Workers at two mills that appear set to close are “devastated” and the communities are heartbroken, a union delegate says.
Winstone Pulp International paused work at its two sites, the Tangiwai Sawmill and the Karioi Pulpmill, earlier this month.
Yesterday, employees learned the company proposed to close the sites indefinitely, citing the high cost of wholesale energy prices.
About 230 people would be out of work if the proposal went ahead.
Jude Sinai, a worker at Karioi Pulpmill, told Breakfast he was “devastated”.
“When the news first broke, I was looking across the room and there was actually a lot of shock and a lot of fear,” he said.
“You could see some stress and emotions playing over in each one of their minds.”
Sinai, who’s also a First Union delegate, said he’d received a lot of phone calls.
“A lot of distressed members, our partners that are crying, children that are upset – ’cause yeah, it has a huge impact on this community.”
Ruapehu Mayor Weston Kirton said: “It is devastating.
“We really feel for those families that potentially could lose their jobs.
“We’re doing our utmost to actually try and get on top of the reasons why this is all happening.”
Kirton said he knew Winstone Pulp chief executive Mike Ryan has been working hard to try and keep the mills open.
Ryan yesterday told RNZ that energy prices have increased from $100 per megawatt hour (MWh) in September 2021 to $500 per MWh in August 2024. He said the increase in costs couldn’t be passed on to customers.
“For comparison, our overseas competitors are paying between NZ$60 to NZ$100/MWh.”
Kirton told Breakfast: “It’s an energy crisis that is in the backbone of this and we just really want to bring it to the Government’s attention that they need to intervene and to protect our people, to protect our business and protect New Zealand’s credibility in terms of exporting this pulp mill product.
“I’m really disappointed, I think it goes back a few years so it’s not just the current Government,” he added. “You don’t have to be a rocket scientist to work out that this is not sustainable, and we have got to get to the bottom of why that is in New Zealand.”
Sinai said he felt the closure was justified.
“I think our company’s done everything it can possibly do to bring down their energy footprint,” he said. “We know that this is an external factor that we have no control over.”
However, the mills were “the backbone of the community” and the losses would be deeply felt.
“We’re a very tight-knit community and it’s just heartbreaking.”
Ryan yesterday told RNZ that power now made up more than 40% of the company’s costs.
He said all staff were given the option of taking voluntary redundancy and would remain on full pay during the consultation period.