fiber flexibility to the R12 and R15 paper machines.

• Conversion of its R15 paper machine from printing and writing papers into lightweight, high-strength kraft linerboard products.

• Expansion of R12 paper machine capability to include unbleached recycled bag and converting papers, in addition to its current offering of bleached and unbleached papers.

• Continued operation of the R9 pulp dryer, including expansion into unbleached softwood kraft market pulp

• Permanent curtailment of mechanical pulping operations and R15 coating and supercalender assets.

The newly rebuilt R10 paper machine will continue to deliver high-quality printing and writing paper and specialty products for ND Paper’s base of customers. Oxford C1S, Orion, Vision, Escanaba, and Dependoweb grades produced on R15 will be transitioned to the R10 and Biron B26 assets, minimizing disruption to loyal customers.

Additionally, the R12 machine, with bleached and unbleached capability, will manufacture Rumford Offset, as well as recycled and kraft papers for multi-wall bags, retail bags, and converting applications.

The Rumford mill was established in 1901. It produces coated one- and two-sided paper, specialty papers and market pulp.